<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended Commission File Number
March 31, 1995 No. 0-13943
STOKELY USA, INC.
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
WISCONSIN 39-0513230
- ------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1055 Corporate Center Drive, Oconomowoc, WI 53066
- --------------------------------------------------
(Address of principal executive office)
Registrant's telephone number, including area code: (414) 569-1800
----------------
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.05 par value
----------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
----- ------
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K X
-----
<PAGE> 2
THIS DOCUMENT IS A COPY OF THE EXHIBITS FILED ON JUNE 29, 1995 PURSUANT TO A
RULE 201 TEMPORARY HARDSHIP EXEMPTION.
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
EXHIBITS
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended Commission File
March 31, 1995 0-13943
STOKELY USA, INC.
(Exact name of Issuer as specified in its Articles of Incorporation)
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
<PAGE> 3
STOKELY USA, INC.
File No. 0-13943
Exhibits to Form 10-K for
fiscal year ended March 31, 1995
<PAGE> 4
EXHIBIT INDEX
A. Exhibits
3.1 Restated and Amended Articles of Incorporation of Registrant(2).
3.2 By-laws of Registrant, as amended(2)(12).
10(a) No longer in effect.
10(b) Loan Agreement between the City of Green Bay, Wisconsin and Stokely
USA, Inc. dated December 1, 1988 with respect to $3,000,000 in
principal amount of City of Green Bay, Wisconsin Industrial Revenue
Bonds (Stokely USA, Inc. Project), relating to Stokely's Green Bay,
Wisconsin facility(4).
10(c) Loan and Mortgage Agreement with respect to $6,000,000 in principal
amount of Industrial Development Bonds relating to Stokely's
Poynette, Wisconsin sauerkraut facility(4).
10(d) Note Agreement between Stokely USA, Inc. and Nationwide Life
Insurance Company, Employers Life Insurance Company of Wausau and
West Coast Life Insurance Company dated January 5, 1990 with
respect to $25,000,000 in principal amount of 9.12% Senior Notes
due January 15, 2000(9).
10(e) No longer in effect.
10(f) Loan Agreement between the Village of Poynette, Wisconsin and
Stokely USA, Inc. dated December 1, 1989, with respect to
$1,600,000 in principal amount of Refunding Revenue Bonds (Stokely
USA, Inc. Project) relating to Stokely's Poynette, Wisconsin
facility(5).
10(g) Loan Agreement between the Village of Waunakee, Wisconsin and
Stokely USA, Inc. dated June 1, 1989 with respect to $4,000,000 in
principal amount of Industrial Revenue Bonds (Stokely USA, Inc.
Project) relating to Stokely's Waunakee, Wisconsin facility(5).
10(h) Loan Agreement between the City of Ackley, Iowa and Stokely USA,
Inc. dated July 1, 1989 with respect to $3,000,000 in principal
amount of Industrial Development Revenue Bonds (Stokely USA, Inc.
Project) Series 1989 relating to Stokely's Ackley, Iowa
facility(5).
10(i) Executive Deferred Compensation Agreements between Stokely USA,
Inc. and each of Thomas W. Mount, Joseph B. Weix and Robert J.
Whelan, Sr.(5).
10(j) 1985 Incentive Stock Option Plan(5).
<PAGE> 5
10(k) Loan Agreement between the Town of Utica, Wisconsin and Stokely
USA, Inc. dated June 1, 1990 with respect to $3,000,000 in
principal amount of Industrial Revenue Bonds (Stokely USA, Inc.
Project) relating to Stokely's Pickett, Wisconsin facility(6).
10(l) Loan Agreement between Port of Walla Walla Public Corporation and
Stokely USA, Inc. dated September 1, 1990 with respect to
$4,000,000 in principal amount of Industrial Revenue Bonds, Series
1990 relating to Stokely's Walla Walla, Washington facility(6).
10(m) Loan Agreement between the City of Wells, Minnesota and Stokely
USA, Inc. dated December 1, 1991 with respect to $3,000,000 in
principal amount of Industrial Revenue Bonds (Stokely USA, Inc.
Project) Series 1991 relating to Stokely's Wells, Minnesota
facility(7).
10(n) Note Agreement between the State of Wisconsin Investment Board and
Stokely USA, Inc. dated December 1, 1991 with respect to
$20,000,000 in principal amount of 9.49% Senior Notes due December
15, 2001(7).
10(o) Loan and Security Agreement by and among Barclays Business Credit,
Inc. as agent and lender, various other lenders and Stokely USA,
Inc. dated August 18, 1992 with respect to a $120,000,000 Credit
Facility(10).
10(p) Restated Agreement for Purchase and Sale of Containers between
Stokely USA, Inc. and Heekin Can, Inc. dated January 1, 1992, and
as amended on July 24, 1992(10).
10(q) Supply Agreement between Stokely USA, Inc. and American National
Can Company dated July 24, 1992 and as amended on June 11,
1993(10).
10(r) Amendment to Note Agreement dated August 18, 1992 regarding
$25,000,000 Original Principal Amount of 9.12% Senior Notes due
January 15, 2000 (see Exhibit 10(d))(10).
10(s) Amendment to Note Agreement dated August 18, 1992 regarding
$20,000,000 in principal amount of 9.49% Senior Notes due December
15, 2000 (see Exhibit 10(n))(10).
10(t) Amendment to Revenue Agreement between Stokely USA, Inc. and the
City of Appleton, Wisconsin, dated December 1, 1988(8).
10(u) Reserved.
10(v) Second Amendment to Note Agreement dated June 11, 1993 regarding
$20,000,000 Promissory Note (see Exhibit 10(n))(8).
10(w) Reserved.
<PAGE> 6
10(x) First Amendment to Security Agreement dated June 1993 relating to
the Credit Facility (see Exhibit 10(o))(8).
10(y) Second Amendment to Security Agreement dated June 11, 1993
regarding $25,000,000 Original Principal Amount of 9.37% Senior
Notes Due January 15, 2000 (see Exhibit 10(d))(8).
10(z) Warrant to Purchase Shares of Common Stock of Stokely USA, Inc.
issued to Nationwide Life Insurance Company dated June 1993(8).
10(aa) Warrant to Purchase Shares of Common Stock of Stokely USA, Inc.
issued to EMPL and Co. dated June 1993(8).
10(bb) Warrant to Purchase Shares of Common Stock of Stokely USA, Inc.
issued to West Coast Life Insurance Company dated June 1993(8).
10(cc) No longer applicable.
10(dd) First Amendment to Loan Agreement with the City of Ackley, Iowa
(see Exhibit 10(h)), dated as of March 31, 1994, between Stokely
USA, Inc. and Norwest Bank Minnesota, N.A., as trustee(11).
10(ee) First Amendment to Loan Agreement with the Village of Poynette,
Wisconsin (see Exhibit 10(c)), dated as of March 31, 1994, between
Stokely USA, Inc. and Norwest Bank Minnesota, N.A., as trustee(11).
10(ff) First Amendment to Loan Agreement with the Village of Poynette,
Wisconsin (see Exhibit 10(f)), dated as of March 31, 1994, between
Stokely USA, Inc. and NationsBank of Virginia, N.A., as
trustee(11).
10(gg) First Amendment to Loan Agreement with the Village of Waunakee,
Wisconsin (see Exhibit 10(g)), dated as of March 31, 1994, between
Stokely USA, Inc. and Nationsbank of Virginia, N.A., as
trustee(11).
10(hh) First Amendment to Loan Agreement with the City of Jefferson,
Wiscosnin, dated as of June 17, 1994, between Stokely USA, Inc. and
NationsBank of Virginia, N.A., as trustee(11).
10(ii) First Amendment to Loan Agreement with the Port of Walla Walla,
Washington Public Corporation (see Exhibit 10(l)), dated as of June
17, 1994, between Stokely USA, Inc. and NationsBank of Virginia,
N.A., as trustee(11).
10(jj) First Amendment to Loan Agreement with the Town of Utica, Wisconsin
(see Exhibit 10(k)), dated as of June 17, 1994, between Stokely
USA, Inc. and NationsBank of Virginia, N.A., as trustee(11).
10(kk) First Amendment to Loan Agreement with the City of Green Bay,
Wisconsin (see Exhibit 10(b)), dated as of June 17, 1994, between
Stokely USA, Inc. and Nationsbank of Virginia, N.A., as
trustee(11).
<PAGE> 7
10(ll) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Vernon L. Wiersma dated October 16, 1992(12).
10(mm) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Stephen W. Theobald dated October 16, 1992(12).
10(nn) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Kenneth L. Murray dated January 27, 1993(12).
10(oo) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Russell J. Trunk dated October 16, 1992(12).
10(pp) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Leslie J. Wilson dated October 16, 1992(12).
10(qq) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Robert M. Brill dated October 16, 1992(12).
10(rr) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Michael A. Wilkes dated October 16, 1992(12).
10(ss) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Robert L. Cook dated October 16, 1992(12).
10(tt) Change of Control Contingent Employment Agreement between Stokely
USA, Inc. and Eddie Foster dated October 16, 1992(12).
10(uu) Stokely USA, Inc. 1994 Executive Stock Option Plan(12).
10(vv) Stock Option Agreement between Stokely USA, Inc. and Kenneth C.
Murray dated March 13, 1990(12).
10(ww) Stock Option Agreement between Stokely USA, Inc. and Vernon L.
Wiersma dated April 8, 1994(12).
10(xx) Stock Option Agreement between Stokely USA, Inc. and Stephen W.
Theobald dated April 8, 1994(12).
10(yy) Warrant to Purchase Shares of Common Stock of Stokely USA, Inc.
issued to the State of Wisconsin Investment Board dated June
1993(12).
10(zz) Employment Agreement by and between Stokely USA, Inc. and Leslie
J. Wilson dated June 17, 1992(12).
10(aaa) Loan Agreement between the City of Jefferson, Wisconsin and
Stokely USA, Inc. with respect to $6,500,000 in principal amount
of Industrial Development Revenue Bonds (Stokely USA, Inc.
Project) relating to Stokely's Jefferson, Wisconsin facility(3).
<PAGE> 8
10(bbb) Loan Agreement between the Town of Windsor, Wisconsin and Stokely
USA, Inc. with respect to $1,500,000 in principal amount of
Industrial Development Revenue Bonds (Stokely USA, Inc. - 1985
Project)(2).
10(ccc) Loan Agreement between the Michigan Job Development Authority and
Stokely USA, Inc. with respect to $1,800,000 in principal amount
of Limited Obligation Revenue Bonds (Oconomowoc Canning Company
Project), Series A(2).
10(ddd) No longer applicable.
10(eee) Loan Agreement between the City of Appleton, Wisconsin and Stokely
USA, Inc. with respect to $1,000,000 to principal amount of
Industrial Development Revenue Bonds (Stokely USA, Inc.
Project)(3).
10(fff) Second Amendment to Loan Documents dated October 13, 1992
regarding the Credit Facility (see Exhibit 10(o))(12).
10(ggg) Third Amendment to Loan Documents dated December 16, 1992
regarding the Credit Facility (see Exhibit 10(o))(12).
10(hhh) Fourth Amendment to Loan Documents dated June 11, 1993 regarding
the Credit Facility (see Exhibit 10(o))(12).
10(iii) Fifth Amendment to Loan Document dated March 24, 1994 regarding
the Credit Facility (see Exhibit 10(o))(12).
10(jjj) Summary Plan Description of Split Dollar Life Insurance Plan(12).
10(kkk) Supplemental Employee Retirement Plan(1).
10(lll) Loan and Security Agreement by and among Harris Trust and Savings
Bank, as agent and lender, various other lenders and Stokely USA,
Inc. dated May 22, 1995 with respect to a $65,000,000 Credit
Facility(1).
10(mmm) Third Amendment to Note Agreement dated May 31, 1995 regarding
$25,000,000 Original Principal Amount of 9.37% Senior Notes due
January 15, 2000 (see Exhibit 10(d))(1).
10(nnn) Third Amendment to Note Agreement dated May 31, 1991 regarding
$20,000,000 in principal amount of 9.49% Senior Notes due December
15, 2001 (see Exhibit 10(n))(1).
13.1 Annual Report to Shareholders (not applicable-not incorporated by
reference into Form 10-K).
21.1 Subsidiaries of the Registrant(1).
23.1 Consent of Deloitte & Touche LLP(1).
24.1 Powers of Attorney for certain officers and directors(12).
<PAGE> 9
27 Financial Data Schedule(1).
99.1 Proxy Statement for 1995 Annual Meeting of Shareholders.
- -----------------------
(1) Filed herewith.
(2) Incorporated by reference to exhibits filed with Registrant's Form
S-1 Registration Statement declared effective on October 29, 1985
(Registration Number 33-339).
(3) Incorporated by reference to exhibits filed with Registrant's Form
10-K for the year ended March 31, 1986.
(4) Incorporated by reference to exhibits filed with Registrant's Form
10-K for the year ended March 31, 1989.
(5) Incorporated by reference to exhibits filed with Registrant's Form
10-K for the year ended March 31, 1990.
(6) Incorporated by reference to exhibits filed with Registrant's Form
10-K for the year ended March 31, 1991.
(7) Incorporated by reference to exhibits filed with Registrant's Form
10-K for the year ended March 31, 1992.
(8) Incorporated by reference to exhibits filed with Registrant's Form
10-K for the year ended March 31, 1993.
(9) Incorporated by reference to exhibits filed with Registrant's Form
10-Q for the three months ended December 31, 1989.
(10) Incorporated by reference to exhibits filed with Registrant's Form
10-Q for the three months ended September 30, 1992.
(11) Incorporated by reference to exhibits filed with Registrant's Form
10-K for the year ended March 31, 1994.
(12) Incorporated by reference to exhibits filed with Registrant's Form
S-1 Registration Statement declared effective on November 17, 1994
(Registration Number 33-55447).
<PAGE> 1
SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN
OF STOKELY USA, INC.
<PAGE> 2
SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN
This Plan is adopted by Stokely USA, Inc. for the purpose of providing
for the payment of definite amounts to its career executive officers when they
are disabled by accident or sickness or when they are retired from service with
the Company, or, in the event of death, to their spouses. Benefits are related
to compensation and years of service with the Company and are in addition to
all other retirement benefits, including social security.
ARTICLE ONE
DEFINITIONS
1. Plan. "Plan" shall mean the Supplemental Employee Retirement Plan for
Executive Officers established by Stokely USA, Inc. for the benefit of its
career executive officers.
2. Employer. "Employer" shall mean the person, firm, or corporation named
above who has adopted this Plan. Stokely USA, Inc. and "Employer" are
hereinafter used interchangeably.
3. Career Executive Officer. "Career Executive Officer' shall mean an
employee of Stokely USA, Inc. who is a member of the Executive Management
Committee and who is designated a Career Executive Officer herein or who, in
the future, is designated a Career Executive Officer by formal act of the Board
of Directors of Employer.
4. Member. "Member" shall mean any Career Executive Officer who has
become a member of this Plan. A "Class One" Member shall mean a Member who
holds the position of President or Vice Chairman at the time he becomes
eligible for retirement benefits hereunder. A "Class Two" Member is any Member
who is not a Class One Member.
5. Retired Member. "Retired Member" shall mean A Career Executive Officer
who has terminated active service with the Employer and is receiving benefits
under the Plan.
6. Beneficiary. "Beneficiary" shall mean a person or persons entitled
under the provisions of this Plan to receive benefits after the death of a
member.
<PAGE> 3
7. Effective Date. "Effective Date" shall mean January 1, 1995.
8. Entry Date. "Entry Date" shall mean April 1 and October 1.
9. Compensation. "Compensation" shall mean a wage or salary or commission
payable to a Member for services rendered to the Employer. It shall include
compensation which would have been payable to an employee absent on a leave of
absence approved by the Employer, at his rate of pay in effect at the start of
his leave, had he been actively engaged in the service of the Employer.
Compensation shall not include any bonus or incentive compensation paid to a
Member.
10. Committee. "Committee" shall mean the administrative committee
appointed and acting in accordance with the provisions of Article Six of this
Plan.
11. Mortality and Discount Rate. "Mortality and Discount Rate" shall mean
the 1983 Group Annuity Mortality and Discount Rate used in the last Annual
Report Disclosure.
ARTICLE TWO
ELIGIBILITY AND PARTICIPATION
1. Service Requirements. Each Career Executive Officer who on the
effective date has been employed by the Employer for not less than one year of
service shall become a Member of the Plan as of that date. Each other Career
Executive Office shall become a Member of the Plan on the entry date next
following his becoming a Career Executive Officer or completing one year of
service, whichever occurs later. For this purpose, "year of service" shall
mean the 12-month period commencing on the date Career Executive Officer first
became a Career Executive Officer and during which he is credited with not less
than 1,000 hours of service. "Hour of service" shall mean an hour for or
during which a Career Executive Officer is either directly or indirectly
compensated by the Employer or is otherwise performing duties for the Employer.
A Career Executive Officer shall also be credited with an hour of service for
each hour during any customary period of work based on a 40-hour week or
pro-rata portion thereof, during which the Career Executive Officer is laid
2
<PAGE> 4
off for a temporary period, is on a leave of absence authorized by the
Employer, is on jury duty, or is not working due to a labor-management dispute.
2. Participation. Participation in the Plan as a Member shall continue
until a Member terminates by early retirement, normal retirement, or deferred
retirement and becomes a Retired Member. Participation in the Plan as a Member
shall also terminate when a Member has a one-year break in service. A one-year
break in service shall mean a fiscal year of the Employer during which a Member
is credited with 500 hours of service or less.
ARTICLE THREE
CONTRIBUTIONS
1. Employer Contributions.
A. Except as provided in subparagraph B, the Plan shall be funded
or unfunded at the election of Employer. If funded, the contributions of the
Employer shall be payable at such intervals as may be agreed upon by the
Employer and the Committee.
B. Employer shall fund the account of a Member at the time that
such Member qualifies to receive payment of a benefit under Article Four hereof
and such account shall remain fully funded until the benefit has been paid in
full.
2. Expenses. All expenses of the Plan shall be paid by the Employer.
ARTICLE FOUR
RETIREMENT AND BENEFITS
1. Normal Retirement. Every Member shall, except as hereinafter
provided, retire on his normal retirement date. Normal retirement date shall
mean the first day in the month in which the Member reaches age 65, herein
referred to as the normal retirement age.
2. Normal Retirement Benefit. Upon the normal retirement of a Member the
normal retirement benefit shall be payable. The normal retirement benefit
shall consist of a monthly
3
<PAGE> 5
benefit payable to a Member for one hundred and twenty (120) consecutive months
commencing with the first (1st) day of the first (1st) month following the
normal retirement of the Member based on the following normal retirement
benefit formulas:
A. For Class One Members, the monthly benefit payable shall be
one-twelfth (1/12th) of forty (40%) percent of the salary and wages
(excluding bonus) paid by Employer to Member for the twelve (12) month
period preceding the normal retirement of the Member.
B. For Class Two Members, the monthly benefit payable shall be
one-twelfth (1/12th) of twenty (20%) percent of the salary and wages
(excluding bonus) paid by Employer to Member for the twelve (12) month
period preceding the normal retirement of the Member.
C. If Member has less than 25 years of service on his normal
retirement date, the normal retirement benefit shall be reduced by
1/25th for each year of service less than 25 that the Member has at
such time.
3. Early Retirement. Any Member who has at least ten (10) years of
service, and who has attained 55 years of age, shall be retired on an early
retirement allowance not less than thirty (30) days following written
application therefor filed with the Committee by the Member. In the event that
the Member fails to submit the application within thirty (30) days after
terminating employment with the Employer, Employer shall make a reasonable
effort to notify him of that requirement. If no such application is submitted
within one year after the Employer has first attempted to notify him of the
need to file, the Member shall forfeit all right to receive benefits under the
Plan's early retirement option. The early retirement allowance shall consist
of a retirement allowance commencing immediately after receipt of the
application, which shall be the actuarial equivalent of the normal retirement
allowance.
4. Deferred Retirement. Upon the application of a Member, the Employer
may defer retirement, in which event commencement of the normal retirement
benefit shall likewise be postponed.
5. Disability. Any Member who shall have had at least five (5) years of
service and who shall have become, through some unavoidable cause, permanently
incapacitated shall
4
<PAGE> 6
receive a monthly benefit equal to the actuarial equivalent of his normal
retirement benefit earned to the date of disability as calculated pursuant to
the Mortality and Discount Rate. The payment of such monthly benefits shall
commence on the first (1st) day of the first (1st) month following the month in
which the Member reaches age 65 and shall continue for one hundred and twenty
(120) consecutive months.
6. Death of Member. If a Member dies while in the employ of Employer
after completing at least five (5) years of service or after payment of
retirement benefits described in subparagraphs 2, 3 & 5 has commenced but before
being paid in full, the retirement benefits described in such subparagraphs
which are accrued and unpaid at the time of his death shall be paid to his
spouse on a monthly basis in accordance with the schedule set forth in Article
Four until such retirement benefits have been paid in full. If the Member's
spouse is not living at the time of the Member's death, or, if living, dies
before the retirement benefits described in Article Four have been paid in
full, or if the Member is unmarried at the time of his death, then the
retirement benefits remaining unpaid at such time shall be paid to the Member's
designee, if one has been designated in writing by Member to Employer before
Member's death, or if not, then to Member's estate. As the option of Employer,
it may make a present value calculation of the amount unpaid and make a lump
sum payment to the designee in satisfaction of its remaining obligation under
Article Four. Member may change his designee from time to time by giving
written notice of such change to Employer, and Employer shall pay the designee
designated by the Member in the latest dated designation in its possession
immediately prior to making payment.
7. Termination of Employment. Should a Member terminate employment prior
to his normal retirement date with five (5) or more years of service, other
than for a reason set forth in subparagraphs 3, 5, & 6 above, Member shall be
entitled to receive the retirement benefit accrued to the date of his
termination with the payment of such benefit to be in one hundred and twenty
(120) equal consecutive payments commencing on the first day of the first month
following the month in which Member reaches age 65.
Notwithstanding any other provision of this Plan, should the
employment of a Member be terminated by Company for cause, all benefits under
this Plan shall be forfeited, canceled and terminated, and Employee shall not
be eligible for nor receive any benefits whatsoever under the Plan following
such termination.
5
<PAGE> 7
ARTICLE FIVE
BENEFIT ACCRUAL
1. Benefit Accrual and Determining Service. For purposes of determining
benefit accrual and years of service for benefit accrual, the measure shall be
the lapsed time from Members date of hire to the date for which the
determination is made.
ARTICLE SIX
ADMINISTRATION
1. Administrative Reponsibility. The general administration of the Plan
and the responsibility for carrying out the provisions thereof shall be placed
in the Compensation Committee of the Board of Directors of Employer, herein
referred to as the Committee.
2. Meetings. The Committee shall hold meetings at such places, and at
such times, as it may from time to time determine. All Committee Members shall
be given written notice of such meetings at least seven (7) days prior thereto.
3. Fiduciary. The Committee is the named fiduciary and the administrator
of the Plan.
4. Powers. The Committee shall have all necessary and appropriate powers
to carry out its responsibilities and duties hereunder including, but not
limited to, the following:
(a) To employ counsel and such clerical, medical, and accounting
personnel and services as may be required to administer and carry out
the provisions of the Plan;
(b) To appoint an actuary for the purpose of making all actuarial
computations required in the administration of the Plan, and such
other actuarial services at the Committee may deem necessary.
(c) To purchase insurance for the Plan, or its fiduciaries, to
cover liability or losses occurring by reason of the act or omission
of a fiduciary, provided that such insurance shall permit recourse by
the insurer against a fiduciary in the case of a breach of a fiduciary
obligation;
6
<PAGE> 8
(d) To establish rules for the administration of the Plan and the
transaction of its business, subject to the limitations of the Plan;
and,
(e) To resolve all questions involving the interpretation,
application, and administration of the Plan, with such resolution
being final and binding upon the Members, Beneficiaries, and the
successors, assigns, heirs, and personal representatives of such
persons.
5. Reliance on Professional Advice. The Committee and the Employer shall
be entitled to rely on all tables, valuations, certificates, and reports
furnished by the actuary, upon all certificates and reports made by any
accountant retained by the Committee, and upon all opinions given by legal
counsel retained by the Committee. The Committee and the Employer shall be
fully protected with respect to any action taken in good faith and reliance
upon any such actuary, accountant, or counsel, and all actions so taken shall
be conclusive upon each of them and upon all Members of the Plan.
ARTICLE SEVEN
ALIENATION
No benefit under the Plan shall be subject in any manner to any
transfer or encumbrance, and any attempt to transfer or encumber benefits under
the Plan shall be void. Benefits under the Plan shall not be in any manner
liable for or subject to the debts and liabilities of the person entitled to
such benefits except as specifically provided in the Plan.
ARTICLE EIGHT
AMENDMENT
1. Amendment. The Plan may be amended or otherwise modified at
any time by the Employer, provided, however, that in no event, any time prior
to the satisfaction of all liabilities with respect to Member and retired
Members and their beneficiaries under the Plan, shall an accrued or funded
benefits be used for, or diverted to, purposes other than for the exclusive
benefit of Members, retired Members or their beneficiaries under the Plan.
7
<PAGE> 9
Such power to amend includes the right, without limitation, to make retroactive
amendments referred to in Section 401(b) of the Internal Revenue Code.
2. Communication. All amendments shall be communicated in writing
to all the Members, retired Members, and their beneficiaries under the Plan.
ARTICLE NINE
TERMINATION
1. Right of Termination. Although it is the intention of the
Employer to continue the Plan, the Plan may be terminated by the Employer at
any time, either in whole or in part, with regard to benefits that are unfunded
at the time of the termination of the Plan.
ARTICLE TEN
MERGER OR CONSOLIDATION
This Plan shall not be merged or consolidated with any other Plan
unless each Member in the Plan would be entitled to receive a benefit,
immediately thereafter, which is equal to or greater than the benefit he would
have been entitled to receive immediately prior to any such event.
ARTICLE ELEVEN
DESIGNATION OF CAREER EXECUTIVE OFFICERS
The Committee designates the following employees of Stokely USA, Inc.
as Career Executive Officers: Vern Wiersma, Stephen Theobald, Russell Trunk,
Ken Murray, Leslie Wilson, Robert Brill, Steven Bannworth, and Michael Wilkes.
8
<PAGE> 10
ARTICLE TWELVE
APPLICABLE LAW
The Plan shall be construed, administered, and governed in accordance
with the laws of the State of Wisconsin.
ARTICLE THIRTEEN
MISCELLANEOUS
1. No Employment Contract. Establishment of the Plan should not
be construed as conferring any legal rights upon any employee, or any other
person for a continuation of employment, nor shall it interfere with the right
of the Employer to discharge any employee and to treat him without regard to
the effect which such treatment might have upon him as a Member of the Plan.
2. Intepretation and Severability. If any provision of the Plan
is conducive to more than one interpretation, the interpretation placed upon it
by the Committee shall be binding and Final. If any provision of this Plan
shall be held invalid or unenforceable by a court of competent jurisdiction,
the remaining provisions of the Plan shall continue to be fully effective.
Dated March 8, 1995.
Ody Fish
-----------------------------
Ody Fish
Chair: Compensation Committee
Robert Brill
- ---------------
Robert Brill
Secretary
9
<PAGE> 1
CLOSING DOCUMENTS
STOKELY USA, INC.
$65,000,000 SECURED REVOLVING CREDIT FACILITY
MAY 22, 1995
A. Secured Credit Agreement among Stokely USA, Inc. (the
"Borrower"), Harris Trust and Savings Bank (individually "Harris") and as agent
(the "Agent"), Mercantile Bank of St. Louis National Association
("Mercantile"), Sanwa Business Credit Corporation ("SBCC") and General Electric
Capital Corporation ("GECC").
B. Secured Revolving Credit Note of the Borrower payable to the
order of Harris payable in the principal amount of $20,000,000.
C. Secured Revolving Credit Note of the Borrower payable to the
order of Mercantile in the principal amount of $5,000,000.
D. Secured Revolving Credit Note of the Borrower payable to the
order of SBCC in the principal amount of $12,500,000.
E. Secured Revolving Credit Note of the Borrower payable to the
order of GECC in the principal amount of $27,500,000.
F. Security Agreement Re: Accounts Receivable and Inventory from
the Borrower to the Agent.
G. Trademark Collateral Agreement from the Borrower to the Agent.
H. License Agreement from D&K Frozen Foods, Inc. to the Agent.
I. License Agreement from ANC Express, Inc. to the Agent.
J. License Agreement from Oconomowoc Canning Company, Inc. to the
Agent.
K. Pre-filing lien searches.
L. UCC Financing Statements.
M. Post-filing lien searches.
N. Pay-off letter from the Existing Lenders.
O. Indemnity Agreement among the Borrower, the Agent and Shawmut
Capital Corporation.
<PAGE> 2
P. Lien releases from the existing lenders.
Q. Partial lien releases from the Nationwide Life Insurance
Company, the State of Wisconsin Investment Board (collectively the "Senior
Noteholders") and the Banks (or a collateral agent or trustee on their behalf).
R. Certificate of the Secretary of the Borrower as to (a) the
Borrower's Articles of Incorporation, (b) the Borrower's By-Laws, (c)
incumbency of officers, and (d) resolutions of its Board of Directors.
S. Opinion of Counsel to the Borrower.
T. Good Standing Certificates for the Borrower.
U. Evidence of Insurance with Loss Payable Endorsement.
V. Compliance Certificate.
W. Borrowing Base Certificate.
<PAGE> 3
===============================================================================
SECURED CREDIT AGREEMENT
AMONG
STOKELY USA, INC.
AND
HARRIS TRUST AND SAVINGS BANK
Individually and as Agent
AND
MERCANTILE BANK OF ST. LOUIS NATIONAL ASSOCIATION
SANWA BUSINESS CREDIT CORPORATION
GENERAL ELECTRIC CAPITAL CORPORATION
as Lenders
Dated as of May 22, 1995
===============================================================================
<PAGE> 4
TABLE OF CONTENTS
STOKELY USA, INC.
SECURED CREDIT AGREEMENT
SECTION DESCRIPTION PAGE
SECTION 1. THE CREDIT ................................................1
Section 1.1. The Revolving Credit.....................................1
Section 1.2. The Notes................................................3
Section 1.3. Interest Rates...........................................3
Section 1.4. Conversion and Continuation of Loans.....................4
Section 1.5. Manner of Borrowing and Rate Selection...................5
Section 1.6. Letters of Credit........................................6
Section 1.7. Reimbursement Obligation.................................7
Section 1.8. Participation in L/Cs....................................7
Section 1.9. Capital Adequacy.........................................8
Section 1.10 Collateral...............................................8
SECTION 2. FEES, PREPAYMENTS AND TERMINATIONS.........................9
Section 2.1. Commitment Fee...........................................9
Section 2.2. Agent's Fee..............................................9
Section 2.3. Optional Prepayments.....................................9
Section 2.4. Mandatory Prepayments; Borrowing Base....................9
Section 2.5. Closing Fee..............................................9
Section 2.6. Collateral Collections..................................10
Section 2.7. Terminations............................................10
SECTION 3. PLACE AND APPLICATION OF PAYMENTS.........................10
SECTION 4. DEFINITIONS...............................................11
Section 4.1. Certain Terms Defined...................................11
Section 4.2. Accounting Terms........................................21
SECTION 5. REPRESENTATIONS AND WARRANTIES............................21
Section 5.1. Organization and Qualification..........................21
Section 5.2. Subsidiaries............................................22
Section 5.3. Financial Reports.......................................22
Section 5.4. Litigation; Tax Returns; Approvals......................23
Section 5.5. Regulation U............................................23
Section 5.6. No Default..............................................23
Section 5.7. ERISA...................................................23
Section 5.8. Security Interests and Debt.............................23
Section 5.9. Accurate Information....................................23
-i-
<PAGE> 5
Section 5.10. Corporate Authority and Validity of Obligations.........24
Section 5.11. Compliance with Laws....................................24
Section 5.12. Restrictive Agreements..................................24
Section 5.13. No Default under Other Agreements.......................24
Section 5.14. Status under Certain Laws...............................25
Section 5.15. Federal Food Security Act...............................25
SECTION 6. CONDITIONS PRECEDENT......................................25
Section 6.1. General.................................................25
Section 6.2. Initial Extension of Credit.............................25
Section 6.3. Each Extension of Credit................................27
Section 6.4. Legal Matters...........................................27
Section 6.5. Documents...............................................27
Section 6.6. Lien Searches...........................................27
SECTION 7. COVENANTS.................................................28
Section 7.1. Maintenance.............................................28
Section 7.2. Taxes...................................................28
Section 7.3. Maintenance of Insurance................................28
Section 7.4. Financial Reports.......................................28
Section 7.5. Inspection and Reviews..................................30
Section 7.6. Consolidation and Merger................................30
Section 7.7. Transactions with Affiliates............................30
Section 7.8. Leverage Ratio..........................................30
Section 7.9. Tangible Net Worth......................................31
Section 7.10. Minimum Net Working Capital.............................31
Section 7.11. Capital Expenditures....................................31
Section 7.12. Dividends and Certain Other Restricted Payments.........31
Section 7.13. Liens...................................................31
Section 7.14. Borrowings and Guaranties...............................33
Section 7.15. Investments, Loans, Advances and Acquisitions...........33
Section 7.16. Sale of Property........................................34
Section 7.17. Notice of Suit, Adverse Change in Business or Default...35
Section 7.18. ERISA...................................................35
Section 7.19. Use of Loan Proceeds....................................35
Section 7.20. Conduct of Business and Maintenance of Existence........35
Section 7.21. Compliance with Laws, etc. .............................35
Section 7.22. Environmental Covenant..................................36
Section 7.23. New Subsidiaries........................................36
Section 7.24. Sale and Leasebacks.....................................36
Section 7.25. Seasonal Clean-Up.......................................37
Section 7.26. Subsidiary Assets and Operations........................37
Section 7.27. Compliance with Federal Food Security Act...............37
Section 7.28. Additional Trademark Collateral.........................37
-ii-
<PAGE> 6
SECTION 8. EVENTS OF DEFAULT AND REMEDIES............................37
Section 8.1. Definitions.............................................37
Section 8.2. Remedies for Non-Bankruptcy Defaults....................39
Section 8.3. Remedies for Bankruptcy Defaults........................39
Section 8.4. L/Cs....................................................39
SECTION 9. CHANGE IN CIRCUMSTANCES REGARDING EURODOLLAR LOANS........40
Section 9.1. Change of Law...........................................40
Section 9.2. Unavailability of Deposits or Inability to Ascertain
the Adjusted Eurodollar Rate............................40
Section 9.3. Taxes and Increased Costs...............................40
Section 9.4. Funding Indemnity.......................................41
Section 9.5. Lending Branch..........................................42
Section 9.6. Discretion of Bank as to Manner of Funding..............42
SECTION 10. THE AGENT.................................................42
Section 10.1. Appointment and Powers..................................42
Section 10.2. Powers..................................................42
Section 10.3. General Immunity........................................43
Section 10.4. No Responsibility for Loans, Recitals, etc..............43
Section 10.5. Right to Indemnity......................................43
Section 10.6. Action Upon Instructions of Banks.......................43
Section 10.7. Employment of Agents and Counsel........................43
Section 10.8. Reliance on Documents; Counsel..........................44
Section 10.9. May Treat Payee as Owner................................44
Section 10.10. Agent's Reimbursement...................................44
Section 10.11. Rights as a Lender......................................44
Section 10.12. Bank Credit Decision....................................44
Section 10.13. Resignation of Agent....................................44
Section 10.14. Removal of Agent........................................45
Section 10.15. Duration of Agency......................................45
Section 10.16. Certain Notices.........................................45
SECTION 11. MISCELLANEOUS.............................................45
Section 11.1. Amendments and Waivers..................................45
Section 11.2. Waiver of Rights........................................46
Section 11.3. Several Obligations.....................................46
Section 11.4. Non-Business Day........................................47
Section 11.5. Survival of Indemnities.................................47
Section 11.6. Documentary Taxes.......................................47
Section 11.7. Survival of Representations.............................47
Section 11.8. Notices.................................................47
Section 11.9. Costs and Expenses; Indemnity...........................47
-iii-
<PAGE> 7
Section 11.10. Counterparts............................................48
Section 11.11. Successors and Assigns..................................48
Section 11.12. No Joint Venture........................................48
Section 11.13. Severability............................................48
Section 11.14. Table of Contents and Headings..........................48
Section 11.15. Participants and Note Assignors.........................48
Section 11.16. Assignment of Commitments by Bank.......................49
Section 11.17. Sharing of Payments.....................................50
Section 11.18. Entire Agreement........................................50
Section 11.19. Governing Law...........................................50
Section 11.20. Submission to Jurisdiction; Waiver of Jury Trial........50
Signature Page............................................................51
Exhibit A Secured Revolving Credit Note
Exhibit B Form of Legal Opinion
Exhibit C Compliance Certificate
Exhibit D Borrowing Base Certificate
Exhibit E Application and Agreement for Standby Letter of Credit
Schedule 5.2 Subsidiaries
Schedule 5.4 Litigation
Schedule 5.15 Farm Product Purchases and Registrations
Schedule 7.13 Liens
-iv-
<PAGE> 8
STOKELY USA, INC.
SECURED CREDIT AGREEMENT
Harris Trust and Savings Bank
Chicago, Illinois
Mercantile Bank of St. Louis
National Association
St. Louis, Missouri
Sanwa Business Credit Corporation
Chicago, Illinois
General Electric Capital Corporation
Chicago, Illinois
Ladies and Gentlemen:
The undersigned, STOKELY USA, INC., a Wisconsin corporation (the
"Company"), applies to you for your several commitment, subject to all the
terms and conditions hereof and on the basis of the representations and
warranties hereinafter set forth, to make a revolving credit (the "Revolving
Credit") available to the Company, all as more fully hereinafter set forth.
Each of you (and your respective successors and assigns) is hereinafter
referred to individually as "Bank" and collectively as "Banks." Harris Trust
and Savings Bank in its individual capacity is sometimes referred to herein as
"Harris", and in its capacity as Agent for the Banks is hereinafter in such
capacity called the "Agent."
SECTION 1. THE CREDIT.
Section 1.1. The Revolving Credit. (a) Subject to all of the terms
and conditions hereof, the Banks agree, severally and not jointly, to extend a
Revolving Credit to the Company which may be utilized by the Company in the
form of loans (individually a "Revolving Credit Loan" and collectively the
"Revolving Credit Loans"), and L/Cs (as hereinafter defined). The aggregate
principal amount of all Revolving Credit Loans under the Revolving Credit plus
the amount available for drawing under all L/Cs and the aggregate principal
amount of all unpaid Reimbursement Obligations (as hereinafter defined) at any
time outstanding shall not exceed the lesser of (i) the sum of the Banks'
Revolving Credit Commitments (as hereinafter defined) in effect from time to
time during the term of this Agreement (as hereinafter defined) or (ii) the
Borrowing Base. The Revolving Credit shall be available to the Company, and may
be availed of by the Company from time to time, be repaid (subject to the
restrictions on prepayment set forth herein) and used again, during the period
from the date hereof to and including July 31, 1998 (the "Termination Date").
<PAGE> 9
(b) At any time not earlier than August 31, 1997, nor later than
December 31, 1997, (the "Extension Request Date"), the Company may request that
the Banks extend the then scheduled Termination Date to the date one year from
such Termination Date. If such request is made by the Company each Bank shall
inform the Agent of its willingness to extend the Termination Date no later
than 30 days after the Banks receive such request. The Banks shall have the
right in their sole discretion to determine whether to grant any requested
extension of the Termination Date. Any Bank's failure to respond by such date
shall indicate its unwillingness to agree to such requested extension, and all
Banks must approve any requested extension. At any time more than 30 days after
such Extension Request Date the Banks may propose, by written notice to the
Company, an extension of this Agreement to such later date on such terms and
conditions as the Banks may then require. If the extension of this Agreement to
such later date is acceptable to the Company on the terms and conditions
proposed by the Banks, the Company shall notify the Banks of its acceptance of
such terms and conditions no later than 30 days after the date of the Banks'
written notice to the Company, and such later date will become the Termination
Date hereunder and this Agreement shall otherwise be amended in the manner
described in the Banks' notice proposing the extension of this Agreement upon
the Agent's receipt of (i) an amendment to this Agreement signed by the Company
and all of the Banks, (ii) resolutions of the Company's Board of Directors
authorizing such extension and (iii) an opinion of counsel to the Company
equivalent in form and substance to the form of opinion attached hereto as
Exhibit B and otherwise acceptable to the Banks.
(c) The respective maximum aggregate principal amounts of the
Revolving Credit at any one time outstanding and the percentage of the
Revolving Credit available at any time which each Bank by its acceptance hereof
severally agrees to make available to the Company are as follows (collectively,
the "Revolving Credit Commitments" and individually, a "Revolving Credit
Commitment"):
<TABLE>
<S> <C> <C>
Harris Trust and Savings Bank $20,000,000 30.76923076%
Mercantile Bank of St. Louis
National Association $ 5,000,000 7.69230769%
Sanwa Business Credit Corporation $12,500,000 19.23076923%
General Electric Capital Corporation $27,500,000 42.30769230%
-----------
Total $65,000,000 100%
</TABLE>
(d) Loans under the Revolving Credit may be Eurodollar Loans or
Domestic Rate Loans. All Loans under the Revolving Credit shall be made from
each Bank in proportion to its respective Revolving Credit Commitment as above
set forth. Each Domestic Rate Loan shall be in an amount not less than $100,000
or such greater amount which is an integral multiple of $10,000 and each
Eurodollar Loan shall be in an amount not less than $1,000,000 or such greater
amount which is an integral multiple of $500,000.
(e) The initial borrowing under this Agreement shall be in an amount
sufficient to pay all amounts outstanding under that Loan and Security
Agreement dated as of August 18, 1992 (the "Existing Agreement") between the
Company, Shawmut Capital Corporation, as successor to Barclay's Business
Credit Inc., as agent and lender, and the other lenders named
-2-
<PAGE> 10
therein (the "Existing Lenders"). The Company shall apply the proceeds of the
initial borrowing hereunder to pay all amounts outstanding under the Existing
Agreement.
Section 1.2. The Notes. All Revolving Credit Loans made by each Bank
hereunder shall be evidenced by a single Secured Revolving Credit Note of the
Company payable to the order of such Bank substantially in the form of Exhibit
A hereto (individually, a "Revolving Note" and together, the "Revolving Notes")
in the principal amount of such Bank's Revolving Credit Commitment, but the
aggregate principal amount of indebtedness evidenced by such Revolving Note at
any time shall be, and the same is to be determined by, the aggregate principal
amount of all Revolving Credit Loans outstanding made by such Bank to the
Company pursuant hereto on or prior to the date of determination. Each
Revolving Note shall be dated as of the execution date of this Agreement, shall
be delivered concurrently herewith, and shall be expressed to mature on the
Termination Date and to bear interest as provided in Section 1.3 hereof. Each
Bank shall record on its books or records or on a schedule to its Revolving
Note the amount of each Revolving Credit Loan made by it hereunder, whether
each Revolving Credit Loan is a Domestic Rate Loan or Eurodollar Loan, and,
with respect to Eurodollar Loans, the interest rate and Interest Period
applicable thereto, and all payments of principal and interest and the
principal balance from time to time outstanding, provided that prior to any
transfer of such Revolving Note all such amounts shall be recorded on a
schedule to such Revolving Note. The record thereof, whether shown on such
books or records or on the schedule to the Revolving Note, shall be prima facie
evidence as to all such amounts; provided, however, that the failure of any
Bank to record or any mistake in recording any of the foregoing shall not limit
or otherwise affect the obligation of the Company to repay all Revolving Credit
Loans made hereunder together with accrued interest thereon. Upon the request
of any Bank, the Company will furnish a new Revolving Note to such Bank to
replace its outstanding Revolving Note and at such time the first notation
appearing on the schedule on the reverse side of, or attached to, such
Revolving Note shall set forth the aggregate unpaid principal amount of
Revolving Credit Loans then outstanding from such Bank, and, with respect to
each Eurodollar Loan, the interest rate and Interest Period applicable thereto.
Such Bank will cancel the outstanding Revolving Note upon receipt of the new
Revolving Note.
Section 1.3. Interest Rates. (a) Domestic Rate Loans. Each Domestic
Rate Loan shall bear interest (computed on the basis of a year of 360 days and
actual days elapsed) on the unpaid principal amount thereof from the date such
Loan is made until maturity (whether by acceleration, upon prepayment or
otherwise) at a rate per annum equal to the sum of the Applicable Rate plus the
Domestic Rate from time to time in effect, payable monthly in arrears on the
last day of each calendar month, commencing on the first of such dates
occurring after the date hereof and at maturity (whether by acceleration, upon
prepayment or otherwise).
(b) Eurodollar Loans. Each Eurodollar Loan under the Revolving Credit
shall bear interest (computed on the basis of a year of 360 days and actual
days elapsed) on the unpaid principal amount thereof from the date such Loan is
made until the last day of the Interest Period applicable thereto or, if
earlier, until maturity (whether by acceleration or otherwise) at a rate per
annum equal to the sum of the Applicable Rate plus the Adjusted
-3-
<PAGE> 11
Eurodollar Rate, payable on the last day of each Interest Period applicable
thereto and at maturity (whether by acceleration or otherwise) and, with
respect to Eurodollar Loans with an Interest Period in excess of three months,
on the date occurring every three months from the first day of the Interest
Period applicable thereto.
(c) Default Rate. If any payment of principal or interest on any Loan
or Reimbursement Obligation is not made when due (including any payment due
upon acceleration), all Loans and Reimbursement Obligations shall bear interest
(computed on the basis of a year of 360 days and actual days elapsed) from the
date such payment was due until paid in full, payable on demand, at a rate per
annum equal to:
(i) with respect to any Domestic Rate Loan and Reimbursement
Obligation, the sum of 3% plus the Applicable Rate plus the Domestic
Rate from time to time in effect; and
(ii) with respect to any Eurodollar Loan, the sum of 3% plus
the Applicable Rate plus the Adjusted Eurodollar Rate applicable
thereto at the time of such default until the end of the Interest
Period then applicable thereto, and, thereafter, at a rate per annum
equal to the sum of 3% plus the Applicable Rate plus the Domestic Rate
from time to time in effect.
Section 1.4. Conversion and Continuation of Loans. (a) Provided that
no Event of Default or Potential Default has occurred and is continuing, the
Company shall have the right, subject to the other terms and conditions of this
Agreement, to continue in whole or in part (but, if in part, in the minimum
amount specified for Eurodollar Loans in Section 1.1 hereof) any Eurodollar
Loan from any current Interest Period into a subsequent Interest Period,
provided that the Company shall give the Agent notice of the continuation of
any such Loan as provided in Section 1.5 hereof.
(b) In the event that the Company fails to give notice pursuant to
Section 1.5 hereof of the continuation of any Eurodollar Loan or fails to
specify the Interest Period applicable thereto, or an Event of Default or
Potential Default has occurred and is continuing at the time any such Loan is
to be continued hereunder, then such Loan shall be automatically converted to
(and the Company shall be deemed to have given notice requesting) a Domestic
Rate Loan, subject to Sections 1.5(b), 8.2 and 8.3 hereof, unless paid in full
on the last day of the then applicable Interest Period.
(c) Provided that no Event of Default or Potential Default has
occurred and is continuing, the Company shall have the right, subject to the
terms and conditions of this Agreement, to convert Loans of one type (in whole
or in part) into Loans of another type from time to time provided that: (i) the
Company shall give the Agent notice of each such conversion as provided in
Section 1.5 hereof, (ii) the principal amount of any Loan converted hereunder
shall be in an amount not less than the minimum amount specified for the type
of Loan in Section 1.1 hereof, (iii) after giving effect to any such conversion
in part, the principal amount of any Eurodollar Loan then outstanding shall not
be less than the minimum amount specified for the type of Loan in Section 1.1
hereof, (iv) any conversion
-4-
<PAGE> 12
of a Loan hereunder shall only be made on a Business Day, and (v) any
Eurodollar Loan may be converted only on the last day of the Interest Period
then applicable thereto.
Section 1.5. Manner of Borrowing and Rate Selection. (a) The Company
shall give telephonic, telex or telecopy notice to the Agent (which notice, if
telephonic, shall be promptly confirmed in writing) no later than (i) 10:30
a.m. (Chicago time) on the date the Banks are requested to make each Domestic
Rate Loan, and (ii) 10:30 a.m. (Chicago time) on the date at least three (3)
Business Days prior to the date of (A) each Eurodollar Loan which the Banks are
requested to make or continue, and (B) the conversion of any Domestic Rate Loan
into a Eurodollar Loan. Each such notice shall specify the date of the Loan
requested (which shall be a Business Day), the amount of such Loan, whether the
Loan is to be made available by means of a Domestic Rate Loan or Eurodollar
Loan and, with respect to Eurodollar Loans, the Interest Period applicable
thereto; provided, that in no event shall the principal amount of any requested
Revolving Credit Loan plus the aggregate principal or face amount, as
appropriate, of all Loans, L/Cs, and unpaid Reimbursement Obligations
outstanding hereunder exceed the amounts specified in Section 1.1 hereof. The
Company agrees that the Agent may rely on any such telephonic, telex or
telecopy notice given by any person who the Agent believes is authorized to
give such notice without the necessity of independent investigation and in the
event any notice by such means conflicts with the written confirmation, such
notice shall govern if any Bank has acted in reliance thereon. The Agent shall,
no later than 11:30 a.m. (Chicago time) on the day any such notice is received
by it, give telephonic, telex or telecopy (if telephonic, to be confirmed in
writing within one Business Day) notice of the receipt of notice from the
Company hereunder to each of the Banks, and, if such notice requests the Banks
to make, continue or convert any Eurodollar Loans, the Agent shall confirm to
the Company by telephonic, telex or telecopy means, which confirmation shall be
conclusive and binding on the Company in the absence of manifest error, the
Interest Period and the interest rate applicable thereto promptly after such
rate is determined by the Agent.
(b) Subject to the provisions of Section 6 hereof, the proceeds of
each Loan shall be made available to the Company at the principal office of the
Agent in Chicago, Illinois, in immediately available funds, on the date such
Loan is requested to be made, except to the extent such Loan represents (i) the
conversion of an existing Loan or (ii) a refinancing of a Reimbursement
Obligation, in which case each Bank shall record such conversion on the
schedule to its Revolving Note, or in lieu thereof, on its books and records,
and shall effect such conversion or refinancing, as the case may be, on behalf
of the Company in accordance with the provisions of Section 1.4(a) hereof and
1.7 hereof, respectively. Not later than 2:00 p.m. Chicago time, on the date
specified for any Loan to be made hereunder, each Bank shall make its portion
of such Loan available to the Company in immediately available funds at the
principal office of the Agent, except (i) as otherwise provided above with
respect to converting or continuing any outstanding Loans and (ii) to the
extent such Loan represents a refinancing of any outstanding Reimbursement
Obligations.
(c) Unless the Agent shall have been notified by a Bank prior to 12:00
noon (Chicago time) on the date a Loan is to be made by such Bank (which
notice shall be effective upon receipt) that such Bank does not intend to make
the proceeds of such Loan
-5-
<PAGE> 13
available to the Agent, the Agent may assume that such Bank has made such
proceeds available to the Agent on such date and the Agent may in reliance upon
such assumption (but shall not be required to) make available to the Company a
corresponding amount. If such corresponding amount is not in fact made
available to the Agent by such Bank, the Agent shall be entitled to receive
such amount on demand from such Bank (or, if such Bank fails to pay such amount
forthwith upon such demand, to recover such amount, together with interest
thereon at the rate otherwise applicable thereto under Section 1.3 hereof, from
the Company) together with interest thereon in respect of each day during the
period commencing on the date such amount was made available to the Company and
ending on the date the Agent recovers such amount, at a rate per annum equal to
the effective rate charged to the Agent for overnight Federal funds
transactions with member banks of the Federal Reserve System for each day, as
determined by the Agent (or, in the case of a day which is not a Business Day,
then for the preceding Business Day) (the "Fed Funds Rate"); provided that the
Agent shall be entitled to retain only a single satisfaction pursuant hereto.
Nothing in this Section 1.5(c) shall be deemed to permit any Bank to breach its
obligations to make Loans under the Revolving Credit or to limit the Company's
claims against any Bank for such breach.
Section 1.6. (a) Letters of Credit. Subject to all the terms and
conditions hereof, satisfaction of all conditions precedent to borrowing under
this Agreement and so long as no Potential Default or Event of Default is in
existence, at the Company's request Harris shall issue letters of credit (an
"L/C" and collectively the "L/Cs") for the account of the Company subject to
availability under the Revolving Credit, and the Banks hereby agree to
participate therein as more fully described in Section 1.8 hereof. Each L/C
shall be issued pursuant to a reimbursement agreement or an application and
agreement for letter of credit (the "L/C Agreement") in Harris' customary form
at the time such L/C is requested, shall conform to the general requirements of
Harris for the issuance of letters of credit as to form and substance, shall be
in U.S. Dollars and shall be a letter of credit which Harris may lawfully
issue. The L/Cs shall consist of standby letters of credit in an aggregate
face amount not to exceed $15,000,000. Each L/C shall have an expiry date not
more than thirteen (13) months from the date of issuance thereof (but in no
event later than the Termination Date.) The amount available to be drawn under
each L/C issued pursuant hereto shall be deducted from the credit otherwise
available under the Revolving Credit. In consideration of the issuance of L/Cs
the Company agrees to pay Harris a fee (the "L/C Issuance Fee") in the amount
per annum (computed on the basis of a 360-day year and actual days elapsed)
equal to 1.25% of the stated amount of each standby L/C issued hereunder. In
addition the Company shall pay Harris for its own account for each L/C such
drawing, negotiation, amendment and other administrative fees in connection
with each L/C as may be established by Harris from time to time (the "L/C
Administrative Fee"). All L/C Issuance Fees will be payable quarterly in
arrears on the last day of each calendar quarter and all L/C Administrative
Fees shall be payable on the date of issuance of each L/C hereunder, on the
date of each extension, if any, of the expiry date of each L/C and on the date
of each drawing under or amendment of each L/C.
(b) Upon the satisfaction of all conditions precedent to the
initial Loan or L/C hereunder, without any further action on the part of the
Company, Harris, the Agent or any
-6-
<PAGE> 14
Bank, (i) that certain Irrevocable Letter of Credit Number SPL34631 dated May
17, 1995 issued by Harris for the account of the Company to NBD Bank shall
constitute an L/C issued under this Agreement for all purposes hereof, (ii) the
Application and Agreement for Standby Letter of Credit dated May 17, 1995 from
the Company to Harris relating to such letter of credit (the "Initial L/C
Agreement") shall constitute an L/C Agreement for all purposes of this
Agreement, and (iii) all of the Company's indebtedness, obligations and
liabilities to Harris under the Initial L/C Agreement shall constitute
Reimbursement Obligations for all purposes of this Agreement.
(c) Upon the satisfaction of all conditions precedent to the Initial
Loan or L/C hereunder, the Initial L/C Agreement shall be amended by (i)
deleting the phrase ", or if so demanded by you, on demand in advance of any
drawing or maturity" appearing in the last line of numbered paragraph 1
thereof, (ii) numbered paragraphs 3, 4 and 7 thereof shall be deleted, and
(iii) the phrase "and in addition to the provisions of paragraph numbered 7
hereof" appearing in the first line of numbered paragraph 10 thereof shall be
deleted.
Section 1.7. Reimbursement Obligation. The Company is obligated, and
hereby unconditionally agrees, to pay in immediately available funds to the
Agent for the account of Harris and the Banks who are participating in L/Cs
pursuant to Section 1.8 hereof the face amount of each draft drawn and
presented under an L/C issued by Harris hereunder not later than 10:30 a.m.
(Chicago Time) on the date such draft is presented for payment to Harris (the
obligation of the Company under this Section 1.7 with respect to any L/C is a
"Reimbursement Obligation"). If at any time the Company fails to pay any
Reimbursement Obligation when due, the Company shall be deemed to have
automatically requested a Domestic Rate Loan from the Banks hereunder, as of
the maturity date of such Reimbursement Obligation, the proceeds of which Loan
shall be used to repay such Reimbursement Obligation. Such Loan shall only be
made if no Potential Default or Event of Default shall exist and upon approval
by all of the Banks, and shall be subject to availability under the Revolving
Credit. If such Loan is not made by the Banks for any reason, the unpaid
amount of such Reimbursement Obligation shall be due and payable to the Agent
for the pro rata benefit of the Banks upon demand and shall bear interest at
the rate of interest specified in Section 1.3(c)(i) hereof.
Section 1.8. Participation in L/Cs. Each of the Banks will acquire a
risk participation for its own account, without recourse to or representation
or warranty from Harris, in each L/C upon the issuance thereof ratably in
accordance with its Commitment Percentage. In the event any Reimbursement
Obligation is not immediately paid by the Company pursuant to Section 1.7
hereof, each Bank will pay to Harris funds in an amount equal to such Bank's
ratable share of the unpaid amount of such Reimbursement Obligation (based upon
its proportionate share relative to its percentage of the Revolving Credit (as
set forth in Section 1.1 hereof)). At the election of all of the Banks, such
funding by the Banks of the unpaid Reimbursement Obligations shall be treated as
additional Revolving Credit Loans to the Company hereunder rather than a
purchase of participations by the Banks in the related L/Cs held by Harris.
The availability of funds to the Company under the Revolving Credit shall be
reduced in an amount equal to the amount available to be drawn under each L/C.
The obligation of the Banks to Harris under this Section 1.8 shall be absolute
and
-7-
<PAGE> 15
unconditional and shall not be affected or impaired by any Event of Default or
Potential Default which may then be continuing hereunder. Harris shall notify
each Bank by telephone of its proportionate share relative to its percentage of
the total Bank's Revolving Credit Commitments set forth in Section 1.1 hereof
(a "Commitment Percentage") of such unpaid Reimbursement Obligation. If such
notice has been given to each Bank by 11:00 a.m., Chicago time, each Bank
agrees to pay Harris in immediately available and freely transferable funds on
the same Business Day. If such notice is received on a day other than a
Business Day or after 11:00 a.m., Chicago time, on a Business Day, each Bank
agrees to pay Harris in immediately available and freely transferable funds no
later than the following Business Day. Funds shall be so made available at the
account designated by Harris in such notice to the Banks. Upon the election by
the Banks to treat such funding as additional Revolving Credit Loans hereunder
and payment by each Bank, such Loans shall bear interest in accordance with
Section 1.3(a) hereof. Harris shall share with each Bank on a pro rata basis
relative to its Commitment Percentage a portion of each payment of a
Reimbursement Obligation (whether of principal or interest) and any L/C
Issuance Fee (but not any L/C Administrative Fee) payable by the Company. Any
such amount shall be promptly remitted to the Banks when and as received by
Harris from the Company.
Section 1.9 Capital Adequacy. If, after the date hereof, any Bank or
the Agent shall have determined in good faith that the adoption of any
applicable law, rule or regulation regarding capital adequacy, or any change
therein (including, without limitation, any revision in the Final Risk-Based
Capital Guidelines of the Board of Governors of the Federal Reserve System (12
CFR Part 208, Appendix A; 12 CFR Part 225, Appendix A) or of the Office of the
Comptroller of the Currency (12 CFR Part 3, Appendix A), or in any other
applicable capital rules heretofore adopted and issued by any governmental
authority), or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Lending Office) with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Bank's capital, or on the capital of any corporation controlling such
Bank, in each case as a consequence of its obligations hereunder to a level
below that which such Bank would have achieved but for such adoption, change or
compliance (taking into consideration such Bank's policies with respect to
capital adequacy) by an amount reasonably deemed by such Bank to be material,
then from time to time, within fifteen (15) days after demand by such Bank
(with a copy to the Agent), the Company shall pay to such Bank such additional
amount or amounts as will compensate such Bank for such reduction. Any Bank
requesting compensation pursuant to this Section shall submit a certificate to
the Company setting forth the calculation of the amount so requested, and such
certificate shall be conclusive and binding on the Company as to the amount
thereof except in the case of manifest errors, so long as such determination is
made on a reasonable basis.
Section 1.10. Collateral. The payment and performance of the
Obligations shall be secured by all of the Company's accounts, chattel paper,
documents, instruments, general intangibles, inventory, and certain other assets
and property of the Company, whether now owned or held or hereafter acquired or
arising, pursuant to that certain Security Agreement
-8-
<PAGE> 16
dated of even date herewith from the Company to the Agent, as the same may be
amended, modified or supplemented from time to time (the "Security Agreement").
SECTION 2. FEES, PREPAYMENTS AND TERMINATIONS.
Section 2.1. Commitment Fee. From and after the earlier of the initial
Loan or L/C hereunder or May 31, 1995, to the Termination Date, the Company
shall pay to the Agent for the account of the Banks a commitment fee with
respect to the Revolving Credit at the Applicable Rate (computed in each case on
the basis of a year of 360 days for the actual number of days elapsed) of the
average daily unused amount of the Banks' Revolving Credit Commitments
hereunder in effect from time to time, all such fees to be payable quarterly in
arrears on the last day of each calendar quarter commencing on the last day of
June, 1995, and on the Termination Date, unless the Revolving Credit is
terminated in whole on an earlier date, in which event the commitment fee for
the final period shall be paid on the date of such earlier termination in
whole.
Section 2.2. Agent's Fee. The Company shall pay to and for the sole
account of the Agent such fees as may be agreed upon in writing from time to
time by the Agent and the Company. Such fees shall be in addition to any fees
and charges the Agent may be entitled to receive under Section 10 hereunder or
under the other Loan Documents.
Section 2.3. Optional Prepayments. The Company shall have the
privilege of prepaying without premium or penalty and in whole or in part (but
if in part, then in a minimum principal amount of $100,000 or such greater
amount which is an integral multiple of $10,000) any Domestic Rate Loan at any
time upon prior telex or telephonic notice to the Agent on or before 12:00 noon
on the same Business Day. The Company may not prepay any Eurodollar Loan. Any
amount prepaid under the Revolving Credit may, subject to the terms and
conditions of this Agreement, be borrowed, repaid and borrowed again.
Section 2.4. Mandatory Prepayments; Borrowing Base. The Company shall
not permit the sum of the principal amount of all Loans plus the amount
available for drawing under all L/Cs and the aggregate principal amount of all
unpaid Reimbursement Obligations at any time outstanding to exceed the lesser
of (i) the sum of the Banks' Revolving Credit Commitments or (ii) the Borrowing
Base. In addition to the Company's obligations to pay any outstanding
Reimbursement Obligations as set forth in Section 1.7 hereof, the Company will
make such payments on any outstanding Loans and Reimbursement Obligations (and,
if any L/Cs are then outstanding, deposit an amount equal to the aggregate face
amount of all such L/Cs into an account with the Agent which shall be held as
additional collateral security for such L/Cs) which are necessary to cure any
such excess within one Business Day after the occurrence thereof. Any amount
prepaid under the Revolving Credit may, subject to the terms and conditions of
this Agreement, be borrowed, prepaid and borrowed again.
Section 2.5. Closing Fee. The Company shall pay to the Agent for the
account of the Banks a closing fee in the amount equal to 0.375% of the
Revolving Credit Commitment of each Bank with a Revolving Credit Commitment of
$25,000,000 or more and 0.25% of the
-9-
<PAGE> 17
Revolving Credit Commitment of all other Banks, which fee shall be payable on
the date of the execution and delivery of this Agreement.
Section 2.6. Collateral Collections. The Company agrees to forthwith
make such arrangements as shall be necessary or appropriate to assure that all
proceeds of all Collateral, including without limitation the Inventory and
Receivables of the Company, are promptly deposited (in the same form as
received) in an account maintained with the Agent, such account to constitute a
special restricted account (the "Restricted Account"). The Company
acknowledges that the Agent has (and is hereby granted to the extent that it
does not already have) a lien on such account and all funds contained therein
to secure the indebtedness, obligations and liabilities of the Company under the
Loan Documents. The Company irrevocably authorizes and directs that all
amounts from time to time deposited in the Restricted Account maintained with
the Agent be applied as and when received (but not less often than once each
Business Day) against the Revolving Credit Loans and Reimbursement Obligations;
provided, however, that if at the time of application there are no outstanding
Revolving Credit Loans and Reimbursement Obligations or the amount on deposit
in such accounts is in excess of the amount necessary to prepay the Revolving
Credit Loans and Reimbursement Obligations in full, then such payment or excess
(as appropriate) shall be held in the Restricted Account or in an investment
account in which the Agent has a first priority perfected lien until needed by
the Company in the ordinary course of its business (including making
expenditures and investments permitted by this Agreement), and all such amounts
shall be held by the Agent as additional collateral security for any other
remaining indebtedness, obligations and liabilities of the Company under the
Loan Documents. The Agent shall not in any event setoff any amount at any time
on deposit in the Restricted Account or any such investment account against any
indebtedness, obligations and liabilities of the Company to it except for any
such arising under the Loan Documents.
Section 2.7. Terminations. The Company shall have the right at any time
upon thirty (30) days' prior notice to the Agent to terminate the unused
Revolving Credit in whole or in part (and if in part, in a minimal amount of
$1,000,000 or any integral multiple thereof), provided, however, that the
Company may not terminate any portion of the Revolving Credit which remains
available for payment under any L/C. Not later than the termination date
stated in such notice, the Company shall prepay Reimbursement Obligations and
the Revolving Notes in an aggregate principal amount equal to the excess, if
any, of all amounts outstanding under the Revolving Credit (including the
amount of outstanding L/Cs) over the Revolving Credit in effect after
giving effect to such reduction, subject to the terms of Section 9.4 hereof,
and shall also pay the interest on such principal amount and accrued and
unpaid commitment fees thereon to such termination date.
SECTION 3. PLACE AND APPLICATION OF PAYMENTS.
All amounts payable by the Company hereunder, shall be made to the Agent
at its office at 111 West Monroe Street, Chicago, Illinois 60690 and in
immediately available funds, prior to 12:00 noon on the date of such payment.
All such payments shall be made without setoff or counterclaim and without
reduction for, and free from, any and all present and future levies, imposts,
duties, fees, charges, deductions withholdings, restrictions or
-10-
<PAGE> 18
conditions of any nature imposed by any government or any political
subdivision or taxing authority thereof. Unless the Banks otherwise agree, any
payments received after 12:00 noon Chicago time shall be deemed received on the
following Business Day. The Agent shall remit to each Bank its proportionate
share of each payment of principal, interest and commitment fees and L/C
Issuance Fees received by the Agent by 3:00 P.M. Chicago time on the same day
of its receipt if received by the Agent by 12:00 noon, Chicago time, and its
proportionate share of each such payment received by the Agent after 12:00 noon
on the Business Day following its receipt by the Agent. In the event the Agent
does not remit any amount to any Bank when required by the preceding sentence,
the Agent shall pay to such Bank interest on such amount until paid at a rate
per annum equal to the Fed Funds Rate. In addition to the Agent's rights under
Section 2.6 hereof, the Company hereby authorizes the Agent to automatically
debit its account with Harris for any principal, interest and fees when due
under the Notes, any L/C Agreement or this Agreement and to transfer the amount
so debited from such account to the Agent for application as herein provided.
All proceeds of Collateral shall be applied in the manner specified in Section
2.6 hereof and in the Security Agreement.
SECTION 4. DEFINITIONS.
Section 4.1. Certain Terms Defined. The terms hereinafter set forth
when used herein shall have the following meanings:
"Account Debtor" shall mean the Person who is obligated on a Receivable.
"Adjusted Eurodollar Rate" means a rate per annum determined pursuant to
the following formula:
Adjusted Eurodollar Rate = Eurodollar Rate
--------------------------
100% - Reserve Percentage
"Affiliate" shall mean any person, firm or corporation which, directly or
indirectly controls, or is controlled by, or is under common control with, the
Company.
"Agent" is defined in the first paragraph of this Agreement.
"Agreement" shall mean this Secured Credit Agreement as supplemented,
modified, restated and amended from time to time.
"Applicable Rate" shall mean, with respect to each type of Loan described
in each row below and the commitment fee payable pursuant to Section 2.1
hereof, (a) from the date of this Agreement through May 31, 1996, the rates set
forth in Column C below, and (b) after May 31, 1996, the rate of interest per
annum shown in Columns A, B and C below for the range of Leverage Ratio
specified for each Column:
-11-
<PAGE> 19
<TABLE>
<CAPTION>
A B C
<S> <C> <C> <C>
LEVERAGE <50% >50% and < >60%
RATIO - 60% -
DOMESTIC RATE 0% 0% .50%
LOANS
EURODOLLAR 1.25% 1.75% 2.00%
LOANS
COMMITMENT 0.20% 0.25% 0.375%
FEE
</TABLE>
Not later than 5 Business Days after receipt by the Agent of the
financial statements called for by Section 7.4(a) or (b) hereof for the last
month of the applicable fiscal quarter, the Agent shall determine the Leverage
Ratio for the applicable period and shall promptly notify the Company and the
Banks of such determination and of any change in the Applicable Rate resulting
therefrom. Any such change in the Applicable Rate shall be effective as of the
date the Agent so notifies the Company and the Banks with respect to all Loans
outstanding on such date and the commitment fee, and such new Applicable Rate
shall continue in effect until the effective date of the next quarterly
redetermination in accordance with this Section. Each determination of the
Leverage Ratio and Applicable Rate by the Agent in accordance with this Section
shall be conclusive and binding on the Company and the Banks absent manifest
error.
"Bank" and "Banks" shall have the meanings specified in the first
paragraph of this Agreement.
"Borrowing Base", as determined by the Agent on the basis of the
information contained in the most recent Borrowing Base Certificate and any
other information available to the Agent, shall mean an amount equal to:
(a) 85% of the amount of Eligible Receivables, plus
(b) 65% of the Value of Eligible Inventory, minus
(c) the aggregate outstanding amount of all Secured
Grower Payables, minus
(d) any storage fees relating to Inventory that remain
unpaid after their due date.
"Borrowing Base Certificate" shall mean the certificate in the form of
Exhibit D hereto which is required to be delivered to the Banks in accordance
with Section 7.4(d) hereof.
-12-
<PAGE> 20
"Business Day" shall mean a day on which banks are open for business
in Chicago, Illinois, other than a Saturday or Sunday, and, with respect to
Eurodollar Loans, dealing in United States Dollar deposits in London, England
and Nassau, Bahamas.
"Capitalized Lease" shall mean, as applied to any Person, any lease of
any Property the discounted present value of the rental obligations of such
person as lessee under which, in accordance with generally accepted accounting
principles, is required to be capitalized on the balance sheet of such Person.
"Capitalized Lease Obligation" shall mean, as applied to any Person,
the discounted present value of the rental obligation, as aforesaid, under any
Capitalized Lease.
"Change in Law" shall have the meaning specified in Section 9.3 hereof.
"Change of Control" shall mean at any time any person or group of
persons (within the meaning of Section 13 or 14 of the Securities and Exchange
Act of 1934, as amended) acquires legal or beneficial ownership (within the
meaning of Rule 13d-3 promulgated by the SEC under said Act) of 20% or more in
voting power of the outstanding voting stock of the Company.
"Collateral" shall mean the collateral security provided to the Agent
for the benefit of the Banks pursuant to the Security Agreement.
"Commitment Percentage" shall have the meaning set forth in Section
1.8 hereof.
"Company" shall have the meaning specified in the first paragraph of
this Agreement.
"Consolidated Subsidiary" shall mean any Subsidiary whose accounts are
consolidated with those of the Company in accordance with generally accepted
accounting principles.
"control" or "controlled by" or "under common control" shall mean
possession, directly or indirectly, of power to direct or cause the direction
of management or policies (whether through ownership of voting securities, by
contract or otherwise); provided that, in any event any Person which
beneficially owns, directly or indirectly, 10% or more (in number of votes) of
the securities having ordinary voting power for the election of directors of a
corporation shall be conclusively presumed to control such corporation, and
provided further that any Consolidated Subsidiary shall be conclusively
presumed to be controlled by the Company.
"Current Assets" shall mean the aggregate amount of assets of the
Company and its Consolidated Subsidiaries which in accordance with generally
accepted accounting principles may be properly classified as current assets
after deducting adequate reserves where proper.
"Current Liabilities" shall mean all items (including taxes accrued as
estimated) of the Company and its Consolidated Subsidiaries which in accordance
with generally accepted accounting principles may be properly classified as
current liabilities, but excluding in any
-13-
<PAGE> 21
event all amounts outstanding from time to time under this Agreement which are
not required to be prepaid under Section 7.25 hereof.
"Debt" of any Person shall mean as of any time the same is to be
determined, the aggregate of:
(a) all indebtedness, obligations and liabilities of such
Person with respect to borrowed money (including by the issuance of
debt securities);
(b) all guaranties, endorsements and other contingent
obligations of such Person with respect to indebtedness arising
from money borrowed by others;
(c) all reimbursement obligations with respect to letters
of credit, bankers acceptances, customer advances and other
extensions of credit whether or not representing obligations for
borrowed money;
(d) the aggregate of the principal components of all
Capitalized Lease Obligations;
(e) all indebtedness, obligations and liabilities
representing the deferred purchase price of property or services; and
(f) all indebtedness secured by a lien on the Property
of such Person, whether or not such Person has assumed or become
liable for the payment of such indebtedness.
"Domestic Rate" means for any day the rate of interest announced by
Harris from time to time as its prime commercial rate in effect on such day,
with any change in the Domestic Rate resulting from a change in said prime
commercial rate to be effective as of the date of the relevant change in said
prime commercial rate (the "Harris Prime Rate"), provided that if the rate per
annum determined by adding 1/2 of 1% to the rate at which Harris would offer to
sell federal funds in the interbank market on or about 10:00 a.m. (Chicago
time) on any day (the "Adjusted Fed Funds Rate") shall be higher than the
Harris Prime Rate on such day, then the Domestic Rate for such day and for any
succeeding day which is not a Business Day shall be such Adjusted Fed Funds
Rate. The Agent shall give notice to each Bank of any period when the Domestic
Rate is based on the Adjusted Fed Funds Rate. The determination of the
Adjusted Fed Funds Rate by Harris shall be final and conclusive except in the
case of manifest error or willful misconduct.
"Domestic Rate Loan" means a Revolving Credit Loan which bears
interest as provided in Section 1.3(a) hereof.
"Eligible Inventory" shall mean any Inventory of the Company itself in
which the Agent has a first priority perfected security interest, which the
Agent in its sole judgment deems to be acceptable for inclusion in the
Borrowing Base and which complies with each of the following requirements:
-14-
<PAGE> 22
(a) it consists solely of canned and frozen vegetables
produced or acquired in the ordinary course of business;
(b) it is not obsolete, and is readily usable or salable
by the Company in the ordinary course of its business;
(c) it substantially conforms to the advertised or
represented specifications and other quality standards of the Company,
and has not been determined by the Agent to be unacceptable due to age
and/or quality;
(d) all warranties as set forth in this Agreement and the
Security Agreement are true and correct with respect thereto;
(e) it has been identified to the Agent in the manner
prescribed pursuant to the Security Agreement;
(f) it is located at a location within the United States
disclosed to the Agent and approved by the Agent and, if requested by
the Agent, any Person (other than the Company) owning or controlling
such location disclosed to the Agent shall have waived all right,
title and interest in and to such Inventory, except for any interest
securing only accrued and unpaid storage fees, in a manner
satisfactory to the Agent;
(g) the purchase price therefor has not been prepaid in
whole or in part; and
(h) the Company has not received a notice from any
governmental agency or other party claiming or indicating the
existence of a lien or other interest therein.
"Eligible Receivables" shall mean any Receivable of the Company itself
in which the Agent has a first priority perfected security interest, which the
Agent, in its sole judgment deems to be acceptable for inclusion in the
Borrowing Base and which complies with each of the following requirements:
(a) It arises out of a bona fide rendering of services or
sale of goods sold and delivered by or on behalf of the Company to, or
in the process of being delivered by or on behalf of the Company to,
the Account Debtor on said Receivables;
(b) all warranties set forth in this Agreement and the
Security Agreement are true and correct with respect thereto;
(c) it has been identified to the Agent in a manner
satisfactory to the Agent;
(d) it is evidenced by an invoice (dated not later than
30 days after the date of shipment or performance of services)
rendered to the Account Debtor thereunder;
(e) such Receivable shall not remain unpaid more than 120
days following its invoice date;
-15-
<PAGE> 23
(f) it is not owing by an Account Debtor who shall have
failed to pay 25% or more of all Receivables owed by such Account
Debtor within 90 days after their respective due dates or who has
become insolvent or is the subject of any bankruptcy, arrangement,
reorganization proceedings or other proceedings for relief of debtors;
(g) it is payable in U.S. Dollars;
(h) it is not owing by the United States of America or
any department, agency or instrumentality thereof unless the Company
shall have provided evidence satisfactory to the Agent of compliance
with the Assignment of Claims Act, or by any state or local government
unless the Company shall provide evidence satisfactory to the Agent of
compliance with any similar state or local statute;
(i) it is not owing by any Account Debtor located outside
of the United States, unless such Receivable is supported by a
transferable irrevocable letter of credit in form and substance and
issued by a bank satisfactory to the Agent, and which letter of credit
will be assigned or transferred to the Agent upon the Agent's request;
(j) it is net of any credit or allowance given by the
Company to such Account Debtor;
(k) the Receivable is not subject to any counterclaim or
defense asserted by the Account Debtor thereunder, nor is it subject
to any offset or contra account payable to the Account Debtor (in any
case, unless the amount of such Receivable is net of such
counterclaim, defense, offset or contra account);
(1) it is not owing by an Account Debtor that is an
Affiliate of the Company;
(m) it is net of any payment or prepayment made by the
Account Debtor thereon; and
(n) the Company has not received any notice from any
governmental agency or other party claiming or indicating the
existence of a lien or other interest therein.
"Environmental Laws" shall mean all federal, state and local
environmental, health and safety statutes and regulations, including without
limitation all statutes and regulations establishing quality criteria and
standards for air, water, land and toxic or hazardous wastes and substances.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Eurodollar Loan" shall mean a Revolving Credit Loan which bears
interest as provided in Section 1.3(b) hereof.
-16-
<PAGE> 24
"Eurodollar Rate" shall mean for each Interest Period applicable to a
Eurodollar Loan, (a) the LIBOR Index Rate for such Interest Period, if such
rate is available, and (b) if the LIBOR Index Rate cannot be determined, the
arithmetic average of the rates of interest per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) at which deposits in U.S. dollars in
immediately available funds are offered to the Agent at 11:00 a.m. (London,
England time) two (2) Business Days before the beginning of such Interest
Period by three (3) or more major banks in the interbank eurodollar market
selected by the Agent for a period equal to such Interest Period and in an
amount equal or comparable to the principal amount of the Eurodollar Loan
scheduled to be made by the Agent during such Interest Period.
"Event of Default" shall mean any event or condition identified as
such in Section 8.1 hereof.
"Existing Agreement" shall have the meaning specified in Section 1. 1
(e) hereof.
"Existing Lenders" shall have the meaning specified in Section 1.1(e)
hereof.
"Fed Funds Rate" shall have the meaning specified in Section 1.5(c)
hereof.
"Funded Debt," with respect to any Person shall mean all indebtedness
for borrowed money of such Person and with respect to the Company all
indebtedness for borrowed money of the Company, in each case maturing by its
terms more than one year after, or which is renewable or extendible at the
option of such Person for a period ending one year or more after, the date of
determination, and shall include indebtedness for borrowed money of such
maturity created, assumed or guaranteed by such Person either directly or
indirectly, including obligations of such maturity secured by liens upon
Property of such Person and upon which such entity customarily pays the
interest, and all rental payments under Capitalized Leases of such maturity;
provided, however, that with respect to amounts outstanding under this
Agreement the term "Funded Debt" shall include the lesser of amounts
outstanding from time to time under this Agreement or amounts not required to
be prepaid under Section 7.25 hereof.
"Harris" shall have the meaning specified in the first paragraph of
this Agreement.
"Intangible Assets" shall mean license agreements, trademarks, trade
names, patents, capitalized research and development, proprietary products (the
results of past research and development treated as long term assets and
excluded from Inventory) and goodwill (all determined on a consolidated basis
in accordance with generally accepted accounting principles consistently
applied).
"Interest Period" shall mean with respect to the Eurodollar Loans, the
period used for the computation of interest commencing on the date the relevant
Eurodollar Loan is made, continued or effected by conversion and concluding on
the date one, two, three or six months thereafter as selected by the Company in
its notice as provided herein; provided that all of the foregoing provisions
relating to Interest Periods are subject to the following:
-17-
<PAGE> 25
(i) if any Interest Period would otherwise end on a day which is
not a Business Day, that Interest Period shall be extended to the next
succeeding Business Day, unless in the case of an Interest Period for a
Eurodollar Loan the result of such extension would be to carry such
Interest Period into another calendar month in which event such Interest
Period shall end on the immediately preceding Business Day;
(ii) no Interest Period may extend beyond the final maturity date of
the Revolving Notes;
(iii) the interest rate to be applicable to each Loan for each
Interest Period shall apply from and including the first day of such
Interest Period to but excluding the last day thereof; and
(iv) no Interest Period may be selected if after giving effect
thereto the Company will be unable to make a principal payment scheduled
to be made during such Interest Period without paying part of a Eurodollar
Loan on a date other than the last day of the Interest Period applicable
thereto.
For purposes of determining an Interest Period, a month means a period starting
on one day in a calendar month and ending on a numerically corresponding day in
the next calendar month, provided, however, if an Interest Period begins on the
last day of a month or if there is no numerically corresponding day in the
month in which an Interest Period is to end, then such Interest Period shall
end on the last Business Day of such month.
"Inventory" shall mean all raw materials, work in process, finished goods,
and goods held for sale or lease or furnished or to be furnished under
contracts of service in which the Company or any Subsidiary now has or
hereafter acquires any right.
"L/C" shall have the meaning set forth in Section 1.6 hereof.
"L/C Agreement" shall have the meaning set forth in Section 1.6 hereof.
"L/C Administrative Fee" has the meaning specified in Section 1.6 hereof.
"L/C Issuance Fee" has the meaning specified in Section 1.6 hereof.
"Leverage Ratio" shall mean the ratio for the Company and its Consolidated
Subsidiaries of (a) the aggregate outstanding principal amount of all Funded
Debt to (b) the sum of the aggregate outstanding principal amount of all
Funded Debt plus Tangible Net Worth.
"LIBOR Index Rate" shall mean, for any Interest Period applicable to a
Eurodollar Loan, the rate per annum (rounded upwards, if necessary, to the next
higher one hundred/thousandth of a percentage point) for deposits in U.S.
Dollars for a period equal to such Interest Period, which appears on the
Telerate Page 3750 as of 11:00 a.m. (London, England time) on the day two
Business Days before the commencement of such Interest Period.
-18-
<PAGE> 26
"License Agreement" shall have the meaning specified in Section 6.2(c)
hereof.
"Loan" shall mean a Revolving Credit Loan and the term "Loans" shall mean
any two or more Revolving Credit Loans collectively.
"Loan Documents" shall mean this Agreement and any and all exhibits
hereto, the Revolving Notes, the L/C Agreements, the Trademark Agreement, the
License Agreements and the Security Agreement.
"Net Income" shall mean the net income of the Company and its Consolidated
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles, consistently applied.
"Net Working Capital" shall mean the excess of Current Assets over Current
Liabilities.
"Net Worth" shall mean the Total Assets minus the Total Liabilities of the
Company and its Consolidated Subsidiaries, all determined on a consolidated
basis in accordance with generally accepted accounting principles, consistently
applied.
"Obligations" means all fees payable hereunder, all obligations of the
Company to pay principal or interest on Loans and Reimbursement Obligations and
all other payment obligations of the Company arising under or in relation to
any Loan Document.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Person" shall mean and include any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization, association,
corporation, institution, entity, party or government (whether national,
federal, state, county, city, municipal, or otherwise, including, without
limitation, any instrumentality, division, agency, body or department thereof).
"Plan" shall mean any employee benefit plan covering any officers or
employees of the Company or any Subsidiary, any benefits of which are, or are
required to be, guaranteed by the PBGC.
"Potential Default" shall mean any event or condition which, with the
lapse of time, or giving of notice, or both, would constitute an Event of
Default.
"Property" shall mean any interest in any kind of property or asset,
whether real, personal or mixed or tangible or intangible.
"Receivables" shall mean all accounts, contract rights, instruments,
documents, chattel paper and general intangibles in which the Company now has
or hereafter acquires any right.
-19-
<PAGE> 27
"Reimbursement Obligation" has the meaning specified in Section 1.7 hereof.
"Required Banks" shall mean any Bank or Banks which in the aggregate hold
at least 66-2/3% of the aggregate unpaid principal balance of the Loans and
Reimbursement Obligations or, if no Loans or Reimbursement Obligations are
outstanding hereunder, any Bank or Banks in the aggregate having at least
66-2/3% of the Revolving Credit Commitments.
"Reserve Percentage" means the daily arithmetic average maximum rate at
which reserves (including, without limitation, any supplemental, marginal and
emergency reserves) are imposed on member banks of the Federal Reserve System
during the applicable Interest Period by the Board of Governors of the Federal
Reserve System (or any successor) under Regulation D on "eurocurrency
liabilities" (as such term is defined in Regulation D), subject to any
amendments of such reserve requirement by such Board or its successor, taking
into account any transitional adjustments thereto. For purposes of this
definition, the Eurodollar Loans shall be deemed to be eurocurrency liabilities
as defined in Regulation D without benefit or credit for any prorations,
exemptions or offsets under Regulation D.
"Restricted Account" shall have the meaning set forth in Section 2.6 hereof.
"Revolving Credit" shall have the meaning specified in the first paragraph
of this Agreement.
"Revolving Credit Commitment" and "Revolving Credit Commitments" shall have
the meanings specified in Section 1. 1 (c) hereof.
"Revolving Credit Loan" and "Revolving Credit Loans" shall have the
meanings specified in Section 1.1(a) hereof.
"Revolving Note" or "Revolving Notes" shall have the meanings specified in
Section 1.1(d) hereof.
"Secured Grower Payables" shall mean all amounts owed from time to time by
the Company to any Person on account of the purchase price of agricultural
products or services if the Agent reasonably determines that such Person is
entitled to the benefits of any grower's lien, statutory trust or similar
security arrangements to secure the payment of any amounts owed to such Person.
"Security Agreement" shall have the meaning specified in Section 1.10
10 hereof.
"Senior Secured Notes" shall mean the Company's 9.37% Senior Secured Notes
maturing January 15, 2000 and the Company's 9.74% Senior Secured Notes
maturing December 15, 2001.
"Subsidiary" shall mean collectively any corporation or other entity at
least a majority of the outstanding voting equity interests (other than
directors' qualifying shares) of which is
-20-
<PAGE> 28
at the time owned directly or indirectly by the Company or by one of more
Subsidiaries or by the Company and one or more Subsidiaries.
"Tangible Net Worth" shall mean the Net Worth minus the amount of all
Intangible Assets of the Company and its Consolidated Subsidiaries, determined
on a consolidated basis in accordance with generally accepted accounting
principles, consistently applied.
"Telerate Page 3750" shall mean the display designated as "Page 3750" on
the Telerate Service (or such other page as may replace Page 3750 on that
service or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar deposits).
"Termination Date" shall have the meaning set forth in Section 1.1(a)
hereof.
"Total Assets" shall mean at any date, the aggregate amount of assets of
the Company and its Consolidated Subsidiaries determined on a consolidated
basis in accordance with generally accepted accounting principles consistently
applied.
"Total Liabilities" shall mean at any date, the aggregate amount of all
liabilities of the Company and its Consolidated Subsidiaries determined on a
consolidated basis in accordance with generally accepted accounting principles,
consistently applied.
"Trademark Agreement" shall have the meaning specified in Section 6.2(d)
hereof.
"Value of Eligible Inventory" shall mean as of any given date with respect
to Eligible Inventory an amount equal to the lower of average cost or market
value.
Section 4.2. Accounting Terms. Any accounting term or the character or
amount of any asset or liability or item of income or expense required to be
determined under this Agreement, shall be determined or made in accordance with
generally accepted accounting principles at the time in effect, to the extent
applicable, except where such principles are inconsistent with the requirements
of this Agreement.
SECTION 5. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to the Banks as to itself and, where
the following representations and warranties apply to Subsidiaries, as to each
of its Subsidiaries, as follows:
Section 5.1. Organization and Qualification. The Company is a corporation
duly organized and existing and in good standing under the laws of the State of
Wisconsin, has full and adequate corporate power to carry on its business as
now conducted, is duly licensed or qualified in all jurisdictions wherein the
nature of its activities requires such licensing or qualification except where
the failure to be so licensed or qualified would not have a material adverse
effect on the financial condition, Property, business or operations of the
-21-
<PAGE> 29
Company and its Subsidiaries taken as a whole, and has full right and authority
to enter into this Agreement and the other Loan Documents, to make the
borrowings herein provided for, to issue the Notes in evidence thereof, to
encumber its assets as security for its Obligations under the Loan Documents,
and to perform each and all of the matters and things herein and therein
provided for.
Section 5.2. Subsidiaries. Schedule 5.2 hereto identifies each Subsidiary,
joint venture, and entity in which the Company or any Subsidiary has a
minority interest, the jurisdiction of its incorporation or organization,
as the case may be, the percentage of issued and outstanding shares of each
class of its capital stock or other equity interest owned by the Company and
the Subsidiaries and, if such percentage is not 100% (excluding directors'
qualifying shares as required by law), a description of each class of its
authorized capital stock and other equity interests and the number of shares of
each class issued and outstanding. From the date any Subsidiary exists, each
Subsidiary is duly incorporated and existing in good standing as a corporation
under the laws of the jurisdiction of its incorporation, has all necessary
corporate power to carry on its present business, and is duly licensed or
qualified and in good standing in each jurisdiction in which the nature of the
business transacted by it or the nature of the Property owned or leased by it
makes such licensing or qualification necessary and in which the failure to be
so licensed or qualified would have a material adverse effect on the financial
condition, or the Property, business or operations, of the Company and its
Subsidiaries taken as a whole. All of the issued and outstanding shares of
capital stock of each Subsidiary are validly issued and outstanding and fully
paid and non assessable and all such shares owned by the Company are owned
beneficially and of record, free of any lien. None of the Company's
Subsidiaries currently conducts any business or operations, and none of the
Company's Subsidiaries owns any Property except that (a) Stokely U.K. Limited
acts as the Company's sales representative in the United Kingdom and may from
time to time have current assets with an aggregate fair market value not in
excess of $1,500,000, and (b) Ocono International, Ltd. is a foreign sales
corporation for the Company and may from time to time have assets with an
aggregate fair market value not in excess of $100,000.
Section 5.3. Financial Reports. The Company has heretofore delivered to
the Agent a copy of the Audit Report as of March 31, 1994 of the Company and
its Subsidiaries prepared by Deloitte Touche LLP, unaudited financial
statements (including a balance sheet, statement of income, statement of cash
flows and comparison to the comparable prior year period) of the Company and
its Subsidiaries as of, and for the period ending December 31, 1994, and
unaudited financial statements (including a balance sheet, statement of income,
statement of cash flows and comparison to the comparable prior year period) of
the Company and its Subsidiaries as of, and for the fiscal year ending, March
31, 1995. Such audited financial statements have been prepared in accordance
with generally accepted accounting principles on a basis consistent, except as
otherwise noted therein, with that of the previous fiscal year or period and
fairly reflect the financial position of the Company and its Subsidiaries as of
the dates thereof, and the results of its operations for the periods covered
thereby. The Company and its Subsidiaries have no material contingent
liabilities other than as indicated on said financial statements and since said
date of March 31, 1994 there has been no material adverse change in the
condition, financial or otherwise, of the Company or
-22-
<PAGE> 30
any Subsidiary that has not been disclosed in writing to the Banks prior to the
initial Loan or L/C issuance.
Section 5.4. Litigation; Tax Returns; Approvals. There is no
litigation or governmental proceeding pending, nor to the knowledge of the
Company threatened, against the Company or any Subsidiary which, if adversely
determined, is likely to result in any material adverse change in the
Properties, business, financial condition and operations of the Company or any
Subsidiary, except as disclosed on Schedule 5.4 hereto. All income tax returns
for the Company required to be filed have been filed on a timely basis, and all
amounts required to be paid as shown by said returns have been paid. There are
no pending or, to the best of the Company's knowledge, threatened objections to
or controversies in respect of the United States federal income tax returns of
the Company for any fiscal year. No authorization, consent, license, exemption
or filing (other than the filing of financing statements) or registration with
any court or governmental department, agency or instrumentality, is or will be
necessary to the valid execution, delivery or performance by the Company of the
Loan Documents.
Section 5.5. Regulation U. Neither the Company nor any Subsidiary is
engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System); no part of the proceeds of any Loan
made or any L/C issued hereunder will be used to purchase or carry any margin
stock or to extend credit to others for such a purpose; and neither the making
of any Loan or the issuance of any L/C hereunder, nor the use of the proceeds
thereof, will violate the provisions of Regulations G, T, U or X of the Board
of Governors of the Federal Reserve System.
Section 5.6. No Default. As of the date of this Agreement, the
Company is in full compliance with all of the terms and conditions of this
Agreement, and no Potential Default or Event of Default is existing under this
Agreement.
Section 5.7. ERISA. The Company and its Subsidiaries are in
compliance in all material respects with ERISA to the extent applicable to them
and have received no notice to the contrary from the PBGC or any other
governmental entity or agency.
Section 5.8. Security Interests and Debt. There are no security
interests, liens or encumbrances on any of the Property of the Company or any
Subsidiary except such as are permitted by Section 7.13 of this Agreement, and
the Company and its Subsidiaries have no Debt except such as is permitted by
Section 7.14 of this Agreement.
Section 5.9. Accurate Information. No information, exhibit or report
furnished by the Company to the Banks in connection with the negotiation of
the Loan Documents contained any material misstatement of fact or omitted to
state a material fact or any fact necessary to make the statements contained
therein not misleading in light of the circumstances in which made. The
financial projections furnished by the Company to the Banks contain to the
Company's knowledge and belief, reasonable projections as of the date hereof
of future results of operations and financial position of the Company and its
-23-
<PAGE> 31
Subsidiaries. As of the date hereof, there is no material inaccuracy in,
material omission from, or material change in, the information contained in
said projections.
Section 5.10. Corporate Authority and Validity of Obligations. The
Company has full right and authority to enter into this Agreement and the
other Loan Documents to which it is a party, to make the borrowings herein
provided for, to issue its Notes in evidence thereof, and to perform all of
its obligations in connection therewith and to perform all of its obligations
under the Loan Documents to which it is a party; each Loan Document to which
it is a party has been duly authorized, executed and delivered by the
Company and constitutes valid and binding obligations of the Company
enforceable in accordance with its terms; and no Loan Document, nor the
performance or observance by the Company of any of the matters or things
therein provided for, contravenes any provision of law or any charter or
by-law provision of the Company or (individually or in the aggregate) any
material covenant, indenture or agreement of or affecting the Company or
any of its Properties or results in or requires the creation or imposition of
any lien on any of the Properties or revenues of the Company.
Section 5.11. Compliance with Laws. The Company and its Subsidiaries
each are in compliance with the requirements of all federal, state and local
laws, rules and regulations applicable to or pertaining to their Properties
or business operations (including, without limitation, the Occupational Safety
and Health Act of 1970, the Americans with Disabilities Act of 1990, and
Environmental Laws), non-compliance with which could have a material adverse
effect on the financial condition, Properties, business or operations of the
Company or any Subsidiary. Neither the Company nor any Subsidiary has
received notice to the effect that its operations are not in compliance
with any of the requirements of applicable Environmental Laws or are the
subject of any governmental investigation evaluating whether any remedial
action is needed to respond to a release of any toxic or hazardous waste or
substance into the environment, which non-compliance or remedial action could
have a material adverse effect on the financial condition, Properties,
business or operations of the Company or any Subsidiary.
Section 5.12. Restrictive Agreements. Neither the Company nor any
Subsidiary is a party to any contract or agreement, or subject to any charge or
other corporate restriction, which affects its ability to execute, deliver and
perform the Loan Documents to which it is a party and repay its indebtedness,
obligations and liabilities under the Loan Documents or which materially and
adversely affects or, insofar as the Company can reasonably foresee, could
materially and adversely affect, the Property, business, operations or
condition (financial or otherwise) of the Company or any of its
Subsidiaries, or would in any respect materially and adversely affect the
Collateral, the repayment of the indebtedness, obligations and liabilities
under the Loan Documents, or any Bank's or the Agent's rights under the Loan
Documents.
Section 5.13. No Default under Other Agreements. Neither the
Company nor any Subsidiary is in default with respect to any note,
indenture, loan agreement, mortgage, lease, deed, or other agreement to
which it is a party or by which it or its Property is bound, which default
might materially and adversely affect the Collateral, the repayment of the
-24-
<PAGE> 32
indebtedness, obligations and liabilities under the Loan Documents, any
Bank's or the Agent's rights under the Loan Documents or the Property,
business, operations or condition (financial or otherwise) of the Company or
any Subsidiary.
Section 5.14. Status under Certain Laws. Neither the Company nor
any of its Subsidiaries is an "investment company" or a person directly or
indirectly controlled by or acting on behalf of an "investment company" within
the meaning of the Investment Company Act of 1940, as amended, or a "holding
company," or a "subsidiary company" of a "holding company," or an "affiliate"
of a "holding company" or a "subsidiary company" of a "holding company,"
within the meaning of the Public Utility Holding Company Act of 1935, as
amended.
Section 5.15. Federal Food Security Act. The Company has received no
notice given pursuant to Section 1324(e)(1) or (3) of the Federal Food
Security Act and there has not been filed any financing statement or notice,
purportedly in compliance with the provisions of the Federal Food Security
Act, purporting to perfect a security interest in farm products purchased by
the Company in favor of a secured creditor of the seller of such farm
products. The Company has registered, pursuant to Section 1324(c)(2)(D) of
the Federal Food Security Act, with the Secretary of State of each State
in which are produced farm products purchased by the Company and which
has established or hereafter establishes a central filing system, as a
buyer of farm products produced in such State; and each such registration
is in full force and effect. The states in which the Company buys farm
products as of the date of this Agreement, whether such states have
established a central filing system under the Federal Food Security Act as of
the date of this Agreement, and the states in which the Company has registered
pursuant to the Federal Food Security Act as of the date of this Agreement, are
set forth on Schedule 5.15 hereto.
SECTION 6. CONDITIONS PRECEDENT.
The obligation of the Banks to make any Loan or issue any L/C pursuant
hereto shall be subject to the following conditions precedent:
Section 6.1. General. The Agent shall have received the notice of
borrowings and the Revolving Notes hereinabove provided for.
Section 6.2. Initial Extension of Credit. Prior to the initial Loan
or L/C hereunder, the Company shall have delivered the required Borrowing
Base Certificate to the Agent, and shall have delivered to the Agent for the
benefit of the Banks in sufficient counterparts for distribution to the
Banks:
(a) a fully executed counterpart of this Agreement;
(b) a fully executed Security Agreement;
(c) a fully executed License Agreement from each of the
Company's Subsidiaries (the "License Agreements"):
-25-
<PAGE> 33
(d) a fully executed Trademark Collateral Agreement from the
Company to the Agent (the "Trademark Agreement");
(e) evidence that the holders of the Senior Secured Notes
have released all of their liens and security interest in the
Collateral and the current assets of the Company and its Subsidiaries;
(f) appropriate forms of financing statements to perfect the
security interest of the Agent provided for by the Security Agreement;
(g) evidence of insurance required by Section 7.3 hereof and
by the Security Agreement showing the Agent as loss payee thereunder;
(h) a good standing certificate or certificate of existence
for the Company, dated as of the date no earlier than 30 days prior
to the date hereof, from the office of the secretary of state of the
state of its incorporation and each state in which it is qualified to
do business as a foreign corporation;
(i) copies of the Certificate of Incorporation, and all
amendments thereto, of the Company certified by the office of the
secretary of state of its state of incorporation as of the date no
earlier than the date 30 days prior to the date hereof,
(j) copies of the By-Laws, and all amendments thereto, of
the Company, certified as true, correct and complete on the date
hereof by the Secretary of the Company;
(k) copies, certified by the Secretary or Assistant
Secretary of the Company of resolutions regarding the transactions
contemplated by this Agreement, duly adopted by the Board of Directors
of the Company and satisfactory in form and substance to all of the
Banks;
(l) an incumbency and signature certificate for the Company
satisfactory in form and substance to all of the Banks;
(m) a pay-off letter satisfactory in form and substance
to all of the Banks from Shawmut Capital Corporation as agent for
the Existing Lenders together with lien releases relating to all
liens in favor of such agent for the Existing Lenders or any
security trustee or agent on their behalf;
(n) the Agent's fees payable under Section 2.2 hereof and
the closing fee payable pursuant to Section 2.5 of this Agreement;
(o) the results of a field audit of the Collateral; and
(p) such other documents as the Banks may reasonably require.
-26-
<PAGE> 34
Section 6.3. Each Extension of Credit. As of the time of the making of
each Loan and the issuance of each L/C hereunder (including the initial Loan
or L/C, as the case may be):
(a) each of the representations and warranties set forth in
Section 5 hereof shall be and remain true and correct as of said time
as if made at said time, except that, the representations and
warranties made under Section 5.3 shall be deemed to refer to the most
recent financial statements furnished to the Banks pursuant to Section
7.4 hereof;
(b) the Company shall be in full compliance with all of the
terms and conditions hereof, and no Potential Default or Event of
Default shall have occurred and be continuing;
(c) after giving effect to the requested extension of
credit and to each Loan that has been made, and L/C issued
hereunder, the aggregate principal amount of all Loans, the amount
available for drawing under all L/Cs and the aggregate principal
amount of all Reimbursement Obligations then outstanding shall not
exceed the lesser of (i) the sum of the Banks' Revolving Credit
Commitments then in effect and (ii) the Borrowing Base, except as
otherwise agreed by the Company and all of the Banks; and
(d) no litigation involving the Company or any of its
Affiliates or Agent or any Bank shall be commenced, in process or
threatened, which, in the reasonable business judgment of any Bank,
threatens or challenges the financing contemplated by the Loan
Documents;
and the request by the Company for any Loan or L/C pursuant hereto shall be and
constitute a warranty to the foregoing effects.
Section 6.4. Legal Matters. Legal matters incident to the execution
and delivery of the Loan Documents shall be satisfactory to each of the Banks
and their legal counsel; and prior to the initial Loan or L/C hereunder,
the Agent shall have received the favorable written opinion of Michael Best
& Friedrich, counsel for the Company substantially in the form of Exhibit B,
in substance satisfactory to each of the Banks and their respective legal
counsel.
Section 6.5. Documents. The Agent shall have received copies
(executed or certified, as may be appropriate) of all documents or
proceedings taken in connection with the execution and delivery of the Loan
Documents to the extent any Bank or its respective legal counsel requests.
Section 6.6. Lien Searches. The Agent shall have received lien
searches showing that the Property of the Company is subject to no security
interest or liens except those permitted by Section 7.13 hereof.
-27-
<PAGE> 35
SECTION 7. COVENANTS.
It is understood and agreed that so long as credit is in use or
available under this Agreement or any amount remains unpaid on any Note,
Reimbursement Obligation or L/C, except to the extent compliance in any case or
cases is waived in writing by the Required Banks:
Section 7.1. Maintenance. The Company will, and will cause each
Subsidiary to, maintain, preserve and keep its plant, Properties and
equipment in good repair, working order and condition and will from time to
time make all needful and proper repairs, renewals, replacements, additions
and betterments thereto so that at all times the efficiency thereof shall
be preserved and maintained in all material respects, normal wear and tear
excepted.
Section 7.2. Taxes. The Company will, and will cause each Subsidiary
to, duly pay and discharge all taxes, rates, assessments, fees and
governmental charges upon or against the Company or its Subsidiaries or
against their respective Properties in each case before the same become
delinquent and before penalties accrue thereon unless and to the extent
that the same are being contested in good faith and by appropriate
proceedings diligently conducted and for which adequate reserves have been
established in accordance with generally accepted accounting principles,
provided that the Company shall pay or cause to be paid all such taxes,
rates, assessments, fees and governmental charges forthwith upon the
commencement of proceedings to foreclose any lien which is attached as security
therefor, unless such foreclosure is stayed by the filing of an appropriate
bond in a manner satisfactory to the Required Banks.
Section 7.3. Maintenance of Insurance. The Company will, and will
cause each Subsidiary to, maintain insurance coverage by good and responsible
insurance underwriters in such forms and amounts and against such risks and
hazards as are customary for companies engaged in similar businesses and
owning and operating similar Properties, and in any event, the Company
will insure any of its Property which is insurable against loss or damage
by fire, theft, burglary, pilferage and loss in transit, all in amounts and
under policies containing loss payable clauses to the Agent as its interest
may appear (and naming the Agent as additional insured therein) and providing
for advance notice to the Agent of cancellation thereof, issued by sound
and reputable insurers and all premiums thereon shall be paid by the
Company and certificates summarizing the same delivered to the Agent. The
Company shall in any event maintain insurance on the Collateral to the
extent required by the Security Agreement.
Section 7.4. Financial Reports. The Company will, and will cause
each Subsidiary to, maintain a standard and modern system of accounting in
accordance with sound accounting practice and will furnish to the Banks
and their duly authorized representatives such information respecting the
business and financial condition of the Company and its Subsidiaries as may be
reasonably requested and, without any request, will furnish to the Banks:
-28-
<PAGE> 36
(a) as soon as available, and in any event within (i) 60
days after the last day of every April, (ii) 45 days after the last
day of every May, and (iii) 35 days after the close of every
other monthly fiscal period of the Company, except March, a copy of
the consolidated balance sheet, statement of income, and statement
of cash flows, for such period of the Company and its Subsidiaries,
together with all such information for the year to date, all in
reasonable detail, prepared by the Company and certified on behalf of
the Company by the Company's chief financial officer;
(b) as soon as available, and in any event within 60 days
after the close of each fiscal year, a copy of the audit report for
such year and accompanying financial statements, including a
consolidated balance sheet, a consolidated statement of income and
retained earnings, and a consolidated statement of cash flows, together
with all footnotes thereto, for the Company and its Subsidiaries, in
each case, showing in comparative form the figures for the previous
fiscal year of the Company, all in reasonable detail, accompanied by
an unqualified opinion of Deloitte & Touche LLP or other independent
public accountants of nationally recognized standing selected by the
Company and satisfactory to the Agent, such opinion to indicate that
such statements are made in accordance with generally accepted
accounting principles;
(c) each of the financial statements furnished to the
Banks pursuant to paragraph (a) and (b) above shall be accompanied
by a Compliance Certificate in the form of Exhibit C hereto signed on
behalf of the Company by its chief financial officer;
(d) within 5 days after the end of each week (or at such
other intervals as the Company and the Agent may agree upon), (i)
a Borrowing Base Certificate in the form of Exhibit D hereto,
setting forth a computation of the Borrowing Base as of that week's
end date, certified as correct on behalf of the Company by the
Company's chief financial officer, (ii) an accounts receivable aging
report, grower payables report and inventory report each in form
satisfactory to the Agent, and (iii) written notice of the receipt
by the Company of any notice or claim of a lien or other interest with
respect to any Collateral;
(e) promptly upon their becoming available, copies of all
registration statements and regular periodic reports, if any, which
the Company shall have filed with the Securities and Exchange
Commission or any governmental agency substituted therefor, or any
national securities exchange, including copies of the Company's form
10-K annual report, including financial statements audited by
Deloitte & Touche LLC or other independent public accountants of
nationally recognized standing selected by the Company and
satisfactory to the Agent, its form 10-Q quarterly report to the
Securities and Exchange Commission and any Form 8-K filed by the
Company with the Securities and Exchange Commission;
(f) promptly upon the mailing thereof to the shareholders
of the Company generally, copies of all financial statements, reports
and proxy statements so mailed; and
-29-
<PAGE> 37
(g) as soon as available but in any event by June
30 of each year, a copy of the annual projections for the current
fiscal year of the Company.
Section 7.5. Inspection and Reviews. The Company shall, and shall
cause each Subsidiary to, permit the Agent, by its representatives and agents
(who may be accompanied by the Banks or their representatives and agents), to
inspect any of the properties, corporate books and financial records of the
Company and its Subsidiaries, to review and make copies of the books of
accounts and other financial records of the Company and its domestic
Subsidiaries, and to discuss the affairs, finances and accounts of the
Company and its Subsidiaries with, and to be advised as to the same by, its
officers at such reasonable times and intervals as the Agent may
designate. In addition to any other compensation or reimbursement to which
the Agent may be entitled under the Loan Documents, the Company shall pay to
the Agent from time to time upon demand the amount necessary to compensate the
Agent for all fees, charges and expenses incurred by it or its designees in
connection with the audits of Collateral, or inspections or review of the
books, records and accounts of the Company or any Subsidiary conducted by the
Agent.
Section 7.6. Consolidation and Merger. The Company will not, and will
not permit any Subsidiary to, consolidate with or merge into any Person, or
permit any other Person to merge into it, or acquire (in a transaction
analogous in purpose or effect to a consolidation or merger) all or
substantially all the Property or stock of the other Person, or acquire
substantially as an entirety the business of any other Person, provided,
however, that the Company or any Subsidiary may allow any other Person to merge
into it so long as:
(a) the Company or a Subsidiary shall be the surviving
entity;
(b) the entity merging into the Company or a Subsidiary
is in the same or a related line of business as the Company or
such Subsidiary; and
(c) after giving effect to such merger, no Potential
Default or Event of Default shall have occurred and be continuing and
the Banks shall have received a pro forma calculation of the covenants
contained in Sections 7.8, 7.9 and 7.10 hereof showing that the
Company is in compliance.
Section 7.7. Transactions with Affiliates. The Company will not, and
will not permit any Subsidiary to, enter into any transaction, including
without limitation, the purchase, sale, lease or exchange of any Property, or
the rendering of any service, with any Affiliate of the Company or such
Subsidiary except in the ordinary course of and pursuant to the reasonable
requirements of the Company's or such Subsidiary's business and upon fair and
reasonable terms not materially less favorable to the Company than would be
obtained in a comparable arm's-length transaction with a Person not an
Affiliate of the Company or such Subsidiary.
Section 7.8. Leverage Ratio. The Company will not permit its Leverage
Ratio at any time to exceed 0.62 to 1.
-30-
<PAGE> 38
Section 7.9. Tangible Net Worth. The Company shall maintain its
Tangible Net Worth at all times during the periods specified below in an
amount not less than the minimum required amount for each period set forth
below:
(a) from the date hereof through March 31, 1996,
$51,000,000; and
(b) during each fiscal quarter of the Company thereafter,
an amount equal to the minimum amount required to be maintained
during the immediately preceding fiscal quarter of the Company plus
an amount equal to 50% of the Company's Net Income (but not less
than zero) during such immediately preceding fiscal quarter.
Section 7.10. Minimum Net Working Capital. The Company will
maintain Net Working Capital at all times in an amount not less than
$35,000,000.
Section 7.11. Capital Expenditures. The Company will not, and
will not permit any Subsidiary to, make or commit to make any capital
expenditures (as defined and classified in accordance with generally accepted
accounting principles consistently applied;) provided, however, that if no
Event of Default or Potential Default shall exist before and after giving
effect thereto, the Company and its Subsidiaries may make capital expenditures
in an aggregate amount in each fiscal year of the Company not to exceed the
sum of (a) $2,000,000, (b) the amount of all depreciation charges shown on
the Company's audited financial statements for the immediately preceding
fiscal year of the Company, (c) the amount, if any, by which such capital
expenditures made by the Company in the immediately preceding fiscal year
was less than the maximum amount permitted by this Section 7.11 for such
preceding year excluding any amount carried over into such preceding year from
prior years, and (d) capital expenditures funded exclusively with the proceeds
of property insurance.
Section 7.12. Dividends and Certain Other Restricted Payments.
The Company will not (a) declare or pay any dividends or make any
distribution on any class of its capital stock (other than dividends
payable solely in its capital stock) or (b) directly or indirectly
purchase, redeem or otherwise acquire or retire any of its capital stock
(except out of the proceeds of, or in exchange for, a substantially concurrent
issue and sale of capital stock) or (c) make any other distributions with
respect to its capital stock; provided, however, that if no Potential Default
or Event of Default shall exist before and after giving effect thereto, the
Company may pay dividends in each fiscal year of the Company commencing with
the fiscal year ending March 31, 1997 in an aggregate amount not to exceed
15% of the Company's positive Net Income for the immediately preceding fiscal
year.
Section 7.13. Liens. The Company will not, and will not permit
any Subsidiary to, pledge, mortgage or otherwise encumber or subject to or
permit to exist upon or be subjected to any lien, charge or security interest
of any kind (including any conditional sale or other title retention agreement
and any lease in the nature thereof), on any of its Properties of any kind or
character other than:
-31-
<PAGE> 39
(a) liens, pledges or deposits for workmen's
compensation, unemployment insurance, old age benefits or social
security obligations, taxes, assessments, statutory obligations or
other similar charges, good faith deposits made in connection with
tenders, contracts or leases to which the Company or a Subsidiary is
a party or other deposits required to be made in the ordinary course
of business, provided in each case the obligation secured is not
overdue or, if overdue, is being contested in good faith by
appropriate proceedings and adequate reserves have been provided
therefor in accordance with generally accepted accounting principles
and that the obligation is not for borrowed money, customer advances,
or trade payables;
(b) the pledge of Property for the purpose of securing
an appeal or stay or discharge in the course of any legal
proceedings, provided that the aggregate amount of liabilities of
the Company and its Subsidiaries so secured by a pledge of Property
permitted under this subsection (b) including interest and penalties
thereon, if any, shall not be in excess of $500,000 at any one
time outstanding;
(c) liens, pledges, mortgages, security interests, or other
charges granted to the Agent to secure the Notes, L/Cs or the
Reimbursement Obligations;
(d) liens, pledges, security interests or other charges now
or hereafter created under the Security Agreement;
(e) security interests or other interests of a lessor in
equipment leased by the Company or any Subsidiary as lessee under
any financing lease, to the extent such security interest or other
interest secures rental payments payable by the Company thereunder;
(f) liens, mortgages and security interests in (1) the
capital stock of D & K Frozen Foods, Inc., and (2) the real
estate, machinery and equipment, and in all licenses, permits,
representations and warranties relating thereto, of the Company and
its Subsidiaries, in favor of the holders of the Senior Secured Notes
or a security agent or trustee on their behalf;
(g) liens of carriers, warehousemen, mechanics and
materialmen and other like liens, in each case arising in the ordinary
course of the Company's or any Subsidiary's business to the extent they
secure obligations that are not past due;
(h) such minor defects, irregularities, encumbrances,
easements, rights of way, and clouds on title as normally exist with
respect to similar properties which do not materially impair the
Property affected thereby for the purpose for which it was acquired;
(i) liens, pledges, mortgages, security interests or other
charges disclosed on Schedule 7.13 attached hereto;
-32-
<PAGE> 40
(j) liens, security interests, pledges, mortgages or
other charges in any Property other than the Collateral securing
obligations in an aggregate amount not exceeding $500,000 at any time;
(k) statutory liens and security interests in
agricultural products in favor of the producers thereof securing the
purchase price of such agricultural products;
(l) the interests of customers who have made customer
advances to the Company in Inventory permitted by Section 7.14(f); and
(m) liens and security interests in favor of the Existing
Lenders, but only until the first Loan is made or L/C issued
hereunder.
Section 7.14. Borrowings and Guaranties. The Company will not, and
will not permit any Subsidiary to, issue, incur, assume, create or have
outstanding any Debt or customer advances, nor assume, be or remain liable,
whether as endorser, surety, guarantor or otherwise, for or in respect of any
liability, claim or indebtedness of any other Person, other than:
(a) indebtedness of the Company arising under or pursuant
to this Agreement or the other Loan Documents;
(b) the liability of the Company arising out of the
endorsement for deposit or collection of commercial paper received in
the ordinary course of business;
(c) the indebtedness evidenced by the Company's Senior
Secured Notes;
(d) trade payables of the Company arising in the ordinary
course of the Company's business;
(e) indebtedness disclosed on the audited financial
statements referred to in Section 5.3 thereof, except indebtedness to
the Existing Lenders under the Existing Agreement; and
(f) customer advances made in the ordinary course of
business.
Section 7.15. Investments, Loans, Advances and Acquisitions. The
Company will not, and will not permit any Subsidiary to, make or retain any
investment (whether through the purchase of stock, obligations or otherwise) in
or make any loan or advance to, any other Person, or acquire all or
substantially all of the assets or business of any Person, other than:
(a) investments in certificates of deposit having a
maturity of one year or less issued by any United States commercial
bank having capital and surplus of not less than $50,000,000;
(b) existing investments in Subsidiaries;
-33-
<PAGE> 41
(c) investments in commercial paper rated P1 by Moody's
Investors Service, Inc. ("Moody's") or A1 by Standard & Poor's Ratings
Group ("S&P") maturing within 180 days of the date of issuance
thereof;
(d) marketable obligations of the United States;
(e) marketable obligations guaranteed by or insured by
the United States, or those for which the full faith and credit of the
United States is pledged for the repayment of principal and interest
thereof; provided that such obligations have a final maturity of no
more than one year from the date acquired by the Company;
(f) repurchase, reverse repurchase agreements and
security lending agreements collateralized by securities of the type
described in subsection (c) and having a term of no more than 90 days,
provided, however, that the Company shall hold (individually or
through an agent) all securities relating thereto during the entire
term of such arrangement;
(g) loans, investments (excluding retained earnings) and
advances by the Company to its Subsidiaries in an aggregate
outstanding amount not to exceed $100,000 at any time;
(h) loans and advances to employees, officers, directors
and contract growers for reasonable expenses incurred in the ordinary
course of business;
(i) acquisitions permitted by Section 7.6 hereof; and
(j) investments in money-market preferred stock issued by
corporations incorporated in any of the states of the United States
and rated "A" or better by Moody's or S&P.
Section 7.16. Sale of Property. The Company will not, and will not
permit any Subsidiary to, sell, lease, assign, transfer or otherwise dispose of
(whether in one transaction or in a series of transactions) all or a material
part of its Property to any other Person; provided, however, that this Section
shall not prohibit:
(a) sales of Inventory by the Company and its
Subsidiaries in the ordinary course of business;
(b) sales or leases by the Company and its Subsidiaries
of its surplus, obsolete or worn-out machinery and equipment;
(c) the sale of the Company's vegetable processing
facilities located in Appleton, Wisconsin, Jefferson, Wisconsin, Union
Grove, Wisconsin, Cobb, Wisconsin and Merrill, Wisconsin; and
-34-
<PAGE> 42
(d) sales that are a part of sale and leaseback
transactions permitted by Section 7.24 hereof.
For purposes of this Section 7.16, "material part" shall mean 5% or more of the
lesser of the book or fair market value of the Property of the Company.
Section 7.17. Notice of Suit, Adverse Change in Business or Default.
The Company shall, as soon as possible, and in any event within ten (10) days
after the Company learns of the following, give written notice to the Banks of
(a) any proceeding(s) that, if determined adversely to the Company or any
Subsidiary could have a material adverse effect on the Properties, business or
operations of the Company or such Subsidiary being instituted or threatened to
be instituted by or against the Company or such Subsidiary in any federal,
state, local or foreign court or before any commission or other regulatory body
(federal, state, local or foreign); (b) any material adverse change in the
business, Property or condition, financial or otherwise, of the Company or any
Subsidiary; and (c) the occurrence of a Potential Default or Event of Default.
Section 7.18. ERISA. The Company will, and will cause each
Subsidiary to, promptly pay and discharge all obligations and liabilities
arising under ERISA of a character which if unpaid or unperformed might result
in the imposition of a lien against any of its Property and will promptly
notify the Agent of (i) the occurrence of any reportable event (as defined in
ERISA) which might result in the termination by the PBGC of any Plan covering
any officers or employees of the Company or any Subsidiary any benefits of
which are, or are required to be, guaranteed by PBGC, (ii) receipt of any
notice from PBGC of its intention to seek termination of any Plan or
appointment of a trustee therefor, and (iii) its intention to terminate or
withdraw from any Plan. The Company will not, and will not permit any
Subsidiary to, terminate any Plan or withdraw therefrom unless it shall be in
compliance with all of the terms and conditions of this Agreement after giving
effect to any liability to PBGC resulting from such termination or withdrawal.
Section 7.19. Use of Loan Proceeds. The Company will use the proceeds
of all Loans and L/Cs made or issued hereunder solely to refinance existing
Debt and to finance its working capital requirements. The Company shall not
use any part of the proceeds of any of the Loans or of the L/Cs directly or
indirectly to purchase or carry any margin stock (as defined in Section 5.5
hereof) or to extend credit to others for the purpose of purchasing or carrying
any such margin stock.
Section 7.20. Conduct of Business and Maintenance of Existence. The
Company will, and will cause each Subsidiary to, continue to engage in business
of the same general type as now conducted by it, and the Company will, and will
cause each Subsidiary to, preserve, renew and keep in full force and effect its
corporate existence and its rights, privileges and franchises necessary or
desirable in the normal conduct of business.
Section 7.21. Compliance with Laws, etc. The Company will, and will
cause each of its Subsidiaries to, comply in all material respects with all
applicable laws, rules, regulations and orders, such compliance to include
(without limitation) (a) compliance with all
-35-
<PAGE> 43
Environmental Laws, (b) the registration pursuant to the Federal Food Security
Act of 1985, as amended, with the Secretary of State of each State in which are
produced any farm products purchased by the Company and which has established a
central filing system, as a buyer of farm products produced in such state, and
the maintenance of each such registration, (c) compliance with all applicable
rules and regulations promulgated by the United States Department of
Agriculture and all similar applicable state rules and regulations, and (d)
compliance with all rules and regulations promulgated pursuant to the
Occupational Safety and Health Act of 1970, as amended.
Section 7.22. Environmental Covenant. The Company will, and will
cause each of its Subsidiaries to:
(a) use and operate all of its facilities and Properties
in material compliance with all Environmental Laws, keep all necessary
permits, approvals, certificates, licenses and other authorizations
relating to environmental matters in effect and remain in material
compliance therewith, and handle all hazardous materials in material
compliance with all applicable Environmental Laws;
(b) immediately notify the Agent and provide copies upon
receipt of all material written claims, complaints, notices or
inquiries relating to the condition of its facilities and Property or
compliance with Environmental Laws, and shall promptly cure and have
dismissed, to the reasonable satisfaction of the Required Banks, any
actions and proceedings relating to compliance with Environmental Laws
unless and to the extent that the same are being contested in good
faith and by appropriate proceedings diligently conducted and for
which adequate reserves in form and amount reasonably satisfactory to
the Required Banks have been established, provided that no proceedings
to foreclose any lien which is attached as security therefor shall
have been commenced unless such foreclosure is stayed by the filing of
an appropriate bond in a manner satisfactory to the Agent; and
(c) provide such information and certifications which the
Agent may reasonably request from time to time to evidence compliance
with this Section 7.22.
Section 7.23. New Subsidiaries. The Company will not, directly or
indirectly, create or acquire any Subsidiary.
Section 7.24. Sale and Leasebacks. The Company will not, and will not
permit any Subsidiary to, enter into any arrangement with any lender or
investor providing for the leasing by the Company or any Subsidiary of any
Property previously owned by the Company or any Subsidiary, except (a) such
transactions entered into to finance capital expenditures permitted by Section
7.11, and (b) such transactions if the entire proceeds of such transaction are
applied first to the repayment of any Debt secured by liens and security
interests in the Property involved in such transaction until all such Debt has
been fully paid, and then to the repayment of Loans and Reimbursement
Obligations outstanding hereunder.
-36-
<PAGE> 44
Section 7.25. Seasonal Clean-Up. The Company shall not allow the
aggregate principal amount of all Loans and Reimbursement Obligations
outstanding hereunder to exceed either (a) $20,000,000 for a period of 30
consecutive days during the period ending July 31, 1996, and (b) $15,000,000
for a period of 30 consecutive days during each annual period ending on any
July 31 occurring thereafter.
Section 7.26. Subsidiary Assets and Operations. The Company will not
permit any Subsidiary to conduct any business or operations or own any
Property, except as described in Section 5.2 hereof.
Section 7.27. Compliance with Federal Food Security Act. The Company
will register, pursuant to Section 13.24(c)(2)(D) of the Federal Food Security
Act, with the Secretary of State of each state in which are produced farm
products purchased by the Company and which has established or hereafter
establishes a central filing system, as a buyer of farm products produced in
such state, and the Company will maintain each such registration in full force
and affect; and the Company will give written notice to the Agent, no later
than 30 days after the end of each fiscal quarter of the Company, of each state
in which it is required to file a registration under the Federal Food Security
Act, accompanied by evidence that the Company has made such required filings.
Section 7.28. Additional Trademark Collateral. The Company will
provide to the Agent within 30 days of acquiring any trademarks, tradenames, or
tradestyles, or making any trademark applications, a Trademark Agreement in the
same form as the Trademark Collateral Agreement of even date herewith executed
and delivered in satisfaction of Section 6.2(d) hereof, in form suitable for
registration with United States Patent and Trademark Office, covering all such
new property.
SECTION 8. EVENTS OF DEFAULT AND REMEDIES.
Section 8.1. Definitions. Any one or more of the following shall
constitute an Event of Default:
(a) Default in the payment when due of (i) any interest
on or principal of any Note or Reimbursement Obligation, whether at
the stated maturity thereof or as required by Section 2.4 hereof or at
any other time provided in this Agreement, or (ii) any fee or other
amount payable by the Company pursuant to this Agreement, and the
continuation under this clause (ii) thereof for 5 days;
(b) Default in the observance or performance of any
covenant set forth in Sections 2.6, 7.6, 7.7, 7.8, 7.9, 7.10, 7.11,
7.12, 7.13, 7.14, 7.15, 7.16, 7.17, 7.19, 7.20, 7.23, 7.24 and 7.25,
inclusive, hereof, or of any provision of the Security Agreement
requiring the maintenance of insurance on the Collateral subject
thereto or dealing with the use or remittance of proceeds of such
Collateral;
-37-
<PAGE> 45
(c) Default in the observance or performance of any
covenant set forth in Sections 7.4 or 7.5 of this Agreement and such
default shall continue for 5 days after written notice thereof to the
Company by any Bank;
(d) Default in the observance or performance of any other
covenant, condition, agreement or provision hereof or any of the other
Loan Documents and such default shall continue for 30 days after
written notice thereof to the Company by any Bank;
(e) Default shall occur under any evidence of
indebtedness in a principal amount exceeding $500,000 issued or
assumed or guaranteed by the Company, or under any mortgage, agreement
or other similar instrument under which the same may be issued or
secured and such default shall continue for a period of time
sufficient to permit the acceleration of maturity of any indebtedness
evidenced thereby or outstanding or secured thereunder or any such
indebtedness shall have been declared or become due and payable as a
result of any such default;
(f) Any representation or warranty made by the Company or
any Subsidiary herein or in any Loan Document or in any statement or
certificate furnished by it pursuant hereto or thereto, proves untrue
in any material respect as of the date made or deemed made pursuant to
the terms hereof;
(g) Any judgment or judgments, writ or writs, or warrant
or warrants of attachment, or any similar process or processes in an
aggregate amount in excess of $500,000 shall be entered or filed
against the Company or any Subsidiary or against any of their
respective Property or assets and remain unbonded, unstayed and
undischarged for a period of 45 days from the date of its entry;
(h) Any reportable event (as defined in ERISA) which
constitutes grounds for the termination of any Plan or for the
appointment by the appropriate United States District Court of a
trustee to administer or liquidate any such Plan, shall have occurred;
or any such Plan shall be terminated; or a trustee shall be appointed
by the appropriate United States District Court to administer any such
Plan; or the PBGC shall institute proceedings to administer or
terminate any such Plan;
(i) The Company or any Subsidiary shall (i) have entered
involuntarily against it an order for relief under the Bankruptcy Code
of 1978, as amended, (ii) admit in writing its inability to pay, or
not pay, its debts generally as they become due or suspend payment of
its obligations, (iii) make an assignment for the benefit of
creditors, (iv) apply for, seek, consent to, or acquiesce in, the
appointment of a receiver, custodian, trustee, conservator, liquidator
or similar official for it or any substantial part of its property,
(v) file a petition seeking relief or institute any proceeding seeking
to have entered against it an order for
-38-
<PAGE> 46
relief under the Bankruptcy Code of 1978, as amended, to adjudicate it
insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, marshalling of assets, adjustment or
composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors or fail to file an
answer or other pleading denying the material allegations of any such
proceeding filed against it, or (vi) fail to contest in good faith any
appointment or proceeding described in Section 8.1(j) hereof;
(j) A custodian, receiver, trustee, conservator,
liquidator or similar official shall be appointed for the Company, any
Subsidiary or any substantial part of its respective Property, or a
proceeding described in Section 8.1(i)(v) shall be instituted against
the Company or any Subsidiary and such appointment continues
undischarged or any such proceeding continues undismissed or unstayed
for a period of 60 days;
(k) The Security Agreement, or any part thereof, shall
cease to be valid and binding on any party thereto, or any party to
the Security Agreement shall terminate, disavow, repudiate or breach
any of its obligations under the Security Agreement; or
(l) The occurrence of a Change of Control.
Section 8.2. Remedies for Non-Bankruptcy Defaults. When any Event of
Default, other than an Event of Default described in subsections (i) and (j) of
Section 8.1 hereof, has occurred and is continuing, the Agent, if directed by
the Required Banks, shall give notice to the Company and take any or all of the
following actions: (i) terminate the remaining Revolving Credit Commitments
hereunder on the date (which may be the date thereof) stated in such notice,
(ii) declare the principal of and the accrued interest on the Notes and unpaid
Reimbursement Obligations to be forthwith due and payable and thereupon the
Notes and unpaid Reimbursement Obligations including both principal and
interest, shall be and become immediately due and payable without further
demand, presentment, protest or notice of any kind, and (iii) proceed to
foreclose against any Collateral under the Security Agreement, take any action
or exercise any remedy under the Loan Documents or exercise any other action,
right, power or remedy permitted by law. Any Bank may exercise the right of
set off with regard to any deposit accounts or other accounts maintained by the
Company with any of the Banks.
Section 8.3. Remedies for Bankruptcy Defaults. When any Event of
Default described in subsections (i) or (j) of Section 8.1 hereof has occurred
and is continuing, then the Notes and all Reimbursement Obligations shall
immediately become due and payable without presentment, demand, protest or
notice of any kind, and the obligation of the Banks to extend further credit
pursuant to any of the terms hereof shall immediately terminate.
Section 8.4. L/Cs. Promptly following the acceleration of the
maturity of the Notes pursuant to Section 8.2 or 8.3 hereof, the Company shall
immediately pay to the Agent for the benefit of the Banks the full aggregate
amount of all outstanding L/Cs. The Agent shall
-39-
<PAGE> 47
hold all such funds and proceeds thereof as additional collateral security for
the obligations of the Company to the Banks under the Loan Documents. The
amount paid under any of the L/Cs for which the Company has not reimbursed the
Banks shall bear interest from the date of such payment at the default rate of
interest specified in Section 1.3(c)(i) hereof.
SECTION 9. CHANGE IN CIRCUMSTANCES REGARDING EURODOLLAR LOANS.
Section 9.1. Change of Law. Notwithstanding any other provisions of
this Agreement or any Note to the contrary, if at any time after the date
hereof with respect to Eurodollar Loans, any Bank shall determine in good faith
that any change in applicable law or regulation or in the interpretation
thereof makes it unlawful for such Bank to make or continue to maintain any
Eurodollar Loan or to give effect to its obligations as contemplated hereby,
such Bank shall promptly give notice thereof to the Company to such effect, and
such Bank's obligation to make, relend, continue or convert any such affected
Eurodollar Loans under this Agreement shall terminate until it is no longer
unlawful for such Bank to make or maintain such affected Loan. The Company
shall prepay the outstanding principal amount of any such affected Eurodollar
Loan made to it, together with all interest accrued thereon and all other
amounts due and payable to the Banks under Section 9.4 of this Agreement, on
the earlier of the last day of the Interest Period applicable thereto and the
first day on which it is illegal for such Bank to have such Loans outstanding;
provided, however, the Company may then elect to borrow the principal amount of
such affected Loan by means of another type of Loan available hereunder,
subject to all of the terms and conditions of this Agreement.
Section 9.2. Unavailability of Deposits or Inability to Ascertain the
Adjusted Eurodollar Rate. Notwithstanding any other provision of this Agreement
or any Note to the contrary, if prior to the commencement of any Interest
Period any Bank shall determine (i) that deposits in the amount of any
Eurodollar Loan scheduled to be outstanding are not available to it in the
relevant market or (ii) by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the
Adjusted Eurodollar Rate, then such Bank shall promptly give telephonic or
telex notice thereof to the Company, the Agent and the other Banks (such notice
to be confirmed in writing), and the obligation of the Banks to make, continue
or convert any such Eurodollar Loan in such amount and for such Interest Period
shall terminate until deposits in such amount and for the Interest Period
selected by the Company shall again be readily available in the relevant market
and adequate and reasonable means exist for ascertaining the Adjusted
Eurodollar Rate. Upon the giving of such notice, the Company may elect to
either (i) pay or prepay, as the case may be, such affected Loan or (ii)
reborrow such affected Loan as another type of Loan available hereunder,
subject to all terms and conditions of this Agreement.
Section 9.3. Taxes and Increased Costs. With respect to the
Eurodollar Loans, if any Bank shall determine in good faith that any change in
any applicable law, treaty, regulation or guideline (including, without
limitation, Regulation D of the Board of Governors of the Federal Reserve
System) or any new law, treaty, regulation or guideline, or any interpretation
of any of the foregoing by any governmental authority charged with the
administration thereof or any central bank or other fiscal, monetary or other
authority
-40-
<PAGE> 48
having jurisdiction over such Bank or its lending branch or the Eurodollar
Loans contemplated by this Agreement (whether or not having the force of law)
("Change in Law") shall:
(i) impose, modify or deem applicable any reserve,
special deposit or similar requirements against assets held by, or
deposits in or for the account of, or Loans by, or any other
acquisition of funds or disbursements by, such Bank (other than
reserves included in the determination of the Adjusted Eurodollar
Rate);
(ii) subject such Bank, any Eurodollar Loan or any Note to
any tax (including, without limitation, any United States interest
equalization tax or similar tax however named applicable to the
acquisition or holding of debt obligations and any interest or
penalties with respect thereto), duty, charge, stamp tax, fee,
deduction or withholding in respect of this Agreement, any Eurodollar
Loan or any Note except such taxes as may be measured by the overall
net income of such Bank or its lending branch and imposed by the
jurisdiction, or any political subdivision or taxing authority
thereof, in which such Bank's principal executive office or its
lending branch is located;
(iii) change the basis of taxation of payments of principal
and interest due from the Company to such Bank hereunder or under any
Note (other than by a change in taxation of the overall net income of
such Bank); or
(iv) impose on such Bank any penalty with respect to the
foregoing or any other condition regarding this Agreement, any
Eurodollar Loan or any Note;
and such Bank shall determine that the result of any of the foregoing is to
increase the cost (whether by incurring a cost or adding to a cost) to such
Bank of making or maintaining any Eurodollar Loan hereunder or to reduce the
amount of principal or interest received by such Bank, then the Company shall
pay to such Bank from time to time as specified by such Bank such additional
amounts as such Bank shall reasonably determine are sufficient to compensate
and indemnify it for such increased cost or reduced amount. If any Bank makes
such a claim for compensation, it shall provide to the Company a certificate
setting forth such increased cost or reduced amount as a result of any event
mentioned herein specifying such Change in Law, and such certificate shall be
conclusive and binding on the Company as to the amount thereof except in the
case of manifest error. Upon the imposition of any such cost, the Company may
prepay any affected Loan, subject to the provisions of Sections 2.3 and 9.4
hereof.
Section 9.4. Funding Indemnity. (a) In the event any Bank shall
incur any loss, cost, expense or premium (including, without limitation, any
loss of profit and any loss, cost, expense or premium incurred by reason of the
liquidation or re-employment of deposits or other funds acquired by such Bank
to fund or maintain any Eurodollar Loan or the
-41-
<PAGE> 49
relending or reinvesting of such deposits or amounts paid or prepaid to such
Bank) as a result of:
(i) any payment or prepayment of a Eurodollar Loan on a date
other than the last day of the then applicable Interest Period;
(ii) any failure by the Company to borrow, continue or
convert any Eurodollar Loan on the date specified in the notice given
pursuant to Section 1.5 hereof; or
(iii) the occurrence of any Event of Default resulting in the
acceleration of any Eurodollar Loans;
then, upon the demand of such Bank, the Company shall pay to such Bank such
amount as will reimburse such Bank for such loss, cost or expense.
(b) If any Bank makes a claim for compensation under this Section
9.4, it shall provide to the Company a certificate setting forth the amount of
such loss, cost or expense in reasonable detail and such certificate shall be
conclusive and binding on the Company as to the amount thereof except in the
case of manifest error.
Section 9.5. Lending Branch. Each Bank may, at its option, elect to
make, fund or maintain its Eurodollar Loans hereunder at the branch or office
specified opposite its signature on the signature page hereof or such other of
its branches or offices as such Bank may from time to time elect, subject to
the provisions of Section 1.5(b) hereof.
Section 9.6. Discretion of Bank as to Manner of Funding.
Notwithstanding any provision of this Agreement to the contrary, each Bank
shall be entitled to fund and maintain its funding of all or any part of its
Loans in any manner it sees fit, it being understood however, that for the
purposes of this Agreement all determinations hereunder shall be made as if the
Banks had actually funded and maintained each Eurodollar Loan during each
Interest Period for such Loan through the purchase of deposits in the relevant
interbank market having a maturity corresponding to such Interest Period and
bearing an interest rate equal to the Adjusted Eurodollar Rate, as the case may
be, for such Interest Period.
SECTION 10. THE AGENT.
Section 10.1. Appointment and Powers. Harris Trust and Savings
Bank is hereby appointed by the Banks as Agent under the Loan Documents,
including but not limited to the Security Agreement, wherein the Agent shall
hold a security interest for the benefit of the Banks, solely as the Agent of
the Banks, and each of the Banks irrevocably authorizes the Agent to act as the
Agent of such Bank. The Agent agrees to act as such upon the express
conditions contained in this Agreement.
Section 10.2. Powers. The Agent shall have and may exercise such
powers hereunder as are specifically delegated to the Agent by the terms of the
Loan Documents, together with
-42-
<PAGE> 50
such powers as are incidental thereto. The Agent shall have no implied duties
to the Banks, nor any obligation to the Banks to take any action under the Loan
Documents except any action specifically provided by the Loan Documents to be
taken by the Agent.
Section 10.3. General Immunity. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable to the Banks or any
Bank for any action taken or omitted to be taken by it or them under the Loan
Documents or in connection therewith except for its or their own gross
negligence or willful misconduct.
Section 10.4. No Responsibility for Loans, Recitals, etc. The Agent
shall not (i) be responsible to the Banks for any recitals, reports,
statements, warranties or representations contained in the Loan Documents or
furnished pursuant thereto, (ii) be responsible for the payment or collection
of or security for any Loans or Reimbursement Obligations hereunder except with
money actually received by the Agent for such payment, (iii) be bound to
ascertain or inquire as to the performance or observance of any of the terms of
the Loan Documents, (iv) be obligated to determined or verify the existence,
eligibility or value of any Collateral, or the correctness of any Borrowing
Base Certificate or compliance certificate, or (v) be responsible to the Banks
for the enforceability or validity of any of the Loan Documents or for the
existence, creation, attachment, perfection or priority of any security
interest in the Collateral.
Section 10.5. Right to Indemnity. The Banks hereby indemnify the
Agent for any actions taken in accordance with this Section 10, and the Agent
shall be fully justified in failing or refusing to take any action hereunder,
unless it shall first be indemnified to its satisfaction by the Banks pro rata
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action, other than any liability which
may arise out of Agent's gross negligence or willful misconduct.
Section 10.6. Action Upon Instructions of Banks. The Agent agrees,
upon the written request of the Required Banks or all of the Banks, as the case
may be, to take any action of the type specified in the Loan Documents as being
within the Agent's rights, duties, powers or discretion. The Agent shall in
all cases be fully protected in acting, or in refraining from acting, hereunder
in accordance with written instructions signed by the Required Banks or all of
the Banks, as the case may be, and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the Banks and on all
holders of the Notes. In the absence of a request by the Required Banks or all
of the Banks, as the case may be, the Agent shall have authority, in its sole
discretion, to take or not to take any action, unless the Loan Documents
specifically require the consent of the Required Banks or all of the Banks.
Section 10.7. Employment of Agents and Counsel. The Agent may execute
any of its duties as Agent hereunder by or through agents (other than
employees) and attorneys-in-fact and shall not be answerable to the Banks,
except as to money or securities received by it or its authorized agents, for
the default or misconduct of any such agents or attorneys-in-fact selected by
it in good faith and with reasonable care. The Agent shall be entitled to
advice and opinion of legal counsel concerning all matters pertaining to the
duties of the agency hereby created.
-43-
<PAGE> 51
Section 10.8. Reliance on Documents; Counsel. The Agent shall be
entitled to rely upon any Note, notice, consent, certificate, affidavit,
letter, telegram, statement, paper or document believed by it to be genuine and
correct and to have been signed or sent by the proper person or persons, and,
in respect to legal matters, upon the opinion of legal counsel selected by the
Agent.
Section 10.9. May Treat Payee as Owner. The Agent may deem and treat
the payee of any Note as the owner thereof for all purposes hereof unless and
until a written notice of the assignment or transfer thereof shall have been
filed with the Agent. Any request, authority or consent of any person, firm or
corporation who at the time of making such request or giving such authority or
consent is the holder of any such Note shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note issued in
exchange therefor.
Section 10.10. Agent's Reimbursement. Each Bank agrees to reimburse
the Agent pro rata in accordance with its Commitment Percentage for any
reasonable out-of-pocket expenses (including fees and charges for field
audits) not reimbursed by the Company (a) for which the Agent is entitled to
reimbursement by the Company under the Loan Documents and (b) for any other
reasonable out-of-pocket expenses incurred by the Agent on behalf of the Banks,
in connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents and for which the Agent is entitled to
reimbursement by the Company and has not been reimbursed.
Section 10.11. Rights as a Lender. With respect to its commitment,
Loans made by it, L/Cs issued by it and the Notes issued to it, Harris shall
have the same rights and powers hereunder as any Bank and may exercise the same
as though it were not the Agent, and the term "Bank" or "Banks" shall, unless
the context otherwise indicates, include Harris in its individual capacity.
Harris and each of the Banks may accept deposits from, lend money to, and
generally engage in any kind of banking or trust business with the Company as
if it were not the Agent or a Bank hereunder, as the case may be.
Section 10.12. Bank Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Agent or any other Bank and
based on the financial statements referred to in Section 5.3 and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into the Loan Documents. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Loan Documents.
Section 10.13. Resignation of Agent. Subject to the appointment of a
successor Agent, the Agent may resign as Agent for the Banks under this
Agreement and the other Loan Documents at any time by sixty days' notice in
writing to the Banks. Such resignation shall take effect upon appointment of
such successor. The Required Banks shall have the right to appoint a successor
Agent who shall be entitled to all of the rights of, and vested with the same
powers as, the original Agent under the Loan Documents. In the event a
successor
-44-
<PAGE> 52
Agent shall not have been appointed within the sixty day period following the
giving of notice by the Agent, the Agent may appoint its own successor.
Resignation by the Agent shall not affect or impair the rights of the Agent
under Sections 10.5 and 10.10 hereof with respect to all matters preceding such
resignation. Any successor Agent must be a Bank holding a Revolving Credit
Commitment for its own account of not less than $12,500,000.
Section 10.14. Removal of Agent. Subject to the appointment of a
successor Agent, the Required Banks, with the consent of the Company (which
consent will not be unreasonably withheld) if no Event of Default shall have
occurred and be continuing and without the Company's consent if an Event of
Default shall have occurred and be continuing, may remove the Agent for the
Banks under this Agreement at any time by 30 days' notice in writing to the
Agent. Such removal shall take effect upon appointment of such successor. The
Required Banks shall have the right to appoint a successor Agent who shall be
entitled to all of the rights of, and vested with the same powers as, the
original Agent under the Loan Documents. In the event a successor Agent shall
not have been appointed within the thirty day period following the giving of
notice to the Agent, the Agent may appoint its own successor. The removal of
the Agent shall not affect or impair the rights of the Agent under Sections
11.5 and 11.10 hereof with respect to all matters preceding such removal. Any
successor Agent must meet the eligibility criteria set forth in Section 10.13
hereof.
Section 10.15. Duration of Agency. The agency established by Section
10.1 hereof shall continue, and Sections 10.1 through and including Section
10.14 shall remain in full force and effect, until the Notes and all other
amounts due hereunder and thereunder, including without limitation all
Reimbursement Obligations, shall have been paid in full and the Banks'
commitments to extend credit to or for the benefit of the Company shall have
terminated or expired.
Section 10.16. Certain Notices. The Agent shall promptly (a) deliver
to each of the Banks a copy of any written notice of the occurrence of an Event
of Default under this Agreement received by the Agent and any schedules,
reports or other written information relating to the Collateral received by the
Agent, and (b) give written notice to the Banks if the amount of the Agent's
Revolving Credit Commitment held for the Agent's own account becomes less than
$5,000,000.
SECTION 11. MISCELLANEOUS.
Section 11.1. Amendments and Waivers. Any term, covenant, agreement
or condition of this Agreement or any other Loan Documents may be amended only
by a written amendment executed by the Company, the Required Banks and, if the
rights or duties of the Agent are affected thereby, the Agent, or compliance
therewith only may be waived (either generally or in a particular instance and
either retroactively or prospectively), if the Company shall have obtained the
consent in writing of the Required Banks and, if the rights or duties of the
Agent are affected thereby, the Agent, provided, however, that without the
consent in writing of the holders of all outstanding Notes and unpaid
Reimbursement Obligations and the issuer of any L/C, or all Banks if no Notes,
L/Cs or Reimbursement Obligations are outstanding, no such amendment or waiver
shall
-45-
<PAGE> 53
(i) change the amount or postpone the date of payment of any scheduled payment
or required prepayment of principal of the Notes or reduce the rate or extend
the time of payment of interest on the Notes, or reduce the amount of principal
thereof, or modify any of the provisions of the Notes with respect to the
payment or prepayment thereof, (ii) give to any Note any preference over any
other Notes, (iii) amend the definition of Required Banks, (iv) alter, modify
or amend the provisions of this Section 11.1, (v) change the amount
(individually or in the aggregate) or term of any of the Banks' Revolving
Credit Commitments or reduce or postpone any fee or other amount coming due to
the Banks under this Agreement or any of the other Loan Documents, (vi) alter,
modify, waive or amend the provisions of Sections 1.9, 6 or 9 of this
Agreement, (vii) alter, modify or amend any Bank's right hereunder to consent
to any action, make any request or give any notice, (viii) change the advance
rates under the Borrowing Base or the definitions of "Borrowing Base",
"Eligible Inventory" or "Eligible Receivables," or waive the deduction of the
Secured Grower Payables from the Borrowing Base, or (ix) release any Collateral
under the Security Agreement or release or discharge any guarantor of the
Company's Obligations to the Banks, in each case, unless such release or
discharge is permitted or contemplated by the Loan Documents. Any such
amendment or waiver shall apply equally to all Banks and the holders of the
Notes and Reimbursement Obligations and shall be binding upon them, upon each
future holder of any Note and Reimbursement Obligation and upon the Company
whether or not such Note shall have been marked to indicate such amendment or
waiver. No such amendment or waiver shall extend to or affect any obligation
not expressly amended or waived.
Section 11.2. Waiver of Rights. No delay or failure on the part of
the Agent or any Bank or on the part of the holder or holders of any Note or
Reimbursement Obligation in the exercise of any power or right shall operate as
a waiver thereof, nor as an acquiescence in any Potential Default or Event of
Default, nor shall any single or partial exercise of any power or right
preclude any other or further exercise thereof, or the exercise of any other
power or right, and the rights and remedies hereunder of the Agent, the Banks
and of the holder or holders of any Notes are cumulative to, and not exclusive
of, any rights or remedies which any of them would otherwise have.
Section 11.3. Several Obligations. The commitments of each of the
Banks hereunder shall be the several obligations of each Bank and the failure
on the part of any one or more of the Banks to perform hereunder shall not
affect the obligation of the other Banks hereunder, provided that nothing
herein contained shall relieve any Bank from any liability for its failure to
so perform. In the event that any one or more of the Banks shall fail to
perform its commitment hereunder, all payments thereafter received by the Agent
on the principal of Loans and Reimbursement Obligations hereunder, whether from
any Collateral or otherwise, shall be distributed by the Agent to the Banks
making such additional Loans ratably as among them in accordance with the
principal amount of additional Loans made by them until such additional Loans
shall have been fully paid and satisfied. All payments on account of interest
shall be applied as among all the Banks ratably in accordance with the amount
of interest owing to each of the Banks as of the date of the receipt of such
interest payment.
-46-
<PAGE> 54
Section 11.4. Non-Business Day. (a) If any payment of principal or
interest on any Domestic Rate Loan shall fall due on a day which is not a
Business Day, interest at the rate such Loan bears for the period prior to
maturity shall continue to accrue on such principal from the stated due date
thereof to and including the next succeeding Business Day on which the same is
payable.
(b) If any payment of principal or interest on any Eurodollar Loan
shall fall due on a day which is not a Business Day, the payment date thereof
shall be extended to the next date which is a Business Day and the Interest
Period for such Loan shall be accordingly extended, unless as a result thereof
any payment date would fall in the next calendar month, in which case such
payment date shall be the next preceding Business Day.
Section 11.5. Survival of Indemnities. All indemnities and all
provisions relative to reimbursement to the Banks of amounts sufficient to
protect the yield to the Banks with respect to Eurodollar Loans, including, but
not limited to, Sections 9.3 and 9.4 hereof, shall survive the termination of
this Agreement and the payment of the Notes and Reimbursement Obligations.
Section 11.6. Documentary Taxes. The Company agrees to pay all
documentary or similar taxes payable in respect of this Agreement or any of the
other Loan Documents, including interest and penalties, in the event any such
taxes are assessed irrespective of when such assessment is made and whether or
not any credit is then in use or available hereunder.
Section 11.7. Survival of Representations. All representations and
warranties made herein or in certificates given pursuant hereto shall survive
the execution and delivery of this Agreement and of the Notes, and shall
continue in full force and effect with respect to the date as of which they
were made and as reaffirmed on the date of each borrowing or request for L/C
and as long as any credit is in use or available hereunder.
Section 11.8. Notices. Unless otherwise expressly provided herein,
all communications provided for herein shall be in writing or by telex and
shall be deemed to have been given or made when served personally, when an
answer back is received in the case of notice by telex or telecopy or 2 days
after the date when deposited in the United States mail (registered, if to the
Company) addressed if to the Company to 1055 Corporate Center Drive,
Oconomowoc, Wisconsin 53066, Attention: Stephen Theobald; if to the Agent or
Harris at 111 West Monroe Street, Chicago, Illinois 60690, Attention:
Agribusiness Division; and if to any of the Banks, at the address for each Bank
set forth under its signature hereon; or at such other address as shall be
designated by any party hereto in a written notice to each other party pursuant
to this Section 11.8.
Section 11.9. Costs and Expenses; Indemnity. The Company agrees to
pay on demand all costs and expenses of the Agent, in connection with the
negotiation, preparation, execution and delivery of this Agreement, the Notes
and the other instruments and documents to be delivered hereunder or in
connection with the transactions contemplated hereby, including the fees and
expenses of Messrs. Chapman and Cutler, special counsel to the Agent; all
costs and expenses of the Agent (including attorneys' fees) incurred in
-47-
<PAGE> 55
connection with any consents or waivers hereunder or amendments hereto, and all
reasonable costs and expenses (including attorneys' fees), if any, incurred by
the Agent, the Banks or any other holders of a Note or any Reimbursement
Obligation in connection with the enforcement of this Agreement or the Notes
and the other instruments and documents to be delivered hereunder. The Company
agrees to indemnify and save harmless the Banks and the Agent from any and all
liabilities, losses, costs and expenses incurred by the Banks or the Agent in
connection with any action, suit or proceeding brought against the Agent or any
Bank by any Person which arises out of the transactions contemplated or
financed hereby or by the Notes, or out of any action or inaction by the Agent
or any Bank hereunder or thereunder, except for such thereof as is caused by
the gross negligence or willful misconduct of the party indemnified. The
provisions of this Section 11.9 shall survive payment of the Notes and
Reimbursement Obligations and the termination of the Revolving Credit
Commitments hereunder.
Section 11.10. Counterparts. This Agreement may be executed in any
number of counterparts and all such counterparts taken together shall be deemed
to constitute one and the same instrument. One or more of the Banks may
execute a separate counterpart of this Agreement which has also been executed
by the Company, and this Agreement shall become effective as and when all of
the Banks have executed this Agreement or a counterpart thereof and lodged the
same with the Agent.
Section 11.11. Successors and Assigns. This Agreement shall be
binding upon each of the Company, the Guarantors and the Banks and their
respective successors and assigns, and shall inure to the benefit of the
Company, and each of the Banks and the benefit of their respective successors
and assigns, including any subsequent holder of any Note or Reimbursement
Obligation. The Company may not assign any of its rights or obligations
hereunder without the written consent of the Banks.
Section 11.12. No Joint Venture. Nothing contained in this
Agreement shall be deemed to create a partnership or joint venture among the
parties hereto.
Section 11.13. Severability. In the event that any term or provision
hereof is determined to be unenforceable or illegal, it shall deemed severed
herefrom to the extent of the illegality and/or unenforceability and all other
provisions hereof shall remain in full force and effect.
Section 11.14. Table of Contents and Headings. The table of contents
and section headings in this Agreement are for reference only and shall not
affect the construction of any provision hereof.
Section 11.15. Participants and Note Assignors. Each Bank shall
have the right at its own cost to grant participations (to be evidenced by one
or more agreements or certificates of participation) in the Loans made, and/or
Revolving Credit Commitment and participations in L/Cs and Reimbursement
Obligations held, by such Bank at any time and from time to time, and to assign
its rights under such Loans, participations in L/Cs and Reimbursement
Obligations or the Notes evidencing such Loans to one or more other Persons;
provided that
-48-
<PAGE> 56
no such participation or assignment shall relieve any Bank of any of its
obligations under this Agreement, and any agreement pursuant to which such
participation or assignment of a Note or the rights thereunder is granted shall
provide that the granting Bank shall retain the sole right and responsibility
to enforce the obligations of the Company under the Loan Documents, including,
without limitation, the right to approve any amendment, modification or waiver
of any provision thereof, except that such agreement may provide that such Bank
will not agree without the consent of such participant or assignee to any
modification, amendment or waiver of this Agreement or the other Loan Documents
that would (A) increase any Revolving Credit Commitment of such Bank, or (B)
reduce the amount of or postpone the date for payment of any principal of or
interest on any Loan or Reimbursement Obligation or of any fee payable
hereunder in which such participant or assignee has an interest or (C) reduce
the interest rate applicable to any Loan or other amount payable in which such
participant or assignee has an interest or (D) release any collateral security
for or guarantor for any of the Company's Obligations under the Loan Documents,
and provided further that no such assignee or participant shall have any rights
under this Agreement except as provided in this Section 11.15, and the Agent
shall have no obligation or responsibility to such participant or assignee,
except that nothing herein provided is intended to affect the rights of an
assignee of a Note to enforce the Note assigned. Any party to which such a
participation or assignment has been granted shall have the benefits of Section
1.9, Section 9.3 and Section 9.4 hereof but shall not be entitled to receive
any greater payment under any such Section than the Bank granting such
participation or assignment would have been entitled to receive with respect to
the rights transferred. Any Bank assigning any Note hereunder shall give
prompt notice thereof to the Company and the Agent, who shall in each case only
be required to treat such assignee of a Note as the holder thereof after
receipt of such notice. The Company authorizes each Bank to disclose to any
purchaser or prospective purchaser of an interest in its Loans or Reimbursement
Obligations owed to it or its Revolving Credit Commitment under this Section
11.15 any financial or other information pertaining to the Company.
Section 11.16. Assignment of Commitments by Bank. Each Bank shall
have the right at any time, with the prior consent of the Company and the Agent
(which consent will not be required in the case of an assignment to another
Bank or an affiliate of the assigning Bank and otherwise will not be
unreasonably withheld), to sell, assign, transfer or negotiate all or any part
of its Revolving Credit Commitment to one or more commercial banks or other
financial institutions; provided that such assignment is in an amount of at
least $10,000,000 or, if less, the entire remaining Revolving Credit Commitment
of the assigning Bank. Upon any such assignment, and its notification to the
Agent, the assignee shall become a Bank hereunder, all Loans, Reimbursement
Obligations and the Revolving Credit Commitment it thereby holds shall be
governed by all the terms and conditions hereof, and the Bank granting such
assignment shall have its Revolving Credit Commitment and its obligations and
rights in connection therewith, reduced by the amount of such assignment. Upon
each such assignment the Bank granting such assignment shall pay to the Agent
for the Agent's sole account a fee of $2,500. The Company authorizes each Bank
to disclose to any purchaser or prospective purchaser of an interest in its
Loans or Reimbursement Obligations owed to it or its Revolving Credit
Commitment under this Section 11.16 any financial or other information
pertaining to the Company.
-49-
<PAGE> 57
Section 11.17. Sharing of Payments. Each Bank agrees with each other
Bank that if such Bank shall receive and retain any payment, whether by set-off
or application of deposit balances or otherwise ("Set-Off"), on any Loan,
Reimbursement Obligation or other amount outstanding under this Agreement in
excess of its ratable share of payments on all Loans, Reimbursement Obligations
and other amounts then outstanding to the Banks, then such Bank shall purchase
for cash at face value, but without recourse, ratably from each of the other
Banks such amount of the Loans and Reimbursement Obligations held by each such
other Bank (or interest therein) as shall be necessary to cause such Bank to
share such excess payment ratably with all the other Banks; provided, however,
that if any such purchase is made by any Bank, and if such excess payment or
part thereof is thereafter recovered from such purchasing Bank, the related
purchases from the other Banks shall be rescinded ratably and the purchase
price restored as to the portion of such excess payment so recovered, but
without interest. Each Bank's ratable share of any such Set-Off shall be
determined by the proportion that the aggregate principal amount of Loans and
Reimbursement Obligations then due and payable to such Bank bears to the total
aggregate principal amount of Loans and Reimbursement Obligations then due and
payable to all the Banks. Each Bank agrees that any set-off made by such Bank
shall be applied first to all Loans and Reimbursement Obligations outstanding
under the Loan Documents until they are paid in full and then to any other
indebtedness, obligations and liabilities of the Company to such Bank.
Section 11.18. Entire Agreement. The Loan Documents constitute the
entire understanding of the parties thereto with respect to the subject matter
thereof and any prior or contemporaneous agreements, whether written or oral,
with respect thereto are superseded hereby.
Section 11.19. Governing Law. This Agreement and the other Loan
Documents, and the rights and duties of the parties hereto, shall be construed
and determined in accordance with the internal laws of the State of Illinois.
SECTION 11.20. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL.
THE COMPANY HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED
STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS AND OF ANY ILLINOIS
STATE COURT SITTING IN THE CITY OF CHICAGO FOR PURPOSES OF ALL LEGAL
PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. THE COMPANY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH
A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE COMPANY, THE AGENT AND
EACH BANK HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN A
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY.
-50-
<PAGE> 58
Upon your acceptance hereof in the manner hereinafter set forth, this
Agreement shall be a contract between us for the purposes hereinabove set
forth.
Dated as of May 22, 1995.
STOKELY USA, INC.
By STEPHEN W. THEOBALD
-----------------------
Its Vice Chairman
-----------------------
-51-
<PAGE> 59
Accepted and Agreed to as of the day and year last above written.
HARRIS TRUST AND SAVINGS BANK
individually and as Agent
By
-----------------------
Its Vice President
Address: 111 West Monroe Street
Chicago, Illinois 60690
Attention: Agribusiness Division
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION
By Wayne C. Lewis
-----------------------
Its Vice President
-----------------------
Address: Mercantile Tower
St. Louis, Missouri 63166
Attention:
-----------------------
SANWA BUSINESS CREDIT CORPORATION
By Michael J. Coe
-----------------------
Its Vice President
-----------------------
Address: One South Wacker Drive
Chicago, Illinois 60606
Attention:
-----------------------
GENERAL ELECTRIC CAPITAL CORPORATION
By Shawn Pettel
---------------------------
Its Region Operations Manager
---------------------------
Address: 105 West Madison Street
Suite 1500
Chicago, Illinois 60602
Attention:
-----------------------
-52-
<PAGE> 60
EXHIBIT A
STOKELY USA, INC.
SECURED REVOLVING CREDIT NOTE
$________________ May 22, 1995
FOR VALUE RECEIVED, the undersigned, STOKELY USA, INC., a Wisconsin
corporation (the "Company"), promises to pay to the order of________________
(the "Lender") on July 31, 1998, at the principal office of Harris Trust and
Savings Bank in Chicago, Illinois, the principal sum of ____________ or, if
less, the aggregate unpaid principal amount of all Revolving Credit Loans made
by the Lender to the Company under the Revolving Credit provided for under the
Credit Agreement hereinafter mentioned and remaining unpaid on July 31, 1998,
together with interest on the principal amount of each Revolving Credit Loan
from time to time outstanding hereunder at the rates, and payable in the manner
and on the dates specified in said Credit Agreement.
The Lender shall record on its books or records or on the schedule to
this Note which is a part hereof the principal amount of each Revolving Credit
Loan made under the Revolving Credit, whether each Loan is a Domestic Rate Loan
or a Eurodollar Loan and, with respect to Eurodollar Loans, the interest rate
and Interest Period applicable thereto, and all payments of principal and
interest and the principal balances from time to time outstanding; provided
that prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such
books or records or on the schedule to this Note, shall be prima facie evidence
as to all such amounts; provided, however, that the failure of the Lender to
record or any mistake in recording any of the foregoing shall not limit or
otherwise affect the obligation of the Company to repay all Revolving Credit
Loans made under the Revolving Credit, together with accrued interest thereon.
This Note is one of the Revolving Notes referred to in and issued under
that certain Secured Credit Agreement dated as of May 22, 1995, among the
Company, Harris Trust and Savings Bank, as Agent, and the lenders named
therein, as amended from time to time (the "Credit Agreement"), and this Note
and the holder hereof are entitled to all of the benefits and security provided
for thereby or referred to therein, including without limitation the collateral
security provided pursuant to the Security Agreement (as defined in the Credit
Agreement), to which Credit Agreement and Security Agreement reference is
hereby made for a statement thereof and a statement of the terms and conditions
upon which the Agent may exercise rights with respect to such collateral. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.
<PAGE> 61
Prepayments may be made on any Revolving Credit Loan evidenced hereby
and this Note (and the Revolving Credit Loans evidenced hereby) may be declared
due prior to the expressed maturity thereof, all in the events, on the terms
and in the manner as provided for in said Credit Agreement and the Security
Agreement.
The undersigned hereby expressly waives diligence, presentment, demand,
protest, notice of protest, notice of intent to accelerate, notice of
acceleration, and notice of any other kind.
IT IS AGREED THAT THIS NOTE AND THE RIGHTS AND REMEDIES OF THE HOLDER
HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF ILLINOIS.
STOKELY USA, INC.
By _____________________________
Its_________________________
-2-
<PAGE> 62
EXHIBIT B
May 22, 1995
Harris Trust and Savings Bank
Chicago, Illinois
General Electric Capital Corporation
Chicago, Illinois
Sanwa Business Credit Corporation
Chicago, Illinois
Mercantile Bank of St. Louis National
Association
St. Louis, Missouri
Ladies and Gentlemen:
We have served as counsel to Stokely USA, Inc., a Wisconsin corporation
(the "Borrower"), in connection with the execution and delivery of the
instruments and documents identified on Exhibit A to this letter (collectively
the "Loan Documents," individual Loan Documents and other capitalized terms
used below being hereinafter referred to by the designations appearing on
Exhibit A).
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of all such corporate records of the Borrower, agreements
and other instruments, certificates of officers of the Borrower, certificates
of public officials, and other documents which we have deemed relevant and
necessary to render this opinion. In rendering this opinion, we have assumed
the genuineness of all signatures (other than those of officers of the
Borrower), the authenticity of all documents submitted to us as originals, the
conformity to originals of all documents submitted to us as copies, the due
execution of the Loan Documents by, and the enforceability of the Loan
Documents against, you, and the legal capacity of all natural persons. Whenever
this
<PAGE> 63
May 22, 1995
Page 2
opinion refers to matters within our "knowledge," "known to us," or of which we
"know," such reference is limited to (i) the representations and warranties of
the Borrower contained in the Loan Documents; and (ii) facts within our actual
knowledge after an inquiry of the attorneys of this firm who have provided
legal services to the Borrower in connection with the Loan Documents, without
further inquiry. Furthermore, we have not undertaken any further factual
investigation of the business, properties, agreements, or litigation of the
Borrower for purposes of rendering this opinion.
Based upon the foregoing, and subject to the qualifications stated
herein, we are of the opinion that:
1. The Borrower is a corporation existing under the laws of the
State of Wisconsin and, based solely on a certificate of status of the
Wisconsin Secretary of State, (a) has filed with the Wisconsin Secretary of
State during its most recently completed report year the required annual
report; (b) is not the subject of a proceeding under Wisconsin Statutes Section
180.1421 to cause its administrative dissolution; and (c) Articles of
Dissolution of the Borrower have not been filed with such Secretary of State.
2. The Borrower has the corporate power and authority to
execute, deliver, and perform its obligations under the Loan Documents.
3. The execution and delivery of the Loan Documents and the
performance by the Borrower of their terms do not and will not (i) contravene
any provisions of the Articles of Incorporation or Bylaws of the Borrower; (ii)
based on our knowledge of the business, operations, and properties of the
Borrower, contravene any presently existing provision of any law applicable to
the Borrower; (iii) contravene any provision of any agreement known to us under
which the Borrower has borrowed money (except for such violation or default as
has been waived or consented to by the relevant party thereto); (iv) to our
knowledge, result in the creation or imposition of any lien upon any of the
property of the Borrower except pursuant to the Loan Documents; or (v) require
the consent or approval of, or any filing or registration with, any
governmental body, agency, or authority other than the filing of the Financing
Statement.
<PAGE> 64
May 22, 1995
Page 3
4. The Borrower is not an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as amended,
or, to our knowledge, controlled by such a company.
5. The Borrower is not a "holding company" or a "subsidiary
company" of a "holding company" or an "affiliate" of a "holding company"
within the meaning of the Public Utility Holding Company Act of 1935, as
amended.
6. The Loan Documents have been duly authorized by all necessary
corporate action (no stockholder approval being required), have been executed
and delivered by the Borrower, and constitute valid and binding agreements of
the Borrower enforceable against it in accordance with their respective terms.
7. The Security Agreement is adequate to create and provide for
the liens and security interests contemplated thereby for the benefit and
security of all the indebtedness secured thereby. The description of the
Collateral set forth in the Financing Statement is sufficient to perfect, and
upon the due filing thereof in the office of the Wisconsin Secretary of State
will perfect, a security interest in the items and types of Collateral in which
a security interest may be perfected by the filing of a financing statement
under the Uniform Commercial Code of the State of Wisconsin as in effect on the
date hereof (the "UCC") to the extent that (i) Wisconsin is the proper state
for filing; (ii) the Collateral consists of the type of property for which a
security interest may be perfected by filing a financing statement in Wisconsin
under the UCC; and (iii) any part of the Collateral or the proceeds or products
thereof does not constitute trust property or a trust fund which by virtue of
federal or state law is not subject to the claims, liens, or security interests
of creditors.
8. To our knowledge, there is no action, suit, proceeding, or
investigation at law or in equity before or by any court or public body pending
or threatened against or affecting the Borrower or any of its assets and
properties which, if adversely determined, could result in any material adverse
change in the properties, business, operations, or financial condition of the
Borrower or in the value of the collateral security for your loans and other
credit accommodations to the Borrower except as described in Schedule 5.4 to
the Secured Credit Agreement.
<PAGE> 65
May 22, 1995
Page 4
9. The rates of interest provided for under the Loan Documents
and any other amounts payable thereunder that would constitute interest would
not violate any usury law of the State of Wisconsin.
All of the foregoing opinions are subject to the following additional
assumptions, limitations, and qualifications:
(a) We express no opinion as to the effect of the compliance or
noncompliance by you with any state or federal laws or regulations applicable
to you because of legal or regulatory status or the nature of your business.
(b) Our opinions relating to the enforceability of the Loan
Documents are subject to and limited by:
(i) Bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, marshalling, and other similar laws now or hereafter in
effect relating to or affecting the rights and remedies of creditors generally;
(ii) Limitations imposed by general principles of equity
upon the specific enforceability of any of the remedies or other provisions of
such documents and upon the availability of injunctive relief and other
equitable remedies (regardless of whether enforcement is considered in
proceedings at law or in equity);
(iii) The qualification that certain provisions of
the Loan Documents are or may be unenforceable in whole or in part under the
laws of the State of Wisconsin, but the inclusion of such provisions does not
render the Loan Documents invalid as a whole and there exist either in the Loan
Documents or under applicable law adequate remedies for the practicable
realization of the principal legal rights and benefits intended to be provided
thereby (except for the economic consequences of any delay resulting from such
unenforceability); and
(iv) Such enforcement is subject to recent court
decisions which may require lenders to act reasonably and in good faith in
exercising their rights and remedies under the Loan Documents.
<PAGE> 66
May 22, 1995
Page 5
(c) We render no advice concerning and do not express any opinion
as to:
(i) the priority of any security interest; or
(ii) items of Collateral which by operation of law cannot
be subject to a consensual security interest.
(d) We express no opinion as to the following:
(i) the Borrower's rights in or title to the Collateral;
(ii) any security interest that is terminated or released;
(iii) the effect of noncompliance with the federal
Assignment of Claims Act; or
(iv) future advances other than loans made or to be made
pursuant to the terms of the Secured Credit Agreement.
(e) In the case of property which becomes Collateral after the date
hereof, (i) Section 547 of the United States Bankruptcy Code provides that
a transfer is not made until the debtor has rights in the property transferred
so a security interest in after-acquired property may be treated as a voidable
preference under the conditions (and subject to the exceptions) provided by
Section 547; (ii) Chapter 128 of the Wisconsin Statutes contains a four-month
preference provision that may apply to after-acquired property; and (iii)
Section 552 of the United States Bankruptcy Code limits the extent to which
property acquired by a debtor after the commencement of a case under the United
States Bankruptcy Code may be subject to a security interest arising from a
security agreement entered into by the debtor before the commencement of such
case.
(f) In the case of any interest in or claim in or under any policy of
insurance covering the Collateral, the security interest of the secured party
therein is limited to proceeds payable to the named insured (and not to any
other party named as loss payee under such policy) by reason of loss or damage
to the collateral insured under such insurance policies.
<PAGE> 67
May 22, 1995
Page 6
(g) In the case of all Collateral in which the security interest of
the secured party has been perfected by the filing of the Financing Statement,
Article 9 of the UCC requires the filing of continuation statements within the
period of six months prior to the expiration of five years from the date of the
original filings in order to maintain the effectiveness of the filings referred
to in this paragraph.
(h) The duties to exercise reasonable care in the custody and
preservation of the Collateral in a secured party's possession and to deal with
and dispose of the collateral in a commercially reasonable manner as required
by the UCC may not be disclaimed by agreement, waived, or released.
We call to your attention that the perfection of the above security interests
will be terminated (i) as to any Collateral acquired by the Borrower more than
four months after the Borrower so changes its name, identity, or corporate
structure as to make any financing statements filed against such party
seriously misleading, unless new appropriate financing statements indicating
the new name, identity, or corporate structure of such party are properly filed
before the expiration of such four months; (ii) as to any Collateral consisting
of accounts or general intangibles, four months after the Borrower changes its
chief executive office to a new jurisdiction outside Wisconsin unless such
security interests are perfected in such new jurisdiction before that
termination; (iii) as against buyers of items of the Collateral consisting of
goods of the Borrower sold in the ordinary course of business; and (iv) as to
Collateral otherwise disposed of by the Borrower if such disposition is
authorized under the Loan Documents.
We express no opinion as to (i) any provision affording indemnification
to you; (ii) provisions imposing penalties, forfeitures, or increases in rates
of interest upon delinquency in any payment or upon any breach or default under
the Loan Documents; or (iii) broadly stated waivers of presentment, protest,
demand, notice, appraisement, valuation, stay, extension, moratorium,
redemption, marshalling of assets, or other rights granted by law to the extent
such waivers or rights are held to be against public policy or prohibited by
law.
This opinion deals only with the specific legal issues that it
explicitly addresses and no opinion shall be implied as to matters not so
addressed. The opinions expressed herein are
<PAGE> 68
May 22, 1995
Page 7
specifically limited to the laws of the State of Wisconsin and the federal laws
of the United States. The opinions expressed herein are given as of the date
of this letter and are intended to apply only to those facts and circumstances
that exist as of the date hereof, and we assume no obligation or responsibility
to update or supplement this opinion to reflect any facts or circumstances
occurring after the date hereof that would alter the opinions contained herein.
This opinion is rendered solely for your information and assistance in
connection with the transactions described above and may not be relied upon by
any other person or for any other purpose without our prior written consent.
Sincerely,
MICHAEL, BEST & FRIEDRICH
<PAGE> 69
EXHIBIT A
THE LOAN DOCUMENTS
(Except as noted below, all Loan Documents are dated as of May 22,
1995. Harris Trust and Savings Bank ("Harris") in its capacity as agent under
the Secured Credit Agreement is referred to below as the "Agent" and Harris in
its individual capacity, together with General Electric Capital Corporation
("GECC"), Mercantile Bank of St. Louis National Association ("Mercantile") and
Sanwa Business Credit Corporation ("SBCC") are referred to below as the
"Banks.")
1. Secured Credit Agreement by and among the Borrower, the
Agent, and the Banks.
2. Secured Revolving Credit Note of the Borrower payable to the
order of Harris in the principal amount of $20,000,000.
3. Secured Revolving Credit Note of the Borrower payable to the
order of GECC in the principal amount of $27,500,000.
4. Secured Revolving Credit Note of the Borrower payable to the
order of Mercantile in the principal amount of $5,000,000.
5. Secured Revolving Credit Note of the Borrower payable to the
order of SBCC in the principal amount of $12,500,000.
6. Security Agreement Re: Accounts Receivable and Inventory from
the Borrower to the Agent for the benefit of itself and the Banks (the
"Security Agreement").
7. Application and Agreement for Irrevocable Standby Letter of
Credit dated May 17, 1995 from the Borrower to Harris.
8. Trademark Collateral Agreement from the Borrower to the Agent
for the benefit of itself and the Banks.
9. UCC financing statement to be filed in the office of the
Wisconsin Secretary of State (the "Financing Statement").
<PAGE> 70
EXHIBIT C
STOKELY USA, INC.
COMPLIANCE CERTIFICATE
This Compliance Certificate is furnished to Harris Trust and Savings
Bank, as agent (the "Agent"), pursuant to that certain Secured Credit Agreement
dated as of May 22, 1995 by and among Stokely USA, Inc. (the "Company"),
Harris Trust and Savings Bank and the other lenders parties thereto (the
"Agreement"). Unless otherwise defined herein, the terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected _______________________________ of the
Company;
2. I have reviewed the terms of the Agreement and I have made, or
have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Company during the accounting period covered
by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose,
and I have no knowledge of, the existence of any condition or event which
constitutes a Potential Default or Event of Default during or at the end of the
accounting period covered by the attached financial statements or as of the
date of this Certificate, except as set forth below; and
4. If attached financial statements are being furnished pursuant
to Section 7.4(a) or (b) of the Agreement, Schedule I attached hereto sets
forth financial data and computations, evidencing the Company's compliance with
certain covenants of the Agreement, all of which data and computations are
true, complete and correct.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking or proposes to
take with respect to each such condition or event:
_________________________________________
_________________________________________
<PAGE> 71
The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this __________day of
________________________, 19__ .
STOKELY USA, INC.
By _________________________________
Its______________________________
-2-
<PAGE> 72
SCHEDULE I
STOKELY USA, INC.
Compliance Calculations for
Credit Agreement Dated as of May 22, 1995
SECTION 7.8 LEVERAGE RATIO
(a) Funded Debt.................................... $____
(b) Funded Debt plus Tangible Net Worth............ $____
TOTAL.......................................... $____
(a)/(b) .......................... ____ *
*Required to not exceed 0.62 to 1.
Compliance........................ Yes____ No_____
SECTION 7.9 TANGIBLE NET WORTH
(a) Net Worth....................................... $____
(b) Intangible Assets............................... $____
(a)-(b)......................................... ____ *
Tangible Net Worth..................................... $____ *
*Required to be no less than $________during this compliance period.
Compliance........................ Yes____ No_____
SECTION 7.10 NET WORKING CAPITAL
(a) Current Assets.................................. $____
(b) Current Liabilities............................. $____
(a)-(b)......................................... ____ *
*Required to be no less than $35,000,000.
Compliance........................ Yes____ No_____
<PAGE> 73
EXHIBIT D
STOKELY USA, INC.
BORROWING BASE CERTIFICATE
as of____________________
($000's omitted)
This Borrowing Base Certificate is furnished to Harris Trust and
Savings Bank, as agent (the "Agent"), pursuant to that certain Secured Credit
Agreement dated as of May 22, 1995, by and among Stokely USA, Inc. (the
"Company"), Harris Trust and Savings Bank and the other lenders parties thereto
(the "Agreement"). Unless otherwise defined herein, the terms used in this
Borrowing Base Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ______________ of the Company.
2. I have reviewed the terms of the Agreement and I have
made, or have caused to be made under my supervision, the attached
computation of the Borrowing Base as defined in Section 4.1 of the
Agreement.
3. No change of name, corporate identity or address of the
chief executive office of the Company has occurred.
4. The information above and any attached exhibits do not
contain any untrue statement of material fact or omit a material
fact, either individually or in aggregate, that would make the
information or any attached exhibits misleading.
STOKELY USA, INC.
By_____________________
Its__________________
<PAGE> 74
STOKELY USA, INC.
BORROWING BASE CERTIFICATE
<TABLE>
<CAPTION>
GROSS NON PRIME PRIME ADVANCE % BORROWING
BASE
<S> <C> <C> <C> <C> <C> <C> <C>
ACCOUNTS _______ _________ ______ ________ _________
RECEIVABLE
INVENTORY _______ _________ ______ ________ _________ _________ __________
TOTAL _______ _________ ______ _________
</TABLE>
<TABLE>
<S> <C> <C> <C> <C>
BORROWING BASE ________ ________
LOAN BALANCE 05-May-95 ________ Sum ________
L.O.C. RESERVE ________
AVAILABLE AMOUNT ________
</TABLE>
<PAGE> 75
<TABLE>
<CAPTION>
GROSS NON PRIME PRIME ADVANCE % ADVANCE
<S> <C> <C> <C> <C> <C>
CANNED RAW MATERIAL _____ _________ ______ ________ _________
FG CANNED _____ _________ ______ ________ _________
FROZEN RAW MATERIAL _____ _________ ______ ________ _________
FG FROZEN _____ _________ ______ ________ _________
_____ _________ ______ _________
</TABLE>
<PAGE> 76
<TABLE>
<S> <C> <C> <C>
NON PRIME - CANNED
SEED INVENTORY _____________
CANNERY RETAIL INVENTORY _____________
PLASTIC INVENTORY _____________
GLASS INVENTORY _____________
BOX INVENTORY _____________
LABEL INVENTORY _____________
FARM SUPPLIES _____________
FACTORY SUPPLIES _____________
SUBTOTAL RAW MATERIALS _____________
NON-PRIME FINISHED GOODS CANNED
GROWER PAYABLES Jan 31 Trial Balance _____________
GROWER PAYMENTS _____________
MONTH TO DATE INCREASE IN GROWER PAYABLE _____________
GRADE 8 & 9 _____________
SUBTOTAL NP FINISHED _____________
TOTAL NON PRIME CANNED _____________
</TABLE>
<PAGE> 77
<TABLE>
<S> <C> <C> <C>
NONPRIME - FROZEN
SEED INVENTORY _____________
HANDLING AND STORAGE _____________
BOX INVENTORY _____________
POLYBAG INVENTORY _____________
FROZEN TOTE INVENTORY _____________
FROZEN OVERWRAP _____________
FARM SUPPLIES _____________
FACTORY SUPPLIES _____________
INGREDIENTS _____________
SUBTOTAL _____________
GROWER PAYABLES Jan 31 Trial Balance _____________
GROWER PAYMENTS _____________
ESTIMATED MONTH TO DATE INCREASE IN GROWERS _____________
20% OF U INVENTORY _____________
ALL OF Z INVENTORY _____________
SUBTOTAL _____________
</TABLE>
<PAGE> 78
<TABLE>
<CAPTION>
DOLLARS UNITS VARIABLE COST PER
CASE OR POUND
<S> <C> <C> <C>
FINISHED GOODS CANNED PER RPT ________ ________ ___________
________ ________ ___________
BURDEN RATE ________ ________ ___________
CANNED FINISHED GOODS W/BURDEN ________ ________ ___________
FINISHED GOODS FROZEN PER RPT ________ ________ ___________
BURDEN RATE ________ ________ ___________
FROZ FINISHED GOODS W/BURDEN ________
</TABLE>
<PAGE> 79
<TABLE>
<CAPTION>
TOTAL NON PRIME PRIME ADVANCE% ADVANCE
<S> <C> <C> <C> <C> <C>
PRIVATE LABEL _____ _________ ______ ________ _________
BRAND _____ _________ ______ ________ _________
FROZEN _____ _________ ______ ________ _________
_____ _________ ______ ________ _________
_____ _________ ______ _________
</TABLE>
<TABLE>
<CAPTION>
PRIVATE BRAND FROZEN TOTAL
<S> <C> <C> <C> <C> <C>
OVER 90 DAYS _______ _______ _______ _______ ___________
CROSS AGE _______ _______ _______ _______ ___________
FOREIGN <90 _______ _______ _______ _______ ___________
LESS FOREIGN ALLOWED _______ _______ _______ _______ ___________
GOVERNMENT _______ _______ _______ _______ ___________
LESS GOV'T ALLOWED _______ _______ _______ _______ ___________
AGED REC. - PACKER FOODS _______ _______ _______ _______ ___________
</TABLE>
<PAGE> 80
EXHIBIT E
APPLICATION AND AGREEMENT FOR IRREVOCABLE
STANDBY LETTER OF CREDIT
Date _________________
International Operations Division SPL _________________
Harris Trust and Savings Bank
P.O. Box 755
111 West Monroe Street
Chicago, Illinois 60690
Gentlemen:
We request you to open and transmit by cable/airmail your Irrevocable Letter of
Credit in favor of:
available by their drafts, drawn at sight on: Harris Trust and Savings Bank,
or not exceeding a total of:
accompanied by the following document(s):
Drafts drawn under this Letter of Credit must be drawn and presented together
with accompanying documentation at your principal office in Chicago, Illinois
not later than:
In consideration of your issuing at our request your Irrevocable Letter of
Credit (hereinafter called "Credit") on the terms mentioned above:
1. We hereby agree to pay you in immediately available and freely transferable
funds the amount of each draft or acceptance drawn under, or purporting
to be drawn under, the Credit, such payment to be made at the maturity of
each respective draft or acceptance.
2. Payment shall be made by us at your office in Chicago, Illinois in lawful
money of the United States, provided that, if a draft or other request for
payment under the Credit is drawn in a currency other than United States
currency, we shall pay the equivalent in United States currency, at the rate
of exchange then current in Chicago for cable transfers to the place of
payment in the currency in which drawing was made, as determined by you and
notified to us, or, if you so request of us at your option, we shall pay you
the amount of such drawing in the currency in which the drawing was made in
a place, form and manner acceptable to you.
<PAGE> 81
5. We agree that in the event of any extension of the maturity or time for
presentation of drafts, acceptances or documents, or any other
modification of the terms of the Credit, at the request of any of us,
with or without notification to the others, or in the event of any
increase in the amount of the Credit at our request, this agreement shall
be binding upon us with regard to the credit extended, increased or
otherwise modified, to drafts, documents and property covered thereby, and
to any action taken by you or any of your correspondents, in accordance
with such extension, increase or other modification.
6. The users of the Credit shall be deemed our agents and we assume all risks
of their acts, omissions, or misrepresentations. Neither you nor your
correspondents shall be responsible for the validity, sufficiency,
truthfulness, or genuineness of any documents even if such documents should
in fact prove to be in any or all respects invalid, insufficient,
fraudulent or forged; for failure of any draft to bear any reference or
adequate reference to the Credit, or failure of any person to note the
amount of any draft on the reverse of the Credit, or to surrender or to
take up the Credit as required by the terms of the Credit; each of which
provisions, if contained in the Credit itself, it is agreed may be waived
by you, or for errors, omissions, interruptions or delays in transmission
or delivery of any message, by mail, cable, telegraph, wireless, or
otherwise, whether or not they be in cipher; nor shall you be responsible
for any error, neglect or default of any of your correspondents; and none
of the above shall affect, impair or prevent the vesting of any of your
rights or powers hereunder, in furtherance and extension and not in
limitation of the specific provisions hereinbefore set forth, we agree
that any action taken by you or by any correspondent of yours under or in
connection with the Credit or the relative drafts, documents or property,
if taken in good faith, shall be binding on us and shall not
put you or your correspondent under any resulting liability to us; and we
make like agreement as to any inaction or omission, unless in breach of
good faith, except for acts caused by gross negligence or willful
misconduct.
8. You shall not be deemed to have waived any of your rights hereunder,
unless you or your authorized agent shall have signed such waiver in
writing. No such waiver, unless expressly as stated therein, shall be
effective as to any transaction which occurs subsequent to the date of
such waiver, or as to any continuance of a breach after such waiver.
9. The word "property", as used in this agreement, includes goods,
merchandise, securities, funds, choses in action, and any and all other
forms of property, whether real, personal or mixed, and any right or
interest therein.
10. Without limiting the foregoing hereof, we agree that all property
belonging to any of us, now or at any time hereafter delivered, deposited,
conveyed, transferred, assigned or paid to you, or coming into your
possession or into the possession of any one for you in any manner
whatsoever, whether expressly as security for any obligations or
liabilities of us to you or otherwise, are hereby made and shall be and
constitute collateral security for any and all obligations and
liabilities, absolute or contingent, due or to become due, which are now
or may at any time hereafter be owing by us or any one or more of us to
you.
11. Without limiting the foregoing and in addition to the provisions of
paragraph numbered 6 hereof, you are hereby expressly authorized and
directed to honor any request for payment which is made under and in
compliance with the terms of said Credit without regard to, and without
any duty on your part to inquire into, the existence of any dispute or
controversies between any of the undersigned, the beneficiary of the
Credit or any other person, firm or corporation, or the respective rights,
duties or liabilities of any of them or whether any facts or occurrences
represented in any of the documents presented under the Credit are true
or correct. Furthermore, we fully understand and agree that your sole
obligation to us shall be limited to honoring requests for payment made
under and in compliance with the terms of the Credit and this application
and your obligation remains so limited even if you may have assisted us in
the preparation of the wording of the Credit or any documents required to
be presented thereunder or you may otherwise be aware of the underlying
transaction giving rise to the Credit and this application. In addition,
and without limiting any of the other provisions hereof, you and your
correspondents may (a) act in reliance upon any oral, telephonic,
telegraphic, electronic or written request or notice believed by you or
your relevant correspondent in good faith to have been authorized by us
or any one of us, whether or not given or signed by an authorized person,
and (b) receive, accept or pay as complying with the terms of the Credit
any drafts or other document, otherwise in order, that may be signed by,
or Issued to, the administrator or executor of, or the trustee in
bankruptcy of, or the receiver for any of the property of, or any other
person or entity acting as the representative of, in the place of or as
the successor in interest to, the party in whose name the Credit provides
that any drafts or other documents should be drawn or issued.
12. If this agreement is signed by one party, the terms "we," "our," "us,"
shall be read throughout as "I," "my," "me," as the case may be. If
this agreement is signed by two or more parties, it shall constitute the
joint and several agreement of such parties. This agreement shall be
deemed to be made under and shall in all respects be governed by the law
of the State of Illinois. The Credit and, to the extent not inconsistent
with the laws of the State of Illinois, this agreement will be subject to
the Uniform Customs and Practice for Documentary Credits as most recently
published by the International Chamber of Commerce (the "UCP"), except
that Article 41 and 43 of the UCP (1993 Revision) published by the
International Chamber of Commerce as Publication No. 500 shall not apply
nor shall any equivalent provision in any future version of the UCP.
Very truly yours,
________________________________
For Bank Use Only (Firm's name, if applicable)
By __________________________
Title __________________________
______________________ ___________ By __________________________
Signatures Approved by Date Title __________________________
<PAGE> 82
SCHEDULE 5.2
SUBSIDIARIES
JURISDICTION OF PERCENTAGE
NAME INCORPORATION OWNERSHIP
1. Oconomowoc Canning Company, Inc. Wisconsin 100%
2. Ocono International, Ltd. U.S. Virgin Islands 100%
3. ANC Express, Inc. Iowa 100%
4. D & K Frozen Foods, Inc. Washington 100%
5. Stokely U.K. Limited England 100%
<PAGE> 83
Schedule 5.4
LITIGATION
1. Walter Reinholdt v. Stokely USA, Inc. (Law No. C2017 in the Iowa District
Court for Franklin County, Iowa)
This is an action brought by plaintiff for damages of $56,633.43 plus
interest and costs. The claim is based on the Company's alleged negligence
in connection with the storage of dark red kidney beans at its plant in
Ackley, Iowa. The Company denies liability.
This case was tried to a jury in July of 1994, and a verdict was
returned which found no liability on the part of the Company. Plaintiff
has, however, appealed to the Court of Appeals of the State of Iowa. A
decision on that appeal is expected later this year.
Davis, Hockenberg, Wine, Brown, Koehn & Shors of Des Moines, Iowa
represents the Company in this matter.
2. Kurt Boehm v. Stokely USA, Inc., et al. (Case No. 93-L-003414 in the
Circuit Court of Cook County, Illinois)
This action was filed in April of 1993 and is for personal injuries
suffered by plaintiff in a boiler explosion that occurred at the Company's
plant in Hoopeston, Illinois while plaintiff was present as a business
invitee.
The Company has liability insurance in force for this claim through
Crum and Forster Commercial Insurance Co., and the Company's defense has
been undertaken by Crum and Forster Insurance Co. through the law firm of
Crystal, Heytow and Warnick, P.C. of Chicago, IL.
3. Robert Potratz and James Potratz v. Stokely USA, Inc. (Case No. 93-CV-811
in the Circuit Court of Winnebago County, Wisconsin.)
This action sought damages of $180,000 on a breach of contract claim
plus punitive damages of an unstated amount. The Company denied
liability, and the case was tried to a jury in April of 1995. The jury
found that the Company breached the contract and returned a damage verdict
of $73,283 against the Company.
The Company has filed motions after verdict to set aside or reduce
the damages to $34,788. These motions are schedled to be heard by the
court on May 11, 1995. The Company plans to appeal if the verdict
as to damages is not
<PAGE> 84
set aside. Robert Brill, general counsel of the Company, represents
the Company in this action.
4. Renee Estrada v. Arnold Bowman and Stokely USA, Inc. (Cause No.
C-1327-94-D, Hidalgo County, Texas District Court).
This action was filed on March 18, 1994 and is an action for damages
based on plaintiff's claim that he was wrongfully discharged as an
employee at the Company's plant in McAllen, Texas. There is no substance to
the plaintiff's claim. Damages sought include lost earnings and punitive
damages. The Complaint, however, fails to state a specific damage amount.
The exposure is minimal.
The Company is represented by the law firm of Adams and Graham, L.L.P.
of Harlingen, Texas in this action.
5. Baker's Best Frozen Commodities Co., v. Stokely USA, Inc. et al. (Case No.
BC102425 Los Angeles County Superior Court).
This action was filed on April 11, 1994 and seeks compensatory and
punitive damages arising from an alleged breach of contract. The amount of
damages is not stated in the Complaint but is generally represented to be
in excess of $500,000; of which sum the compensatory damage claim comprises
a small part. Stokely USA, Inc. denies liability.
A tentative settlement has been reached which is in the process of
being reduced to writing. Pursuant to this settlement, the Company will
forgive outstanding invoices owed it by Plaintiff in the amount of $16,700
and will provide $15,000 of trade discounts to Plaintiff in each of the
next 3 years.
The Company is represented in this action by Lane, Powell, Spears and
Lubersky of Los Angeles, California.
6. Duane C. Klingler v. Stokely USA, Inc. (Case No. CI-95-046 in the Common
Pleas Court of Paulding County, Ohio).
This action was filed in March of 1995 and claims that the Company
breached a warehouse lease agreement with Plaintiff. Damages of $44,000
are claimed.
The Company has denied liability. Glenn Troth of Paulding, Ohio
represents the Company in this action.
7. Pedro Rodriguez v. Stokely USA, Inc. (Case No. C94-3057 in the United
States District Court for the Northern District of Iowa).
2
<PAGE> 85
This action was filed in August of 1994 and claims that the Company
breached an employment agreement with Plaintiff. Damages are unstated in
the complaint but are estimated by the Company to be less than $5,000.
The Company has denied liability. No trial date has been set. Robert
Brill, general counsel of the Company, represents the Company in this
action.
8. Philip D. Freeman v. Stokely USA, Inc. (Case No. 95-C-003 in the United
States District Court for the Eastern District of Wisconsin).
This is a class action lawsuit which was filed on January 3, 1995, in
the United States District Court for the Eastern District of Wisconsin, by
Philip D. Freeman, a Minnesota resident, against the Company, all of the
individual members of the Board of Directors of the Company (in both their
capacity as a member of the Board of Directors and as an executive officer,
as applicable), William Blair & Company and Dain Bosworth, Inc. The
plaintiff brought the action pursuant to Sections 11, 12(2) and 15 of the
Securities Act of 1934, as amended, and Rule 10b-5 promulgated thereunder.
The plaintiff alleges that he sustained losses in connection with his
purchase of shares of Common Stock of the Company following a secondary
offering by the Company during the period from October 17, 1994 to December
19, 1994, as a result of defendants' alleged misleading statements and
omission to state material facts. The complaint seeks rescission and/or
compensatory damages, and costs and expenses related to the bringing of the
lawsuit. The Company believes that the allegations are without merit or
substance.
The Company retained the law firm of Gibbs, Roper, Loots and Williams
of Milwaukee, Wisconsin to represent the Company and its officers. The
Company has retained the law firm of Michael, Best & Friedrich of
Milwaukee, Wisconsin, to represent the Company's non-employee directors.
The Company has Directors and Officers Liability Insurance coverage through
two carriers with total coverage of $10,000,000, less retention of
$250,000. The Company has negotiated allocation of defense costs with the
primary carrier assuming 75% of such costs and the Company 25% after the
retention.
Motions for dismissal of the Complaint have been filed on behalf of all
defendants and remain pending.
9. Daniel J. Sweeney v. Stokely USA, Inc., et al. (Case No. 95-C-0501) in the
United States District Court for Eastern District of Wisconsin).
3
<PAGE> 86
This case was filed on 5/10/95 and served 5/17/95. It is a
class action suit arising from the same events as the Freeman case.
The Company has retained the law firm of Gibbs, Roper, Loots &
Williams of Milwaukee, Wisconsin to represent it and its employees
named as defendants.
ADMINISTRATIVE PROCEEDINGS PENDING
1. Cynthia A. Spencer v. Stokely USA, Inc. (Case No. CP 08-92-22838 Iowa Civil
Rights Commission)
Cynthia A. Spencer filed a complaint with the Iowa Civil Rights
Commission in August of 1992. She claims that she was not hired in 1992
as a mechanic due to her gender. There is no substance to her complaint
which remains under investigation by the Iowa Civil Rights Commission.
The Company is represented in this matter by its general counsel,
Robert Brill.
2. John Areklet v. Stokely USA, Inc. (PACA N-7964 in the United States
Department of Agriculture)
John Areklet filed a complaint with the United States Department of
Agriculture in February of 1995 which claims the Company violated the
Perishable Agricultural Commodities Act by rejecting a quantity of green
beans grown under contract with the Company by Mr. Areklet in 1994. Mr.
Areklet claims damages of $12,474.
Stokely has denied liability. An administrative decision on the claim
is forthcoming. The Company is represented in this matter by its general
counsel, Robert Brill.
3. Robert Van der Zanden v. Stokely USA, Inc. (PACA N-8003 in the United
States Department of Agriculture).
Robert Van der Zanden filed a complaint with the United States
Department of Agriculture in March of 1995 which claims the Company
violated the Perishable Agricultural Commodities Act by rejecting a
quantity of green beans grown under contract with the Company by Mr. Van
der Zanden in 1994. Mr. Van der Zanden claims damages of $5,770.
Stokely has denied liability. An administrative decision on the claim
is forthcoming. The Company is represented in this matter by its general
counsel, Robert Brill.
4
<PAGE> 87
THREATENED LITIGATION
1. Middleton Refuse Hideaway. The Company has been named as a potentially
responsible party with regard to the Middleton Refuse Hideaway Landfill
Site in Dane County, Wisconsin. The Company believes its responsibility,
if any, is de minimus on the basis that it contributed no hazardous
materials to the landfill site and an insignificant volume of materials in
a volumetric ranking scheme.
The Company joined with several other de minimus parties to retain the
law firm of Michael Best and Friedrich of Madison, Wisconsin to represent
it with regard to this matter; although there is no legal action pending
against the Company at this time. The Company is currently negotiating a
de minimus settlement.
5
<PAGE> 88
SCHEDULE 5.15
FARM PRODUCT PURCHASES AND REGISTRATIONS
States in Which The
Company is Registered
States in Which Farm Central Filing System Under the Federal Food
Products are Purchased (Yes/No) Security Act
- ---------------------- ------ ------------
Wisconsin NO
Illinois NO
Iowa NO
Texas NO
Washington NO
Florida NO
Michigan NO
Minnesota YES Minnesota
Missouri NO
<PAGE> 89
SCHEDULE 7.13
PERMITTED LIENS
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
Arkansas UCC
Secretary of
State
Pulaski County, UCC
AR
Illinois UCC
Secretary of
State
3077203 01/25/93 Heekin Can, Inc. Inventory:
Ready to fill
cans
Indiana Secretary UCC
of State
1812696 11/12/93 Packer Foods, Inventory
Inc. produced by
Packer Foods,
Inc. and A/R
generated by
its sale
Iowa Secretary UCC 04/26/95 K363187 05/26/92 Heekin Can, Inc. Ready to fill
of State cans
K405321 11/16/92 Leasing LEASE: Specific
Dynamics, Inc. equipment
k430927 01/26/93 Heekin Can, Inc. Ready to fill
cans
Michigan UCC 04/19/95 C677593 01/25/93 Heekin Can, Inc. Inventory:
Secretary of Ready to fill
State cans
</TABLE>
<PAGE> 90
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Minnesota UCC 05/02/95 1504490 05/26/92 Heekin Can, Inc. Inventory:
Secretary of Ready to fill
State cans
1510939 06/22/92 Budach Tractors
Implement, Inc.
assigned to Case
Credit, a
division of Case
Corporation
Missouri UCC
Secretary of
State
Greene County, UCC
MO
New York UCC
Department of
State
Albany County, UCC
NY
Oklahoma UCC
County Clerk,
OK
Oregon UCC
Secretary of
State
Tennessee UCC
Secretary of
State
Texas Secretary UCC
of State
9400224522 11/18/94 LDI Corporation LEASE: Specific
equipment
Virginia State UCC
Corporation
Commission
</TABLE>
-2-
<PAGE> 91
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Indep. City of UCC
Richmond, VA
Washington UCC 04/24/95 92-188-0990 07/06/92 Industrial (1) Hyster Lift
Department of Finance truck
Licensing Company
92-353-9651 12/18/92 Industrial ASSIGNMENT:
ASSIGNMENT Finance to CIT Group/
Company Equipment
Financing, Inc.
94-144-0173 05/24/94 Hyster Sales (1) Hyster Lift
Company truck
95-090-0314 03/31/95 Container Specific
Corporation of equipment/
America machinery
95-090-0315 03/31/95 Container Specific
Corporation of equipment/
America machinery
95-090-0316 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0317 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0318 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0319 03/31/95 Container Specific
Corporation of machinery/
America equipment
Wisconsin UCC 12/07/94 845203 05/01/86 First Bank (2) Forklifts
Secretary of (N.A.), as w. clamps
State Trustee
</TABLE>
-3-
<PAGE> 92
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
1171913 12/28/90 First Bank CONTINUATION
CONTINUATION (N.A.), as
Trustee
1007611 08/23/88 Village of Specific
Poynette furniture,
assigned to First machinery,
Bank (N.A.), as equipment paid
Trustee for by proceeds
of $6,000,000
Village of
Poynette Indus.
Revenue Bonds
1296582 08/10/92 First Bank ASSIGNMENT
ASSIGNMENT (N.A.), as to Nations Bank
Trustee of Virginia,
N.A.
1369947 07/28/93 NationsBank of CONTINUATION
CONTINUATION Virginia, N.A.
1158190 10/12/90 Port of Walla (1) FMC
Walla Public pressure cooker
Corporation
assigned to First
Bank (N.A.), as
Trustee
1303747 09/18/92 Port of Walla ASSIGNMENT
ASSIGNMENT Walla Public to Nations Bank
Corporation of Virginia,
assigned to First N.A.
Bank (N.A.), as
Trustee
1315321 11/17/92 First Bank ASSIGNMENT
ASSIGNMENT (N.A.), as to Nations Bank
Trustee of Virginia,
N.A.
1216491 07/11/91 American LEASE: (1)
Industrial Omega phone
Leasing system
</TABLE>
-4-
<PAGE> 93
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ---------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
1107349 01/25/90 Key Key Color-sort
Technology, Inc. system
822029 01/02/86 First Bank Machinery,
(N.A.), as equipment,
Trustee fixtures, other
personal
property from
proceeds from
sale of $6.5MM
Jefferson,
Wisconsin
Indus. Develop.
Revenue Bonds
1170976 12/21/90 First Bank CONTINUATION
CONTINUATION (N.A.), as
Trustee
1296533 08/10/92 First Bank ASSIGNMENT
ASSIGNMENT (N.A.), as to Nations Bank
Trustee of Virginia,
N.A.
1331277 02/08/93 GTE Leasing LEASE: Norstar
Corp. Telephone
System
1328653 01/26/93 Heekin Can, Inc. Inventory--
"Cans", "Ends"
i.e. "Containers"
1094129 11/14/89 Thorstad Motorola
Leasing, Inc. Cellular phone
1313536 11/09/92 Packer Foods, Inventory
Inc. produced by
Packer Foods
and accounts
generated by sale
of such
1152613 09/13/90 Orix Credit LEASE: Specific
Alliance, Inc. equipment
</TABLE>
-5-
<PAGE> 94
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
1298316 08/19/92 Orix Credit RELEASE:
RELEASE Alliance, Inc. Specific leased
equipment
1155291 09/27/90 Leasing LEASE: Specific
Dynamics, Inc. equipment
0751194813 04/05/91 Leasing LEASE: Specific
Dynamics, Inc. office equipment
1340380 03/17/93 IBM Specific IBM
equipment for
$269,886
1340382 03/17/93 IBM Specific IBM
equipment for
$170,000
1419066 03/30/94 LDI Corporation LEASE: specific
IBM equipment
Brown County, UCC
WI
Columbia UCC
County, WI
670109 04/02/93 Rhyme Supply (1) Fax system
Dane County, UCC
WI
Outagamie UCC 05/05/95 2124 05/01/86 First Bank (2) Fork lifts,
County, WI (N.A.) as railroad track,
Trustee security system
315 01/25/91 First Bank CONTINUATION
CONTINUATION (N.A.) as
Trustee
419 02/08/95 Comerica Bank- Blanket lien/
Illinois Fixtures
Waukesha UCC
County, WI
</TABLE>
-6-
<PAGE> 95
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
</TABLE>
-7-
<PAGE> 96
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
D & K FROZEN FOODS, INC.
Washington UCC 12/01/94 86-057-0460 02/26/86 Caterpillar (1) New CAT
Department of Financial lift truck
Licensing Services
Corporation
91-004-0453 01/04/91 Caterpillar CONTINUATION
CONTINUATION Financial
Services
Corporation
91-100-0520 04/10/91 Tumac Lease & LEASE: Specific
Finance Inc. equipment
93-210-0455 07/29/93 United States Machinery,
Department of equipment,
Commerce furniture,
fixtures located
on real property-
-subject to
Subordination
Agrmt (Rainier
National Bank)
</TABLE>
-8-
<PAGE> 97
STOKELY USA, INC.
SECURED REVOLVING CREDIT NOTE
$20,000,000.00 May 22, 1995
FOR VALUE RECEIVED, the undersigned, STOKELY USA, INC., a Wisconsin
corporation (the "Company"), promises to pay to the order of HARRIS TRUST AND
SAVINGS BANK (the "Lender") on July 31, 1998, at the principal office of Harris
Trust and Savings Bank in Chicago, Illinois, the principal sum of Twenty
Million Dollars ($20,000,000) or, if less, the aggregate unpaid principal
amount of all Revolving Credit Loans made by the Lender to the Company under
the Revolving Credit provided for under the Credit Agreement hereinafter
mentioned and remaining unpaid on July 31, 1998, together with interest on
the principal amount of each Revolving Credit Loan from time to time
outstanding hereunder at the rates, and payable in the manner and on the
dates specified in said Credit Agreement.
The Lender shall record on its books or records or on the schedule to
this Note which is a part hereof the principal amount of each Revolving Credit
Loan made under the Revolving Credit, whether each Loan is a Domestic Rate Loan
or a Eurodollar Loan and, with respect to Eurodollar Loans, the interest rate
and Interest Period applicable thereto, and all payments of principal and
interest and the principal balances from time to time outstanding; provided that
prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such books
or records or on the schedule to this Note, shall be prima facie evidence as to
all such amounts; provided, however, that the failure of the Lender to record
or any mistake in recording any of the foregoing shall not limit or otherwise
affect the obligation of the Company to repay all Revolving Credit Loans made
under the Revolving Credit, together with accrued interest thereon.
This Note is one of the Revolving Notes referred to in and issued under
that certain Secured Credit Agreement dated as of May 22, 1995, among the
Company, Harris Trust and Savings Bank, as Agent, and the lenders named
therein, as amended from time to time (the "Credit Agreement"), and this Note
and the holder hereof are entitled to all of the benefits and security provided
for thereby or referred to therein, including without limitation the collateral
security provided pursuant to the Security Agreement (as defined in the Credit
Agreement), to which Credit Agreement and Security Agreement reference is
hereby made for a statement thereof and a statement of the terms and conditions
upon which the Agent may exercise rights with respect to such collateral. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.
<PAGE> 98
Prepayments may be made on any Revolving Credit Loan evidenced hereby
and this Note (and the Revolving Credit Loans evidenced hereby) may be declared
due prior to the expressed maturity thereof, all in the events, on the terms
and in the manner as provided for in said Credit Agreement and the Security
Agreement.
The undersigned hereby expressly waives diligence, presentment, demand,
protest, notice of protest, notice of intent to accelerate, notice of
acceleration, and notice of any other kind.
IT IS AGREED THAT THIS NOTE AND THE RIGHTS AND REMEDIES OF THE HOLDER
HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF ILLINOIS.
STOKELY USA, INC.
By
--------------------------
Its Vice Chairman
----------------------
-2-
<PAGE> 99
STOKELY USA, INC.
SECURED REVOLVING CREDIT NOTE
$5,000,000.00 May 22, 1995
FOR VALUE RECEIVED, the undersigned, STOKELY USA, INC., a Wisconsin
corporation (the "Company"), promises to pay to the order of MERCANTILE BANK OF
ST. LOUIS NATIONAL ASSOCIATION (the "Lender") on July 31, 1998, at the
principal office of Harris Trust and Savings Bank in Chicago, Illinois, the
principal sum of Five Million Dollars ($5,000,000) or, if less, the aggregate
unpaid principal amount of all Revolving Credit Loans made by the Lender to the
Company under the Revolving Credit provided for under the Credit Agreement
hereinafter mentioned and remaining unpaid on July 31, 1998, together with
interest on the principal amount of each Revolving Credit Loan from time to
time outstanding hereunder at the rates, and payable in the manner and on the
dates specified in said Credit Agreement.
The Lender shall record on its books or records or on the schedule to
this Note which is a part hereof the principal amount of each Revolving Credit
Loan made under the Revolving Credit, whether each Loan is a Domestic Rate Loan
or a Eurodollar Loan and, with respect to Eurodollar Loans, the interest rate
and Interest Period applicable thereto, and all payments of principal and
interest and the principal balances from time to time outstanding; provided
that prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such
books or records or on the schedule to this Note, shall be prima facie
evidence as to all such amounts; provided, however, that the failure of the
Lender to record or any mistake in recording any of the foregoing shall not
limit or otherwise affect the obligation of the Company to repay all Revolving
Credit Loans made under the Revolving Credit, together with accrued interest
thereon.
This Note is one of the Revolving Notes referred to in and issued under
that certain Secured Credit Agreement dated as of May 22, 1995, among the
Company, Harris Trust and Savings Bank, as Agent, and the lenders named
therein, as amended from time to time (the "Credit Agreement"), and this Note
and the holder hereof are entitled to all of the benefits and security provided
for thereby or referred to therein, including without limitation the collateral
security provided pursuant to the Security Agreement (as defined in the Credit
Agreement), to which Credit Agreement and Security Agreement reference is
hereby made for a statement thereof and a statement of the terms and conditions
upon which the Agent may exercise rights with respect to such collateral. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.
<PAGE> 100
Prepayments may be made on any Revolving Credit Loan evidenced hereby
and this Note (and the Revolving Credit Loans evidenced hereby) may be declared
due prior to the expressed maturity thereof, all in the events, on the terms
and in the manner as provided for in said Credit Agreement and the Security
Agreement.
The undersigned hereby expressly waives diligence, presentment, demand,
protest, notice of protest, notice of intent to accelerate, notice of
acceleration, and notice of any other kind.
IT IS AGREED THAT THIS NOTE AND THE RIGHTS AND REMEDIES OF THE HOLDER
HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF ILLINOIS.
STOKELY USA, INC.
By _________________________
Its Vice Chairman
_____________________
-2-
<PAGE> 101
STOKELY USA, INC.
SECURED REVOLVING CREDIT NOTE
$12,500,000.00 May 22, 1995
FOR VALUE RECEIVED, the undersigned, STOKELY USA, INC., a Wisconsin
corporation (the "Company"), promises to pay to the order of SANWA BUSINESS
CREDIT CORPORATION (the "Lender") on July 31, 1998, at the principal office of
Harris Trust and Savings Bank in Chicago, Illinois, the principal sum of Twelve
Million Five Hundred Thousand Dollars ($12,500,000) or, if less, the aggregate
unpaid principal amount of all Revolving Credit Loans made by the Lender to the
Company under the Revolving Credit provided for under the Credit Agreement
hereinafter mentioned and remaining unpaid on July 31, 1998, together with
interest on the principal amount of each Revolving Credit Loan from time to
time outstanding hereunder at the rates, and payable in the manner and on the
dates specified in said Credit Agreement.
The Lender shall record on its books or records or on the schedule to
this Note which is a part hereof the principal amount of each Revolving Credit
Loan made under the Revolving Credit, whether each Loan is a Domestic Rate Loan
or a Eurodollar Loan and, with respect to Eurodollar Loans, the interest rate
and Interest Period applicable thereto, and all payments of principal and
interest and the principal balances from time to time outstanding; provided
that prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such
books or records or on the schedule to this Note, shall be prima facie evidence
as to all such amounts; provided, however, that the failure of the Lender to
record or any mistake in recording any of the foregoing shall not limit or
otherwise affect the obligation of the Company to repay all Revolving Credit
Loans made under the Revolving Credit, together with accrued interest thereon.
This Note is one of the Revolving Notes referred to in and issued
under that certain Secured Credit Agreement dated as of May 22, 1995, among the
Company, Harris Trust and Savings Bank, as Agent, and the lenders named
therein, as amended from time to time (the "Credit Agreement"), and this Note
and the holder hereof are entitled to all of the benefits and security provided
for thereby or referred to therein, including without limitation the collateral
security provided pursuant to the Security Agreement (as defined in the Credit
Agreement), to which Credit Agreement and Security Agreement reference is
hereby made for a statement thereof and a statement of the terms and conditions
upon which the Agent may exercise rights with respect to such collateral. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.
<PAGE> 102
Prepayments may be made on any Revolving Credit Loan evidenced hereby
and this Note (and the Revolving Credit Loans evidenced hereby) may be declared
due prior to the expressed maturity thereof, all in the events, on the terms
and in the manner as provided for in said Credit Agreement and the Security
Agreement.
The undersigned hereby expressly waives diligence, presentment,
demand, protest, notice of protest, notice of intent to accelerate, notice of
acceleration, and notice of any other kind.
IT IS AGREED THAT THIS NOTE AND THE RIGHTS AND REMEDIES OF THE HOLDER
HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF ILLINOIS.
STOKELY USA, INC.
By ____________________________
Its Vice Chairman
- 2 -
<PAGE> 103
STOKELY USA, INC.
SECURED REVOLVING CREDIT NOTE
$27,500,000.00 May 22, 1995
FOR VALUE RECEIVED, the undersigned, STOKELY USA, INC., a Wisconsin
corporation (the "Company"), promises to pay to the order of GENERAL ELECTRIC
CAPITAL CORPORATION (the "Lender") on July 31, 1998, at the principal office of
Harris Trust and Savings Bank in Chicago, Illinois, the principal sum of
Twenty-Seven Million Five Hundred Thousand Dollars ($27,500,000) or, if less,
the aggregate unpaid principal amount of all Revolving Credit Loans made by the
Lender to the Company under the Revolving Credit provided for under the Credit
Agreement hereinafter mentioned and remaining unpaid on July 31, 1998, together
with interest on the principal amount of each Revolving Credit Loan from time
to time outstanding hereunder at the rates, and payable in the manner and on
the dates specified in said Credit Agreement.
The Lender shall record on its books or records or on the schedule to
this Note which is a part hereof the principal amount of each Revolving Credit
Loan made under the Revolving Credit, whether each Loan is a Domestic Rate Loan
or a Eurodollar Loan and, with respect to Eurodollar Loans, the interest rate
and Interest Period applicable thereto, and all payments of principal and
interest and the principal balances from time to time outstanding; provided
that prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such
books or records or on the schedule to this Note, shall be prima facie evidence
as to all such amounts; provided, however, that the failure of the Lender to
record or any mistake in recording any of the foregoing shall not limit or
otherwise affect the obligation of the Company to repay all Revolving Credit
Loans made under the Revolving Credit, together with accrued interest thereon.
This Note is one of the Revolving Notes referred to in and issued
under that certain Secured Credit Agreement dated as of May 22, 1995, among the
Company, Harris Trust and Savings Bank, as Agent, and the lenders named
therein, as amended from time to time (the "Credit Agreement"), and this Note
and the holder hereof are entitled to all of the benefits and security provided
for thereby or referred to therein, including without limitation the collateral
security provided pursuant to the Security Agreement (as defined in the Credit
Agreement), to which Credit Agreement and Security Agreement reference is
hereby made for a statement thereof and a statement of the terms and conditions
upon which the Agent may exercise rights with respect to such collateral. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.
<PAGE> 104
Prepayments may be made on any Revolving Credit Loan evidenced hereby
and this Note (and the Revolving Credit Loans evidenced hereby) may be declared
due prior to the expressed maturity thereof, all in the events, on the terms
and in the manner as provided for in said Credit Agreement and the Security
Agreement.
The undersigned hereby expressly waives diligence, presentment,
demand, protest, notice of protest, notice of intent to accelerate, notice of
acceleration, and notice of any other kind.
IT IS AGREED THAT THIS NOTE AND THE RIGHTS AND REMEDIES OF THE HOLDER
HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF ILLINOIS.
STOKELY USA, INC.
By ________________
Its Vice Chairman
- 2 -
<PAGE> 105
STOKELY USA, INC.
SECURITY AGREEMENT
RE: ACCOUNTS RECEIVABLE AND INVENTORY
Harris Trust and Savings Bank
as Agent under the Secured Credit
Agreement hereinafter identified
111 West Monroe Street
Chicago, Illinois 60690
Ladies and Gentlemen:
Reference is made to that certain Secured Credit Agreement dated as of
May 22, 1995 (such Secured Credit Agreement, as the same may be modified or
amended from time to time, being hereinafter referred to as the "Secured Credit
Agreement") by and among Stokely USA, Inc. (the "Debtor"), and Harris Trust and
Savings Bank, Mercantile Bank of St. Louis National Association, Sanwa Business
Credit Corporation, and General Electric Capital Corporation (all of said
lenders, including Harris Trust and Savings Bank in its individual capacity,
being hereinafter referred to collectively as the "Banks" and individually as a
"Bank", and said Harris Trust and Savings Bank as agent for the Banks under the
Secured Credit Agreement being hereinafter referred to in such capacity as the
"Agent"), pursuant to which the Debtor has issued its Secured Revolving Credit
Notes dated May 22, 1995 payable to the order of each Bank in the aggregate
principal amount of $65,000,000 (such Secured Revolving Credit Notes, together
with all extensions, renewals or refundings thereof being hereinafter referred
to as the "Notes") and has agreed to reimburse Harris Trust and Savings Bank
for all amounts paid by it in connection with letters of credit ("L/Cs") issued
for the Debtor's account as described in the Secured Credit Agreement. The
Notes, together with all indebtedness, obligations and liabilities of the
Debtor to the Banks under the Secured Credit Agreement, the L/C Agreements, any
of the other Loan Documents or otherwise are hereinafter referred to
collectively as the "Borrower Indebtedness").
1. Security Interest. Accordingly, the Debtor, in order to
secure the (i) payment of all principal of and interest on the Notes and all
other Borrower Indebtedness as and when the same become due and payable
(whether by lapse of time, acceleration or otherwise), (ii) payment of all
other indebtedness, obligations and liabilities which this Agreement secures
pursuant to any of its terms and the observance and performance of all
covenants and agreements contained herein or in the Notes or Secured Credit
Agreement or in any other instrument or document at any time evidencing or
securing any of the foregoing or setting forth terms and conditions applicable
thereto, (iii) payment of all interest, fees and charges payable by the Debtor
under the terms of the Secured Credit Agreement and (iv) payment in full of all
expenses and charges, legal or otherwise, including reasonable attorneys' fees,
suffered or incurred by Agent or any Bank in
<PAGE> 106
collecting or enforcing payment of any Note or any or all of the other
foregoing indebtedness or in realizing upon, protecting or preserving any
collateral security for any Note or such other indebtedness (all of such
indebtedness, obligations and liabilities referred to in the immediately
foregoing clauses (i), (ii), (iii) and (iv) being hereinafter collectively
referred to as the "Obligations"), the Debtor hereby grants to the Agent for
the ratable benefit of the Banks a security interest in, and acknowledges and
agrees that the Agent has and shall continue to have for the ratable benefit of
the Banks a continuing security interest in, any and all of the Debtor's:
(a) Receivables. Receivables whether now existing or
hereafter arising, and however evidenced or acquired, or in which the
Debtor now has or hereafter acquires any rights (the term
"Receivables" means and includes accounts, accounts receivable,
contract rights, instruments, notes, drafts, acceptances, documents,
chattel paper, general intangibles, any right of the Debtor to payment
for goods sold or leased or for services rendered, whether arising out
of the sale of Inventory [as hereinafter defined] or otherwise and
whether or not earned by performance, and all other forms of
obligations owing to the Debtor, and all of the Debtor's rights to any
merchandise [including without limitation any returned or repossessed
goods and the right of stoppage in transit] which is represented by,
arises from or is related to any of the foregoing; provided that the
term "Receivables" shall not include agreements, contracts, licenses,
permits, representations and warranties relating to the real estate,
machinery and equipment of Debtor);
(b) Inventory. Inventory, whether now owned or hereafter
acquired, and all documents of title at any time evidencing or
representing any part thereof (the term "Inventory" means and includes
all goods which are held for sale or lease or are to be furnished
under contracts of service, or which are raw materials,
work-in-process, finished goods, materials and supplies of every
nature used or usable in connection with the manufacture, processing,
supply, servicing, storing, packing, shipping, advertising, selling,
leasing or furnishing of such goods and any constituents or
ingredients thereof, and returned or repossessed goods, and all of the
Debtor's right, title and interest in and to all trademarks, trademark
registrations, trademark licenses, trade names, trade styles, patents,
patent applications, patent licenses and similar properties, rights,
interests and privileges used or usable in connection with, or in any
way related to or being a part of, any of the foregoing; and without
limiting the foregoing the Debtor's Inventory of: fresh vegetables and
canned and frozen vegetables produced or acquired in the ordinary
course of business;
(c) Deposits and Property in Possession. All deposit
accounts and investment accounts (whether general, specific or
otherwise) and all sums now or hereafter on deposit therein or payable
thereon, and any and all other property or interests in property which
now is or may from time to time hereafter come into the possession,
custody or control of the Agent or any of the Banks, or any agent or
affiliate of any of them, in any way and for any purpose (whether for
safekeeping, custody, pledge, transmission, collection or otherwise);
-2-
<PAGE> 107
(d) Records and Cabinets. Supporting evidence and
documents relating to any of the above described property, including
without limitation, computer programs, disks, tapes and related
electronic data processing media, and all rights of the Debtor to
retrieve the same from third parties, written applications, credit
information, account cards, payment records, correspondence, invoice
copies, delivery receipts, notes and other evidences of indebtedness,
insurance certificates and the like, together with all books of
account, ledgers and cabinets in which the same are reflected or
maintained, all whether now existing or hereafter arising;
(e) Proceeds and Products. All proceeds and products of
the foregoing and all insurance of the foregoing and proceeds thereof,
whether now existing or hereafter arising;
all of the foregoing being herein sometimes referred to as the "Collateral".
2. Covenants, Agreements, Representations and Warranties. The
Debtor hereby covenants and agrees with, and represents and warrants to the
Agent and the Banks that:
(a) The Debtor is a corporation duly organized, existing
and in good standing under the laws of the state of its incorporation,
is the sole and lawful owner of its Collateral and has full right,
power and authority to enter into this Agreement and to perform each
and all of the matters and things herein provided for; and the
execution and delivery of this Agreement, and the observance and
performance of any of the matters and things herein set forth, will
not violate or contravene any provision of law or of the articles of
incorporation or by-laws of the Debtor or of any indenture, loan
agreement or other agreement of or affecting the Debtor or any of its
properties.
(b) The Collateral is located at the locations listed under
Column 1 on Schedule A attached hereto, except for Inventory which in
the ordinary course of the Debtor's business is in transit between any
such locations. The Debtor's chief executive offices and chief places
of business are listed under Columns 2 and 3 on Schedule A attached
hereto and the Debtor has no other places of business other than those
listed under Item 2 on Schedule A attached hereto. Except as provided
in Section 5(a), the Debtor will not remove its Collateral from the
locations specified in the first sentence of this Section 2(b) without
giving the Agent written notice thereof (provided that if for any
reason Collateral is at any time kept or located at locations other
than its present location or locations hereafter disclosed to the
Agent, the Agent shall nevertheless have and retain a security
interest therein).
(c) The Collateral and every part thereof is and will be
free and clear of all security interests, liens, attachments, levies
and encumbrances of every kind, nature and description and whether
voluntary or involuntary except for the security interest of the Agent
therein and liens and security interests permitted by the Credit
Agreement, and the Debtor will warrant and defend the Collateral
against any claims and demands of all persons at any time claiming the
same or any interest therein adverse to the Agent or any Bank.
-3-
<PAGE> 108
(d) The Debtor will pay promptly when due all taxes,
assessments, and governmental charges and levies upon or against its
Collateral in each case before the same become delinquent and before
penalties accrue thereon, unless and to the extent that the same are
being contested as required by Section 7.2 of the Credit Agreement.
(e) The Debtor at its own cost and expense will maintain,
keep and preserve its Collateral in good repair and condition and will
not waste or destroy such Collateral or any part thereof and will not
be negligent in the care and use of any Collateral and will not use or
permit to be used any Collateral in violation of any statute,
ordinance or other governmental requirement.
(f) Subject to Sections 4(a) and 5(a) hereof, the Debtor
will not without the Agent's prior written consent, sell, assign,
mortgage, lease or otherwise dispose of its Collateral or any interest
therein.
(g) The Debtor will insure its Collateral which is
insurable against such risks and hazards as other companies similarly
situated insure against, and including in any event loss or damage by
fire, theft, burglary, pilferage, loss in transit and such other
hazards as the Agent may specify, in amounts and under policies
(providing that no cancellation of such insurance shall be effective
without 30 days' prior written notice to the Agent and containing loss
payable clauses to the Agent as its interest may appear and naming the
Agent as additional insured therein) by insurers acceptable to the
Agent and all premiums thereon shall be paid by the Debtor and the
policies of such insurance (or certificates therefor) delivered to the
Agent. In case of any material loss, damage to or destruction of the
Collateral or any part thereof, the Debtor shall promptly give written
notice thereof to the Agent generally describing the nature and extent
of such damage or destruction. In the event the Debtor shall receive
any proceeds of such insurance, the Debtor will immediately pay over
such proceeds to the Agent. The Debtor hereby authorizes the Agent at
the Agent's option during the existence of any Event of Default to
adjust, compromise and settle any losses under any insurance afforded,
and the Debtor does hereby irrevocably constitute the Agent, its
officers, agents and attorneys, as its attorneys-in-fact, with full
power and authority to effect such adjustment, compromise and/or
settlement and to endorse any drafts drawn by an insurer of all the
Collateral or any part thereof and to do everything necessary to carry
out such purposes and to receive and receipt for any unearned premiums
due under policies of such insurance; but unless the Agent elects to
adjust, compromise or settle losses as aforesaid, such adjustment,
compromise and/or settlement shall be made by the Debtor, subject to
final approval of the Agent in the case of losses exceeding $10,000.
Net insurance proceeds received by the Agent under the provisions
hereof or under any policy or policies of insurance covering the
Collateral or any part thereof shall be applied to the reduction of
the Obligations (whether or not then due) then outstanding, provided,
however, that in the absence of an event of default the Agent, with
the prior consent of the Required Banks, may release any or all such
insurance proceeds to the Debtor. All insurance proceeds in respect
of the Collateral shall be subject to the lien and security interest
of the Agent hereunder.
-4-
<PAGE> 109
(h) The Debtor will allow the Agent or its representatives
(which may be accompanied by any of the Banks or their respective
representatives) free access to and right of inspection of the
Collateral, which in the absence of an Event of Default shall be at
reasonable times and upon reasonable notice. The Debtor will, to the
extent it is within its power so to do, authorize and instruct all
bailees and other parties at any time holding, storing, shipping or
transferring all or any part of the Debtor's Collateral to permit the
Agent, any Bank or their respective designees to examine and inspect
any of such Collateral then in such party's possession and to verify
from such party's own books and records any information concerning
such Collateral or any part thereof which the Agent or any Bank may
seek to verify.
(i) The Debtor agrees from time to time to deliver to the
Agent such evidence of the existence and identity of the Debtor's
Collateral and of its availability as collateral security pursuant
hereto, as the Agent may request.
(j) The Debtor will comply in all material respects with
the terms and conditions of any leases, easements, right-of-way
agreements or other agreements covering the premises wherein its
Collateral is located and any orders, ordinances, laws or statutes of
any city, state or other governmental entity, department or agency
having jurisdiction with respect to such premises or the conduct of
business thereon.
(k) On failure of the Debtor to perform any of the
covenants and agreements herein contained, the Agent may, at its
option, perform the same and in so doing may expend such sums as the
Agent may deem advisable in the performance thereof, including without
limitation the payment of any insurance premiums, the payment of any
taxes, liens and encumbrances, expenditures made in defending against
any adverse claim and all other expenditures which the Agent may be
compelled to make by operation of law or which the Agent may make by
agreement or otherwise for the protection of the security hereof. All
such sums and amounts so expended shall be repayable by the Debtor
immediately without notice or demand, shall constitute so much
additional Obligations hereby secured and shall bear interest from the
date said amounts are expended at the rate per annum (computed on the
basis of a 360-day year for the actual number of days elapsed)
determined by adding 3% to the rate per annum from time to time
announced by said Harris Trust and Savings Bank as its prime
commercial rate with any change in such rate per annum as so
determined by reason of a change in such prime commercial rate to be
and become effective as of and on the date of such change in said
prime commercial rate (such rate per annum as so determined being
hereinafter referred to as the "Default Rate"). No such performance
of any covenant or agreement by the Agent on behalf of the Debtor and
no such advancement or expenditure therefor, shall relieve the Debtor
of any default under the terms of this Agreement. The Agent, in making
any payment hereby authorized may do so according to any bill,
statement or estimate procured from the appropriate public office or
holder of the claim to be discharged without inquiry into the accuracy
of such bill, statement or estimate or into the validity of any tax
assessment, sale, forfeiture, tax lien or title or claim. The Agent,
in performing any act hereunder, shall be the sole judge of whether
the Debtor is required to perform
-5-
<PAGE> 110
same under the terms of this Agreement. The Agent or any Bank is
authorized to charge any depository account of the Debtor maintained
with the Agent or such Bank for the amount of such sums and amounts so
expended by such party.
(l) The Debtor warrants that it has not transacted
business, and does not transact business, under any trade names except
Oconomowoc Canning Company. The Debtor will not change its name or
transact business under any trade names without first giving the Agent
and the Banks 30 days' prior written notice of its intent to do so.
(m) The Debtor agrees to execute and deliver to the Agent
such further agreements and assignments or other instruments and to do
all such other things as the Agent may deem necessary or appropriate
to assure the Agent its security interest hereunder, including such
financing statement or statements or amendments thereof or supplements
thereto or other instruments as the Agent may from time to time
require in order to comply with the Uniform Commercial Code as enacted
in the State of Wisconsin and any other state in which Collateral is
located and any successor statute(s) thereto (the "Code"). The Debtor
hereby agrees that a carbon, photographic or other reproduction of
this Agreement or any such financing statement is sufficient for
filing as a financing statement by the Agent without notice thereof to
the Debtor wherever the Agent in its sole discretion desires to file
the same. In the event for any reason the law of any other
jurisdiction than Wisconsin becomes or is applicable to the Collateral
or any part thereof, or to any of the Obligations, the Debtor agrees
to execute and deliver all such instruments and to do all such other
things as the Agent in its sole discretion deems necessary or
appropriate to preserve, protect and enforce the security interests of
the Agent under the law of such other jurisdiction to at least the
same extent as such security interests would be protected under the
Code. If any Collateral is in the possession or control of any of the
Debtor's agents or processors, at the Agent's request during the
existence of any Event of Default, the Debtor agrees to notify such
agents or processors in writing of the Agent's security interests
therein, and upon the Agent's request instruct them to hold all such
Collateral for the Agent's account and subject to the Agent's
instructions. The Debtor agrees to mark its books and records to
reflect the security interests of the Agent in the Collateral.
3. Special Provisions Re: Receivables. (a) As of the time any
Receivable becomes subject to the security interests provided for hereby, the
Debtor shall be deemed to have warranted as to each and all of its Receivables
that each such Receivable and all papers and documents relating thereto are
genuine and in all respects what they purport to be; that each such Receivable
is valid and subsisting and if such Receivable is an account receivable, arises
out of a bona fide sale of goods sold (or advanced payment on a sale of goods)
and delivered by the Debtor to, or out of and for services theretofore actually
rendered by the Debtor to, the account debtor named therein; that the amount of
the Receivable represented as owing is the correct amount actually and
unconditionally owing, except for normal cash discounts on normal trade terms
in the ordinary course of business if such Receivable is an account receivable;
that the amount of such Receivable represented as owing is not disputed, and is
not subject to any set-offs, credits, deductions or counter charges other than
in the ordinary
-6-
<PAGE> 111
course of business; that no Receivable is evidenced by any instrument or
chattel paper unless such instrument or chattel paper has theretofore been
endorsed by the Debtor and delivered to the Agent (except to the extent the
Agent specifically requests the Debtor not to do so with respect to any such
instrument or chattel paper); and that no surety bond was required or given in
connection with said Receivable or the contracts or purchase orders out of
which the same arose. Without limiting the foregoing, if any Receivable arises
out of a contract with the United States of America or any of its departments,
agencies or instrumentalities or by any state or local government and is
included in the Borrowing Base (as defined in the Secured Credit Agreement),
the Debtor agrees to notify the Agent and the Banks and at the Agent's request
will execute whatever instruments are required by the Agent in order that such
Receivable shall be assigned to the Agent and that proper notice of such
assignment shall be given under the Federal Assignment of Claims Act or any
similar state or local statute, respectively.
(b) The Debtor shall keep all of its books and records relating to
the Receivables only at its chief executive office described in Section 2(b)
hereof.
(c) Unless and until an event of default hereunder occurs, any
merchandise which is returned by a customer or account debtor or otherwise
recovered may be resold by the Debtor in the ordinary course of its business in
accordance with Section 5(a) hereof; after such an event of default hereunder
occurs, such merchandise shall be set aside and held by the Debtor as trustee
for the Agent and shall remain part of the Agent's Collateral. Unless and
until an event of default hereunder occurs, the Debtor may settle and adjust
disputes and claims with its customers and account debtors, handle returns and
recoveries and grant discounts, credits and allowances in the ordinary course
of its business and otherwise for amounts and on terms which the Debtor
considers advisable. However, after an event of default hereunder has occurred
and unless the Agent requests otherwise, the Debtor shall notify the Agent and
the Banks promptly of all returns and recoveries and on request deliver the
merchandise to the Agent. After an event of default hereunder has occurred and
unless the Agent requests otherwise, the Debtor shall also notify the Agent and
the Banks promptly of all disputes and claims and settle or adjust them at no
expense to the Agent, but no discount, credit or allowance other than on normal
trade terms in the ordinary course of business shall be granted to any customer
or account debtor and no returns of merchandise shall be accepted by the Debtor
without the Agent's consent. The Agent may, at all times after such an event
of default has occurred, settle or adjust disputes and claims directly with
customers or account debtors for amounts and upon terms which the Agent
considers advisable.
(d) From time to time, as the Agent may request of the Debtor, the
Debtor shall provide the Agent with schedules describing all Receivables
created or acquired by the Debtor, provided, however, that the failure of the
Debtor to execute and deliver such schedules shall not affect or limit the
Agent's security interest or other rights in and to any such Receivables.
Together with each schedule, the Debtor shall if requested by the Agent,
furnish copies of customers' invoices or the equivalent, and original shipping
or delivery receipts, for all merchandise sold, and the Debtor warrants the
genuineness thereof.
-7-
<PAGE> 112
4. Collection of Receivables. (a) The Debtor shall make
collection of all of its Receivables and may use the same to carry on its
business in accordance with sound business practice, subject to the terms
hereof and Section 2.6 of the Credit Agreement.
(b) In furtherance of Section 2.6 of the Credit Agreement:
(i) all instruments and chattel paper at any time
constituting part of the Receivables (including any postdated checks)
shall, upon receipt by the Debtor, be immediately endorsed to and
deposited with Agent; and
(ii) the Debtor shall instruct all account debtors to
remit all payments in respect of Receivables to a lockbox to be
maintained at the main post office, Chicago, Illinois under the sole
custody and control of Agent.
(c) Whether or not the Agent has exercised any or all of its
rights under other provisions of this Section 4, during the existence of any
event of default hereunder, the Agent or its designee may notify any of the
Debtor's customers or account debtors at any time that Receivables have been
assigned to the Agent or of the Agent's security interest therein and either in
its own name, or the Debtor's or both, demand, collect (including without
limitation through a lockbox analogous to that described in Section 4(b)(ii)
hereof), receive, receipt for, sue for, compound and give acquittance for any
or all amounts due or to become due on Receivables, and in the Agent's
discretion file any claim or take any other action or proceeding which the
Agent may deem necessary or appropriate to protect and realize upon the
security interest of the Agent in the Receivables.
(d) Any proceeds of Receivables or other Collateral transmitted to
or otherwise received by the Agent pursuant to any of the provisions of
Sections 4(b) or 4(c) hereof shall be handled and administered by the Agent in
and through a remittance account at the Agent and the Debtor acknowledges that
the maintenance of such remittance account by the Agent is solely for the
Agent's own convenience and that the Debtor does not have any right, title or
interest in such remittance account or any amounts at any time standing to the
credit thereof. The Agent need not apply or give credit for any item included
in proceeds of Receivables or other Collateral until the Agent has received
final payment therefor at its office in cash or final solvent credits current
in Chicago, Illinois, acceptable to the Agent as such. However, if the Agent
does give credit for any item prior to receiving final payment therefor and the
Agent fails to receive such final payment or an item is charged back to the
Agent for any reason, the Agent may at its election in either instance charge
the amount of such item back against the remittance account, together with
interest thereon at the Default Rate. The Debtor shall accompany each
transmission of any proceeds of Receivables or other Collateral to the Agent
with a report in such form as the Agent shall require identifying the
particular Receivable or other Collateral from which the same arises or
relates. The Debtor hereby indemnifies the Agent from and against all
liabilities, damages, losses, actions, claims, judgments, costs, expenses,
charges and attorney's fees suffered or incurred by the Agent because of the
maintenance of the foregoing arrangements. The Agent shall have no liability
or responsibility to the Debtor for accepting any check, draft or other order
for payment of money bearing the legend "payment in full" or words of similar
-8-
<PAGE> 113
import or any other restrictive legend or endorsement whatsoever or be
responsible for determining the correctness of any remittance.
5. Special Provisions Re: Inventory. (a) The Debtor may, until
otherwise notified, without further consent or approval of the Agent, use,
consume and sell its Inventory in the ordinary course of its business, but a
sale in the ordinary course of business shall not include any transfer or sale
in satisfaction, partial or complete, of a debt owing by the Debtor.
(b) As of the time any Inventory becomes subject to the security
interest provided for hereby, the Debtor shall be deemed to have warranted as
to any and all of such Inventory that such Inventory is new and unused and in
saleable condition; all warranties of the Debtor set forth in this Agreement
are true and correct with respect to such Inventory; and such Inventory is
located at a location set forth pursuant to Section 2(b) hereof or in transit
between any such locations.
(c) The Debtor shall at the request of the Agent provide the Agent
from time to time as specified by the Agent with a report of a physical listing
and the location of all Inventory and with reports stating the book value of
Inventory by major category and location. The Debtor shall furnish such other
reports and information concerning Inventory as the Agent may request. The
Debtor will also promptly notify the Agent of any Inventory which the Debtor
has determined to have been rendered obsolete, stating the prior book value of
such Inventory, its type and location. The Agent may examine and inspect any
Inventory wherever located at any reasonable time.
(d) If any of the Inventory of the Debtor is at any time evidenced
by a document of title, such document shall be promptly delivered by the Debtor
to the Agent.
6. Power of Attorney. In addition to any other powers of
attorney contained herein, the Debtor appoints the Agent, its nominee, or any
other person whom the Agent may designate as the Debtor's attorney in fact,
with full power during the existence of any event of default hereunder to
endorse the Debtor's names on any checks, notes, acceptances, money orders,
drafts or other forms of payment or security that may come into the Agent's
possession, to sign the Debtor's name on any invoice or bill of lading relating
to any Receivables, on drafts against customers, on schedules and assignments
of Receivables, on notices of assignment, on public records, on verifications
of accounts and on notices to customers, to send requests for verification of
Receivables to customers or account debtors, and to do all things necessary to
carry out this Agreement and after an event of default has occurred hereunder,
to notify the post office authorities to change the address for delivery of the
Debtor's mail to an address designated by the Agent and to receive, open and
dispose of all mail addressed to the Debtor. The Debtor ratifies and approves
all acts of any such attorney and agree that neither the Agent nor any such
attorney will be liable for any acts or omissions nor for any error of judgment
or mistake of fact or law other than their gross negligence or willful
misconduct. The foregoing power of attorney, being coupled with an interest,
is irrevocable until the Obligations have been fully satisfied. The Agent may
file one or more financing statements disclosing its security interest in any
or all of the
-9-
<PAGE> 114
Collateral without the Debtor's signature appearing thereon. The Debtor also
hereby grants the Agent a power of attorney to execute any such financing
statement, or amendments and supplements to financing statements, on behalf of
the Debtor without notice thereof to the Debtor, which power of attorney is
coupled with an interest and is irrevocable until the Obligations have been
fully satisfied.
7. Defaults and Remedies. (a) The occurrence of any event or the
existence of any condition specified as an "Event of Default" in the Secured
Credit Agreement shall constitute an event of default hereunder.
(b) Upon the occurrence of any event of default hereunder, the
Agent shall have, in addition to all other rights provided herein or by law,
the rights and remedies of a secured party under the Code (regardless of
whether the Code is the law of the jurisdiction where the rights or remedies
are asserted and regardless of whether the Code applies to the affected
Collateral), and further the Agent may, without demand and without
advertisement or notice, all of which the Debtor hereby waives, at any time or
times, sell and deliver any or all Collateral held by or for it at public or
private sale, for cash, upon credit or otherwise, at such prices and upon such
terms as the Agent deems advisable, in its sole discretion. In addition to all
other sums due the Agent or any Bank hereunder, the Debtor shall pay the Agent
and any Bank all costs and expenses incurred by the Agent or such Bank,
including a reasonable allowance for attorneys' fees and court costs, in
obtaining, liquidating or enforcing payment of Collateral or Obligations or in
the prosecution or defense of any action or proceeding by or against the Agent,
such Bank or the Debtor concerning any matter arising out of or connected with
this Agreement or the Collateral or Obligations, including without limitation
any of the foregoing arising in, arising under or related to a case under the
Bankruptcy Code. Any requirement of reasonable notice shall be met if such
notice is personally served on or mailed, postage prepaid, to the Debtor in
accordance with Section 10(b) hereof at least 10 days before the time of sale
or other event giving rise to the requirement of such notice; however, no
notification need be given to the Debtor if the Debtor has signed, after an
event of default hereunder has occurred, a statement renouncing any right to
notification of sale or other intended disposition. The Agent shall not be
obligated to make any sale or other disposition of the Collateral regardless of
notice having been given. The Agent or any Bank may be the purchaser at any
such sale. The Debtor hereby waives all of its rights of redemption from any
such sale. Subject to the provisions of applicable law, the Agent may postpone
or cause the postponement of the sale of all or any portion of the Collateral
by announcement at the time and place of such sale, and such sale may, without
further notice, be made at the time and place to which the sale was postponed
or the Agent may further postpone such sale by announcement made at such time
and place.
(c) Without in any way limiting the foregoing, the Agent shall
after an event of default has occurred hereunder have the right, in addition to
all other rights provided herein or by law, to take physical possession of any
and all of the Collateral and anything found therein, the right for that
purpose to enter without legal process any premises where the Collateral may be
found (provided such entry be done lawfully), and the right to maintain such
possession on the Debtor's premises for a period of 60 days or to remove its
Collateral
-10-
<PAGE> 115
or any part thereof to such other places as the Agent may desire. The Debtor
shall, upon the Agent's demand, assemble its Collateral and make it available
to the Agent at a place designated by the Agent. If the Agent exercises its
right to take possession of the Collateral, the Debtor shall also at its
expense perform any and all other steps requested by the Agent to preserve and
protect the security interest hereby granted in the Collateral, such as placing
and maintaining signs indicating the security interest of the Agent, appointing
overseers for the Collateral and maintaining stock records.
(d) The proceeds and avails of the Collateral at any time received
by the Agent after an event of default hereunder shall have occurred shall,
when received by the Agent in cash or its equivalent, be applied by the Agent
as follows:
(i) First, to the payment and satisfaction of all sums
paid and costs and expenses incurred by the Agent hereunder or
otherwise in connection herewith, including such monies paid or
incurred in connection with protecting, preserving or realizing
upon the Collateral or enforcing any of the terms hereof, including
reasonable attorneys' fees and court costs, together with any interest
thereon (but without preference or priority of principal over interest
or of interest over principal), to the extent the Agent is not
reimbursed therefor by the Debtor; and
(ii) Second, to the payment and satisfaction of any sums
paid hereunder by any of the Banks to preserve or protect the
Collateral or enforce the Loan Documents (to the extent such Banks are
not reimbursed therefor by the Debtor), together with any interest
thereon, and, if such proceeds are insufficient to repay all such
advances and interest thereon in full, ratably (without preference or
priority of principal over interest or of interest over principal) as
among such Banks in accordance with the amounts owing to each of such
Banks for such sums and interest thereon; and
(iii) Third, to the payment and satisfaction of the remaining
Obligations (whether or not then due), both for interest and
principal, and, if such proceeds are insufficient to pay and satisfy
such remaining Obligations in full, ratably (without preference or
priority of principal over interest or of interest over principal) as
among the Banks in accordance with the amounts owing to each Bank for
principal and interest on such Obligations held by such Bank.
The Debtor shall remain liable to the Agent and the Banks for any deficiency.
Any surplus remaining after the full payment and satisfaction of the foregoing
may be returned to the Debtor or to whomsoever a court of competent
jurisdiction shall determine to be entitled thereto.
(e) Without in any way limiting the foregoing, the Debtor hereby
grants to the Agent and the Banks a royalty-free irrevocable license and right
to use all of the Debtor's patents, patent applications, patent licenses,
trademarks, trademark registrations, trademark licenses, trade names, trade
styles, and similar intangibles in connection with any foreclosure or other
realization by the Agent or the Banks on all or any part of the Collateral.
The license and right granted the Agent and the Banks hereby shall be without
any royalty or fee
-11-
<PAGE> 116
or charge whatsoever. This license and right shall terminate upon the
termination of this Agreement.
(f) Failure by the Agent or any Bank to exercise any right, remedy
or option under this Agreement or any other agreement between the Debtor and
the Agent or any Bank or provided by law, or delay by the Agent or any Bank in
exercising the same, shall not operate as a waiver; no waiver shall be
effective unless it is in writing, signed by the Agent and then only to the
extent specifically stated. Neither the Agent, nor any Bank, nor any party
acting as attorney for the Agent or any Bank, shall be liable for any acts or
omissions or for any error of judgment or mistake of fact or law other than
their gross negligence or willful misconduct. The rights and remedies of the
Agent and the Banks under this Agreement shall be cumulative and not exclusive
of any other right or remedy which the Agent or the Banks may have.
8. Continuing Agreement. This Agreement shall be a continuing
agreement in every respect and shall remain in full force and effect until all
of the Obligations have been fully paid and satisfied and any commitment of any
Bank to extend any credit to the Debtor shall have terminated.
9. The Agent. In acting under or by virtue of this Agreement,
Agent shall be entitled to all the rights, authority, privileges and immunities
provided in Section 10 of the Secured Credit Agreement, all of which provisions
of said Section 10 are incorporated by reference herein with the same force and
effect as if set forth herein. Agent hereby disclaims any representation or
warranty to the Banks concerning the perfection of the security interest
granted hereunder or the value of the Collateral.
10. Miscellaneous. (a) This Agreement cannot be changed or
terminated orally. All of the rights, privileges, remedies and options given
to the Agent and the Banks hereunder shall inure to the benefit of their
successors and assigns, and all the terms, conditions, promises, covenants,
representations and warranties of and in this Agreement shall bind the Debtor
and its legal representatives, successors and assigns, provided that the Debtor
may not assign its rights or delegate its duties hereunder without the Agent's
prior written consent. The Debtor hereby releases the Agent from any liability
for any act or omission relating to its Collateral or this Agreement, except
the Agent's gross negligence or willful misconduct.
(b) All communications provided for herein shall be given in
accordance with Section 11.8 of the Secured Credit Agreement.
(c) In the event that any provision hereof shall be deemed to be
invalid by reason of the operation of any law or by reason of the
interpretation placed thereon by any court, this Agreement shall be construed
as not containing such provision, but only as to such locations where such law
or interpretation is operative, and the invalidity of such provision shall not
affect the validity of any remaining provision hereof, and any and all other
provisions hereof which are otherwise lawful and valid shall remain in full
force and effect.
-12-
<PAGE> 117
(d) This Agreement shall be deemed to have been made in the State
of Illinois and shall be governed by the internal laws of the State of
Illinois. All terms which are used in this Agreement which are defined in the
Code shall have the same meanings herein as said terms do in the Code unless
this Agreement shall otherwise specifically provide. The headings in this
instrument are for convenience of reference only and shall not limit or
otherwise affect the meaning of any provision hereof.
(e) This Agreement may be executed in any number of counterparts,
each constituting an original, but all together one and the same instrument.
The Debtor acknowledges that this Agreement is and shall be effective upon its
execution and delivery by the Debtor to the Agent, and it shall not be
necessary for the Agent or any Bank to execute this Agreement or any other
acceptance hereof or otherwise to signify or express its acceptance hereof.
IN WITNESS WHEREOF, the Debtor has caused this Agreement to be duly
executed as of this 22nd day of May, 1995.
STOKELY USA, INC.
By Theobold
Its Vice Chairman
-13-
<PAGE> 118
SCHEDULE A
Chief Executive Office
and Principal Place of Business: 1055 Corporate Center Drive
Oconomowoc, Wisconsin 53066-0248
Additional Collateral Locations:
1. OWNED
Hwy 20 West,
P.O. Box 99
Ackley, IA 50601
(515) 847-2643
1820 W. Eighth Street
P.O. Box 1457-54913
Appleton, WI 54914
(414) 734-5737 / 749-3020
840 Bakke St.
Deforest, WI 53532
(608) 846-2490
Avenue A - P.O. Box 400
Grandview, WA 98930
D&K Frozen Foods, Inc.
(509) 882-3322
1425 Main Street
P.O. Box 841
Green Bay, WI 54302
102 North First Avenue,
Box 250
Hoopeston, IL 60942
(217) 283-5141
Hwy 80, P.O. Box 157
Cobb, WI
7740 State Road 44, Box 279
Pickett, WI 54964
(414) 589-4411
W8070 Kent Road
Poynette, WI 53955-9713
(608) 635-4396
506 E. State Street
Box 218
Scottville, MI 49454
(616) 757-4715
151 Market St.
Box 65
Sun Prairie, WI 53590
(608) 837-5177
1164 Dell Avenue,
P.O. Box 818
Walla Walla, WA 99362
D&K Frozen Foods, Inc.
(509) 525-7890
300 East Third St., Box 307
Waunakee, WI 53597
(608) 849-4131
(608) 849-8810
Hwy 22 North, P.O. Box 8
Wells, MN 56097
(507) 553-3171
<PAGE> 119
II. OUTSIDE WAREHOUSES
Americold
6875 State
Bettendorf, IA 52722
Burris Refrigerated Service
Hwy 264
Lyndhurst, VA 22952
Americold
2641 Stephenson Dr.
Murfreesboro, TN 37133
Central Cold Storage
4309 Cottage Grove Rd.
Madison, WI 53716
Los Angeles Cold Storage
410 S. Central Avenue
Los Angeles, CA 90054
U.S. Cold Storage
1602 Island St.
Laredo, TX 78044
Loop Cold Storage
4000 W. Military Hwy
McAllen, TX 78503
Millard Refrigerated Service
6800 S. Ware Rd.
McAllen, TX 78503
Americold Corporation
4096 Portland Rd., NE
Salem, Oregon 97308
Southwest Freeport
4802 W. Polk
Phoenix, AZ 85043
Loop Cold Storage
Southton & Center Rd.
San Antonio, TX 78217
Commercial Warehouse Little Rock
6500 Forbing Rd.
Little Rock, AR 72209
Commercial Warehouse Oklahoma
CI
3501 N. Santa Fe
Oklahoma City, OK 73216
Foodservice Distribution Systems
515 Hill Avenue
Aurora, IL 60505
IDC-AAA Warehouse
221 South Franklin
Indianapolis, IN 46219
Trans-City Terminal Warehouse
4750 Kentucky Avenue
P.O. Box 42069
Indianapolis, IN 46241
(317) 856-3781
Mendez & Co., Inc.
Calle A Esq. B
San Juan, Puerto Rico
Aunt Nellies
640 Caughlin Rd.
Clyman, WI 53016
PAC-AM
9401 San Leandro
Oakland, CA 94603
Shippers Warehouse
2901 STH Lamar Street
Dallas, TX 75215
-2-
<PAGE> 120
C&B Warehouse
1326 E. Traffic Way
Springfield, MO 65802
Underground Warehouse
3411 Gardner
Quincy, IL 62306
Valley Warehouse
122 Kohlman Road
Fond du Lac, WI 54935
Warehousing UnLtd
122 Kohlman Road
Fond du Lac, WI 54935
W. R. Nykorchuck & Co.
International Distribution Center
NE Industrial Park, Bldg 8
Guilderland Center, NY 12085
Badger Cold Storage
Div, Wiscold, Inc.
1201 Green Valley Rd.
Beaver Dam, WI 53916
Man of New York-Intl
Distribution Center
c/o NE Industrial Park
Building 8, Door 4
Guilderland, NY 12085
Saddle Creek Corp.
2479 Eunice Avenue
Orlando, FL 32808
Warehouse & Transloading, Inc.
4174 Bandini Blvd.
Vernon, CA 90023
Kenyon Zero Storage
250 Avenue B
Grandview, WA 98930
Price Warehouse
420 Jefferson
Walla Walla, WA
Northwestern Ice & Cold Storage
1041 N. 15th
Walla Walla, WA 99362
Americold Corporation
13th and West Rose
Walla Walla, WA 99362
Taylor & Sledd Richmond
7420 Ranco Road
Richmond, VA 23228
Northland Cold Storage
1590 S. Broadway
Green Bay, WI 54305
Atlas Cold Storage
Morrow Street
Green Bay, WI 54305
Americold
252 W. Washington
Hillsboro, OR 97123
Warehouse Specialist
356 Dixie St.
Fond du Lac, WI 54935
Peters Warehouse
4 Taylor Street
Waupun, WI 53963
-3-
<PAGE> 121
Angus Corporation
111 Portwall
Houston, TX 77029
-4-
<PAGE> 122
TRADEMARK COLLATERAL AGREEMENT
This 22nd day of May, 1995, Stokely USA, Inc., a Wisconsin corporation
("Assignor") with its principal place of business and mailing address at 1055
Corporate Drive, Oconomowoc, Wisconsin 53066-0248, in consideration of ten
dollars ($10.00) and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, assigns, mortgages and pledges to
Harris Trust and Savings Bank, an Illinois banking corporation with its mailing
address at 111 West Monroe Street, Chicago, Illinois 60690, as agent (the
"Agent") for itself and certain other lenders to the Assignor (collectively the
"Lenders" and individually a "Lender"), and its successors and assigns (as such
Agent, "Assignee"), and grants to Assignee a continuing security interest in,
the following property:
(i) Each trademark, trademark registration and trademark
application listed on Schedule A-1 hereto, and all of the goodwill of
the business connected with the use of, and symbolized by, each such
trademark, trademark registration and trademark application; and
(ii) Each trademark license listed on Schedule A-2 hereto
and all royalties and other sums due or to become due under or in
respect of each such trademark license, together with the right to sue
for and collect all such royalties and other sums; and
(iii) All proceeds of the foregoing, including without
limitation any claim by Assignor against third parties for damages by
reason of past, present or future infringement of any trademark or
trademark registration listed on Schedule A-1 hereto or of any
trademark licensed under a trademark license listed on Schedule A-2 or
by reason of injury to the goodwill associated with any such
trademark, trademark registration or trademark license, in each case
together with the right to sue for and collect said damages;
to secure performance of all Obligations as set out in that certain Security
Agreement bearing even date herewith from Assignor to Assignee (the
"Agreement").
Assignor does hereby further acknowledge and affirm that the rights
and remedies of Assignee with respect to the assignment, mortgage, pledge and
security interest in the trademarks, trademark registrations, trademark
applications and trademark licenses made and granted hereby are more fully set
forth in the Agreement, the terms and provisions of which are incorporated by
reference herein as if fully set forth herein.
This Trademark Collateral Agreement shall terminate upon the
termination of the Agreement.
<PAGE> 123
All terms defined in the Agreement, whether by reference or otherwise,
when used herein, shall have their respective meanings set forth therein,
unless the context requires otherwise.
IN WITNESS WHEREOF, Assignor has caused this Agreement to be duly
executed as of the date and year last above written.
STOKELY USA, INC.
(CORPORATE SEAL) By Stephen W. Theobald
--------------------------
Its Vice Chairman
Stephen W. Theobald
----------------------
(Type or Print Name)
ATTEST:
Robert Brill
- ----------------
Its Secretary
HARRIS TRUST AND SAVINGS BANK, as Agent
Robert Brill
- -----------------------
(Type or Print Name)
By H. Glen Clarke
------------------------
Its Vice President
H. Glen Clarke
------------------------
(Type or Print Name)
-2-
<PAGE> 124
STATE OF ILLINOIS )
)SS
COUNTY OF COOK )
I, Lisa Brenza a Notary Public in and for said County, in the State
aforesaid, do hereby certify that Stephen W. Theobald, Vice Chairman of Stokely
USA, Inc., a Wisconsin corporation, and Robert Brill, Secretary of said
corporation, who are personally known to me to be the same persons whose names
are subscribed to the foregoing instrument as such Vice Chairman and Secretary,
respectively, appeared before me this day in person and acknowledged that they
signed and delivered the said instrument as their own free and voluntary act
and as the free and voluntary act and deed of said corporation for the uses and
purposes therein set forth; and the said Secretary then and there acknowledged
that he, as custodian of the corporate seal of said corporation, did affix the
corporate seal of said corporation to said instrument as his own free and
voluntary act and as the free and voluntary act of said corporation, for the
uses and purposes therein set forth.
Given under my hand and notarial seal, this 22nd day of May, 1995.
(NOTARIAL SEAL) Lisa Brenza
----------------------
Notary Public
Lisa Brenza
----------------------
My Commission Expires: (Type or Print Name)
OFFICIAL SEAL
LISA BRENZA
NOTARY PUBLIC STATE OF ILLINOIS
MY COMMISSION EXP. SEPT 16, 1995
<PAGE> 125
STATE OF ILLINOIS )
)SS
COUNTY OF COOK )
I, Lisa Brenza, a Notary Public in and for said County, in the State
aforesaid, do hereby certify that H. Glen Clarke, Vice President of Harris
Trust and Savings Bank, an Illinois banking corporation, who is personally
known to me to be the same person whose name is subscribed to the foregoing
instrument as such Vice President, appeared before me this day in person and
acknowledged that he signed and delivered the said instrument as his own free
and voluntary act and as the free and voluntary act and deed of said
corporation for the uses and purposes therein set forth.
Given under my hand and notarial seal, this 22nd day of May, 1995.
(NOTARIAL SEAL) Lisa Brenza
----------------------
Notary Public
Lisa Brenza
----------------------
My Commission Expires: (Type or Print Name)
OFFICIAL SEAL
LISA BRENZA
NOTARY PUBLIC STATE OF ILLINOIS
MY COMMISSION EXP. SEPT 16, 1995
<PAGE> 126
SCHEDULE A-1
TO TRADEMARK COLLATERAL AGREEMENT
REGISTERED TRADEMARKS AND TRADEMARK APPLICATIONS
FEDERAL TRADEMARK REGISTRATIONS
MARKS REG. NO. GRANTED
- ----- -------- -------
The Cannery 1214226 10/26/82
Newport 1474332 01/26/88
School Days 1473362 01/19/88
Our Favorite 1511104 11/01/88
Shellie 509866 05/17/49
Stokely's Finest & Design 277037 11/04/30
Stokely's 994442 10/01/74
Stokely's Finest 999795 12/17/74
Singles* 1459387 09/29/87
Little Nap 244196 07/17/28
Divisional B-Hart 243844 07/03/28
Fixins' 1673564 01/28/92
Fort Howard 1525297 01/02/90
Singles 1008448 04/08/75
Econo Brand 1122494 07/17/79
Butterland 772459 06/30/64
Teenie Weenie 189207 09/16/24
Chef's Best 657227 01/14/58
Buddie 355649 03/22/58
Buddie 188704 09/02/24
Miss Wisconsin 348287 07/20/57
Honey Dew 646193 05/28/57
Chef's Best 616936 11/29/55
<PAGE> 127
MARKS REG. NO. GRANTED
- ----- -------- -------
Oconomowoc 1265174 01/24/84
Food For Thought 1268696 02/28/84
Hart 41402 11/03/03
Divisional A-Hart 133799 08/03/20
Picked and Packed Daisy Fresh 545508 07/24/51
Pee-Wee 249772 11/20/28
Tiny Tad 255086 04/16/29
Stokely's Gold Ser. No.74/572/755 Filed 09/12/94
PENDING FEDERAL TRADEMARK APPLICATIONS
MARKS SER. NO. FILED
- ----- -------- -----
Crisp-N-Sweet 114889 11/30/90
Stokely's Toppers 035084 03/05/92
Micro Jar 243203 02/04/92
Stokely's Salad Bar 035080 03/05/90
Sweet-n-Sauerkraut 281093 06/01/92
Vegetable Fixin's 126222 12/21/90
Nutri Blend 195446 08/16/91
Health Pack 195424 08/16/91
Right Stuff 243503 02/05/92
Health-Max 195413 08/16/91
Health Guard 196031 08/16/91
Corn Plus 123585 12/13/90
Health Max 195413 08/16/91
2
<PAGE> 128
COMMON LAW MARKS AND TRADE NAMES
Oconomowoc Canning
Oconomowoc Canning Company
D & K Frozen Foods
Ackley Food Processing Company
REGISTERED STATE TRADEMARKS
AND TRADEMARK APPLICATIONS
NONE
REGISTERES FOREIGN TRADEMARKS
AND TRADEMARK APPLICATIONS
COUNTRY MARKS REG. NO.
- ------- ----- --------
Canada Teenie Weenie 114,097
Mexico Stokely's 399357
Stokely's Finest 399207
Stokely's Finest & Design 400100
3
<PAGE> 129
SCHEDULE A-2
TO TRADEMARK COLLAGERAL AGREEMENT
TRADEMARK LICENSES
<TABLE>
<CAPTION>
LICENSEE MARKS TERM
- -------- ----- ----
<S> <C> <C> <C>
1. Mason County Fruit Stokely's Reg. No. 994.422 9/20/93 - 9/19/96
Packers Cooperative, Inc. Stokely's Finest Reg. No. 277,037
999,795
2. Red Gold, Inc. Stokely's Reg. No. 994,422 8/1/93 - 7/31/98
Stokely's Finest Reg. No. 277,037
999,795
3. Foster Canning, Inc. Stokely's Reg. No. 994,422 6/1/94 - 5/30/97
Stokely's Finest Reg. No. 277,037
999,795
4. Packer Foods, Inc. Stokely's Reg. No. 994,422 Subject to termination
Stokely's Finest Reg. No. 277,037 on 90-180 day notice
999,795
</TABLE>
<PAGE> 130
LICENSE AGREEMENT
THIS LICENSE AGREEMENT dated as of May 22, 1995 is from D & K Frozen
Foods, Inc., a Washington corporation ("Licensor") to Harris Trust and Savings
Bank, as agent (the "Agent") for itself and certain other lenders (the "Banks")
to Stokely USA, Inc., a Wisconsin corporation (the "Borrower") pursuant to that
certain Secured Credit Agreement of even date herewith (the "Credit Agreement")
among the Borrower, the Agent and the Banks.
Licensor has been informed that the Banks are willing to extend a
$65,000,000 secured revolving credit facility (the "Revolving Credit") to the
Borrower pursuant to the Credit Agreement. However, as a condition precedent
to doing so, the Agent and the Banks require that Licensor grant to the Agent
an irrevocable license to use all trademarks, tradenames and certain other
intangibles property of the Licensor more fully described below.
Accordingly, to induce the Agent and the Banks to make the Revolving
Credit available to the Borrower, Licensor hereby grants to the Agent and the
Bank a royalty-free irrevocable license and right to use all of the Licensor's
patents, patent applications, patent licenses, trademarks, trademark
registrations, trademark licenses, tradenames, tradestyles, and similar
intangibles in connection with any foreclosure or other realization by the
Agent or the Banks on all or any part of the Collateral (as defined in the
Credit Agreement) provided by the Borrower to the Agent pursuant to the
Security Agreement (as defined in the Credit Agreement). The license and right
granted the Agent and the Banks hereby shall be without any royalty or fee or
charge whatsoever.
This agreement shall be deemed to have been made in the State of Illinois
and shall be governed by the internal laws of the State of Illinois. This
agreement may be executed in any number of counterparts, each constituting an
original, but all together one and the same instrument. The Licensor
acknowledges that this agreement is and shall be affective upon its execution
and delivery by the Licensor to the Agent, and it shall not be necessary for
the Agent or any Bank to execute this agreement or any other acceptance hereof
or otherwise to signify or express this acceptance hereof.
IN WITNESS WHEREOF, the Licensor has caused this agreement to be duly
executed as of the date first written above.
D & K FROZEN FOODS, INC.
By Robert Brill
-------------------
Its Secretary
----------------
<PAGE> 131
LICENSE AGREEMENT
THIS LICENSE AGREEMENT dated as of May 22, 1995 is from ANC Express, Inc.,
an Iowa corporation ("Licensor") to Harris Trust and Savings Bank, as agent
(the "Agent") for itself and certain other lenders (the "Banks") to Stokely
USA, Inc., a Wisconsin corporation (the "Borrower") pursuant to that certain
Secured Credit Agreement of even date herewith (the "Credit Agreement") among
the Borrower, the Agent and the Banks.
Licensor has been informed that the Banks are willing to extend a
$65,000,000 secured revolving credit facility (the "Revolving Credit") to the
Borrower pursuant to the Credit Agreement. However, as a condition precedent
to doing so, the Agent and the Banks require that Licensor grant to the Agent
an irrevocable license to use all trademarks, tradenames and certain other
intangibles property of the Licensor more fully described below.
Accordingly, to induce the Agent and the Banks to make the Revolving
Credit available to the Borrower, Licensor hereby grants to the Agent and the
Bank a royalty-free irrevocable license and right to use all of the Licensor's
patents, patent applications, patent licenses, trademarks, trademark
registrations, trademark licenses, tradenames, tradestyles, and similar
intangibles in connection with any foreclosure or other realization by the
Agent or the Banks on all or any part of the Collateral (as defined in the
Credit Agreement) provided by the Borrower to the Agent pursuant to the
Security Agreement (as defined in the Credit Agreement). The license and right
granted the Agent and the Banks hereby shall be without any royalty or fee or
charge whatsoever.
This agreement shall be deemed to have been made in the State of Illinois
and shall be governed by the internal laws of the State of Illinois. This
agreement may be executed in any number of counterparts, each constituting an
original, but all together one and the same instrument. The Licensor
acknowledges that this agreement is and shall be affective upon its execution
and delivery by the Licensor to the Agent, and it shall not be necessary for
the Agent or any Bank to execute this agreement or any other acceptance hereof
or otherwise to signify or express this acceptance hereof.
IN WITNESS WHEREOF, the Licensor has caused this agreement to be duly
executed as of the date first written above.
ANC EXPRESS, INC.
By Robert Brill
------------------
Its Secretary
----------------
<PAGE> 132
LICENSE AGREEMENT
THIS LICENSE AGREEMENT dated as of May 22, 1995 is from Oconomowoc Canning
Company, Inc., a Wisconsin corporation ("Licensor") to Harris Trust and Savings
Bank, as agent (the "Agent") for itself and certain other lenders (the "Banks")
to Stokely USA, Inc., a Wisconsin corporation (the "Borrower") pursuant to that
certain Secured Credit Agreement of even date herewith (the "Credit Agreement")
among the Borrower, the Agent and the Banks.
Licensor has been informed that the Banks are willing to extend a
$65,000,000 secured revolving credit facility (the "Revolving Credit") to the
Borrower pursuant to the Credit Agreement. However, as a condition precedent
to doing so, the Agent and the Banks require that Licensor grant to the Agent
an irrevocable license to use all trademarks, tradenames and certain other
intangibles property of the Licensor more fully described below.
Accordingly, to induce the Agent and the Banks to make the Revolving
Credit available to the Borrower, Licensor hereby grants to the Agent and the
Bank a royalty-free irrevocable license and right to use all of the Licensor's
patents, patent applications, patent licenses, trademarks, trademark
registrations, trademark licenses, tradenames, tradestyles, and similar
intangibles in connection with any foreclosure or other realization by the
Agent or the Banks on all or any part of the Collateral (as defined in the
Credit Agreement) provided by the Borrower to the Agent pursuant to the
Security Agreement (as defined in the Credit Agreement). The license and right
granted the Agent and the Banks hereby shall be without any royalty or fee or
charge whatsoever.
This agreement shall be deemed to have been made in the State of Illinois
and shall be governed by the internal laws of the State of Illinois. This
agreement may be executed in any number of counterparts, each constituting an
original, but all together one and the same instrument. The Licensor
acknowledges that this agreement is and shall be affective upon its execution
and delivery by the Licensor to the Agent, and it shall not be necessary for
the Agent or any Bank to execute this agreement or any other acceptance hereof
or otherwise to signify or express this acceptance hereof.
IN WITNESS WHEREOF, the Licensor has caused this agreement to be duly
executed as of the date first written above.
OCONOMOWOC CANNING COMPANY, INC.
By Robert Brill
----------------------
Its Secretary
---------------------
<PAGE> 133
[LETTERHEAD SHAWMUT CAPITAL]
May 30, 1995
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60690
General Electric Capital Corporation
105 West Madison Street
Suite 1500
Chicago, Illinois 60602
Mercantile Bank of St. Louis,
National Association
Mercantile Tower
St. Louis, Missouri 63166
Sanwa Business Credit Corporation
One South Wacker Drive
Chicago, Illinois 60606
RE: STOKELY USA, INC. (HEREINAFTER REFERRED TO AS "BORROWER")
Gentlemen:
The undersigned, Shawmut Capital Corporation ("SCC"), formerly known
as Barclays Business Credit, Inc., as Agent (the "Agent") for itself and
certain Lenders (the "Lenders") under a certain Loan and Security Agreement
dated August 18, 1992, as amended (the "Loan Agreement"), has been informed by
Borrower that you will be entering into a financing arrangement with Borrower
and Borrower will be using the proceeds of certain loans made in connection
therewith to pay in full all of the liabilities, obligations and indebtedness
owing by Borrower to the Agent and the Lenders under the Loan Agreement. If
paid by the close of business on May 31, 1995, the amount necessary to pay all
of the liabilities, obligations and indebtedness owing by Borrower to the Agent
and the Lenders under the Loan Agreement is $24,624,552.40, comprised of (i)
$24,390,474.24 in respect of principal and (ii) $234,078.16 in respect of
accrued interest, fees and expenses (collectively, the "Payoff Amount"). Such
liabilities, obligations, and indebtedness would be increased by $7,622.02 for
each day after May 31, 1995 until the Payoff Amount is paid in full (the "Per
Diem Amount"). In addition to the
<PAGE> 134
Harris Trust and Savings Bank
May 30, 1995
Page 2
foregoing, Borrower would need to provide replacements for the letters of
credit listed on Exhibit A hereto (the "SCC L/Cs") and return the originals of
the SCC L/Cs to the undersigned.
This letter will confirm that, upon (i) the execution by Borrower and
Harris Trust and Savings Bank, as Agent for you ("Harris"), of the attached
Indemnity Agreement and delivery thereto to SCC, (ii) the delivery to SCC of
the original SCC L/Cs and (iii) payment by wire transfer of the Payoff Amount,
plus the Per Diem Amount, if any, to the following account:
Harris Trust and Savings Bank
Chicago, Illinois
ABA #0710-0028-8
Acct. #183-842-4
Reference: Shawmut Capital Corporation and
Stokely USA, Inc.,
all liens and security interests of any kind of the Agent, for the benefit of
itself and the Lenders, on and in any and all of the property of Borrower and
its subsidiaries, shall be deemed to be released and terminated.
The undersigned will deliver to Harris, immediately after receipt of
the Payoff Amount, the SCC L/Cs and the aforesaid Indemnity Agreement, executed
termination statements, mortgage releases and other releases pertaining to any
liens and security interests of the Agent, for the benefit of itself and the
Lenders, on and in any of the property of Borrower and of its subsidiaries.
The undersigned further agrees to deliver to Harris, upon payment of the Payoff
Amount and receipt of the SCC L/Cs and the aforesaid Indemnity Agreement, such
other termination statements, releases and other agreements, in form and
substance satisfactory to Harris, as Harris may reasonably request in
connection with the above described release and termination of liens and
security interests of Agent, for the benefit of itself and the Lenders, on and
in any of the property of Borrower and of its subsidiaries.
Sincerely,
SHAWMUT CAPITAL CORPORATION, As Agent
By ?????????????
--------------------------
Its Vice President
-----------------------
<PAGE> 135
EXHIBIT A
SCC L/Cs
(NONE)
<PAGE> 136
INDEMNITY AGREEMENT
Stokely USA, Inc. ("Borrower"), for good and valuable consideration,
does hereby indemnify Shawmut Capital Corporation ("SCC"), in its capacity as
Agent and as a Lender, and all other Lenders under the certain Loan and
Security Agreement dated August 18, 1992, as amended, and in each case, their
respective successors and assigns, (each, an "Indemnitee"), from any losses
arising from the failure on the part of any Indemnitee to collect the full
amount of customers' or other checks previously received by any Indemnitee and
credited to the account of Borrower and for any service or other charges due to
any Indemnitee upon any loans heretofore made by any Indemnitee to Borrower.
SCC acknowledges that Borrower shall have no indemnity obligation under the
second sentence of this paragraph unless any such indemnification claim is made
within 180 days of the date hereof.
IN WITNESS WHEREOF, Borrower has caused this indemnity and release to
be executed by one of its officers thereunto duly authorized this __ day of
May, 1995.
STOKELY USA, INC.
By __________________
Name ________________
Its ______________
Harris Trust and Savings Bank, as Agent (the "Agent") for itself,
General Electric Capital Corporation, Sanwa Business Credit Corporation,
Mercantile Bank of St. Louis, National Association (collectively, the "Banks")
for good and valuable consideration, does hereby agree to indemnify the
Indemnitees from any losses arising from the failure on the part of any
Indemnitee to collect the full amount of customers' or other checks previously
received by any Indemnitee and credited to the account of Borrower and for any
service or other similar charges due to any Indemnitee upon any loans
heretofore made by any Indemnitee to Borrower. SCC acknowledges that neither
the Agent nor the Banks shall have any indemnity obligation under this
paragraph unless any such indemnification claim is made within 180 days of the
date hereof.
IN WITNESS WHEREOF, the Agent has caused this indemnity to be executed
by one of its officers thereunto duly authorized this _ day of May, 1995.
HARRIS TRUST AND SAVINGS BANK
By ___________________
Name _________________
Its Vice President
Acknowledged and Agreed to
this _ day of May, 1995.
SHAWMUT CAPITAL CORPORATION
By __________________
Its _________________
<PAGE> 137
INDEMNITY AGREEMENT
Stokely USA, Inc. ("Borrower"), for good and valuable consideration,
does hereby indemnify Shawmut Capital Corporation ("SCC"), in its capacity as
Agent and as a Lender, and all other Lenders under the certain Loan and
Security Agreement dated August 18, 1992, as amended, and in each case, their
respective successors and assigns, (each, an "Indemnitee"), from any losses
arising from the failure on the part of any Indemnitee to collect the full
amount of customers' or other checks previously received by any Indemnitee and
credited to the account of Borrower and for any service or other charges due to
any Indemnitee upon any loans heretofore made by any Indemnitee to Borrower.
SCC acknowledges that Borrower shall have no indemnity obligation under the
second sentence of this paragraph unless any such indemnification claim is made
within 180 days of the date hereof.
IN WITNESS WHEREOF, Borrower has caused this indemnity and release to
be executed by one of its officers thereunto duly authorized this 31 day of
May, 1995.
STOKELY USA, INC.
By Stephen W. Theobald
-------------------
Name Stephen W. Theobald
-------------------
Its Vice Chairman
---------------
Harris Trust and Savings Bank, as Agent (the "Agent") for itself,
General Electric Capital Corporation, Sanwa Business Credit Corporation,
Mercantile Bank of St. Louis, National Association (collectively, the "Banks")
for good and valuable consideration, does hereby agree to indemnify the
Indemnitees from any losses arising from the failure on the part of any
Indemnitee to collect the full amount of customers' or other checks previously
received by any Indemnitee and credited to the account of Borrower and for any
service or other similar charges due to any Indemnitee upon any loans
heretofore made by any Indemnitee to Borrower. SCC acknowledges that neither
the Agent nor the Banks shall have any indemnity obligation under this
paragraph unless any such indemnification claim is made within 180 days of the
date hereof.
IN WITNESS WHEREOF, the Agent has caused this indemnity to be executed
by one of its officers thereunto duly authorized this 31 day of May, 1995.
HARRIS TRUST AND SAVINGS BANK
By H. Glen Clarke
--------------------
Name H. Glen Clarke
--------------------
Its Vice President
----------------
Acknowledged and Agreed to
this 31 day of May, 1995.
SHAWMUT CAPITAL CORPORATION
By
-------------------------
Its --------------------
<PAGE> 138
INDEMNITY AGREEMENT
Stokely USA, Inc. ("Borrower"), for good and valuable consideration,
does hereby indemnify Shawmut Capital Corporation ("SCC"), in its capacity as
Agent and as a Lender, and all other Lenders under the certain Loan and
Security Agreement dated August 18, 1992, as amended, and in each case, their
respective successors and assigns, (each, an "Indemnitee"), from any losses
arising from the failure on the part of any Indemnitee to collect the full
amount of customers' or other checks previously received by any Indemnitee and
credited to the account of Borrower and for any service or other charges due to
any Indemnitee upon any loans heretofore made by any Indemnitee to Borrower.
SCC acknowledges that Borrower shall have no indemnity obligation under the
second sentence of this paragraph unless any such indemnification claim is made
within 180 days of the date hereof.
IN WITNESS WHEREOF, Borrower has caused this indemnity and release to
be executed by one of its officers thereunto duly authorized this __ day of
May, 1995.
STOKELY USA, INC.
By
--------------------------
Name
--------------------------
Its
--------------------------
Harris Trust and Savings Bank, as Agent (the "Agent") for itself,
General Electric Capital Corporation, Sanwa Business Credit Corporation,
Mercantile Bank of St. Louis, National Association (collectively, the "Banks")
for good and valuable consideration, does hereby agree to indemnify the
Indemnitees from any losses arising from the failure on the part of any
Indemnitee to collect the full amount of customers' or other checks previously
received by any Indemnitee and credited to the account of Borrower and for any
service or other similar charges due to any Indemnitee upon any loans
heretofore made by any Indemnitee to Borrower. SCC acknowledges that neither
the Agent nor the Banks shall have any indemnity obligation under this
paragraph unless any such indemnification claim is made within 180 days of the
date hereof.
IN WITNESS WHEREOF, the Agent has caused this indemnity to be executed
by one of its officers thereunto duly authorized this __ day of May, 1995.
HARRIS TRUST AND SAVINGS BANK
By
-------------------------
Name
-----------------------
Its Vice President
Acknowledged and Agreed to
this 31 day of May, 1995.
SHAWMUT CAPITAL CORPORATION
By
--------------------------
Its Vice President
<PAGE> 139
SECRETARY'S CERTIFICATE
OF
STOKELY USA, INC.
I. Robert Brill, hereby certify that:
(a) I am the duly elected, qualified and acting Secretary of
Stokely USA, Inc. ("Borrower"), a Wisconsin corporation;
(b) Attached hereto as Exhibit A is a true and complete copy
of the Articles of Incorporation of Borrower, as in full force and
effect on the date hereof;
(c) Attached hereto as Exhibit B is a true and complete copy
of the By-Laws of Borrower (including all amendments thereto);
(d) Each person who, as an officer or director of Borrower,
signed any of the agreements, instruments or documents in connection
with the financing arrangements described in the resolutions attached
hereto was, at the respective time of signing and the delivery thereof
to Harris Trust and Savings Bank, Mercantile Bank of St. Louis, N.A.,
Sanwa Business Credit Corporation and General Electric Credit
Corporation, duly elected, qualified and acting as such officer or
director;
(e) Attached hereto as Exhibit C is a true and complete copy
of all resultions adopted by the Board of Directors and/or stockholders
of Borrower in accordance with Borrower's By-Laws and the laws of the
State of Wisconsin with respect to the Loan and Security Agreement of
even date herewith among Borrower, Agent and certain lenders party
thereto and all transactions and documents contemplated thereby; such
resolutions have not been modified, amended, repealed or rescinded and
remain in full force and effect as of the date hereof; and such
resolutions are the only resolutions adopted by Borrower's Board of
Directors or Stockholders relating to the matters described therein.
IN WITNESS WHEREOF, I have hereunto set my hand this 22nd day of May,
1995.
Robert Brill
-----------------------
Robert Brill, Secretary
<PAGE> 140
EXHIBIT A
ARTICLES OF INCORPORATION
<PAGE> 141
UNITED STATES OF AMERICA
STATE OF WISCONSIN )
) SS.
OFFICE OF THE )
SECRETARY OF STATE )
TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETING:
I, DOUGLAS La FOLLETTE, Secretary of State of the State of Wisconsin
and Keeper of the Great Seal thereof, do hereby certify that the annexed copy
has been compared by me with the record on file in this Office and that the
same is a true copy thereof, and of the whole of such record; and that I am
the legal custodian of such record, and that this certification is in due form.
[SEAL] IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed the Great
Seal of the State.
DOUGLAS LA FOLLETTE
DOUGLAS La FOLLETTE
Secretary of State
BY: ROBERT KAUS DATE: APR 26 1995
Corporation Division
FORM 38
<PAGE> 142
ARTICLES OF AMENDMENT AND
RESTATED ARTICLES OF INCORPORATION
OF STOKELY USA, INC.
At a meeting of the stockholders of Stokely USA, Inc. held on September
16, 1985, pursuant to the Wisconsin Statutes and the Articles and By-Laws of
said corporation, the following Articles of Amendment and Restated Articles of
Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendment and Restated Articles of Incorporation so adopted
are set forth in Exhibit A attached hereto and made a part hereof.
THIRD: The date of adoption of the Amendment and Restated Articles of
Incorporation by the stockholders was September 16, 1985.
FOURTH: The foregoing Amendment and Restated Articles of Incorporation
were adopted by the stockholders entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ------ ----------- -------- ----------- --------- -------
<S> <C> <C> <C> <C> <C>
Common 6,635,200 6,635,200 4,423,467 6,238,800 None
</TABLE>
<PAGE> 143
FIFTH: The Amendment and Restated Articles of Incorporation effect a
change in the authorized capital stock of the corporation. The total number of
authorized shares of common stock is increased from 10,000,000 shares of a par
value of $.06 per share to 12,000,000 shares of a par value of $.05 per share.
There is no change in the stated capital of the corporation, which
remains at $600,000 represented by 12,000,000 shares of a par value of $.05
per share. Each presently outstanding share of a par value of $.06 per share
shall be converted into a share of a par value of $.05 and no new shares
shall be issued in connection with such reduction of par value.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 16th day of September, 1985.
STOKELY USA, INC.
By THOMAS W. MOUNT
_______________________________
Thomas W. Mount, President
DUANE W. THORSEN
_______________________________
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
<PAGE> 144
EXHIBIT A
RESTATED
ARTICLES OF INCORPORATION
OF
STOKELY USA, INC.
The following Restated Articles of Incorporation of Stokely USA, Inc.
supersede and take the place of the heretofore existing Articles of
Incorporation of said corporation and all prior amendments thereto:
ARTICLE I
The name of the corporation is Stokely USA, Inc.
ARTICLE II
The purpose or purposes for which the corporation is organized are to
engage in any lawful activity within the purposes for which a corporation may
be organized under the Wisconsin Business Corporation Law, Chapter 180 of the
Wisconsin Statutes.
ARTICLE III
The number of shares of capital stock which the corporation shall be
authorized to issue is Twelve Million (12,000,000) shares. Such shares shall be
designated common stock and shall be of a par value of $.05 per share. The
holders of the capital stock shall not have any preemptive rights to purchase
or to subscribe for shares of any class
<PAGE> 145
of shares of capital stock or securities convertible into capital stock, now or
hereafter authorized.
ARTICLE IV
The address of the registered office of the corporation is 626 East
Wisconsin Avenue, Box 248, Oconomowoc, Waukesha County, Wisconsin 53066, and
the name of its registered agent at such address is Joseph B. Weix.
ARTICLE V
The number of directors constituting the Board of Directors of the
corporation shall be fixed from time to time by the By-Laws of the corporation.
-2-
<PAGE> 146
STATE OF WISCONSIN
FILED
SEP 17 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 147
ARTICLES OF MERGER
OF
STOKELY USA, INC.
a Wisconsin Corporation
AND
AMERICAN NATIONAL CORP.
an Iowa Corporation
The following Articles of Merger have been duly adopted by the Board of
Directors of Stokely USA, Inc. pursuant to the provisions of Section 180.685 of
the Wisconsin Statutes.
FIRST: The Plan of Merger so adopted is set forth on Exhibit A
attached hereto and made a part hereof.
SECOND: Stokely USA, Inc., the surviving corporation, is the owner of
all of the outstanding shares of American National Corp., the merging
corporation. The Plan of Merger does not provide for any changes in the
Articles of Incorporation of Stokely USA, Inc. or any issuance of capital stock
by Stokely USA, Inc. The Plan of Merger provides for the cancellation of the
currently outstanding capital stock of American National Corp. held by Stokely
USA, Inc.
THIRD: The merger shall become effective at the close of business on
May 31, 1989 if these Articles of Merger are duly filed prior to such time. If
these Articles of Merger are not duly filed until after the close of business
on May 31, 1989, the merger shall become effective upon the due filing thereof.
FOURTH: The number of outstanding shares of each class of American
National Corp. and the number of such shares of each class owned by Stokely
USA, Inc. is as follows:
<TABLE>
<CAPTION>
CLASS OUTSTANDING OWNED BY STOKELY USA, INC.
- ----- ----------- --------------------------
<S> <C> <C>
Common 75,000 75,000
</TABLE>
FIFTH: As Stokely USA, Inc., the surviving corporation, is the sole
owner of all of the outstanding capital stock of American National Corp., no
notice of the merger to each shareholder of record of American National Corp.
is required by Section 180.685(2) of the Wisconsin Statutes. Stokely USA, Inc.
<PAGE> 148
waives any and all rights to be paid the fair value of its shares as provided
in Section 180.72 of the Wisconsin Statutes.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc., the
surviving corporation, and of American National Corp., the merging corporation,
have caused these Articles of Merger to be executed as of the 26th day of May,
1989.
STOKELY USA, INC. AMERICAN NATIONAL CORP.
By: THOMAS W. MOUNT By: THOMAS W. MOUNT
--------------- ---------------
Thomas W. Mount Thomas W. Mount
President President
Attest: DUANE W. THORSEN Attest: WILLIAM SIMONS
---------------- --------------
Duane W. Thorsen William Simons
Secretary Secretary
[CORPORATE SEAL] [NO CORPORATE SEAL]
This document was drafted by and should be returned to:
F. J. Pelisek, Esq.
Michael, Best & Friedrich
250 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
(414) 271-6560
<PAGE> 149
EXHIBIT A
PLAN OF MERGER
--------------
WHEREAS, Stokely USA, Inc., a Wisconsin corporation ("Stokely"), owns
all of the outstanding shares of stock of American National Corp., an Iowa
corporation ("American"); and
WHEREAS, it is deemed advisable that Stokely be merged with American,
with Stokely being the surviving corporation:
NOW, THEREFORE, this Plan of Merger is hereby adopted under and
pursuant to Section 496A.72 of the Iowa Code by the Board of Directors of
Stokely, the surviving corporation.
1. The corporations proposing to merge are Stokely and American,
with Stokely being the surviving corporation.
2. The terms and conditions of the proposed merger are that upon
the merger becoming effective the parties to this Plan of Merger shall become a
single corporation and shall have and succeed to all of the rights, privileges
and powers now possessed by both parties to the merger. The surviving
corporation shall assume and discharge all of the obligations and liabilities
of both of the parties to the merger.
3. All of the outstanding shares of common stock of American
currently owned by Stokely will be surrendered and cancelled. There shall be no
conversion of the shares of American into shares, obligations or other
securities of Stokely or any other corporation or, in whole or in part, into
cash or other property. Stokely will not issue any shares of its capital stock
as a result of the merger. There will be no change in the Articles of
Incorporation of Stokely as a result of the merger.
4. This Plan of Merger shall become effective at the close of
business on May 31, 1989, or upon the filing of Articles of Merger if such
filing shall occur after such time.
5. Stokely's registered office is located in Waukesha County. The
registered office of Stokely, the surviving corporation, shall remain in
Waukesha County.
<PAGE> 150
STATE OF WISCONSIN
FILED
MAY 30 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 151
ARTICLES OF AMENDMENT TO THE
RESTATED ARTICLES OF INCORPORATION OF
STOKELY USA, INC.
By action of the shareholders of Stokely USA, Inc. on June 24, 1989 at
a meeting duly convened pursuant to the provisions of the Wisconsin Statutes
and the Articles and By-Laws of said corporation, the following Articles of
Amendment to the Restated Articles of Incorporation of said corporation were
duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendments to the Restated Articles of Incorporation so
adopted are as follows:
(1) RESOLVED, that Article III of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended
to read as follows:
"Article III. The number of shares of capital stock which the
Corporation shall be authorized to issue is Twenty-One Million
(21,000,000) shares, divided into Twenty Million (20,000,000) shares of
Common Stock, $.05 par value per share, and One Million (1,000,000)
shares of Preferred Stock, $.10 par value per share.
(1) The Board of Directors of the Corporation is authorized at
any time or from time to time to divide the shares of preferred stock
into classes and into series within any class or classes of preferred
stock; and to determine for any such class or series its
<PAGE> 152
designation, relative rights, preferences and limitations, including, if
applicable, the rate of dividend, the price at and the terms and conditions
upon which shares may be redeemed, the amount payable upon shares in event of
voluntary or involuntary liquidation, sinking fund provisions for the
redemption or purchase of shares, and the terms and conditions upon which
shares may be converted.
(2) No holder of any shares of Common or preferred stock of the
Corporation shall have any right as such holder (other than such right, if any,
as the Board of Directors in its discretion may determine) to purchase or to
subscribe for shares of any class of shares of capital stock or securities
convertible into capital stock, now or hereafter authorized."
(2) RESOLVED, that Article V of the Restated Articles of Incorporation
of this Corporation shall be, and it hereby is, amended to read as follows:
"Article V. The number of Directors constituting the Board of
Directors of this Corporation, not less than nine (9) nor more than fifteen
(15), shall be fixed from time to time by the By-Laws of this Corporation. The
Board of Directors of this Corporation shall be divided into three (3) classes
of not less than three (3) nor more than five (5) Directors each. The term of
office of the first class of Directors shall expire at the first annual meeting
after their initial election under the provisions of this Article V, the term
of office of the second class shall expire at the second annual meeting after
their initial election under the provisions of this Article V, and that of the
third class shall expire at the third annual meeting after their initial
election under the provisions of this Article V. At each annual meeting after
the initial classification of the Board of Directors under this Article V, the
class of Directors whose term expires at the time of such election shall be
elected to hold office until the third succeeding annual meeting.
Any Director may be removed from office by affirmative vote of 80% of
the outstanding shares entitled to vote for the election of such Director,
taken at an annual meeting or a special meeting of shareholders called for that
purpose, and any vacancy so created may be filled by the affirmative vote of
80% of such shares.
2
<PAGE> 153
Notwithstanding any other provisions of these Articles
of Incorporation or the By-Laws of the Corporation (and
notwithstanding the fact that a lesser percentage may be
specified by law, these Articles of Incorporation or the
By-Laws of the Corporation), the affirmative vote of the
holders of at least 80% of the voting power of all the shares
of the Corporation entitled to vote for the election of
directors, voting together as a single class, shall be
required to amend or repeal, or adopt any provisions
inconsistent with, this Article V of these Articles of
Incorporation."
(3) RESOLVED, that Article VI of the Restated Articles
of Incorporation of this Corporation shall be, and it hereby
is, created to read as follows:
Article VI is attached to these Articles of Amendment
of Stokely USA, Inc. as Annex A.
THIRD: The date of adoption of the Amendments by the
shareholders was June 24, 1989.
FOURTH: The foregoing Amendments were adopted by the
shareholders entitled to vote as set forth below. At the record date for the
meeting of June 24, 1989, the outstanding shares of Common Stock, all of which
were entitled to vote, are as set forth below:
(1) AMENDMENT OF ARTICLE III - INCREASE IN CAPITAL STOCK
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
Class to Vote Required For Against
----- ------------ ----------- ------ -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,966,124 694,026
</TABLE>
3
<PAGE> 154
(2) AMENDMENT OF ARTICLE V - CLASSIFIED BOARD OF DIRECTORS
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- ----- -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,951,984 634,951
</TABLE>
<TABLE>
<CAPTION>
(3) ADDITION OF ARTICLE VI - REPURCHASE RIGHTS
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- ------ -------
<S> <C> <C> <C> <C>
Common 8,239,145 5,492,797 5,960,405 626,666
</TABLE>
FIFTH: The Amendments will effect a change in the authorized
capital stock of the Corporation. The Amendments increase the authorized
capital stock of the Corporation from 12,000,000 shares of Common Stock of $.05
par value to 20,000,000 shares of Common Stock of $.05 par value and 1,000,000
shares of Preferred Stock of $.10 par value, or an increase in authorized
capital stock of 8,000,000 shares of Common Stock of $.05 par value and
1,000,000 shares of Preferred Stock of $.10 par value. The Amendments do not
increase the stated capital of the Corporation as defined in Section 180.02(12),
Wisconsin Statutes, as there are no current plans or proposals for issuance by
the Corporation of the additional authorized Common Stock or the newly
authorized Preferred Stock.
4
<PAGE> 155
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 24th day of June, 1989.
STOKELY USA, INC.
By THOMAS W. MOUNT
---------------------------
Thomas W. Mount, President
By DUANE W. THORSEN
---------------------------
Duane W. Thorsen, Secretary
This document was drafted by:
Frank J. Pelisek, Attorney at Law
Michael, Best & Friedrich
100 East Wisconsin Avenue, Suite 3300
Milwaukee, Wisconsin 53202-4108
Record in Waukesha County, Wisconsin
5
<PAGE> 156
ANNEX A
ARTICLE VI
REPURCHASE OF COMMON STOCK
6.1 REPURCHASE RIGHTS.
6.1.1. In the event that any person (Acquiring Person)(i) who is the
beneficial owner, directly or indirectly, of fifty percent (50%) or more of the
Common Stock then outstanding and any of such Common Stock was acquired
pursuant to a tender offer, each holder of Common Stock shall have the right,
until and including the ninetieth (90th) day following the date the notice to
holders of Common Stock referred to in Section 6.3 herein is mailed, to have
the Common Stock held by such holder repurchased by the Corporation at the
Repurchase Price determined as provided in Section 6.5 herein, and each holder
of securities convertible into Common Stock or of options, warrants or rights
exercisable to acquire Common Stock prior to such thirtieth (30th) day shall
have the right simultaneously with the conversion of such securities or
exercise of such options, warrants or rights to have the Common Stock to be
received by such holder repurchased by the Corporation at the Repurchase Price.
6.1.2. All repurchase rights hereunder shall be subject to, and
limited by, any provision contained in the Wisconsin Business Corporation Law
which limits the amounts which may be used by the Corporation to repurchase its
Common Stock.
6.1.3. No holder of Common Stock of the Corporation shall have any
right to have Common Stock repurchased by the Corporation pursuant to this
Article VI if the Corporation, acting through a majority of its Board of
Directors, shall within ten (10) business days following the publication of
such
<PAGE> 157
tender offer or following publication of any amendment of such tender offer
recommend to the holders of Common Stock that such tender offer be accepted.
6.2 DEFINITIONS.
6.2.1. The term "person" shall include an individual, a Corporation,
partnership, trust or other entity. When two or more persons act as a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring Common Stock, such partnership, syndicate or group shall be deemed a
"person."
6.2.2. For the purpose of determining whether a person is an Acquiring
Person, such person shall be deemed to beneficially own (i) all Common Stock
with respect to which such person has the capability to control or influence
the voting or dispositive power in respect thereof and (ii) all Common Stock
which such person has the immediate or future right to acquire, directly or
indirectly, pursuant to agreements, through the exercise of options, warrants
or rights or through the conversion of convertible securities or otherwise; and
all Common Stock which an Acquiring Person has the right to acquire in such
manner shall be deemed to be outstanding shares, but Common Stock which any
other person has the right to acquire in such manner shall not be deemed to be
outstanding shares.
6.2.3. The acquisition of Common Stock by the Corporation or by any
person controlled by the Corporation shall not engender the right to have
Common Stock repurchased pursuant to this Article VI.
6.2.4. The right to have Common Stock repurchased pursuant to this
Article VI shall attach to such shares and shall not be personal to the holder
thereof.
6.2.5. The term "tender offer" shall mean an offer to acquire or an
acquisition of Common Stock pursuant to a request or invitation for tenders or
an offer to purchase such shares for cash, securities or any other
consideration.
6.2.6. The term "market purchases" shall mean the acquisition of
Common Stock from holders of such shares in privately negotiated transactions
or in transactions effected through a broker or dealer.
6.2.7. Subject to the provisions of Section 6.2.2. herein,
"outstanding shares" shall mean shares of Common Stock which at the time in
question have been issued by the Corporation and not reacquired and held or
retired by it or held by any subsidiary of the Corporation.
-2-
<PAGE> 158
6.3 REPURCHASE PROCEDURE.
Not later than thirty (30) days following the date on which the
Corporation receives notice that any person has become an Acquiring Person and,
as a result, the right to have Common Stock repurchased by the Corporation
under this Article VI shall have been created, the Corporation shall give
written notice, by first class mail, postage prepaid, at the address shown on
the records of the Corporation to each holder of record of Common Stock (and to
any other person known by the Corporation, to have rights to demand repurchase
pursuant to Section 6.1 of this Article) as of the date not more than seven (7)
days prior to the date of the mailing pursuant to this Section 6.3 and shall
advise each such holder of the right to have shares repurchased and the
procedures for such repurchase. In the event that the Corporation fails to give
notice as required by this Section 6.3, any holder entitled to receive such
notice may, within thirty (30) days thereafter, serve written demand upon the
Corporation to give such notice. If within ten (10) days after the receipt of
written demand the Corporation fails to give the required notice, such holder
may at the expense and on behalf of the Corporation take such reasonable action
as may be appropriate to give notice or to cause notice to be given pursuant to
this Section 6.3.
6.3.1. In the event Common Stock is subject to repurchase in
accordance with this Acticle VI, the Directors of the Corporation shall
designate a Repurchase Agent, which shall be a corporation or association (i)
organized and doing business under the laws of the United States or any state,
(ii) subject to supervision or examination by federal or state authority, (iii)
having combined capital and surplus of at least $5,000,000 and (iv) having the
power to exercise corporate trust powers.
6.3.2. For a period of ninety (90) days from the date of the mailing
of the notice to holders of Common Stock referred to in this Section 6.3,
holders of Common Stock and other persons entitled to have Common Stock
repurchased pursuant to this Article VI may, at their option, deposit
certificates representing all or less than all Common Stock held of record by
them with the Repurchase Agent together with written notice that the holder
elects to have such shares repurchased pursuant to this Article VI. Repurchase
shall be deemed to have been effected at the close of business on the day such
certificates are deposited in proper form with the Repurchase Agent.
-3-
<PAGE> 159
6.3.3. The Corporation shall promptly deposit in trust with the
Repurchase Agent cash in an amount equal to the aggregate Repurchase Price of
all of the Common Stock deposited with the Repurchase Agent for the purposes of
repurchase.
6.3.4. As soon as practicable after receipt by the Repurchase Agent of
the cash deposit by the Corporation referred to in this Section 6.3, the
Repurchase Agent shall issue its checks payable to the order of the persons
entitled to receive the Repurchase Price of the Common Stock in respect of
which such cash deposit was made.
6.3.5 In the event the Corporation is unable to deposit with the
Repurchase Agent cash in full amount of the aggregate Repurchase Price of all
shares deposited for repurchase, because of limitations upon repurchase of
Common Stock contained in the Wisconsin Business Corporation Law, the
Corporation shall promptly deposit with the Repurchase Agent the maximum amount
of cash which may be used for the repurchase of Common Stock, under the most
restrictive of the applicable limitations upon such repurchase. In the event of
deposit of less than the full aggregate Repurchase Price pursuant to the
provisions of this subsection, the Repurchase Agent shall, after the expiration
of the notice period provided for in this Section 6.3.4, use the amount so
deposited to repurchase shares pro lanto, in proportion to the number of shares
deposited by each shareholder for repurchase. Certificates representing all
shares which remain unpurchased shall be returned to the depositors thereof as
soon as practicable thereafter, and there shall be no further repurchase rights
with respect to such shares arising in connection with the transactions
already completed.
6.4. RETIRED STOCK.
All Common Stock with respect to which repurchase has been effected
pursuant to this Article VI shall thereupon be deemed retired.
6.5. REPURCHASE PRICE.
The Repurchase Price shall be the amount payable by the Corporation in
respect of each share of Common Stock with respect to which repurchase has been
demanded pursuant to this Article VI and shall be the greatest amount
determined on any of the following three bases:
(i) The highest price per share of Common Stock, including any
commission paid to brokers or dealers for solicitation or whatever, at which
Common Stock held by the Acquiring Person were acquired pursuant to a tender
offer regardless of when such tender offer was made or were
-4-
<PAGE> 160
acquired pursuant to any market purchase or otherwise within
eighteen (18) months prior to the notice to holders of Common Stock
referred to in Section 6.3 herein. For purposes of this subsection (i),
if the consideration paid in any such acquisition of Common Stock
consisted, in whole or part, of consideration other than cash, the
Board of Directors of the Corporation shall take such action, as in its
judgment it deems appropriate, to establish the cash value of such
consideration, but such valuation shall not be less than the cash
value, if any, ascribed to such consideration by the Acquiring Person.
(ii) The highest sale price per share of Common Stock for any
trading day during the eighteen (18) months prior to the notice to
holders of Common Stock referred to in Section 6.3 herein. For purposes
of this subsection (ii), the sale price for any trading day shall be
the closing price per share of Common Stock as furnished by the
National Association of Securities Dealers Automated Quotation System
(NASDAQ) or the last sale price per share traded on any national
securities exchange.
(iii) The amount of shareholders' equity in respect of each
outstanding share of Common Stock as determined in accordance with
generally accepted accounting principles and as reflected in any
published report by the Corporation as of the quarter ending
immediately preceding the notice to shareholders referred to in Section
6.3 herein.
6.5.1. The determinations to be made pursuant to Section 6.5 shall be
made by the Board of Directors not later than the date of the notice to holders
of Common Stock referred to in Section 6.3 herein. In making such
determination, the Board of Directors may engage such persons, including
investment banking firms and the independent accountants who have reported on
the most recent financial statements of the Corporation, and may utilize
employees and agents of the Corporation, who will, in the judgment of the Board
of Directors, be of assistance to the Board of Directors.
6.5.2. The determinations to be made pursuant to this Section 6.5,
when made by the Board of Directors acting in good faith on the basis of such
information and assistance as was then reasonably available for such purpose,
shall be conclusive and binding upon the Corporation and its shareholders,
including any person referred to in Section 6.1 herein.
-5-
<PAGE> 161
$24.00 RD
Amendment to Restated Articles
- -Increases authorized shares from: 12,000,000 Common at $0.05 P.V.
To: 20,000,000 Shares Common at $0.05 P.V.
1,000,000 Shares Preferred at $0.10 P.V.
- -adds Directors provision (Art V)
- -adds Stock Repurchase Provisions (new Art VI)
$650.00 plus $25.00 Exp
Michael, Best & Friedrich
P.O. Box 1806
Madison, WI 53701
Attn: Julie Bretl
STATE OF WISCONSIN
FILED
JUL 07 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 162
Form 38 (88)
UNITED STATES OF AMERICA
STATE OF WISCONSIN )
)
0FFICE OF THE ) SS.
SECRETARY OF STATE )
TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETING:
I, DOUGLAS La FOLLETTE, Secretary of State of the State of Wisconsin
and Keeper of the Great Seal thereof, do hereby certify that the annexed copy
has been compared by me with the record on file in this Office and that the
same is a true copy thereof, and of the whole of such record; and that I am the
legal custodian of such record, and that this certification is in due form.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed
the Great Seal of the State.
[STATE SEAL OF WISCONSIN]
DOUGLAS La FOLLETTE
DOUGLAS La FOLLETTE
Secretary of State
BY: N. Striyic DATE: JULY 31, 1992
Corporation Division
<PAGE> 163
KNOW ALL MEN BY THESE PRESENTS: That the undersigned, adult
residents of the State of Wisconsin, do hereby make, sign and agree to
the following
ARTICLES OF ORGANIZATION
ARTICLE FIRST.- The undersigned have associated, and do hereby
associate themselves together for the purpose of forming a corporation
under Chapter 86 of the Wisconsin Statutes and the acts amendatory
thereof and supplementary thereto, the business and purposes of which
corporation shall be: to own, operate, run and manage canning
factories, and own real estate, buildings, structures and all the
necessary machinery and appliances for running and operating
canning factories for the purpose of canning, preserving and packing
fruits, grain, meats, foods and vegetables and their by-products; to
own and hold by lease or otherwise farming lands, from which to
As produce and raise such articles, vegetables and fruit; and to
Amended furnish and supply farmers, gardeners and such laborers and workmen
Mar. 27, with seed and seeds with which to grow and produce such vegetables
1936 and products to be sold, canned, packed and preserved, and to deal in
canned goods, and to buy and sell all such canned goods generally, and
to sell and dispose of all by-products made and resulting in the
operation of such factories, and to do all things necessary and proper
in running and operating such factories, and to do and transact all
business usual and incident to such business.
To purchase or otherwise acquire, apply for, register, hold, use, sell
or in any manner dispose of, and to grant licenses or other rights
in, and in any manner deal with patents, inventions, improvements,
processes, formulas, trade-marks, trade names, rights and licenses
secured under letters patent, copyrights or otherwise.
To purchase, hold, sell and reissue the shares of its own
capital stock; to buy, sell, lease, pledge, mort-
<PAGE> 164
-2-
gage or otherwise deal in real estate and personal property of every
kind and description, necessary and proper to effectuate the purposes
for which this company is organized.
To purchase, hold, sell, assign, transfer, mortgage, pledge or
otherwise dispose of the shares of the capital stock of, or any
bonds, securities or evidence of indebtedness created by any other
corporation or corporations of this or any other state, territory
or country, and, while owner of such stock, to exercise all the
As rights and powers and privileges of ownership, including the right
Amended to vote thereon; to guarantee any dividends, bonds, stocks, contracts
Mar. 27, or other obligations of any corporation in which this corporation is
1936 an owner or has an interest; to aid in any lawful manner such
corporations, and to do all legal acts and things designed for the
preservation, protection, improvement, development, or enhancement
of the value of any such corporation, or of its stock, bonds,
securities, evidences of indebtedness, contracts or other obligations.
As
Amended ARTICLE SECOND.- The name of said corporation shall be
January OCONOMOWOC CANNING COMPANY, and its location shall be in Oconomowoc,
31, 1923 Wisconsin.
As ARTICLE THIRD.- The capital stock of said corporation shall be
Amended six hundred thousand dollars ($600,000.00) and the same shall consist
Mar 27, of six thousand (6000) shares, each of which said shares shall be of
1936 the face or par value of one hundred dollars ($100.00).
ARTICLE FOURTH.- The general officers of said corporation
shall be a President, Vice-President, Secretary and Treasurer, and
the Board of Directors shall consist of five (5) stockholders.
<PAGE> 165
-3-
ARTICLE FIFTH.- The principal duties of the President shall be to
preside at all meetings of the Board of Directors and to have a general
supervision of the affairs of the corporation.
The principal duties of the Vice-President shall be
to discharge the duties of the President in the event of the absence or
disability, for any cause whatever, of the latter.
The principal duties of the Secretary shall be to
countersign all deeds, leases and conveyances executed by the corporation,
affix the seal of the corporation thereto, and to such other papers as shall
be required or directed to be sealed, and to keep a record of the proceedings
of the Board of Directors, and to safely and systematically keep all books,
papers, records and documents belonging to the corporation, or in anywise
pertaining to the business thereof.
The principal duties of the Treasurer shall be to keep
and account for all moneys, credits and property, of any and every nature, of
the corporation, which shall come into his hands, and keep an accurate account
of all moneys received and disbursed, and proper vouchers for moneys disbursed,
and to render such accounts, statements and inventories of moneys received and
disbursed, and of moneys and property on hand, and generally of all matters
pertaining to this office, as shall be required by the Board of Directors.
The Board of Directors may provide for the appointment
of such additional officers as they may deem for the best interests of the
corporation.
Whenever the Board of Directors may so order, the
offices of Secretary and Treasurer may be held by the same person.
The said officers shall perform such additional or
different duties as shall from time to time be imposed or required by the Board
of Directors, or as may be prescribed from time to time by the by-laws.
ARTICLE SIXTH.- Only persons holding stock according to the
regulations of the corporation shall be members of it.
ARTICLE SEVENTH.- These Articles may be amended by resolution setting
forth such amendment or amendments, adopted at any meeting of the stockholders
by a vote of at least two-thirds of all the stock of said corporation then
outstanding.
<PAGE> 166
-4-
ARTICLE 8. - NAMES AND RESIDENCES. The names and residences of the
persons forming this corporation are:
Rudolph P. Binzel, residing at Beaver Dam, Wis.
Ernest C. Theobald, residing at Oconomowoc, Wis.
H. P. MacDermott, residing at 254 Mason St., Apt. 211,
Milwaukee, Wis.
Philip Binzel, residing at Oconomowoc, Wis.
IN WITNESS WHEREOF, we have hereunto set our hands this 13th day of
February, A.D. 1920.
Signed in Presence of:
PHILIP BINZEL
N.W. EVANS ) RUDOLPH P. BINZEL
JOS. A. MC CAFFREY ) ERNEST C. THEOBALD
HARRY MAC DERMOTT
STATE OF WISCONSIN, )
) SS.
COUNTY OF WAUKESHA. )
Personally came before me this 13th day of February, A.D. 1920, the
above named RUDOLPH P. BINZEL, ERNEST C. THEOBALD, HARRY MacDERMOTT and PHILIP
BINZEL, to me known to be the persons who executed the foregoing instrument,
and acknowledged the same.
N. W. EVANS,
Notary Public, Wisconsin.
(Notarial Seal)
My Commission expires )
Aug. 14, 1921. )
STATE OF WISCONSIN, )
) SS.
COUNTY OF WAUKESHA. )
PHILIP BINZEL and ERNEST C. THEOBALD, being each duly sworn, doth each
for himself depose and say that he is one of the original signers of the above
declaration and articles; that the above and foregoing is a true, correct and
complete copy of such original declaration and articles, and of the whole
thereof.
Subscribed and sworn to before me
this 18th day of February, A.D. 1920. ERNEST C. THEOBALD
PHILIP BINZEL
N. W. EVANS,
Notary Public, Wisconsin.
(Notarial Seal)
<PAGE> 167
REEL 258 IMAGE 115
ARTICLES OF AMENDMENT TO
THE ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
The undersigned officers of Oconomowoc Canning Company, a Wisconsin
corporation, do hereby certify that at the annual meeting of the shareholders
of said corporation, held at Oconomowoc, Wisconsin on June 20, 1977, pursuant
to the By-Laws and notice duly given, the following Amendments to the Articles
of Incorporation of said corporation were duly adopted by the shareholders:
RESOLVED, that Article FOURTH of the Articles of Incorporation
be, and the same is hereby amended to read as follows:
"ARTICLE FOURTH: The general officers of said corporation shall
be a President, Vice President, Secretary, and Treasurer, and the Board
of Directors shall consist of such number, not less than three (3), as
shall from time to time be fixed by the By-Laws. Directors need not be
shareholders."
FURTHER RESOLVED, that the first paragraph of Article FIFTH of
the Articles of Incorporation be, and the same is hereby amended to
read as follows:
"ARTICLE FIFTH: The principal duties of the President shall be
to have general supervision of the affairs of the corporation."
The foregoing amendments to the Articles of Incorporation were adopted
by the following vote:
<PAGE> 168
REEL 258 IMAGE 116
<TABLE>
<CAPTION>
Number of Number Number Voted
Classes Shares Out- Entitled ------------
of Shares standing to Vote For Against
- ---------- ------------ --------- --- -------
<S> <C> <C> <C> <C>
Common Stock 4,122 4,122 4,122 0
</TABLE>
Dated and the seal of the corporation affixed this 30 day of June,
1977.
THOMAS W. MOUNT
---------------------------
Thomas W. Mount, President
[CORPORATE SEAL]
DUANE W. THORSEN
---------------------------
Duane W. Thorsen, Secretary
This instrument was prepared by John S. Best.
-2-
<PAGE> 169
REEL 652 IMAGE 864
ARTICLES OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
At a meeting of the stockholders of Oconomowoc Canning Company held on
June 17, 1983, pursuant to the Wisconsin Statutes and the Articles and By-Laws
of said corporation, the following Articles of Amendment to the Articles of
Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Oconomowoc Canning Company.
SECOND: The Amendment to the Articles of Incorporation so adopted is as
follows:
RESOLVED, that Article Third of the Articles of Incorporation
of this corporation be, and it hereby is, amended to read as
follows:
"Third: The authorized capital of this corporation shall be Six
Hundred Thousand Dollars ($600,000) consisting of One Million
Two Hundred Thousand (1,200,000) shares of common stock of a par value
of Fifty cents ($.50) per share."
THIRD: The date of adoption of the Amendment by the stockholders was
June 17, 1983.
FOURTH: The foregoing Amendment was adopted by the stockholders
entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ------ ----------- -------- ----------- ------- -------
<S> <C> <C> <C> <C> <C>
Common 4,122 4,122 2,749 3,854 none
</TABLE>
FIFTH: The Amendment effects a change in the authorized capital stock
of the corporation. The total number
<PAGE> 170
REEL 652 IMAGE 865
of authorized shares of common stock are increased from 6,000 shares of a par
value of $100 per share to 1,200,000 shares of a par value of $.50 per share.
There is no change in the stated capital of the corporation which remains at
$600,000 represented by 1,200,000 shares of a par value of $.50 per share.
Following the effectiveness of the Amendment, the presently outstanding shares
of common stock of the corporation will be split 200 for 1, effected in the
form of a stock dividend of 199 shares of common stock ($.50 par value) for
each share then outstanding.
IN WITNESS WHEREOF, the undersigned officers of Oconomowoc Canning
Company have hereunto set their hands this 2nd day of January, 1985.
OCONOMOWOC CANNING COMPANY
By Thomas W. Mount
--------------------------
Thomas W. Mount, President
[SEAL]
D. W. Thorsen
--------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
STATE OF WISCONSIN
FILED
JAN 16 1985
Record in Waukesha County, Wisconsin. DOUGLAS LA FOLLETTE
SECRETARY OF STATE
-2-
<PAGE> 171
1284307 1284307
REEL 652 IMAGE 863
FORM 14
UNITED STATES OF AMERICA
STATE OF WISCONSIN
OFFICE OF THE SECRETARY OF STATE
---------------
To All to Whom These Presents Shall Come.
The undersigned, as Secretary of State of the State of Wisconsin,
certifies that the attached is a duplicate of a document accepted and filed in
my office.
IN TESTIMONY WHEREOF, I have hereunto
set my hand and affixed my official seal,
at Madison, on the date of filing of said
document.
Douglas La Follette
DOUGLAS La FOLLETTE
Secretary of State
<PAGE> 172
REEL 652 IMAGE 861
ARTICLES OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
At a meeting of the stockholders of Oconomowoc Canning Company held on
January 2, 1985, pursuant to the Wisconsin Statutes and the Articles and
By-Laws of said corporation, the following Articles of Amendment to the
articles of Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Oconomowoc Canning Company.
SECOND: The Amendment to the Articles of Incorporation so adopted is
as follows:
RESOLVED, that Article Second of the Articles of Incorporation
of this corporation be, and it hereby is, amended to read as follows:
"Second: The name of this corporation shall be Stokely USA,
Inc."
THIRD: The date of adoption of the Amendment by the stockholders was
January 2, 1985.
FOURTH: The foregoing Amendment was adopted by the stockholders
entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ----- ----------- -------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Common 824,400 824,400 549,600 684,583.32 55,333.34
</TABLE>
FIFTH: The Amendment will not effect a change in the stated capital or
authorized capital stock of the corporation.
<PAGE> 173
IN WITNESS WHEREOF, the undersigned officers of Oconomowoc Canning
Company have hereunto set their hands this 2nd day of January, 1985.
REEL 652 IMAGE 862
OCONOMOWOC CANNING COMPANY
By THOMAS W. MOUNT
------------------------------
Thomas W. Mount, President
DUANE W. THORSEN
------------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
STATE OF WISCONSIN
FILED
JAN 16 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
-2-
<PAGE> 174
1284306 1284306
REEL 652 IMAGE 860
FORM 14
UNITED STATES OF AMERICA
STATE OF WISCONSIN
OFFICE OF THE SECRETARY OF STATE
---------------
To All to Whom These Presents Shall Come.
The undersigned, as Secretary of State of the State of Wisconsin,
certifies that the attached is a duplicate of a document accepted and filed in
my office.
IN TESTIMONY WHEREOF, I have hereunto
set my hand and affixed my official seal,
at Madison, on the date of filing of said
document.
Douglas La Follette
DOUGLAS La FOLLETTE
Secretary of State
<PAGE> 175
ARTICLES OF AMENDMENT AND
RESTATED ARTICLES OF INCORPORATION
OF STOKELY USA, INC.
At a meeting of the stockholders of Stokely USA, Inc. held on September
16, 1985, pursuant to the Wisconsin Statutes and the Articles and By-Laws of
said corporation, the following Articles of Amendment and Restated Articles of
Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendment and Restated Articles of Incorporation so
adopted are set forth in Exhibit A attached hereto and made a part hereof.
THIRD: The date of adoption of the Amendment and Restated Articles of
Incorporation by the stockholders was September 16, 1985.
FOURTH: The foregoing Amendment and Restated Articles of Incorporation
were adopted by the stockholders entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- -------- ----------- -------- ----------- ---------- --------
<S> <C> <C> <C> <C> <C>
Common 6,635,200 6,635,200 4,423,467 6,238,800 None
</TABLE>
<PAGE> 176
FIFTH: The Amendment and Restated Articles of Incorporation effect a
change in the authorized capital stock of the corporation. The total number of
authorized shares of common stock is increased from 10,000,000 shares of a par
value of $.06 per share to 12,000,000 shares of a par value of $.05 per share.
There is no change in the stated capital of the corporation, which remains at
$600,000 represented by 12,000,000 shares of a par value of $.05 per share.
Each presently outstanding share of a par value of $.06 per share shall be
converted into a share of a par value of $.05 and no new shares shall be issued
in connection with such reduction of par value.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 16th day of September, 1985.
STOKELY USA, INC.
By THOMAS W. MOUNT
-------------------------------
Thomas W. Mount, President
DUANE W. THORSEN
-------------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
-2-
<PAGE> 177
EXHIBIT A
RESTATED
ARTICLES OF INCORPORATION
OF
STOKELY USA, INC.
The following Restated Articles of Incorporation of Stokely USA, Inc.
supersede and take the place of the heretofore existing Articles of
Incorporation of said corporation and all prior amendments thereto:
ARTICLE I
The name of the corporation is Stokely USA, Inc.
ARTICLE II
The purpose or purposes for which the corporation is organized are to
engage in any lawful activity within the purposes for which a corporation may
be organized under the Wisconsin Business Corporation Law, Chapter 180 of the
Wisconsin Statutes.
ARTICLE III
The number of shares of capital stock which the corporation shall be
authorized to issue is Twelve Million (12,000,000) shares. Such shares shall
be designated common stock and shall be of a par value of $.05 per share. The
holders of the capital stock shall not have any preemptive rights to purchase
or to subscribe for shares of any class
<PAGE> 178
of shares of capital stock or securities convertible into capital stock, now or
hereafter authorized.
ARTICLE IV
The address of the registered office of the corporation is 626 East
Wisconsin Avenue, Box 248, Oconomowoc, Waukesha County, Wisconsin 53066, and
the name of its registered agent at such address is Joseph B. Weix.
ARTICLE V
The number of directors constituting the Board of Directors of the
corporation shall be fixed from time to time by the By-Laws of the corporation.
-2-
<PAGE> 179
STATE OF WISCONSIN
FILED
SEP 17 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 180
ARTICLES OF AMENDMENT TO THE
RESTATED ARTICLES OF INCORPORATION OF
STOKELY USA, INC.
By action of the shareholders of Stokely USA, Inc. on June 24, 1989 at a
meeting duly convened pursuant to the provisions of the Wisconsin Statutes and
the Articles and By-Laws of said corporation, the following Articles of
Amendment to the Restated Articles of Incorporation of said corporation were
duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendments to the Restated Articles of Incorporation so
adopted are as follows:
(1) RESOLVED, that Article III of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended to
read as follows:
"Article III. The number of shares of capital stock which the
Corporation shall be authorized to issue is Twenty-One Million
(21,000,000) shares, divided into Twenty Million (20,000,000) shares of
Common Stock, $.05 par value per share, and One Million (1,000,000) shares
of Preferred Stock, $.10 par value per share.
(1) The Board of Directors of the Corporation is authorized at any
time or from time to time to divide the shares of preferred stock into
classes and into series within any class or classes of preferred stock;
and to determine for any such class or series its
<PAGE> 181
designation, relative rights, preferences and limitations, including, if
applicable, the rate of dividend, the price at and the terms and
conditions upon which shares may be redeemed, the amount payable upon
shares in event of voluntary or involuntary liquidation, sinking fund
provisions for the redemption or purchase of shares, and the terms and
conditions upon which shares may be converted.
(2) No holder of any shares of Common or preferred stock of the
Corporation shall have any right as such holder (other than such right, if
any, as the Board of Directors in its discretion may determine) to
purchase or to subscribe for shares of any class of shares of capital
stock or securities convertible into capital stock, now or hereafter
authorized."
(2) RESOLVED, that Article V of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended to
read as follows:
"Article V. The number of Directors constituting the Board of
Directors of this Corporation, not less than nine (9) nor more than
fifteen (15), shall be fixed from time to time by the By-Laws of this
Corporation. The Board of Directors of this Corporation shall be divided
into three (3) classes of not less than three (3) nor more than five (5)
Directors each. The term of office of the first class of Directors shall
expire at the first annual meeting after their initial election under the
provisions of this Article V, the term of office of the second class shall
expire at the second annual meeting after their initial election under the
provisions of this Article V, and that of the third class shall expire at
the third annual meeting after their initial election under the provisions
of this Article V. At each annual meeting after the initial
classification of the Board of Directors under this Article V, the class
of Directors whose term expires at the time of such election shall be
elected to hold office until the third succeeding annual meeting.
Any Director may be removed from office by affirmative vote of 80% of
the outstanding shares entitled to vote for the election of such Director,
taken at an annual meeting or a special meeting of shareholders called for
that purpose, and any vacancy so created may be filled by the affirmative
vote of 80% of such shares.
2
<PAGE> 182
Notwithstanding any other provisions of these Articles of
Incorporation or the By-Laws of the Corporation (and notwithstanding
the fact that a lesser percentage may be specified by law, these
Articles of Incorporation or the By-Laws of the Corporation), the
affirmative vote of the holders of at least 80% of the voting power of
all the shares of the Corporation entitled to vote for the election of
directors, voting together as a single class, shall be required to
amend or repeal, or adopt any provisions inconsistent with, this
Article V of these Articles of Incorporation."
(3) RESOLVED, that Article IV of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, created
to read as follows:
Article VI is attached to these Articles of Amendment of
Stokely USA, Inc. as Annex A.
THIRD: The date of adoption of the Amendments by the shareholders was
June 24, 1989.
FOURTH: The foregoing Amendments were adopted by the shareholders
entitled to vote as set forth below. At the record date for the meeting of June
24, 1989, the outstanding shares of Common Stock, all of which were entitled to
vote, are as set forth below:
(1) AMENDMENT OF ARTICLE III - INCREASE IN CAPITAL STOCK
----------------------------------------------------
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
Class to Vote Required For Against
- ----- ------------ ----------- ------ -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,966,124 694,026
</TABLE>
3
<PAGE> 183
(2) AMENDMENT OF ARTICLE V - CLASSIFIED BOARD OF DIRECTORS
------------------------------------------------------
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- ------ -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,951,984 634,951
</TABLE>
(3) ADDITION OF ARTICLE VI - REPURCHASE RIGHTS
------------------------------------------
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to vote Required For Against
------------ ----------- ------ -------
<S> <C> <C> <C> <C>
Common 8,239,145 5,492,797 5,960,405 626,666
</TABLE>
FIFTH: The Amendments will effect a change in the authorized capital
stock of the Corporation. The Amendments increase the authorized capital stock
of the Corporation from 12,000,000 shares of Common Stock of $.05 par value to
20,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value, or an increase in authorized capital stock
of 8,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value. The Amendments do not increase the stated
capital of the Corporation as defined in Section 180.02(12), Wisconsin
Statutes, as there are no current plans or proposals for issuance by the
Corporation of the additional authorized Common Stock or the newly authorized
Preferred Stock.
4
<PAGE> 184
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 24th day of June, 1989.
STOKELY USA, INC.
By THOMAS W. MOUNT
---------------------------
Thomas W. Mount, President
By DUANE W. THORSEN
---------------------------
Duane W. Thorsen, Secretary
This document was drafted by:
Frank J. Pelisek, Attorney at Law
Michael, Best & Friedrich
100 East Wisconsin Avenue, Suite 3300
Milwaukee, Wisconsin 53202-4108
Record in Waukesha County, Wisconsin
5
<PAGE> 185
ANNEX A
ARTICLE VI
REPURCHASE OF COMMON STOCK
6.1 REPURCHASE RIGHTS.
6.1.1. In the event that any person (Acquiring Person)(i) who is the
beneficial owner, directly or indirectly, of fifty percent (50%) or more of the
Common Stock then outstanding and any of such Common Stock was acquired pursuant
to a tender offer, each holder of Common Stock shall have the right, until and
including the ninetieth (90th) day following the date the notice to holders of
Common Stock referred to in Section 6.3 herein is mailed, to have the Common
Stock held by such holder repurchased by the Corporation at the Repurchase
Price determined as provided in Section 6.5 herein, and each holder of
securities convertible into Common Stock or of options, warrants or rights
exercisable to acquire Common Stock prior to such thirtieth (30th) day shall
have the right simultaneously with the conversion of such securities or
exercise of such options, warrants or rights to have the Common Stock to be
received by such holder repurchased by the Corporation at the Repurchase Price.
6.1.2. All repurchase rights hereunder shall be subject to, and
limited by, any provision contained in the Wisconsin Business Corporation Law
which limits the amounts which may be used by the Corporation to repurchase its
Common Stock.
6.1.3. No holder of Common Stock of the Corporation shall have any
right to have Common Stock repurchased by the Corporation pursuant to this
Article VI if the Corporation, acting through a majority of its Board of
Directors, shall within ten (10) business days following the publication of
such
<PAGE> 186
tender offer or following publication of any amendment of such tender offer
recommend to the holders of Common Stock that such tender offer be accepted.
6.2 DEFINITIONS.
6.2.1. The term "person" shall include an individual, a Corporation,
partnership, trust or other entity. When two or more persons act as a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring Common Stock, such partnership, syndicate or group shall be deemed a
"person."
6.2.2. For the purpose of determining whether a person is an Acquiring
Person, such person shall be deemed to beneficially own (i) all Common Stock
with respect to which such person has the capability to control or influence
the voting or dispositive power in respect thereof and (ii) all Common Stock
which such person has the immediate or future right to acquire, directly or
indirectly, pursuant to agreements, through the exercise of options, warrants
or rights or through the conversion of convertible securities or otherwise; and
all Common Stock which an Acquiring Person has the right to acquire in such
manner shall be deemed to be outstanding shares, but Common Stock which any
other person has the right to acquire in such manner shall not be deemed to be
outstanding shares.
6.2.3. The acquisition of Common Stock by the Corporation or by any
person controlled by the Corporation shall not engender the right to have
Common Stock repurchased pursuant to this Article VI.
6.2.4. The right to have Common Stock repurchased pursuant to this
Article VI shall attach to such shares and shall not be personal to the holder
thereof.
6.2.5. The term "tender offer" shall mean an offer to acquire or an
acquisition of Common Stock pursuant to a request or invitation for tenders or
an offer to purchase such shares for cash, securities or any other
consideration.
6.2.6. The term "market purchases" shall mean the acquisition of
Common Stock from holders of such shares in privately negotiated transactions
or in transactions effected through a broker or dealer.
6.2.7. Subject to the provisions of Section 6.2.2 herein, "outstanding
shares" shall mean shares of Common Stock which at the time in question have
been issued by the Corporation and not reacquired and held or retired by it or
held by any subsidiary of the Corporation.
-2-
<PAGE> 187
6.3 REPURCHASE PROCEDURE.
Not later than thirty (30) days following the date on which the
Corporation receives notice that any person has become an Acquiring Person and,
as a result, the right to have Common Stock repurchased by the Corporation
under this Article VI shall have been created, the Corporation shall give
written notice, by first class mail, postage prepaid, at the address shown on
the records of the Corporation to each holder of record of Common Stock (and to
any other person known by the Corporation, to have rights to demand repurchase
pursuant to Section 6.1 of this Article) as of the date not more than seven (7)
days prior to the date of the mailing pursuant to this Section 6.3 and shall
advise each such holder of the right to have shares repurchased and the
procedures for such repurchase. In the event that the Corporation fails to
give notice as required by this Section 6.3, any holder entitled to receive
such notice may, within thirty (30) days thereafter, serve written demand upon
the Corporation to give such notice. If within ten (10) days after the receipt
of written demand the Corporation fails to give the required notice, such
holder may at the expense and on behalf of the Corporation take such reasonable
action as may be appropriate to give notice or to cause notice to be given
pursuant to this Section 6.3.
6.3.1. In the event Common Stock is subject to repurchase in
accordance with this Article VI, the Directors of the Corporation shall
designate a Repurchase Agent, which shall be a corporation or association (i)
organized and doing business under the laws of the United States or any state,
(ii) subject to supervision or examination by federal or state authority, (iii)
having combined capital and surplus of at least $5,000,000 and (iv) having the
power to exercise corporate trust powers.
6.3.2. For a period of ninety (90) days from the date of the mailing
of the notice to holders of Common Stock referred to in this Section 6.3,
holders of Common Stock and other persons entitled to have Common Stock
repurchased pursuant to this Article VI may, at their option, deposit
certificates representing all or less than all Common Stock held of record by
them with the Repurchase Agent together with written notice that the holder
elects to have such shares repurchased pursuant to this Article VI. Repurchase
shall be deemed to have been effected at the close of business on the day such
certificates are deposited in proper form with the Repurchase Agent.
-3-
<PAGE> 188
6.3.3. The Corporation shall promptly deposit in trust with the
Repurchase Agent cash in an amount equal to the aggregate Repurchase Price of
all of the Common Stock deposited with the Repurchase Agent for the purposes of
repurchase.
6.3.4. As soon as practicable after receipt by the Repurchase Agent
of the cash deposit by the Corporation referred to in this Section 6.3, the
Repurchase Agent shall issue its checks payable to the order of the persons
entitled to receive the Repurchase Price of the Common Stock in respect of
which such cash deposit was made.
6.3.5. In the event the Corporation is unable to deposit with the
Repurchase Agent cash in full amount of the aggregate Repurchase Price of all
shares deposited for repurchase, because of limitations upon repurchase of
Common Stock contained in the Wisconsin Business Corporation Law, the
Corporation shall promptly deposit with the Repurchase Agent the maximum amount
of cash which may be used for the repurchase of Common Stock, under the most
restrictive of the applicable limitations upon such repurchase. In the event
of deposit of less than the full aggregate Repurchase Price pursuant to the
provisions of this subsection, the Repurchase Agent shall, after the expiration
of the notice period provided for in this Section 6.3.4, use the amount so
deposited to repurchase shares pro tanto, in proportion to the number of shares
deposited by each shareholder for repurchase. Certificates representing all
shares which remain unpurchased shall be returned to the depositors thereof as
soon as practicable thereafter, and there shall be no further repurchase rights
with respect to such shares arising in connection with the transactions already
completed.
6.4. RETIRED STOCK.
All Common Stock with respect to which repurchase has been effected
pursuant to this Article VI shall thereupon be deemed retired.
6.5. REPURCHASE PRICE.
The Repurchase Price shall be the amount payable by the Corporation in
respect of each share of Common Stock with respect to which repurchase has been
demanded pursuant to this Article VI and shall be the greatest amount
determined on any of the following three bases:
(i) The highest price per share of Common Stock, including any
commission paid to brokers or dealers for solicitation or whatever, at
which Common Stock held by the Acquiring Person were acquired pursuant to a
tender offer regardless of when such tender offer was made or were
-4-
<PAGE> 189
acquired pursuant to any market purchase or otherwise within eighteen
(18) months prior to the notice to holders of Common Stock referred to in
Section 6.3 herein. For purposes of this subsection (i), if the
consideration paid in any such acquisition of Common Stock consisted, in
whole or part, of consideration other than cash, the Board of Directors of
the Corporation shall take such action, as in its judgment it deems
appropriate, to establish the cash value of such consideration, but such
valuation shall not be less than the cash value, if any, ascribed to such
consideration by the Acquiring Person.
(ii) The highest sale price per share of Common Stock for any trading
day during the eighteen (18) months prior to the notice to holders of
Common Stock referred to in Section 6.3 herein. For purposes of this
subsection (ii), the sale price for any trading day shall be the
closing price per share of Common Stock as furnished by the National
Association of Securities Dealers Automated Quotation System (NASDAQ) or
the last sale price per share traded on any national securities exchange.
(iii) The amount of shareholders' equity in respect of each outstanding
share of Common Stock as determined in accordance with generally accepted
accounting principles and as reflected in any published report by the
Corporation as of the quarter ending immediately preceding the notice to
shareholders referred to in Section 6.3 herein.
6.5.1. The determinations to be made pursuant to Section 6.5 shall be
made by the Board of Directors not later than the date of the notice to holders
of Common Stock referred to in Section 6.3 herein. In making such
determination, the Board of Directors may engage such persons, including
investment banking firms and the independent accountants who have reported on
the most recent financial statements of the Corporation, and may utilize
employees and agents of the Corporation, who will, in the judgment of the Board
of Directors, be of assistance to the Board of Directors.
6.5.2. The determinations to be made pursuant to this Section 6.5,
when made by the Board of Directors acting in good faith on the basis of such
information and assistance as was then reasonably available for such purpose,
shall be conclusive and binding upon the Corporation and its shareholders,
including any person referred to in Section 6.1 herein.
-5-
<PAGE> 190
$24.00 RD
Amendment to Restated Articles
- - Increases authorized shares from: 12,000,000 Common at $0.05 P.V.
To: 20,000,000 Shares Common at $0.05 P.V.
1,000,000 Shares Preferred at $0.10 P.V.
- - adds Directors provision (Art V)
- - adds Stock Repurchase Provisions (new Art VI)
$650.00 plus $25.00 Exp
Michael, Best & Friedrich
P.O. Box 1806
Madison, WI 53701
Attn: Julie Bretl
STATE OF WISCONSIN
FILED
JUL 07 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 191
EXHIBIT B
BY-LAWS
<PAGE> 192
BY-LAWS
OF
STOKELY USA, INC.
(a Wisconsin corporation)
<PAGE> 193
BY-LAWS
OF
STOKELY USA, INC.
(a Wisconsin Corporation)
Introduction - Variable References
0.01. Date of annual shareholders' meeting: the last Saturday in
June beginning at 11:00 a.m. central standard time (See also Section
2.01)
10:00 a.m. First Tuesday June 1991
- ---------- ----- ------- ---- ----
(HOUR) (WEEK) (DAY) (MONTH) (FIRST YEAR)
0.02. Required notice of shareholders' meeting (See Section 2.04):
not less than 10 days.
0.03. Authorized number of Directors (See Section 3.01): 12.
0.04. Required notice of Directors' meeting (See Section 3.05): not
less than 24 hours.
0.05. Authorized number of Vice Presidents (See Section 4.01): 12.
0.06. Fiscal year of the Corporation shall commence on the first day
of April and end on the last day of March.
<PAGE> 194
TABLE OF CONTENTS
ARTICLE I. OFFICES
<TABLE>
<S> <C> <C>
1.01 Principal and Business Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.02 Registered Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II. SHAREHOLDERS
2.01 Annual Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.02 Special Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.03 Place of Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.04 Notice of Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.05 Closing of Stock Transfer Books or Fixing
of Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.06 Voting Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.07 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.08 Conduct of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.09 Proxies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.10 Voting of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.11 Voting of Shares by Certain Holders . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(a) Other Corporations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(b) Legal Representatives and Fiduciaries . . . . . . . . . . . . . . . . . . . . . . . 5
(c) Pledgees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(d) Treasury Stock and Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(e) Minors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(f) Incompetents and Spendthrifts . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(g) Joint Tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.12 Waiver of Notice By Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.13 Unanimous Consent Without Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE III. BOARD OF DIRECTORS
3.01 General Powers and Number. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.02 Tenure and Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.03 Nominations For Election to the
Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.04 Regular Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.05 Special Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.06 Notice; Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.07 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.08 Manner of Acting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.09 Conduct of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.10 Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.11 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.12 Presumption of Assent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.13 Committees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.14 Unanimous Consent Without Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.15 Meetings By Telephone Or By Other
Communication Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
</TABLE>
(i)
<PAGE> 195
ARTICLE IV. OFFICERS
<TABLE>
<S> <C> <C>
4.01 Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.02 Election and Term of Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.03 Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.04 Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.05 Chairman of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.06 President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.07 Executive Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.08 The Vice Presidents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.09 The Secretary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.10 The Treasurer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.11 Assistant Secretaries and Assistant Treasurers . . . . . . . . . . . . . . . . . . . . 15
4.12 Other Assistants and Acting Officers . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.13 Salaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE V. CONFLICT OF INTEREST TRANSACTIONS,
CONTRACTS, LOANS, CHECKS AND DEPOSITS:
SPECIAL CORPORATE ACTS
5.01 Conflict of Interest Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.02 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.03 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.04 Checks, Drafts, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.05 Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.06 Voting of Securities Owned by this Corporation . . . . . . . . . . . . . . . . . . . . 17
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
6.01 Certificate for Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.02 Facsimile Signatures and Seal . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.03 Signature by Former Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.04 Transfer of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.05 Restrictions on Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.06 Lost, Destroyed or Stolen Certificates . . . . . . . . . . . . . . . . . . . . . . . . 19
6.07 Consideration for Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.08 Uncertificated Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.09 Transfer Agent and Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.10 Stock Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE VII. INDEMNIFICATION
7.01 Indemnification for Successful Defense . . . . . . . . . . . . . . . . . . . . . . . . 20
7.02 Other Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.03 Written Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.04 Nonduplication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
7.05 Determination of Right to Indemnification . . . . . . . . . . . . . . . . . . . . . . 22
7.06 Advance Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
7.07 Nonexclusivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
7.08 Court-Ordered Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
7.09 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.10 Securities Law Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.11 Liberal Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.12 Definitions Applicable to This Article . . . . . . . . . . . . . . . . . . . . . . . . 26
</TABLE>
(ii)
<PAGE> 196
ARTICLE VIII. SEAL
ARTICLE IX. AMENDMENTS
<TABLE>
<S> <C> <C>
9.01 By Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
9.02 By Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
9.03 Implied Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
</TABLE>
ARTICLE X. FISCAL YEAR
(iii)
<PAGE> 197
ARTICLE I. OFFICES
1.01 Principal and Business Offices. The Corporation may have such
principal and other business offices, either within or without the State of
Wisconsin, as the Board of Directors may designate or as the business of the
Corporation may require from time to time.
1.02 Registered Office. The registered office of the Corporation
required by the Wisconsin Business Corporation Law to be maintained in the
State of Wisconsin may be, but need not be, identical with the principal
office in the State of Wisconsin, and the address of the registered office may
be changed from time to time by the Board of Directors or by the registered
agent. The business office of the registered agent of the Corporation shall be
identical to such registered office.
ARTICLE II. SHAREHOLDERS
2.01 Annual Meeting. The annual meeting of the shareholders shall be
held at the date and hour in each year set forth in Section 0.01, or at such
other time and date within thirty days before or after said date as may be
fixed by or under the authority of the Board of Directors, for the purpose of
electing Directors and for the transaction of such other business as may come
before the meeting. If the day fixed for the annual meeting shall be a legal
holiday in the State of Wisconsin, such meeting shall be held on the next
succeeding business day. If the election of Directors shall not be held on the
day designated herein, or fixed as herein provided, for any annual meeting of
the shareholders, or at any adjournment thereof, the Board of Directors shall
cause the election to be held at a special meeting of the shareholders as soon
thereafter as conveniently may be.
2.02 Special Meeting. Special meetings of the shareholders, for any
purpose or purposes, unless otherwise prescribed by the Wisconsin Business
Corporation Law, may be called by the Chairman of the Board or a majority of
the Board of Directors or by the holders of at least ten percent of all the
votes entitled to be cast on any issue proposed to be considered at the
proposed special meeting who sign, date and deliver to the Corporation one or
more written demands for the meeting describing one or more purposes for which
it is to be held. If duly called, the Corporation shall communicate notice of
a special meeting as set forth in Section 2.04.
-1-
<PAGE> 198
2.03 Place of Meeting. The Board of Directors may designate any
place, either within or without the State of Wisconsin, as the place of
meeting for any annual meeting or for any special meeting. If no designation
is made, the place of meeting shall be the principal business office of the
Corporation in the State of Wisconsin, but any meeting may be adjourned to
reconvene at any place designated by vote of a majority of the shares
represented thereat.
2.04 Notice of Meeting. Notice may be communicated in person, by
telephone, telegraph, teletype, facsimile or other form of wire or wireless
communication, or by mail or private carrier, and, if these forms of personal
notice are impracticable, notice may be communicated by a newspaper of general
circulation in the area where published, or by radio, television or other form
of public broadcast communication. Such notice stating the place, day and hour
of the meeting and, in case of a special meeting, a description of each purpose
for which the meeting is called, shall be communicated or sent not less than
the number of days set forth in Section 0.02 (unless a longer period is
required by the Wisconsin Business Corporation Law or the articles of
incorporation) nor more than sixty days before the date of the meeting, by or
at the direction of the Chairman of the Board or the Secretary, or other
Officer or persons calling the meeting, to each shareholder of record entitled
to vote at such meeting. Written notice by the Corporation to its Shareholders
is effective when mailed and may be addressed to the shareholder's address
shown in the Corporation's current record of shareholders. Oral notice is
effective when communicated and the Corporation shall maintain a record
setting forth the date, time, manner and recipient of the notice.
2.05 Closing of Stock Transfer Books or Fixing of Record Date. A
"shareholder" of the Corporation shall mean the person in whose name shares are
registered in the stock transfer books of the Corporation or the beneficial
owner of shares to the extent of the rights granted by a nominee certificate on
file with the Corporation. Such nominee certificates, if any, shall be
reflected in the stock transfer books of the Corporation. For the purpose of
determining shareholders entitled to notice of or to vote at any meeting of
shareholders or any adjournment thereof, or shareholders entitled
to receive payment of any dividend, or in order to make a determination of
shareholders for any other proper purpose, the Board of Directors may provide
that the stock transfer books shall be closed for a stated period but not to
exceed, in any case, seventy days. If the stock transfer books shall be closed
for the purpose of determining shareholders entitled to notice of or to vote at
a meeting of shareholders, such books shall be closed for at least ten days
immediately preceding such meeting. In lieu of closing the stock transfer
-2-
<PAGE> 199
books, the Board of Directors may fix in advance a date as the record
date for any such determination of shareholders, such date in any case to be
not more than seventy days and, in case of a meeting of shareholders, not less
than ten days prior to the date on which the particular action requiring such
determination of shareholders is to be taken. If the stock transfer books are
not closed and no record date is fixed for the determination of shareholders
entitled to notice of or to vote at a meeting of shareholders, or shareholders
entitled to receive payment of a dividend, the close of business on the date on
which notice of the meeting is mailed or on the date on which the resolution of
the Board of Directors declaring such dividend is adopted, as the case may be,
shall be the record date for such determination of shareholders. When a
determination of shareholders entitled to vote at any meeting of shareholders
has been made as provided in this section, such determination shall be applied
to any adjournment thereof except where the determination has been made through
the closing of the stock transfer books and the stated period of closing
has expired.
2.06 Voting Record. The Officer or agent having charge of the stock
transfer books for shares of the Corporation shall, before each meeting of
shareholders, make a complete list of the shareholders entitled to vote at such
meeting, or any adjournment thereof, with the address of and the number of
shares held by each. Such record shall be produced and kept open at the time
and place of the meeting and shall be subject to the inspection of any
shareholder during the whole time of the meeting for the purposes of the
meeting. The original stock transfer books shall be prima facie evidence as to
who are the shareholders entitled to examine such record or transfer books or
to vote at any meeting of shareholders. Failure to comply with the requirements
of this section shall not affect the validity of any action taken at such
meeting.
2.07 Quorum. Shares entitled to vote as a separate voting group as
defined in the Wisconsin Business Corporation Law may take action on a matter
at a meeting only if a quorum of those shares exists with respect to that
matter. Unless the articles of incorporation or the Wisconsin Business
Corporation Law provides otherwise, a majority of the votes entitled to be cast
on the matter by the voting group constitutes a quorum of that voting group for
action on that matter.
Once a share is represented for any purpose at a meeting, other than
for the purpose of objecting to holding the meeting or transacting business at
the meeting, it is considered present for purposes of determining whether a
quorum exists, for the remainder of the meeting and for any adjournment of that
meeting unless a new record date is or must be set for that adjourned meeting.
-3-
<PAGE> 200
If a quorum exists, action on a matter by a voting group is approved if
the votes cast within the voting group favoring the action exceed the votes
cast opposing the action, unless the articles of incorporation or the Wisconsin
Business Corporation Law requires a greater number of affirmative votes.
"Voting group" means any of the following:
(a) All shares of one or more classes or series that under the
articles of incorporation or the Wisconsin Business Corporation Law are
entitled to vote and be counted together collectively on a matter at a meeting
of shareholders.
(b) All shares that under the articles of incorporation or the
Wisconsin Business Corporation Law are entitled to vote generally on a matter.
Though less than a quorum of the outstanding shares are represented at
a meeting, a majority of the shares so represented may adjourn the meeting from
time to time without further notice. At such adjourned meeting at which a
quorum shall be present or represented, any business may be transacted which
might have been transacted at the meeting as originally notified.
2.08 Conduct of Meetings. The Chairman of the Board, or in the
Chairman's absence, the President, or in the President's absence, the Executive
Vice President, or in the Executive Vice President's absence, a Vice President
in the order provided under Section 4.08, and in their absence, any person
chosen by the shareholders present shall call the meeting of the shareholders
to order and shall act as chairman of the meeting, and the Secretary of the
Corporation shall act as Secretary of all meetings of the shareholders, but, in
the absence of the Secretary, the presiding Officer may appoint any other
person to act as Secretary of the meeting.
2.09 Proxies. At all meetings of shareholders, a shareholder entitled
to vote may vote in person or by proxy. A shareholder may appoint a proxy to
vote or otherwise act for the shareholder by signing an appointment form, either
personally or by his or her attorney-in-fact. Such proxy appointment is
effective when received by the Secretary of the Corporation before or at the
time of the meeting. Unless otherwise provided in the appointment form of
proxy, a proxy appointment may be revoked at any time before it is voted,
either by written notice filed with the Secretary or the acting Secretary of
the meeting or by oral notice given by the shareholder to the presiding officer
during the meeting. The presence of a shareholder who has filed his or her
proxy
-4-
<PAGE> 201
appointment shall not of itself constitute a revocation. No proxy appointment
shall be valid after eleven months from the date of its execution, unless
otherwise provided in the appointment form of proxy. The Board of Directors
shall have the power and authority to make rules establishing presumptions as
to the validity and sufficiency of proxy appointments.
2.10 Voting of Shares. Each outstanding share shall be entitled to one
vote upon each matter submitted to a vote at a meeting of shareholders, except
to the extent that the voting rights of the shares of any voting group or
groups are enlarged, limited or denied by the articles of incorporation.
2.11 Voting of Shares by Certain Holders.
(a) Other Corporations. Shares standing in the name of another
corporation may be voted either in person or by proxy, by the president of such
corporation or any other officer appointed by such president. An appointment
form of proxy executed by any principal officer of such other corporation or
assistant thereto shall be conclusive evidence of the signer's authority to
act, in the absence of express notice to this Corporation, given in writing to
the Secretary of this Corporation, or the designation of some other person by
the Board of Directors or by the by-laws of such other corporation.
(b) Legal Representatives and Fiduciaries. Shares held by an
administrator, executor, guardian, conservator, trustee in bankruptcy, receiver
or assignee for creditors may be voted by him, either in person or by proxy,
without a transfer of such shares into his or her name, provided that there is
filed with the Secretary before or at the time of meeting proper evidence of
his or her incumbency and the number of shares held or her. Shares standing in
the name of a fiduciary may be voted by him, either in person or by proxy. An
appointment form of proxy executed by a fiduciary shall be conclusive evidence
of the signer's authority to act, in the absence of express notice to this
Corporation, given in writing to the Secretary of this Corporation, that such
manner of voting is expressly prohibited or otherwise directed by the document
creating the fiduciary relationship.
(c) Pledgees. A shareholder whose shares are pledged shall be
entitled to vote such shares until the shares have been transferred into the
name of the pledgee, and thereafter the pledgee shall be entitled to vote the
shares so transferred; provided, however, a pledgee shall be entitled to vote
shares held of record by the pledgor if the Corporation receives acceptable
evidence of the pledgee's authority to sign.
-5-
<PAGE> 202
(d) Treasury Stock and Subsidiaries. Neither treasury shares, nor
shares held by another corporation if a majority of the shares entitled to vote
for the election of Directors of such other corporation is held by this
Corporation, shall be voted at any meeting or counted in determining the total
number of outstanding shares entitled to vote, but shares of its own issue held
by this Corporation in a fiduciary capacity, or held by such other corporation
in a fiduciary capacity, may be voted and shall be counted in determining the
total number of outstanding shares entitled to vote.
(e) Minors. Shares held by a minor may be voted by such minor in
person or by proxy and no such vote shall be subject to disaffirmance or
avoidance, unless prior to such vote the Secretary of the Corporation has
received written notice or has actual knowledge that such shareholder is a
minor. Shares held by a minor may be voted by a personal representative,
administrator, executor, guardian or conservator representing the minor if
evidence of such fidicuary status is presented and acceptable to the
Corporation.
(f) Incompentents and Spendthrifts. Shares held by an
incompetent or spendthrift may be voted by such incompetent or spendthrift in
person or by proxy and no such vote shall be subject to disaffirmance
or avoidance, unless prior to such vote the Secretary of the Corporation has
actual knowledge that such shareholder has been adjudicated an incompetent or
spendthrift or actual knowledge of filing of judicial proceedings for
appointment of a guardian. Shares held by an incompetent or spendthrift may
be voted by a personal representative, administrator, executor, guardian or
conservator representing the minor if evidence of such fiduciary status is
presented and acceptable to the Corporation.
(g) Joint Tenants. Shares registered in the names of two or more
individuals who are named in the registration as joint tenants may be voted in
person or by proxy signed by any one or more of such individuals if either (i)
no other such individual or his or her legal representative is present and
claims the right to participate in the voting of such shares or prior to the
vote files with the Secretary of the Corporation a contrary written voting
authorization or direction or written denial or authority of the individual
present or signing the appointment form of proxy proposed to be voted or (ii)
all such other individuals are deceased and the Secretary of the Corporation
has no actual knowledge that the survivor has been adjudicated not to be the
successor to the interests of those deceased.
-6-
<PAGE> 203
2.12 Waiver of Notice by Shareholders. Whenever any notice whatever
is required to be given to any shareholder of the Corporation under the
articles of incorporation or by-laws or any provision of law, a waiver thereof
in writing, signed at any time, whether before or after the time of meeting, by
the shareholder entitled to such notice, shall be deemed equivalent to the
giving of such notice and the Corporation shall include copies of such waivers
in its corporate records; provided that such waiver in respect to any matter of
which notice is required under any provision of the Wisconsin Business
Corporation Law, shall contain the same information as would have been
required to be included in such notice, except the time and place of meeting.
2.13 Unanimous Consent Without Meeting. Any action required or
permitted by the articles of incorporation or by-laws or any provision of law
to be taken at a meeting of the shareholders, may be taken without a meeting if
a consent in writing, setting forth the action so taken, shall be signed by all
of the shareholders entitled to vote with respect to the subject matter
thereof.
ARTICLE III. BOARD OF DIRECTORS
3.01 General Powers and Number. All corporate powers shall be
exercised by or under the authority of, and the business and affairs of the
Corporation managed under the direction of, the Board of Directors, subject to
any limitation set forth in the articles of incorporation. The number of
Directors of the Corporation shall be as provided in Section 0.03, but shall be
not less than nine (9) nor more than fifteen (15).
The Board of Directors shall be divided into three (3) classes of not
less than three (3) nor more than five (5) Directors each. The term of office
of the first class of Directors shall expire at the first annual meeting after
their initial election and until their successors are elected and qualified,
the term of office of the second class shall expire at the second annual
meeting after their initial election and until their successors are elected and
qualified, and the term of office of the third class shall expire at the third
annual meeting after the initial election and until their successors are
elected and qualified. At each annual meeting after the inital classification
of the Board of Directors, the class of Directors whose term expires at the
time of such election shall be elected to hold office Until the third succeeding
annual meeting and until their successors are elected and qualified.
-7-
<PAGE> 204
STOKEY USA(R) INC.
FAX number: 414-569-3860
TELECOPIES/FAX TRANSMISSION
TO: Steven Wolf DATE: 9-2-92
COMPANY: Securities and Exchange Commission
FROM: Robert Brill
NUMBER OF PAGES (including this page) 62
MESSAGE: Following are copies of relevant Articles and By-Laws of Stokely USA,
Inc. Due to age of corporation I have not included all Amendments as I fear
that doing so would tie up your fax unduly.
--Continuation of fax--
FORM 4012 C
626 East Wisconsin Ave. - P.O. Box 248 - Oconomowoc, WI 53066 0248
414-567-1731
<PAGE> 205
3.02 Tenure and Qualifications. Each Director shall hold office
until the next annual meeting of shareholders in the year in which such
Director's term expires and until his successor shall have been elected, or
until his prior death, resignation or removal for cause only. A Director may
be removed from office for cause only by affirmative vote of 80% of the
outstanding shares entitled to vote for the election of such Director, taken
at an annual meeting or a special meeting of shareholders called for that
purpose, and any vacancy so created may be filled by the affirmative vote
of 80% of such shares. A Director may resign at any time by filing his
written resignation with the Secretary of the Corporation. Directors need
not be residents of the State of Wisconsin or shareholders of the Corporation.
3.03 Nominations for Election to the Board of Directors. Nominations
for election to the Board of Directors may be made by the Board of Directors
or by any shareholder of any outstanding class of capital stock of the
Corporation entitled to vote for election of Directors. Nominations, other
than those made by or on behalf of the existing management of the Corporation,
shall be made in writing and shall be delivered or mailed to the Chief
Executive Officer and/or President of the Corporation, not less than 14 days
nor more than 60 days prior to any meeting of shareholders called for the
election of directors; provided, however, that if less than 14 days' notice of
the meeting is given to shareholders, such nomination shall be mailed or
delivered to the Chief Executive Officer and/or President of the Corporation
not later than the close of business on the fourth day following the day on
which the notice of meeting was mailed. Such notification shall contain the
following information to the extent known to the nominating shareholder: (a)
the name and address of each proposed nominee; (b) the principal occupation of
each proposed nominee; (c) the name and residence address of the nominating
shareholder; and (d) the number of shares of capital stock of the Corporation
owned by the nominating shareholder. Nominations not made in accordance
herewith may be disregarded by the chairman of the meeting, in his or her
discretion, and upon his or her instructions, the vote tellers may disregard
all votes cast for each such nominee.
3.04 Regular Meetings. A regular meeting of the Board of Directors
shall be held without other notice than this by-law immediately after the
annual meeting of shareholders, and each adjourned session thereof. The place
of such regular meeting shall be the same as the place of the meeting of
shareholders which precedes it, or such other suitable place as may be
announced at such meeting of shareholders. The Board of Directors may provide,
by resolution, the time and place,
-8-
<PAGE> 206
either within or without the State of Wisconsin, for the holding of additional
regular meetings without other notice than such resolution.
3.05 Special Meetings. Special meetings of the Board of Directors
may be called by or at the request of the Chairman of the Board, Secretary or
any two Directors. The Chairman or Secretary calling any special meeting of
the Board of Directors may fix any place, either within or without the State of
Wisconsin, as the place for holding any special meeting of the Board of
Directors called by them, and if no other place is fixed, the place of meeting
shall be the principal business office of the Corporation in the State of
Wisconsin.
3.06 Notice; Waiver. Notice may be communicated in person, by
telephone, telegraph, teletype, facsimile or other form of wire or wireless
communication, or by mail or private carrier, and, if these forms of personal
notice are impracticable, notice may be communicated by a newspaper of general
circulation in the area where published, or by radio, television or other form
of public broadcast communication. Notice of each meeting of the Board of
Directors (unless otherwise provided in or pursuant to Section 3.03) shall be
communicated to each Director at his or her business address or telephone
number or at such other address or telephone number as such Director shall have
designated in writing filed with the Secretary, in each case not less than that
number of hours prior thereto as set forth in Section 0.04. Written notice is
effective at the earliest of the following:
(i) when received;
(ii) five days after its deposit in the U.S. Mail, if mailed
postpaid and correctly addressed; or
(iii) on the date shown on the return receipt, if sent by
registered or certified mail, return receipt requested
and the receipt is signed by or on behalf of the
addressee.
Oral notice is effective when communicated and the Corporation shall maintain a
record setting forth the date, time, manner and recipient of the notice.
Whenever any notice whatever is required to be given to any Director of
the Corporation under the articles of incorporation or by-laws or any provision
of law, a waiver thereof in writing, signed at any time, whether before or
after the time of meeting, by the Director entitled to such notice,
-9-
<PAGE> 207
shall be deemed equivalent to the giving of such notice, and the Corporation
shall retain copies of such waivers in its corporate records. A Director's
attendance at or participation in a meeting waives any required notice to him
or her of the meeting unless the director at the beginning of the meeting or
promptly upon his or her arrival objects to holding the meeting or transacting
business at the meeting and does not thereafter vote for or assert to action
taken at the meeting. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Board of Directors need be
specified in the notice or waiver of notice of such meeting.
3.07 Quorum. Except as otherwise provided by the Wisconsin Business
Corporation Law or by the articles of incorporation or these by-laws, a
majority of the number of Directors as provided in Section 0.03 shall
constitute a quorum for the transaction of business at any meeting of the Board
of Directors, but a majority of the Directors present or participating (though
less than such quorum) may adjourn the meeting from time to time without
further notice.
3.08 Manner of Acting. If a quorum is present or participating when
a vote is taken, the affirmative vote of a majority of directors present or
participating is the act of the Board of Directors or a committee of the Board
of Directors, unless the Wisconsin Business Corporation Law or the articles of
incorporation or these by-laws require the vote of a greater number of
directors.
3.09 Conduct of Meetings. The Chairman of the Board, or in the
Chairman's absence, the President, or in the President's absence, the Executive
Vice President, or in the Executive Vice President's absence, a Vice President
in the order provided under Section 4.08, and in their absence, any Director
chosen by the Directors present, shall call meetings of the Board of Directors
to order and shall act as chairman of the meeting. The Secretary of the
Corporation shall act as Secretary of all meetings of the Board of Directors,
but in the absence of the Secretary, the presiding Officer may appoint any
Assistant Secretary or any Director or other person present or participating to
act as Secretary of the meeting.
3.10 Vacancies. Any vacancy occurring in the Board of Directors,
including a vacancy created by an increase in the number of Directors, may be
filled until the next succeeding annual election by the affirmative vote of a
majority of the Directors then in office, though less than a quorum of the
Board of Directors; provided, that in case of a vacancy created by the removal
of a Director for cause by vote of the shareholders, the shareholders shall
have the right to fill
-10-
<PAGE> 208
such vacancy at the same meeting or any adjournment thereof by the affirmative
vote of 80% of the outstanding shares entitled to vote for the election of such
Director.
3.11 Compensation. The Board of Directors, by affirmative vote of a
majority of the Directors then in office, and irrespective of any personal
interest of any of its members, may establish reasonable compensation of all
Directors for services to the Corporation as Directors, Officers or otherwise,
or may delegate such authority to an appropriate committee. The Board of
Directors also shall have authority to provide for or to delegate authority to
an appropriate committee to provide for reasonable pensions, disability or
death benefits, and other benefits of payments, to Directors, Officers and
employees and to their estates, families, dependents or beneficiaries on
account of prior services rendered by such Directors, Officers and employees to
the Corporation.
3.12 Presumption of Assent. A Director of the Corporation who is
present at or participates in a meeting of the Board of Directors or a
committee thereof of which he or she is a member, at which action on any
corporate matter is taken, shall be presumed to have assented to the action
taken unless his or her dissent shall be entered in the minutes of the meeting
or unless he or she shall file his or her written dissent to such action with
the person acting as the Secretary of the meeting before the adjournment
thereof or shall forward such dissent by registered mail to the Secretary of
the Corporation immediately after the adjournment of the meeting. Such right
to dissent shall not apply to a Director who voted in favor of such action.
3.13 Committees. The Board of Directors, by resolution adopted by
the affirmative vote of a majority of the number of Directors as provided in
Section 0.03, may designate one or more committees, each committee to consist
of two or more Directors elected by the Board of Directors, which to the extent
provided in said resolution as initially adopted, and as thereafter
supplemented or amended by further resolution adopted by a like vote, shall
have and may exercise, when the Board of Directors is not in session, the
powers of the Board of Directors in the management of the business and affairs
of the Corporation, except that a committee may not do any of the following:
(a) authorize distributions; (b) approve or propose to shareholders action that
the Wisconsin Business Corporation Law requires be approved by shareholders;
(c) fill vacancies on the Board of Directors or on any of its committees,
unless the Board of Directors provides by resolution that any vacancies on a
committee shall be filled by the affirmative vote of a
-11-
<PAGE> 209
majority of the remaining committee members; (d) amend articles of
incorporation under Section 180.1002 of the Wisconsin Business Corporation Law;
(e) adopt, amend or repeal by-laws; (f) approve a plan of merger not requiring
shareholder approval; (g) authorize or approve reacquisition of shares, except
according to a formula or method prescribed by the Board of Directors; or (h)
authorize or approve the issuance or sale or contract for sale of shares, or
determine the designation and relative rights, preferences and limitations of a
class or series of shares, except that the Board of Directors may authorize a
committee or a senior executive officer of the Corporation to do so within
limits prescribed by the Board of Directors. The Board of Directors may elect
one or more of its members as alternate members of any such committee who may
take the place of any absent member or members at any meeting of such
committee, upon request by the President or upon request by the chairman of
such meeting. Each such committee shall fix its own rules governing the
conduct of its activities and shall make such reports to the Board of Directors
of its activities as the Board of Directors may request.
3.14 Unanimous Consent Without Meeting. Any action required or
permitted by the articles of incorporation or by-laws or any provision of law
to be taken by the Board of Directors at a meeting or by resolution may be
taken without a meeting if a consent in writing, setting forth the action so
taken, shall be signed by all of the Directors then in office.
3.15 Meetings By Telephone Or By Other Communication Technology.
Meetings of the Board of Directors or committees may be conducted by telephone
or by other communication technology in accordance with Section 180.0820 of the
Wisconsin Business Corporation Law.
ARTICLE IV. OFFICERS
4.01 Number. The principal Officers of the Corporation shall be a
Chairman of the Board, a President, an Executive Vice President, the number of
Vice Presidents as provided in Section 0.05, a Secretary, and a Treasurer, each
of whom shall be elected annually by the Board of Directors. Such other
Officers and assistant officers as may be deemed necessary may be elected or
appointed by the Board of Directors, and shall have such powers and perform
such duties as may be assigned by the Board of Directors or Chairman of the
Board. The Board of Directors may authorize a duly appointed officer to
appoint one or more officers or assistant officers. The same natural person
may simultaneously hold more than one office in the Corporation, provided that
such person holding any two or more offices may sign documents in only one
capacity as an officer of the Corporation.
-12-
<PAGE> 210
4.02 Election and Term of Office. The Officers of the Corporation
to be elected by the Board of Directors shall be elected annually by the Board
of Directors at the first meeting of the Board of Directors held after each
annual meeting of the shareholders. If the election of Officers shall not be
held at such meeting, such election shall be held as soon thereafter as
conveniently may be. Each Officer shall hold office until his or her successor
shall have been duly elected or until his or her prior death, resignation or
removal.
4.03 Removal. Any Officer or agent may be removed by
the Board of Directors with or without cause whenever in its judgment the best
interests of the Corporation will be served thereby, but such removal shall be
without prejudice to the contract rights, if any, of the person so removed.
Election or appointment shall not of itself create contract rights.
4.04 Vacancies. A vacancy in any principal office because of death,
resignation, removal, disqualification or otherwise, shall be filled by the
Board of Directors for the unexpired portion of the term.
4.05 Chairman of the Board. The Chairman shall be the chief execu-
tive officer of the Corporation and, subject to the control of the Board of
Directors, shall in general supervise and control all of the business and
affairs of the Corporation. He or she shall, when present, preside at all
meetings of the shareholders and of the Board of Directors. The Chairman shall
have authority, subject to such rules as may be prescribed by the Board of
Directors, to appoint such agents and employees of the corporation as he or she
shall deem necessary, to prescribe their powers, duties and compensation, and
to delegate authority to them. Such agents and employees shall hold office at
the discretion of the Chairman. The Chairman shall have authority to sign,
execute and acknowledge, on behalf of the Corporation, all deeds, mortgages,
bonds, stock certificates, contracts, leases, reports and all other documents
or instruments necessary or proper to be executed in the course of the
corporation's regular business, or which shall be authorized by resolution of
the Board of Directors; and, except as otherwise provided by law or the Board
of Directors, the Chairman may authorize the President, the Executive Vice
President, or any Vice President or other officer or agent of the Corporation
to sign, execute and acknowledge such documents or instruments in his or her
place and stead. In general, the Chairman shall perform all duties incident to
the office of chief executive officer and such other duties as may be
prescribed by the Board of Directors from time to time.
-13-
<PAGE> 211
4.06 President. The President shall be the chief operating officer
of the Corporation and, subject to the control of the Chairman, shall supervise
and control the operations of the Corporation. He or she shall, in the absence
of the Chairman, preside at all meetings of the shareholders and of the Board
of Directors. He or she shall have authority to sign, execute and acknowledge,
on behalf of the Corporation, all deeds, mortgages, bonds, stock certificates,
contracts, leases, reports and all other documents or instruments necessary or
proper to be executed in the course of the Corporation's regular business, or
which shall be authorized by resolution of the Board of Directors; and, except
as otherwise provided by law or the Board of Directors, he or she may authorize
the Executive Vice President or any Vice President or other Officer or agent of
the Corporation to sign, execute and acknowledge such documents or instruments
in his or her place and stead. In general, he or she shall perform all duties
incident to the office of chief operating officer and such other duties as may
be prescribed by the Board of Directors or Chairman from time to time.
4.07 The Executive Vice President. The Executive Vice President
shall assist the President in the discharge of supervisory, managerial and
executive duties and functions. In the absence of the President or in the
event of his or her death, inability or refusal to act, the Executive Vice
President shall perform the duties of the President and when so acting shall
have all the powers and duties of the President. He or she shall perform such
other duties as from time to time may be assigned to him or her by the Board of
Directors, the Chairman or the President.
4.08 The Vice Presidents. In the absence of the Chairman, President
and the Executive Vice President or in the event of their death, inability or
refusal to act, or in the event for any reason it shall be impracticable for
them to act personally, the Vice President (or in the event there be more than
one Vice President, the Vice Presidents in the order designated by the Board of
Directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the President, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
President. Any Vice President may sign, with the Secretary or Assistant
Secretary, certificates for shares of the Corporation; and shall perform such
other duties and have such authority as from time to time may be delegated or
assigned to him or her by the Chairman, the President, the Executive Vice
President or by the Board of Directors. The execution of any instrument of the
Corporation by any Vice President shall be conclusive evidence, as to third
parties, of his or her authority to act in the stead of the Chairman or the
President.
-14-
<PAGE> 212
4.09 The Secretary. The Secretary shall: (a) keep the minutes of the
meetings of the shareholders and of the Board of Directors in one or more books
provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these by-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the Corporation and see
that the seal of the Corporation is affixed to all documents, the execution of
which on behalf of the Corporation under its seal is duly authorized; (d) keep
or arrange for the keeping of a register of the post office address of each
shareholder which shall be furnished to the Secretary by such shareholder; (e)
have general charge of the stock transfer books of the Corporation; and (f) in
general, perform all duties incident to the office of Secretary and have such
other duties and exercise such authority as from time to time may be delegated
or assigned to him or her by the Chairman or President or by the Board of
Directors.
4.10 The Treasurer. The Treasurer shall: (a) have charge and custody
of and be responsible for all funds and securities of the Corporation; (b)
receive and give receipts for moneys due and payable to the Corporation from
any source whatsoever, and deposit all such moneys in the name of the
Corporation in such banks, trust companies or other depositories as shall be
selected in accordance with the provisions of Section 5.05; and (c) in general,
perform all of the duties incident to the office of Treasurer and have such
other duties and exercise such other authority as from time to time may be
delegated or assigned to him or her by the Chairman or President or by the
Board of Directors. If required by the Board of Directors, the Treasurer shall
give a bond for the faithful discharge of his duties in such sum and with such
surety or sureties as the Board of Directors shall determine.
4.11 Assistant Secretaries and Assistant Treasurers. There shall be
such number of Assistant Secretaries and Assistant Treasurers as the Board of
Directors may from time to time authorize. The Assistant Treasurers shall,
respectively, if required by the Board of Directors, give bonds for the
faithful discharge of their duties in such sums and with such sureties as the
Board of Directors shall determine. The Assistant Secretaries and Assistant
Treasurers, in general, shall perform such duties and have such authority as
shall from time to time be delegated or assigned to them by the Secretary or
the Treasurer, respectively, or by the Chairman or President or the Board of
Directors.
4.12 Other Assistants and Acting Officers. The Board of Directors
shall have the power to appoint any person to act as assistant to any Officer,
or as agent for the Corporation in his or her stead, or to perform the duties
of such Officer
-15-
<PAGE> 213
whenever for any reason it is impracticable for such Officer to act personally
and such assistant or acting Officer or other agent so appointed by the Board
of Directors shall have the power to perform all the duties of the office to
which he or her is so appointed to be assistant, or as to which he or her is so
appointed to act, except as such power may be otherwise defined or restricted
by the Board of Directors.
4.13 Salaries. The salaries of the principal Officers shall be fixed
from time to time by the Board of Directors or by a duly authorized committee
thereof, and no Officer shall be prevented from receiving such salary by reason
of the fact that he or she is also a Director of the Corporation.
ARTICLE V. CONFLICT OF INTEREST TRANSACTIONS,
CONTRACTS, LOANS, CHECKS AND DEPOSITS: SPECIAL CORPORATE ACTS
5.01 Conflict of Interest Transactions. A "conflict of interest"
transaction means a transaction with the Corporation in which a Director of the
Corporation has a direct or indirect interest. The circumstances in which a
Director of the Corporation has an indirect interest in a transaction include
but are not limited to a transaction under any of the following circumstances:
(1) another entity in which the Director has a material financial interest or
in which the Director is a general partner is a party to the transaction; or
(2) another entity of which the Director is a director, officer or trustee is
a party to the transaction and the transaction is or, because of its
significance to the Corporation, should be considered by the Board of
Directors of the Corporation. A conflict of interest transaction is not
voidable by the Corporation solely because of the Director's interest in the
transaction if any of the circumstances set forth in Section 180.0831 of the
Wisconsin Business Corporation Law are true or occur.
5.02 Contracts. The Board of Directors may authorize any Officer
or Officers, agent or agents, to enter into any contract or execute or deliver
any instrument in the name of and on behalf of the Corporation, and such
authorization may be general or confined to specific instances. In the
absence of other designation, all deeds, mortgages and instruments of
assignment or pledge made by the Corporation shall be executed in the name of
the Corporation by the Chairman of the Board, President or Executive Vice
President or one of the Vice Presidents and by the Secretary, or Assistant
Secretary, the Treasurer or Assistant Treasurer; the Secretary or an Assistant
Secretary, when necessary or required, shall affix the
-16-
<PAGE> 214
corporate seal thereto; and when so executed no other party to such instrument
or any third party shall be required to make any inquiry into the authority of
the signing officer or officers.
5.03 Loans. No indebtedness for borrowed money shall be contracted
on behalf of the Corporation and no evidences of such indebtedness shall be
issued in its name unless authorized by or under the authority of a resolution
of the Board of Directors. Such authorization may be general or confined to
specific instances.
5.04 Checks, Drafts, etc. All checks, drafts or other orders for
the payment of money, notes or other evidences of indebtedness issued in the
name of the Corporation, shall be signed by such Officer or Officers, agent or
agents of the Corporation and in such manner as shall from time to time be
determined by or under the authority of a resolution of the Board of Directors.
5.05 Deposits. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
in such banks, trust companies or other depositories as may be selected by or
under the authority of a resolution of the Board of Directors.
5.06 Voting of Securities Owned by this Corporation. Subject
always to the specific directions of the Board of Directors, (a) any shares or
other securities issued by any other corporation and owned or controlled by
this Corporation may be voted at any meeting of security holders of such other
corporation by the Chairman of the Board of this Corporation if he or she be
present, or in the Chairman's absence, by the President, or in the President's
absence, by the Executive Vice President, or in the Executive Vice President's
absence, by any Vice President of this Corporation who may be present, and (b)
whenever, in the judgment of the Chairman of the Board, or in the Chairman's
absence, the President, or in the President's absence, the Executive Vice
President, or in the Executive Vice President's absence, by any Vice President,
it is desirable for this Corporation to execute a proxy or written consent in
respect to any shares or other securities issued by any other corporation and
owned by this Corporation, such proxy or consent shall be executed in the name
of this Corporation by the Chairman, the President, the Executive Vice
President, or one of the Vice Presidents of this Corporation in the order as
provided in clause (a) of this Section, without necessity of any authorization
by the Board of Directors, affixation of corporate seal or countersignature or
attestation by another officer. Any person or persons designated in the manner
above
-17-
<PAGE> 215
stated as the proxy or proxies of this Corporation shall have full right,
power and authority to vote the shares or other securities issued by such other
corporation and owned by this Corporation the same as such shares or other
securities might be voted by this Corporation.
ARTICLE VI. CERTIFICATES FOR
SHARES AND THEIR TRANSFER
6.01 Certificates for Shares. Certificates representing shares of
the Corporation shall be in such form, consistent with law, as shall
be determined by the Board of Directors. Such Certificates shall be signed by
the Chairman or the President or by another Officer designated by the Chairman
or the Board of Directors. All certificates for shares shall be consecutively
numbered or otherwise identified. The name and address of the person to whom
the shares represented thereby are issued, with the number of shares and date
of issue, shall be entered on the stock transfer books of the Corporation. All
certificates surrendered to the Corporation for transfer shall be cancelled and
no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and cancelled, except as provided
in Section 6.06.
6.02 Facsimile Signatures and Seal. The seal of the Corporation on
any certificates for shares may be a facsimile. The signature of the Chairman
or the President or other authorized Officer upon a certificate may be a
facsimile if the certificate is manually signed on behalf of a transfer agent,
or a registrar, other than the Corporation itself or an employee of the
Corporation.
6.03 Signature by Former Officers. In case any officer, who has
signed or whose facsimile signature has been placed upon, any certificate for
shares, shall have ceased to be such Officer before such certificate is issued,
it may be issued by the Corporation with the same effect as if he or she were
such Officer at the date of its issue.
6.04 Transfer of Shares. Prior to due presentment of a certificate
for shares for registration of transfer, the Corporation may treat the
shareholder of such shares as the person exclusively entitled to vote, to
receive notifications and otherwise to have and exercise all the rights and
powers of an owner. Where a certificate for shares is presented to the
Corporation with a request to register for transfer, the Corporation shall not
be liable to the owner or any other person suffering loss as a result of such
registration of
-18-
<PAGE> 216
transfer if (a) there were on or with the certificate the necessary
endorsements, and (b) the corporation had no duty to inquire into adverse
claims or has discharged any such duty. The Corporation may require reasonable
assurance that said endorsements are genuine and effective and in compliance
with such other regulations as may be prescribed by or under the authority of
the Board of Directors.
6.05 Restrictions on Transfer. The face or reverse side of each
certificate representing shares shall bear a conspicuous notation of any
restriction imposed by the Corporation upon the transfer of such shares.
6.06 Lost, Destroyed or Stolen Certificates. Where the owner claims
that his or her certificate for shares has been lost, destroyed or wrongfully
taken, a new certificate shall be issued in place thereof if the owner (a) so
requests before the Corporation has notice that such shares have been acquired
by a bona fide purchaser, and (b) files with the Corporation a sufficient
indemnity bond, and (c) satisfies such other reasonable requirements as may be
prescribed by or under the authority of the Board of Directors.
6.07 Consideration for Shares. The shares of the Corporation may be
issued for such consideration as shall be fixed from time to time by the Board
of Directors, provided that any shares having a par value shall not be issued
for a consideration less than the par value thereof. The consideration to be
received for shares may consist of any tangible or intangible property or
benefit to the Corporation, including cash, promissory notes, services
performed, contracts for services to be performed or other securities of the
Corporation. When the Corporation receives the consideration for which the
Board of Directors authorized the issuance of shares, the shares issued for
that consideration are fully paid and nonassessable, except as provided by
Section 180.0622 of the Wisconsin Business Corporation Law which may require
further assessment for unpaid wages to employees under certain circumstances.
The Corporation may place in escrow shares issued for a contract for future
services or benefits or a promissory note, or make other arrangements to
restrict the transfer of the shares, and may credit distributions in respect of
the shares against their purchase price, until the services are performed, the
benefits are received or the note is paid. If the services are not performed,
the benefits are not received or the note is not paid, the Corporation may
cancel, in whole or in part, the shares escrowed or restricted and the
distributions credited.
-19-
<PAGE> 217
6.08 Uncertificated Shares. In accordance with Section 180.0626
of the Wisconsin Business Corporation Law, the Board of Directors may issue any
shares of any of its classes or series without certificates. The authorization
does not affect shares already represented by certificates until the
certificates are surrendered to the Corporation. Within a reasonable time
after the issuance or transfer of shares without certificates, the Corporation
shall send the shareholder a written statement of the information required on
share certificates by Sections 180.0625 and 180.0627, if applicable, of the
Wisconsin Business Corporation Law, and by the By-laws of the Corporation.
The Corporation shall maintain at its offices, or at the office of its
transfer agent, an original or duplicate stock transfer book containing the
names and addresses of all shareholders and the number of shares held by each
shareholder. If the shares are uncertificated, the Corporation shall be
entitled to recognize the exclusive right of a person registered on its books
as such, as the owner of shares for all purposes, and shall not be bound to
recognize any equitable or other claim to or interest in such shares on the
part of any other person, whether or not it shall have express or other notice
thereof, except as otherwise provided by the laws of the State of Wisconsin.
6.09 Transfer Agent and Registrar. The Corporation may maintain
one or more transfer offices or agencies, each in charge of a transfer agent
designated by the Board of Directors, where the shares of stock of the
Corporation shall be transferable. The Corporation may also maintain one or
more registry offices, each in charge of a registrar designated by the Board of
Directors, where such shares of stock shall be registered. The same person or
entity may be both a transfer agent and registrar.
6.10 Stock Regulations. The Board of Directors shall have the
power and authority to make all such further rules and regulations not
inconsistent with the statutes of the State of Wisconsin as it may deem
expedient concerning the issue, transfer and registration of certificates
representing shares of the Corporation.
ARTICLE VII. INDEMNIFICATION
7.01 Indemnification for Successful Defense. Within 20 days
after receipt of a written request pursuant to Section 7.03, the Corporation
shall indemnify a Director, Officer, Employee or Agent, to the extent he or she
has been
-20-
<PAGE> 218
successful on the merits or otherwise in the defense of a proceeding, for
all reasonable expenses incurred in the proceeding if the Director, Officer,
Employee or Agent was a party because he or she is a Director, Officer,
Employee or Agent of the Corporation.
7.02 Other Indemnification. (a) In cases not included under
Section 7.01, the Corporation shall indemnify a Director, Officer, Employee or
Agent against all liabilities and expenses incurred by the Director, Officer,
Employee or Agent in a proceeding to which the Director, Officer, Employee or
Agent was a party because he or she is a Director, Officer, Employee or Agent
of the Corporation, unless liability was incurred because the Director,
Officer, Employee or Agent breached or failed to perform a duty he or she owes
to the Corporation and the breach or failure to perform constitutes any of the
following:
(1) A willful failure to deal fairly with the Corporation or its
shareholders in connection with a matter in which the Director, Officer,
Employee or Agent has a material conflict of interest.
(2) A violation of criminal law, unless the Director, Officer,
Employee or Agent had reasonable cause to believe his or her conduct was
lawful or no reasonable cause to believe his or her conduct was unlawful.
(3) A transaction from which the Director, Officer, Employee or
Agent derived an improper personal profit.
(4) Willful misconduct.
(b) Determination of whether indemnification is required under this
Section shall be made pursuant to Section 7.05.
(c) The termination of a proceeding by judgment, order, settlement
or conviction, or upon a plea of no contest or an equivalent plea, does not, by
itself, create a presumption that indemnification of the Director, Officer,
Employee or Agent is not required under this Section.
7.03 Written Request. A Director, Officer, Employee or Agent who
seeks indemnification under Sections 7.01 or 7.02 shall make a written request
to the Corporation.
-21-
<PAGE> 219
7.04 Nonduplication. The Corporation shall not indemnify a Director,
Officer, Employee or Agent under Sections 7.01 or 7.02 if the Director,
Officer, Employee or Agent has previously received indemnification or
allowance of expenses from any person, including the Corporation, in
connection with the same proceeding. However, the Director, Officer, Employee
or Agent has no affirmative duty to look to any other person for
indemnification nor to first exhaust his remedies to seek indemnification from
such other person.
7.05 Determination of Right to Indemnification.
(a) Unless otherwise provided by the articles of incorporation
or by written agreement between the Director, Officer, Employee or Agent and
the Corporation, the Director, Officer, Employee or Agent seeking
indemnification under Section 7.02 shall select one of the following means for
determining his or her right to indemnification:
(1) By a majority vote of a quorum of the Board of
Directors consisting of Directors not at the time parties to the same
or related proceedings. If a quorum of disinterested Directors cannot
be obtained, by majority vote of a committee duly appointed by the
Board of Directors and consisting solely of two or more Directors not
at the time parties to the same or related proceedings. Directors who
are parties to the same or related proceedings may participate in the
designation of members of the committee.
(2) By independent legal counsel selected by a quorum of
the Board of Directors or its committee in the manner prescribed in
sub. (1) or, if unable to obtain such a quorum or committee, by a
majority vote of the full Board of Directors, including Directors who
are parties to the same or related proceedings.
(3) By a panel of three arbitrators consisting of one
arbitrator selected by those Directors entitled under sub. (2) to
select independent legal counsel, one arbitrator selected by the
Director or Officer seeking indemnification and one arbitrator
selected by the two arbitrators previously selected.
(4) By an affirmative vote of the majority of shares
represented at a meeting of shareholders at which a quorum is present.
Shares owned by, or voted under the control of, persons who are at the
time parties to the same or related proceedings, whether as plaintiffs
or defendants or in any other capacity, may not be voted in making the
determination.
-22-
<PAGE> 220
(5) By a court under Section 7.08.
(6) By any other method provided for in any additional
right to indemnification permitted under Section 7.07.
(b) In any determination under (a), the burden of proof is on the
Corporation to prove by clear and convincing evidence that indemnification
under Section 7.02 should not be allowed.
(c) A written determination as to a Director, Officer, Employee or
Agent's indemnification under Section 7.02 shall be submitted to both the
Corporation and the Director, Officer, Employee or Agent within 60 days of the
selection made under (a).
(d) If it is determined that indemnification is required under
Section 7.02, the Corporation shall pay all liabilities and expenses not
prohibited by Section 7.04 within 10 days after receipt of the written
determination under (c). The Corporation shall also pay all expenses incurred
by the Director, Officer, Employee or Agent, in the determination process
under (a).
7.06 Advance Expenses. Within 10 days after receipt of a written
request by a Director, Officer, Employee or Agent who is a party to a
proceeding, the Corporation shall pay or reimburse his or her reasonable
expenses as incurred if the Director, Officer, Employee or Agent provides the
Corporation with all of the following:
(1) A written affirmation of his or her good faith
belief that he or she has not breached or failed to perform his or her
duties to the Corporation.
(2) A written undertaking, executed personally or on his or
her behalf, to repay the allowance (together with reasonable interest
thereon) to the extent that it is ultimately determined under Section
7.05 that indemnification under Section 7.02 is not required and that
indemnification is not ordered by a court under Section 7.08(b)(2).
The undertaking under this subsection shall be an unlimited general
obligation of the Director, Officer, Employee or Agent, and may be
accepted without reference to his or her ability to repay the
allowance. The undertaking may be secured or unsecured.
-23-
<PAGE> 221
7.07 Nonexclusivity. (a) Except as provided in (b), Sections 7.01,
7.02 and 7.06 do not preclude any additional right to indemnification or
allowance of expenses that a Director, Officer, Employee or Agent may have
under any of the following:
(1) The articles of incorporation.
(2) A written agreement between the Director, Officer,
Employee or Agent, and the Corporation.
(3) A resolution of the Board of Directors.
(4) A resolution, after notice, adopted by a majority vote of
all of the Corporation's voting shares then issued and outstanding.
(b) Regardless of the existence of an additional right under (a), the
Corporation shall not indemnify a Director, Officer, Employee or Agent, or
permit a Director, Officer, Employee or Agent to retain any allowance of
expenses, unless it is determined by or on behalf of the Corporation that the
Director, Officer, Employee or Agent did not breach or fail to perform a duty
he or she owes to the Corporation which constitutes conduct under Section
7.02(a)(1), (2), (3) or (4). A Director, Officer, Employee or Agent who is a
party to the same or related proceeding for which indemnification or an
allowance of expenses is sought may not participate in a determination under
this subsection.
(c) Sections 7.01 to 7.12 do not affect the Corporation's power to pay or
reimburse expenses incurred by a Director, Officer, Employee or Agent in any of
the following circumstances.
(1) As a witness in a proceeding to which he or she is not a
party.
(2) As a plaintiff or petitioner in a proceeding because he or
she is or was a Director, Officer, Employee or Agent of the
Corporation.
7.08 A Court-Ordered Indemnification. (a) Except as provided otherwise
by written agreement between the Director, Officer, Employee or Agent and the
Corporation, a Director, Officer, Employee or Agent who is a party to a
proceeding may apply for indemnification to the court conducting the proceeding
or to another court of competent jurisdiction. Application may be made for an
initial determination by the court under Section 7.05 (a) (5) or for review by
the court of an
-24-
<PAGE> 222
adverse determination under Section 7.05(a) (1), (2), (3), (4) or (6). After
receipt of an application, the court shall give any notice it considers
necessary.
(b) The court shall order indemnification if it determines any of the
following:
(1) That the Director, Officer, Employee or Agent is entitled to
indemnification under Sections 7.01 or 7.02.
(2) That the Director, Officer, Employee or Agent is fairly and
reasonably entitled to indemnification in view of all the relevant
circumstances, regardless of whether indemnification is required under
Section 7.02.
(c) If the court determines under (b) that the Director, Officer,
Employee or Agent is entitled to indemnification, the Corporation shall pay the
Director, Officer, Employee or Agent's expenses incurred to obtain the
court-ordered indemnification.
7.09 Insurance. The Corporation may purchase and maintain insurance
on behalf of an individual who is a Director, Officer, Employee or Agent of the
Corporation against liability asserted against or incurred by the individual in
his or her capacity as a Director, Officer, Employee or Agent, regardless of
whether the Corporation is required or authorized to indemnify or allow
expenses to the individual against the same liability under Sections 7.01,
7.02, or 7.06.
7.10 Securities Law Claims. (a) Pursuant to the public policy of the
State of Wisconsin, the Corporation shall provide indemnification, allowance of
expenses and insurance for any liability incurred in connection with a
proceeding involving securities regulation described under (b) to the extent
required or permitted under Sections 7.01 to 7.09.
(b) Sections 7.01 to 7.09 apply, to the extent applicable to any
other proceeding, to any proceeding involving a federal or state statute, rule
or regulation regulating the offer, sale or purchase of securities, securities
brokers or dealers, or investment companies or investment advisers.
7.11 Liberal Construction. In order for the corporation to obtain
and retain qualified Directors, Officers, Employees and Agents, the foregoing
provisions shall be liberally administered in order to afford maximum
indemnification of Directors, Officers, Employees or Agents
-25-
<PAGE> 223
and, accordingly, the indemnification above provided for shall be granted in
all cases unless to do so would clearly contravene applicable law, controlling
precedent or public policy.
7.12 Definitions Applicable to This Article.
(a) "Affiliate" shall include, without limitation, any corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise
that directly or indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, the Corporation.
(b) "Corporation" means this Corporation and any domestic or foreign
predecessor of this Corporation where the predecessor corporation's existence
ceased upon the consummation of a merger or other transaction.
(c) "Director, Officer, Employee or Agent" means any
of the following:
(1) A natural person who is or was a director, officer, employee or
agent (including attorneys) of this Corporation; provided, however, that
no attorney of the Corporation shall be considered an agent with respect
to those actions taken by such attorney solely in his capacity as an
independent contractor to the Corporation.
(2) A natural person who, while a director, officer, employee or
agent, of this Corporation, is or was serving at the Corporation's request
as a director, officer, employee, agent, partner, trustee, member of any
governing or decision-making committee, of another Corporation or foreign
corporation, partnership, joint venture, trust or other enterprise.
(3) A natural person who, while a director, officer, employee or
agent of this Corporation, is or was serving an employee benefit plan
because his or her duties to the Corporation also impose duties on, or
otherwise involve services by, the person to the plan or to participants
or beneficiaries of the plan.
(4) Unless the context requires otherwise, the estate or personal
representative of a Director, Officer, Employee or Agent.
For purposes of this Article, it shall be conclusively presumed
that any Director, Officer, Employee or Agent serving as a
-26-
<PAGE> 224
director, officer, employee, agent, partner, trustee, member of any governing
or decision-making committee of an Affiliate shall be so serving at the request
of the Corporation.
(d) "Expenses" include fees, costs, charges, disbursements, attorney fees
and other expenses incurred in connection with a proceeding.
(e) "Liability" includes the obligation to pay a judgment, settlement,
penalty, assessment, forfeiture or fine, including an excise tax assessed with
respect to an employee benefit plan, and reasonable expenses.
(f) "Party" includes a natural person who was or is, or who is threatened
to be made, a named defendant or respondent in a proceeding.
(g) Proceeding" means any threatened, pending or completed civil,
criminal, administrative or investigative action, suit, arbitration or other
proceeding, whether formal or informal, which involves foreign, federal, state
or local law and which is brought by or in the right of the Corporation or by
any other person.
ARTICLE VIII. SEAL
The Board of Directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the Corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE IX. AMENDMENTS
9.01. By Shareholders. These by-laws may be altered, amended or
repealed and new by-laws may be adopted by the shareholders by affirmative
vote of not less than a majority of the shares present or represented at an
annual or special meeting of the shareholders at which a quorum is in
attendance.
9.02. By Directors. These by-laws may also be altered, amended or
repealed and new by-laws may be adopted by the Board of Directors by
affirmative vote of a majority of the number of Directors present at or
participating in any meeting at which a quorum is in attendance; but no by-law
adopted by the shareholders shall be amended or repealed by the Board of
Directors if the by-law so adopted so provides.
- 27 -
<PAGE> 225
9.03. Implied Amendments. Any action taken or authorized by the
shareholders or by the Board of Directors, which would be inconsistent with
the by-laws then in effect but is taken or authorized by affirmative vote of
not less than the number of shares or the number of Directors required to amend
the by-laws so that the by-laws would be consistent with such action, shall be
given the same effect as though the by-laws had been temporarily amended or
suspended so far, but only so far, as is necessary to permit the specific
action so taken or authorized.
ARTICLE X. FISCAL YEAR
The fiscal year of the Corporation shall be as provided in Section 0.06.
-28-
<PAGE> 226
EXHIBIT C
RESOLUTIONS
<PAGE> 227
RESOLUTIONS OF
STOKELY USA, INC.
WHEREAS, this Corporation is duly authorized to borrow money and
obtain other credit and financial accommodations for its corporate purposes and
to execute and deliver its promissory notes and other instruments and
agreements for the amounts so borrowed or acquired; and
WHEREAS, the proper officers of this Corporation have negotiated with
Harris Trust and Savings Bank and certain other lenders (individually a "Bank"
and collectively the "Banks") for a three-year revolving credit to be made
available by the Banks to this Corporation in the form of loans and letters of
credit in an aggregate principal amount not to exceed $65,000,000 at any one
time outstanding; and
WHEREAS, advances made under said revolving credit are to be repayable
on July 31, 1998 and to bear interest at the rates and be payable at the times
and in the manner specified therefor in the Credit Agreement hereinafter
referred to; and
WHEREAS, as a condition precedent to the extension of said revolving
credit and any other credit or financial accommodations from the Banks to this
Corporation, the Banks require that this Corporation enter into a credit
agreement with the Banks setting forth the terms and conditions applicable
thereto and that this Corporation secure said extensions of credit from the
Banks by granting to Harris Trust and Savings Bank, as agent (the "Agent") for
the Banks, a security interest in and lien on all of this Corporation's
accounts, chattel paper, documents, instruments, general intangibles,
inventory, and certain other assets and property of this Corporation; and
WHEREAS, there are now before this Board of Directors forms of (i)
Secured Revolving Credit Notes in the aggregate face principal amount of
$65,000,000 (the "Revolving Credit Notes") to be executed and delivered by this
Corporation to evidence advances made under said revolving credit, (ii) a
Secured Credit Agreement (the "Credit Agreement") to be entered into by this
Corporation, the Agent and the Banks setting forth the terms and conditions
applicable to said revolving credit and the covenants, agreements,
representations and warranties to be made by this Corporation in connection
therewith, (iii) a Security Agreement (the "Security Agreement") to be executed
and delivered by this Corporation granting the Agent a security interest in and
lien on this Corporation's accounts, chattel paper, documents, instruments,
general intangibles, inventory and certain other assets and property of this
Corporation described therein as collateral security for said revolving credit
and any other credit or financial accommodations from the Banks, (iv) a
Reimbursement Agreement (the "Reimbursement Agreement") to be executed and
delivered
<PAGE> 228
by this Corporation setting forth certain of the terms and conditions
applicable to certain letters of credit to be issued by Harris Trust and
Savings Bank in connection with industrial revenue bonds issued for this
Corporation's benefit, and (v) a Trademark Collateral Agreement (the "Trademark
Agreement") to be executed and delivered by this Corporation granting a
security interest in this Corporation's trademarks and related property of this
Corporation as collateral security for said revolving credit loans and any
other credit or financial accommodations from the Banks; and
WHEREAS, said Revolving Credit Notes, Credit Agreement, Reimbursement
Agreement, Security Agreement, and Trademark Agreement, having been examined by
this Board, are in the judgment of this Board in proper form for their intended
purposes; and
NOW, THEREFORE, BE IT AND IT IS HEREBY RESOLVED by the Board of
Directors of Stokely USA, Inc. as follows:
1. The obtaining of the revolving credit (in the form of loans
and letters of credit) from the Banks and the granting of collateral security
therefor as aforesaid, all on the terms and conditions set forth in the
instruments and documents now before this Board, are in the judgment of this
Board in the best interest of this Corporation and its shareholders.
2. Any one of the following officers of this Corporation:
<TABLE>
<CAPTION>
Name Office
---- ------
<S> <C>
Stephen Theobald Vice Chairman
Robert Brill Secretary
Les Wilson Vice President
</TABLE>
be and the same each is hereby authorized, empowered and directed for, in the
name and on behalf of this Corporation (and when requested by the Banks, under
the corporate seal and attested to by the Secretary or Assistant Secretary) to
execute and deliver to the Banks (i) Revolving Credit Notes in the aggregate
face principal amount of $65,000,000, (ii) a Credit Agreement, (iii) a Security
Agreement, (iv) a Reimbursement Agreement, and (v) a Trademark Agreement (each
of the foregoing as so executed being hereinafter referred to collectively as
the "Loan Documents") containing substantially the terms, conditions and
provisions as set forth in the forms of (i) Revolving Credit Notes, (ii) Credit
Agreement, (iii) Security Agreement, (iv) Reimbursement Agreement, and (v)
Trademark Agreement, respectively, now before this meeting and hereby approved
and/or such additional, modified or revised terms as may be acceptable to said
officer as evidenced by her/his execution thereof and any and all amendments
and supplements to the Loan Documents (including amendments extending the
maturity of the same) and to also execute and deliver to the Banks such notes,
security agreements, assignments, mortgages and other instruments and documents
as may from time to time be required by the Banks in connection with any of the
Loan Documents, and any and all amendments and supplements to such notes,
security
2
<PAGE> 229
agreements, assignments, mortgages and other instruments and documents, all on
such terms and conditions and for such consideration as any of the foregoing
officers may in her/his sole discretion deem proper as evidenced by her/his
execution thereof.
3. Any one of the officers of this Corporation mentioned in
resolution number two (2) above, and any other officer of this Corporation
appointed by any one of the foregoing officers pursuant to the Credit
Agreement, each is hereby authorized, empowered and directed for, in the name
of and on behalf of this Corporation, to borrow all or any part of the
revolving credit provided for under the Credit Agreement now before this Board
as the same may from time to time be amended or extended, to select interest
rate options provided for thereunder and, in connection with extensions of
credit in the form of letters of credit, to execute and deliver to the Banks
separate applications and reimbursement agreements as to each letter of credit
issued by the Banks as any one of the foregoing officers may in her/his sole
discretion deem proper as evidenced by her/his execution thereof, including,
without limiting hereby, a certain letter of credit in the amount of $2,643,500
which may be issued by Harris Trust and Savings Bank in favor of NBD Bank for
the account of Corporation prior to the execution by the Corporation of the
Credit Agreement and Revolving Credit Notes and which will become a part of the
revolving credit and subject to the terms and conditions of the Loan Documents
upon execution of the Loan Documents by Corporation.
4. The Banks shall be authorized to rely on telephonic requests
for borrowings and selection of interest rate options with respect thereto to
be made by this Corporation and telephonic wire transfer instructions when the
Banks in good faith believe such telephonic requests and instructions have been
made by a person authorized to act on behalf of this Corporation and the Banks
shall be indemnified by this Corporation against any costs, liabilities,
damages or losses ensuing from such reliance.
5. Any officer, agent or employee of this Corporation is hereby
authorized, empowered and directed for, in the name and on behalf of this
Corporation to execute such further instruments and documents and to perform
such further acts and things as may by any one of them be deemed necessary or
appropriate to comply with or evidence compliance with any of the terms,
provisions or conditions of any of the Loan Documents and any note, security
agreement, assignment, mortgage or other instrument or document executed
pursuant to the authority contained in these resolutions and any other
requirement or condition specified by the Banks in respect thereto, including
without limiting the execution and filing of any financing statement or similar
notice or instrument.
6. The Secretary or Assistant Secretary of this Corporation shall
deliver to the Banks a certified copy of these resolutions and shall file with
the Banks from time to time the names of the officers, agents and employees of
this Corporation at the time authorized by these resolutions to act in the
premises together with the specimen signatures of such officers, agents and
employees. The Banks shall be entitled as against this Corporation
conclusively to presume that the persons so certified continue to be authorized
to act as such on behalf of this Corporation until otherwise notified in
writing by the Secretary or other
3
<PAGE> 230
officer of this Corporation and that each of the foregoing resolutions shall
continue in force until express written notice of its rescission or
modification has been received by the Banks (but no such rescission or
modification shall affect any transaction occurring before the actual receipt
by the Banks of such written notice), and if the authority therein contained
shall be terminated by operation of law without such notice, it is hereby
resolved and agreed for the purposes of inducing the Banks to act hereunder
that the Banks shall be saved harmless from any loss suffered or liability
incurred by it in so acting under such authority without such notice of its
termination.
7. These resolutions shall be in addition to and supplementary of
any and all other resolutions of this Board of Directors now or hereafter on
file with the Banks, and nothing herein contained shall be deemed to amend,
revoke or modify any of such other resolutions or any of the authority therein
contained.
4
<PAGE> 231
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
[Attorneys at Law]
May 22, 1995
Harris Trust and Savings Bank
Chicago, Illinois
General Electric Capital Corporation
Chicago, Illinois
Sanwa Business Credit Corporation
Chicago, Illinois
Mercantile Bank of St. Louis National
Association
St. Louis, Missouri
100 East Wisconsin Avenue
Milwaukee, Wisconsin 53202-4108
FAX 414/277-0656
Telex 262057
Telephone 414/271-6560
Offices In:
Madison, Wisconsin
Chicago, Illinois
Affiliated with:
Edward D. Heffernan, Esq.
Washington, D.C.
Member: Lex Mundi,
A Global Association of
122 Independent Law Firms
Ladies and Gentlemen:
We have served as counsel to Stokely USA, Inc., a Wisconsin
corporation (the "Borrower"), in connection with the execution and delivery of
the instruments and documents identified on Exhibit A to this letter
(collectively the "Loan Documents," individual Loan Documents and other
capitalized terms used below being hereinafter referred to by the designations
appearing on Exhibit A).
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of all such corporate records of the Borrower,
agreements and other instruments, certificates of officers of the Borrower,
certificates of public officials, and other documents which we have deemed
relevant and necessary to render this opinion. In rendering this opinion, we
have assumed the genuineness of all signatures (other than those of officers of
the Borrower), the authenticity of all documents submitted to us as originals,
the conformity to originals of all documents submitted to us as copies, the due
execution of the Loan Documents by, and the enforceability of the Loan
Documents against, you, and the legal capacity of all natural persons.
Whenever this
<PAGE> 232
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
[Attorneys at Law]
May 22, 1995
Page 2
opinion refers to matters within our "knowledge," "known to us," or of which
we "know," such reference is limited to (i) the representations and warranties
of the Borrower contained in the Loan Documents; and (ii) facts within our
actual knowledge after an inquiry of the attorneys of this firm who have
provided legal services to the Borrower in connection with the Loan Documents,
without further inquiry. Furthermore, we have not undertaken any further
factual investigation of the business, properties, agreements, or litigation of
the Borrower for purposes of rendering this opinion.
Based upon the foregoing, and subject to the qualifications stated
herein, we are of the opinion that:
1. The Borrower is a corporation existing under the laws of the
State of Wisconsin and, based solely on a certificate of status of the
Wisconsin Secretary of State, (a) has filed with the Wisconsin Secretary of
State during its most recently completed report year the required annual
report; (b) is not the subject of a proceeding under Wisconsin Statutes Section
180.1421 to cause its administrative dissolution; and (c) Articles of
Dissolution of the Borrower have not been filed with such Secretary of State.
2. The Borrower has the corporate power and authority to execute,
deliver, and perform its obligations under the Loan Documents.
3. The execution and delivery of the Loan Documents and the
performance by the Borrower of their terms do not and will not (i) contravene
any provisions of the Articles of Incorporation or Bylaws of the Borrower; (ii)
based on our knowledge of the business, operations, and properties of the
Borrower, contravene any presently existing provision of any law applicable to
the Borrower; (iii) contravene any provision of any agreement known to us under
which the Borrower has borrowed money (except for such violation or default as
has been waived or consented to by the relevant party thereto); (iv) to our
knowledge, result in the creation or imposition of any lien upon any of the
property of the Borrower except pursuant to the Loan Documents; or (v) require
the consent or approval of, or any filing or registration with, any
governmental body, agency, or authority other than the filing of the Financing
Statement.
<PAGE> 233
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
[Attorneys at Law]
MAY 22, 1995
Page 3
4. The Borrower is not an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as amended,
or, to our knowledge, controlled by such a company.
5. The Borrower is not a "holding company" or a "subsidiary
company" of a "holding company" or an "affiliate" of a "holding company"
within the meaning of the Public Utility Holding Company Act of 1935, as
amended.
6. The Loan Documents have been duly authorized by all necessary
corporate action (no stockholder approval being required), have been executed
and delivered by the Borrower, and constitute valid and binding agreements of
the Borrower enforceable against it in accordance with their respective terms.
7. The Security Agreement is adequate to create and provide for
the liens and security interests contemplated thereby for the benefit and
security of all the indebtedness secured thereby. The description of the
Collateral set forth in the Financing Statement is sufficient to perfect, and
upon the due filing thereof in the office of the Wisconsin Secretary of State
will perfect, a security interest in the items and types of Collateral in which
a security interest may be perfected by the filing of a financing statement
under the Uniform Commercial Code of the State of Wisconsin as in effect on the
date hereof (the "UCC") to the extent that (i) Wisconsin is the proper state
for filing; (ii) the Collateral consists of the type of property for which a
security interest may be perfected by filing a financing statement in Wisconsin
under the UCC; and (iii) any part of the Collateral or the proceeds or products
thereof does not constitute trust property or a trust fund which by virtue of
federal or state law is not subject to the claims, liens, or security interests
of creditors.
8. To our knowledge, there is no action, suit, proceeding, or
investigation at law or in equity before or by any court or public body pending
or threatened against or affecting the Borrower or any of its assets and
properties which, if adversely determined, could result in any material adverse
change in the properties, business, operations, or financial condition of the
Borrower or in the value of the collateral security for your loans and other
credit accommodations to the Borrower except as described in Schedule 5.4 to
the Secured Credit Agreement.
<PAGE> 234
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
[Attorneys at Law]
May 22, 1995
Page 4
9. The rates of interest provided for under the Loan Documents
and any other amounts payable thereunder that would constitute interest would
not violate any usury law of the State of Wisconsin.
All of the foregoing opinions are subject to the following additional
assumptions, limitations, and qualifications:
(a) We express no opinion as to the effect of the compliance or
noncompliance by you with any state or federal laws or regulations applicable
to you because of legal or regulatory status or the nature of your business.
(b) Our opinions relating to the enforceability of the Loan
Documents are subject to and limited by:
(i) Bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, marshalling, and other similar laws now or hereafter in
effect relating to or affecting the rights and remedies of creditors generally;
(ii) Limitations imposed by general principles of equity
upon the specific enforceability of any of the remedies or other provisions of
such documents and upon the availability of injunctive relief and other
equitable remedies (regardless of whether enforcement is considered in
proceedings at law or in equity);
(iii) The qualification that certain provisions of the Loan
Documents are or may be unenforceable in whole or in part under the laws of the
State of Wisconsin, but the inclusion of such provisions does not render the
Loan Documents invalid as a whole and there exist either in the Loan Documents
or under applicable law adequate remedies for the practicable realization of
the principal legal rights and benefits intended to be provided thereby (except
for the economic consequences of any delay resulting from such
unenforceability); and
(iv) Such enforcement is subject to recent court decisions
which may require lenders to act reasonably and in good faith in exercising
their rights and remedies under the Loan Documents.
<PAGE> 235
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
[Attorneys at Law]
May 22, 1995
Page 5
(c) We render no advice concerning and do not express any opinion
as to:
(i) the priority of any security interest; or
(ii) items of Collateral which by operation of law cannot
be subject to a consensual security interest.
(d) We express no opinion as to the following:
(i) the Borrower's rights in or title to the Collateral;
(ii) any security interest that is terminated or released;
(iii) the effect of noncompliance with the federal
Assignment of Claims Act; or
(iv) future advances other than loans made or to be made
pursuant to the terms of the Secured Credit Agreement.
(e) In the case of property which becomes Collateral after the
date hereof, (i) Section 547 of the United States Bankruptcy Code provides
that a transfer is not made until the debtor has rights in the property
transferred so a security interest in after-acquired property may be treated as
a voidable preference under the conditions (and subject to the exceptions)
provided by Section 547; (ii) Chapter 128 of the Wisconsin Statutes contains a
four-month preference provision that may apply to after-acquired property; and
(iii) Section 552 of the United States Bankruptcy Code limits the extent to
which property acquired by a debtor after the commencement of a case under the
United States Bankruptcy Code may be subject to a security interest arising
from a security agreement entered into by the debtor before the commencement of
such case.
(f) In the case of any interest in or claim in or under any policy
of insurance covering the Collateral, the security interest of the secured
party therein is limited to proceeds payable to the named insured (and not to
any other party named as loss payee under such policy) by reason of loss or
damage to the collateral insured under such insurance policies.
<PAGE> 236
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
[Attorneys at Law]
May 22, 1995
Page 6
(g) In the case of all Collateral in which the security interest
of the secured party has been perfected by the filing of the Financing
Statement, Article 9 of the UCC requires the filing of continuation statements
within the period of six months prior to the expiration of five years from the
date of the original filings in order to maintain the effectiveness of the
filings referred to in this paragraph.
(h) The duties to exercise reasonable care in the custody and
preservation of the Collateral in a secured party's possession and to deal with
and dispose of the collateral in a commercially reasonable manner as required
by the UCC may not be disclaimed by agreement, waived, or released.
We call to your attention that the perfection of the above security interests
will be terminated (i) as to any Collateral acquired by the Borrower more than
four months after the Borrower so changes its name, identity, or corporate
structure as to make any financing statements filed against such party
seriously misleading, unless new appropriate financing statements indicating
the new name, identity, or corporate structure of such party are properly filed
before the expiration of such four months; (ii) as to any Collateral consisting
of accounts or general intangibles, four months after the Borrower changes its
chief executive office to a new jurisdiction outside Wisconsin unless such
security interests are perfected in such new jurisdiction before that
termination; (iii) as against buyers of items of the Collateral consisting of
goods of the Borrower sold in the ordinary course of business; and (iv) as to
Collateral otherwise disposed of by the Borrower if such disposition is
authorized under the Loan Documents.
We express no opinion as to (i) any provision affording
indemnification to you; (ii) provisions imposing penalties, forfeitures, or
increases in rates of interest upon delinquency in any payment or upon any
breach or default under the Loan Documents; or (iii) broadly stated waivers of
presentment, protest, demand, notice, appraisement, valuation, stay, extension,
moratorium, redemption, marshalling of assets, or other rights granted by law
to the extent such waivers or rights are held to be against public policy or
prohibited by law.
This opinion deals only with the specific legal issues that it
explicitly addresses and no opinion shall be implied as to matters not so
addressed. The opinions expressed herein are
<PAGE> 237
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
[Attorneys at Law]
May 22, 1995
Page 7
specifically limited to the laws of the State of Wisconsin and the federal laws
of the United States. The opinions expressed herein are given as of the date
of this letter and are intended to apply only to those facts and circumstances
that exist as of the date hereof, and we assume no obligation or responsibility
to update or supplement this opinion to reflect any facts or circumstances
occurring after the date hereof that would alter the opinions contained herein.
This opinion is rendered solely for your information and assistance in
connection with the transactions described above and may not be relied upon by
any other person or for any other purpose without our prior written consent.
Sincerely,
MICHAEL, BEST & FRIEDRICH
Michael, Best & Friedrich
<PAGE> 238
EXHIBIT A
THE LOAN DOCUMENTS
(Except as noted below, all Loan Documents are dated as of May 22,
1995. Harris Trust and Savings Bank ("Harris") in its capacity as agent under
the Secured Credit Agreement is referred to below as the "Agent" and Harris in
its individual capacity, together with General Electric Capital Corporation
("GECC"), Mercantile Bank of St. Louis National Association ("Mercantile") and
Sanwa Business Credit Corporation ("SBCC") are referred to below as the
"Banks.")
1. Secured Credit Agreement by and among the Borrower, the Agent,
and the Banks.
2. Secured Revolving Credit Note of the Borrower payable to the
order of Harris in the principal amount of $20,000,000.
3. Secured Revolving Credit Note of the Borrower payable to the
order of GECC in the principal amount of $27,500,000.
4. Secured Revolving Credit Note of the Borrower payable to the
order of Mercantile in the principal amount of $5,000,000.
5. Secured Revolving Credit Note of the Borrower payable to the
order of SBCC in the principal amount of $12,500,000.
6. Security Agreement Re: Accounts Receivable and Inventory from
the Borrower to the Agent for the benefit of itself and the Banks (the
"Security Agreement").
7. Application and Agreement for Irrevocable Standby Letter of
Credit dated May 17, 1995 from the Borrower to Harris.
8. Trademark Collateral Agreement from the Borrower to the Agent
for the benefit of itself and the Banks.
9. UCC financing statement to be filed in the office of the
Wisconsin Secretary of State (the "Financing Statement").
<PAGE> 239
STATE OF INDIANA
OFFICE OF THE SECRETARY OF STATE
CERTIFICATE OF AUTHORIZATION
To Whom These Presents Come, Greeting:
I, SUE ANNE GILROY, Secretary of State of Indiana, do hereby certify
that I am, by virtue of the laws of the State of Indiana, the custodian of the
corporate records and the proper official to execute this certificate.
I further certify that records of this office disclose that
STOKELY USA INC
is a corporation duly organized under the laws of the State of Wisconsin,
received its Certificate of Authority on May 25, 1983, and is a corporation
authorized to transact business in the State of Indiana.
I further certify this corporation has filed its most recent annual
report required by Indiana law with the Secretary of State, or is not yet
required to file such annual reports, and that an Application for a Certificate
of Withdrawal has not been filed.
In Witness Whereof, I have hereunto set my hand and
affixed the seal of the State of Indiana, at the City of
Indianapolis, this Twenty-eighth day of April, 1995.
[STATE OF INDIANA SEAL]
Sue Anne Gilroy
SUE ANNE GILROY, Secretary of State
--------
Deputy
<PAGE> 240
Number 5310-579-3
STATE OF ILLINOIS
OFFICE OF
THE SECRETARY OF STATE
TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETING:
I, George H. Ryan, Secretary of State of the State of Illinois, do hereby
certify that STOKELY USA, INC., INCORPORATED IN THE STATE OF WISCONSIN AND
LICENSED TO TRANSACT BUSINESS IN THIS STATE ON JUNE 3, 1983, APPEARS TO HAVE
COMPLIED WITH ALL THE PROVISIONS OF THE BUSINESS CORPORATION ACT OF THIS STATE
RELATING TO THE FILING OF ANNUAL REPORTS AND PAYMENT OF FRANCHISE TAXES, AND IS
AT THIS TIME A FOREIGN CORPORATION IN GOOD STANDING AND AUTHORIZED TO TRANSACT
BUSINESS IN THE STATE OF ILLINOIS*********************************************
IN TESTIMONY WHEREOF, I hereto set
[STATE OF ILLINOIS SEAL] my hand and cause to be affixed the Great Seal of
the State of Illinois this 1ST day of MAY A.D., 1995.
George H. Ryan
-----------------------
Secretary of State
<PAGE> 241
No. 00103354
Date: 05/01/1995
IOWA
SECRETARY OF STATE
490 FP-000131862
STOKELY USA INC
ATTN; ROBERT BRILL
1055 CORPORATE CENTER DR BOX 248
OCONOMOWOC, WI 53066-0248
CERTIFICATE OF AUTHORIZATION
Name: STOKELY USA, INC.
Begin date: 19890626
Expiration: PERPETUAL
State: WISCONSIN
I, PAUL D. PATE, secretary of state of the state of Iowa, custodian of
the records of incorporations, certify that the corporation named on this
certificate is authorized to transact business in this state, that the
corporation qualified to do business in Iowa on the date printed above, that
all fees required by the Iowa business corporation act have been paid by the
corporation, and that the most recent annual corporate report required by Iowa
Code chapter 490 has been filed by the secretary of state.
[STATE OF IOWA SEAL]
Paul D. Pate
------------------
SECRETARY OF STATE
Printed on
Recycled Paper
<PAGE> 242
UNITED STATES OF AMERICA
THE STATE OF MICHIGAN
MICHIGAN DEPARTMENT OF COMMERCE
LANSING, MICHIGAN
This is to Certify That
STOKELY USA, INC.
a WISCONSIN profit corporation, was validly authorized on June 14, 1983, to
transact business or conduct affairs in Michigan, and that said corporation
holds a valid certificate of authority to transact business or conduct affairs
in this State.
This certificate is issued to attest to the fact that the corporation is in
good standing in this office as of this date and is duly authorized to transact
business or conduct affairs in Michigan and for no other purpose. It is in the
usual form, made by me as the proper officer, and is entitled to have full
faith and credit given it in every court and office within the United States.
In testimony whereof, I have hereunto set my
hand and affixed the Seal of the Department,
in the City of Lansing, this 28th day
of April, 1995.
Carl L. Tysor, Director
-------------------------------
Corporation & Securities Bureau
SEAL APPEARS ONLY ON ORIGINAL
174
<PAGE> 243
STATE OF MINNESOTA
SECRETARY OF STATE
Certificate of Good Standing
I, Joan Anderson Growe, Secretary of State of Minnesota, do certify
that: The corporation listed below is a foreign corporation qualified to do
business in Minnesota pursuant to Minnesota Statutes, Chapter 303 on this date;
that the qualification was filed with the Office of the Secretary of State on
the date listed below; and that the corporation was formed under the laws of
the state listed below.
Name of Corporation in Minnesota: Stokely USA, Inc.
Name in State of Formation: Stokely USA, Inc.
Date Qualification was Filed in Minnesota: 01/14/1991
Formed Under the Laws Of: WI
This certificate has been issued on 05/01/95.
[STATE SEAL OF MINNESOTA]
Joan Anderson Growe
-----------------------
Secretary of State
<PAGE> 244
[STATE SEAL OF WASHINGTON]
______________________________________________________________________
STATE OF WASHINGTON SECRETARY OF STATE
______________________________________________________________________
CERTIFICATE OF EXISTENCE/AUTHORIZATION
OF
STOKELY USA, INC.
I, RALPH MUNRO, Secretary of State of the State of Washington, hereby
certify that I am the custodian of the corporation records of this state.
I FURTHER CERTIFY that the records on file in this office show that the
above-named profit corporation was incorporated under the laws of the State of
Wisconsin and was issued a certificate of authority in Washington on August 27,
1990.
I FURTHER CERTIFY that as of the date of this certificate no Articles
of Dissolution or Certificate of Withdrawal have been filed, that the
conditions of the Revised Code of Washington, Title 23B.01.280(2) (a) through
(d) have been met, and the corporation is duly authorized to transact business
in the corporate form in the State of Washington.
Date: May 2, 1995
Given under my hand and the seal of the State
of Washington, at Olympia, the State Capitol.
RALPH MUNRO
-------------------------------
Ralph Munro, Secretary of State
E. Anderson
<PAGE> 245
Chapter 180 & 181
Secretary of State
WISCONSIN
3/94
UNITED STATES OF AMERICA
State of Wisconsin
OFFICE OF THE SECRETARY OF STATE
To All to Whom These Presents Shall Come, Greeting:
I, DOUGLAS LA FOLLETTE, Secretary of State of the State of Wisconsin,
do hereby certify that
STOKELY USA, INC.
is a domestic corporation organized under the laws of this state and that its
date of incorporation is February 25, 1920.
I further certify that said corporation has, during its most recently
completed report year, filed with this office an annual report required by sec.
180.1622, 180.1921, or 181.651 of the Wisconsin Statutes, and that it has not
filed articles of dissolution.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed my official
seal, at Madison, on April 26, 1995
[STATE OF WISCONSIN SEAL] Douglas La Follette
DOUGLAS LA FOLLETTE
Secretary of State
BY:
The above certificate contains the statements prescribed by the
Wisconsin Business Corporation Law for a certificate of status. Under current
law, the status of a corporation is not described in terms of "good" or "bad"
standing.
<PAGE> 246
[LOGO] CERTIFICATE OF INSURANCE 9641 ISSUE DATE (MM/DD/YY)
GLL / / 5/24/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
MARSH & MCLENNAN, INCORPORATED CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 EAST WISCONSIN AVENUE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
SUITE 900 POLICIES BELOW.
MILWAUKEE, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A HARTFORD STEAM BOILER
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
STOKELY USA, INC. ---------------------------------------------------------------
1055 CORPORATE CENTER DRIVE COMPANY
OCONOMOWOC, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
LTR TYPE OF INSURANCE DATE DATE
POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
GENERAL LIABILITY GENERAL AGGREGATE $
/ / COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $
/ / / / CLAIMS MADE / / OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $
/ / --------------------------------------------------
---------------------------- EACH OCCURRENCE $
--------------------------------------------------
FIRE DAMAGE (Any one fire) $
--------------------------------------------------
MED. EXPENSE (Any one person) $
- ------------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY COMBINED SINGLE
/ / ANY AUTO LIMIT $
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY
/ / (Per Accident) $
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURRENCE $
/ / UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
A BOILER 9184893-00 11/01/94 11/01/95 SEE BELOW
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
HARRIS TRUST AND SAVINGS BANK EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
INDIVIDUALLY AND AS AGENT MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 WEST MONROE LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
CHICAGO, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
/s/ David A. Etuistle
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 247
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE #9641 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
The following are recognized as Loss Payee as respects liability coverage for
Stokely: Harris Trust and Savings Bank Individually and as Agent persuant to
that certain Secured Agreement among Stokely USA, Inc. and Harris Trust and
Savings Bank, Mercantile Bank of St. Louis National Association, Sanwa Business
Credit Corporation and General Electric Credit Corporation Dated May 22, 1995;
State of Wisconsin Investment Board; and Nationwide Life Insurance Company;
Employers Life Insurance Company of Wausau and West Coast Life Insurance
Company as their interests may appear.
PAGE: 2 OF 2
<PAGE> 248
[LOGO] CERTIFICATE OF INSURANCE 9642 ISSUE DATE (MM/DD/YY)
GLL / / 5/24/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
MARSH & MCLENNAN, INCORPORATED CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 EAST WISCONSIN AVENUE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
SUITE 900 POLICIES BELOW.
MILWAUKEE, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A LUMBERMENS MUTUAL CASUALTY
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
STOKELY USA, INC. ---------------------------------------------------------------
1055 CORPORATE CENTER DRIVE COMPANY
OCONOMOWOC, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
LTR TYPE OF INSURANCE DATE DATE
POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
GENERAL LIABILITY GENERAL AGGREGATE $
/ / COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $
/ / / / CLAIMS MADE / / OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $
/ / --------------------------------------------------
---------------------------- EACH OCCURRENCE $
--------------------------------------------------
FIRE DAMAGE (Any one fire) $
--------------------------------------------------
MED. EXPENSE (Any one person) $
- ------------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY COMBINED SINGLE
/ / ANY AUTO LIMIT $
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY
/ / (Per accident) $
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURRENCE $
/ / UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
A INLAND MARINE 3AT626693-01 11/01/94 11/01/95 $2,500,000
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
HARRIS TRUST AND SAVINGS BANK EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
INDIVIDUALLY AND AS AGENT MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 WEST MONROE LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
CHICAGO, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
/s/ David A. Etuistle
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 249
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE #9642 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
The following are recognized as Loss Payee as respects liability coverage for
Stokely: Harris Trust and Savings Bank Individually and as Agent persuant to
that certain Secured Agreement among Stokely USA, Inc. and Harris Trust and
Savings Bank, Mercantile Bank of St. Louis National Association, Sanwa Business
Credit Corporation and General Electric Credit Corporation Dated May 22, 1995;
State of Wisconsin Investment Board; and Nationwide Life Insurance Company;
Employers Life Insurance Company of Wausau and West Coast Life Insurance
Company as their interests may appear.
PAGE: 2 OF 2
<PAGE> 250
[LOGO] CERTIFICATE OF INSURANCE # 9644 ISSUE DATE (MM/DD/YY)
GLL / / 5/24/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
MARSH & MCLENNAN, INCORPORATED CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 EAST WISCONSIN AVENUE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
SUITE 900 POLICIES BELOW.
MILWAUKEE, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A LUMBERMENS UNDRWRTNG ALLIANCE
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
STOKELY USA, INC. ---------------------------------------------------------------
1055 CORPORATE CENTER DRIVE COMPANY
OCONOMOWOC, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
LTR TYPE OF INSURANCE DATE DATE
POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
GENERAL LIABILITY GENERAL AGGREGATE $
/ / COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $
/ / / / CLAIMS MADE / / OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $
/ / --------------------------------------------------
---------------------------- EACH OCCURRENCE $
--------------------------------------------------
FIRE DAMAGE (Any one fire) $
--------------------------------------------------
MED. EXPENSE (Any one person) $
- ------------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY COMBINED SINGLE
/ / ANY AUTO LIMIT $
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY $
/ / (Per accident)
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURRENCE $
/ / UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
A FIRE & ALLIED 307733 11/01/94 11/01/96
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
HARRIS TRUST AND SAVINGS BANK EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
INDIVIDUALLY AND AS AGENT MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 WEST MONROE LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
CHICAGO, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
/s/ David A. Etuistle
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 251
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE #9644 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
All Risk Coverage including Flood and Earthquake*
Replacement Cost with Agreed Amount
Scheduled limits per location
* Flood and Earthquake coverage provided by Lumbermens Underwriting
Alliance Policy No. 307733 effective 11/1/94 - 11/1/96.
The following are recognized as Loss Payee as respects liability coverage for
Stokely: Harris Trust and Savings Bank Individually and as Agent persuant to
that certain Secured Agreement among Stokely USA, Inc. and Harris Trust and
Savings Bank, Mercantile Bank of St. Louis National Association, Sanwa Business
Credit Corporation and General Electric Credit Corporation Dated May 22, 1995;
State of Wisconsin Investment Board; and Nationwide Life Insurance Company;
Employers Life Insurance Company of Wausau and West Coast Life Insurance
Company as their interests may appear.
PAGE: 2 OF 2
<PAGE> 252
[LOGO] CERTIFICATE OF INSURANCE # 10460 ISSUE DATE (MM/DD/YY)
GLL / / 5/24/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
MARSH & MCLENNAN, INCORPORATED CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 EAST WISCONSIN AVENUE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
SUITE 900 POLICIES BELOW.
MILWAUKEE, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A UNITED STATES FIRE INS CO
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
STOKELY USA, INC. ---------------------------------------------------------------
1055 CORPORATE CENTER DRIVE COMPANY
OCONOMOWOC, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
LTR TYPE OF INSURANCE DATE DATE
POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
A GENERAL LIABILITY 541 020411-9 11/01/94 11/01/95 GENERAL AGGREGATE $ 2000000
/X/ COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $ 2000000
/ / / / CLAIMS MADE /X/ OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $ 1000000
/ / --------------------------------------------------
---------------------------- EACH OCCURRENCE $ 1000000
--------------------------------------------------
FIRE DAMAGE (Any one fire) $ 100000
--------------------------------------------------
MED. EXPENSE (Any one person) $ 5000
- ------------------------------------------------------------------------------------------------------------------------------------
A AUTOMOBILE LIABILITY 138 017166 3 11/01/94 11/01/95 COMBINED SINGLE
/X/ ANY AUTO LIMIT $ 1000000
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY
/ / (Per accident) $
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
A EXCESS LIABILITY 553 021448 4 11/01/94 11/01/95 EACH OCCURRENCE $ 20000000
/X/ UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $ 20000000
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
HARRIS TRUST AND SAVINGS BANK EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
INDIVIDUALLY AND AS AGENT MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 WEST MONROE LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
CHICAGO, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
/s/ David A. Etuistle
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 253
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE #10460 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
Comprehensive and Collision coverages apply with a $500 deductible for
Tractor/Trailers and a $1,000 deductible for all other vehicles. The following
are recognized as Loss Payee as respects liability coverage for Stokely: Harris
Trust and Savings Bank Individually and as Agent persuant to that certain
Secured Agreement among Stokely USA, Inc. and Harris Trust and Savings Bank,
Mercantile Bank of St. Louis National Association, Sanwa Business Credit
Corporation and General Electric Credit Corporation Dated May 22, 1995; State
of Wisconsin Investment Board; and Nationwide Life Insurance Company; Employers
Life Insurance Company of Wausau and West Coast Life Insurance Company as their
interests may appear.
PAGE: 2 OF 2
<PAGE> 254
EXHIBIT C
STOKELY USA, INC.
COMPLIANCE CERTIFICATE
This Compliance Certificate is furnished to Harris Trust and Savings
Bank, as agent (the "Agent"), pursuant to that certain Secured Credit Agreement
dated as of May 22, 1995 by and among Stokely USA, Inc. (the "Company"), Harris
Trust and Savings Bank and the other lenders parties thereto (the "Agreement").
Unless otherwise defined herein, the terms used in this Compliance Certificate
have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT;
1. I am the duly elected Vice-President and Chief Financial Officer
of the Company;
2. I have reviewed the terms of the Agreement and I have made, or
have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Company during the accounting period covered
by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which constitutes
a Potential Default or Event of Default during or at the end of the accounting
period covered by the attached financial statements or as of the date of this
Certificate, except as set forth below; and
4. If attached financial statements are being furnished pursuant to
Section 7.4(a) or (b) of the Agreement, Schedule I attached hereto sets forth
financial data and computations, evidencing the Company's compliance with
certain covenants of the Agreement, all of which data and computations are
true, complete and correct.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking or proposes to
take with respect to each such condition or event:
----------------------------------------
----------------------------------------
<PAGE> 255
The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this 22nd day of May,
1995.
STOKELY USA, INC.
By H Wilson
----------------------------------------------
Its Vice-President and Chief Financial Officer
-----------------------------------------
-2-
<PAGE> 256
SCHEDULE I
STOKELY USA, INC.
Compliance Calculations for Secured
Credit Agreement Dated as of March 31, 1995
SECTION 7.8 LEVERAGE RATIO
<TABLE>
<S> <C> <C>
(a) Funded Debt ........................................ $ 80,497,000
(b) Funded Debt ........................................ $ 80,497,000
Tangible Net Worth ................................. $ 57,619,000
TOTAL .............................................. $ 138,116,000
(a)/(b)................... .5828*
</TABLE>
*Required to not exceed 0.62 to 1.
Compliance ......................... Yes X No
SECTION 7.9 TANGIBLE NET WORTH
<TABLE>
<S> <C> <C>
(a) Net Worth .......................................... $ 58,378,000
(b) Intangible Assets .................................. $ 759,000
(a)-(b) ............................................ 57,619,000*
Tangible Net Worth ......................................... $ 57,619,000
</TABLE>
*Required to be no less than $51,000,000 during this compliance period.
Compliance ......................... Yes X No
SECTION 7.10 NET WORKING CAPITAL
<TABLE>
<S> <C> <C>
(a) Current Assets ..................................... $ 108,230,000
(b) Current Liabilities ................................ $ 40,178,000
(a)-(b) ............................................ 68,052,000*
</TABLE>
* Required to be no less than $35,000,000.
Compliance ......................... Yes X No
<PAGE> 257
STOKELY USA, INC.
FINANCIAL STATEMENTS
MARCH, 1995
UNAUDITED
<PAGE> 258
STOKELY USA, INC.
CONSOLIDATING BALANCE SHEET
MARCH 1995
<TABLE>
<CAPTION> 1995 1994
CONSOLIDATED CONSOLIDATED VARIANCE
STOKELY STOKELY CONSOLIDATING STOKELY STOKELY FROM
USA U.K. DEBT CREDIT USA USA ACTUAL
<S> <C> <C> <C> <C> <C> <C> <C>
CURRENT ASSETS
CASH & MKT SECURITIES 680 497 1,177 2,898 (1,721)
ACCOUNTS RECEIVABLE 26,045 278 412 25,911 21,202 4,709
ALLOWANCE 452 0 452 385 67
INVENTORIES 79,026 363 79,389 55,256 24,133
RECOVERABLE INCOME TAXES 380 0 380 1,979 (1,599)
PREPAID EXPENSES 1,807 18 1,825 1,983 (158)
---------------------------------------------------------------------------------------------------
107,486 1,156 0 412 108,230 82,933 25,297
OTHER ASSETS 1,775 0 1,775 3,867 (2,092)
PROPERTY FOR DISPOSITION 1,933 0 1,933 3,541 (1,608)
INTERCOMPANY 573 (985) 412 0 0 0
---------------------------------------------------------------------------------------------------
PROPERTY PLANT & EQUIPMENT
LAND AND IMPROVEMENTS 3,453 0 3,453 3,184 269
BUILDING 29,650 0 29,650 27,386 2,264
MACHINERY & EQUIPMENT 74,278 0 74,278 66,296 7,982
CONSTRUCTION IN PROGRESS 0 0 0 562 (562)
---------------------------------------------------------------------------------------------------
107,381 0 0 0 107,381 97,428 9,953
LESS ACCUMULATED
DEPRECIATIO 38,784 0 38,784 30,072 8,712
---------------------------------------------------------------------------------------------------
68,597 0 0 0 68,597 67,356 1,241
CONSTRUCTION FUNDS
TRUSTEE 0 0 0 0 0
---------------------------------------------------------------------------------------------------
68,597 0 0 0 68,597 67,356 1,241
TRADEMARKS 759 0 759 838 (79)
---------------------------------------------------------------------------------------------------
181,123 171 412 412 181,294 158,535 22,759
===================================================================================================
</TABLE>
<PAGE> 259
STOKELY USA, INC.
CONSOLIDATING BALANCE SHEET
MARCH 1995
<TABLE>
<CAPTION>
1995 1994
CONSOLIDATED CONSOLIDATED VARIANCE
STOKELY STOKELY CONSOLIDATING STOKELY STOKELY FROM
USA U.K. DEBIT CREDIT USA USA ACTUAL
<S> <C> <C> <C> <C> <C> <C> <C>
CURRENT LIABILTIES
NOTES PAYABLE 37,291 0 18,000 19,291 17,992 1,299
ACCOUNTS PAYABLE 13,450 4 13,454 13,867 (413)
ACCRUED COMPENSATION AND W/H 3,015 0 3,015 3,065 (50)
OTHER ACCRUED 1,635 0 1,635 1,840 (205)
INCOME TAXES 189 58 247 230 17
CURRENT MATURITIES ON L-T DEBT 2,536 0 2,536 3,868 (1,332)
------------------------------------------------------ ---------------------
58,116 62 18,000 0 40,178 40,862 (684)
LONG TERM LIABILITIES 60,497 0 18,000 78,497 80,438 (1,941)
DEFERRED COMP 1,520 0 1,520 1,826 (306)
POST RETIREMENT BENEFITS 2,579 0 2,579 2,769 (190)
RESERVE FOR PROPERTY DISPOSITI 0 0 0 0 0
DEFERRED INCOME TAXES 142 0 142 0 142
STOCKHOLDERS EQUITY
COMMON STOCK 572 0 572 422 150
ADDITIONAL PAID IN CAPITAL 43,683 0 43,683 18,661 25,022
RETAINED EARNINGS 14,642 109 14,751 14,181 570
------------------------------------------------------ ---------------------
58,897 109 0 0 59,006 33,264 25,742
LESS
RESTRICTED STOCK 0 0 0 0 0
TREASURY STOCK 628 0 628 624 4
------------------------------------------------------ ---------------------
58,269 109 0 0 58,378 32,640 25,738
------------------------------------------------------ ---------------------
181,123 171 18,000 18,000 181,294 158,535 22,759
====================================================== =====================
</TABLE>
<PAGE> 260
STOKELY USA, INC.
CONSOLIDATING STATEMENT OF EARNINGS
YEAR TO DATE AS OF MARCH 1995
<TABLE>
<CAPTION> 1995
CONSOLIDATING CONSOLIDATED 1994
STOKELY STOKELY DEBIT CREDIT STOKELY STOKELY
USA U.K. USA % USA CHANGE
<S> <C> <C> <C> <C> <C> <C> <C> <C>
REVENUES
NET SALES 230,853 1,244 675 231,422 100.00 256,145 (24,723)
OTHER 517 0 517 0.22 4,691 (4,174)
------------------------------------------------------------- ---------------------
231,370 1,244 675 0 231,939 100.22 260,836 (28,897)
COST AND EXPENSES
COST OF PRODUCT SOLD 186,735 754 675 186,814 80.72 216,392 (29,578)
SELLING AND ADMINISTRATIVE 33,086 531 33,617 14.53 36,476 (2,859)
INTEREST 10,818 (22) 10,796 4.67 12,710 (1,914)
------------------------------------------------------------- ---------------------
230,639 1,263 0 675 231,227 99.92 265,578 (34,351)
------------------------------------------------------------- ---------------------
EARNINGS BEFORE TAXES 731 (19) 675 (675) 712 0.31 (4,742) 5,454
INCOME TAXES 147 (5) 142 0.06 (2,527) 2,669
------------------------------------------------------------- ---------------------
NET EARNINGS 584 (14) 675 (675) 570 0.25 (2,215) 2,785
============================================================= =====================
</TABLE>
<PAGE> 261
STOKELY USA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Years Ended March 31,
(Dollars in thousands) 1995 1994 1993
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings (loss) $ 570 $ (2,215) $(31,127)
Adjustments to net earnings (loss):
Depreciation 7,508 7,230 9,286
Nonrecurring charge 21,145
Deferred compensation and
postretirement benefits (496) (36) 2,713
Deferred income taxes 142 (9,833)
Amortization of trademarks 79 80 82
Amortization of deferred debt
issuance costs 1,649 1,637 887
Provision for bad debts 67 (285) 270
Gains on disposal of property,
plant and equipment (256) (361) (693)
- -----------------------------------------------------------------------------
9,263 6,050 (7,270)
Changes in operating assets and
liabilities:
Accounts receivable (4,709) 20,983 (14,824)
Refundable income taxes 1,599 1,890 1,831
Inventories (24,133) 45,335 (2,526)
Prepaid expenses 158 (428) 769
Accounts payable (413) (25,292) 23,739
Accrued compensation and
withholdings (50) (397) 307
Income taxes 17 (301) (135)
Other net (1,532) (9,773) (448)
- -----------------------------------------------------------------------------
(29,063) 32,017 8,713
- -----------------------------------------------------------------------------
Net cash provided by (used in)
operating activities (19,800) 38,067 1,443
- -----------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant
and equipment (6,421) (5,174) (12,871)
(Increase) decrease in
construction funds held by
trustee 1,362
Proceeds from sales of property,
plant and equipment 863 9,143 3,197
Other-net 443 (176) 1,034
- -----------------------------------------------------------------------------
Net cash provided by (used in)
investing activities (5,115) 3,793 (7,278)
- -----------------------------------------------------------------------------
</TABLE>
6
<PAGE> 262
STOKELY USA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Years Ended March 31,
(Dollars in thousands) 1995 1994 1993
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Change in short-term debt (net) 1,299 (31,266) 13,036
Payments of long-term debt (3,273) (9,002) (2,296)
Payments of cash dividends (415)
Payments of deferred debt
issuance costs (3,436)
Issuance of common stock 25,168
Exercise of stock options 55 143
- -----------------------------------------------------------------------------
Net cash provided by (used in)
financing activities 23,194 (40,213) 7,032
- -----------------------------------------------------------------------------
Net increase (decrease) in cash
and cash equivalents (1,721) 1,647 1,197
Cash and cash equivalents at
beginning of year 2,898 1,251 54
- -----------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS,
END OF YEAR $ 1,177 $ 2,898 $ 1,251
- --------------------------------------------=================================
</TABLE>
See notes to consolidated financial statements.
7
<PAGE> 263
EXHIBIT D
STOKELY USA, INC.
BORROWING BASE CERTIFICATE
as of ___________________
($000's omitted)
This Borrowing Base Certificate is furnished to Harris Trust and
Savings Bank, as agent (the "Agent"), pursuant to that certain Secured Credit
Agreement dated as of May 22, 1995, by and among Stokely USA, Inc. (the
"Company"), Harris Trust and Savings Bank and the other lenders parties thereto
(the "Agreement"). Unless otherwise defined herein, the terms used in this
Borrowing Base Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected Vice-President of the Company.
2. I have reviewed the terms of the Agreement and I have
made, or have caused to be made under my supervision, the attached
computation of the Borrowing Base as defined in Section 4.1 of the
Agreement.
3. No change of name, corporation identity or address of
the chief executive office of the Company has occurred.
4. The information above and any attached exhibits do not
contain any untrue statement of material fact or omit a material fact,
either individually or in aggregate, that would make the information or
any attached exhibits misleading.
STOKELY USA, INC.
By L. F. Wilson
-------------------------------------------
Its Vice President and Chief Financial Officer
<PAGE> 264
<TABLE>
STOKELY USA, INC. 05/24/95 02:14 PM
22-May-95 BEG A/R DATE 04-May-95
BORROWING BASE CERTIFICATE END A/R DATE 22-May-95
INV. DATE 22-May-95
0
<CAPTION>
BORROWING
GROSS NON-PRIME PRIME ADVANCE % BASE
---------- ----------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C>
ACCOUNTS RECEIVABLE 16,918,347 (2,861,825) 14,056,522 85.00% 11,946,043
INVENTORY 67,212,887 (6,719,377) 60,493,489 65.00% 39,320,768
---------- ---------- ---------- ----------
TOTAL 84,131,214 (9,581,203) 74,550,011 51,268,811
========== ========== ========== ==========
BORROWING BASE 51,268,811
LOAN BALANCE 23-May-95 (22,696,624)
L.O.C. RESERVE (2,643,500)
-----------
AVAILABLE AMOUNT 25,928,687
===========
</TABLE>
PAGE 1
<PAGE> 265
STOKELY USA, INC.
22-MAY-95
BORROWING BASE CERTIFICATE
<TABLE>
<CAPTION>
GROSS NONPRIME PRIME ADVANCE % ADVANCE
----------------------------------------------- ---------- ----------
<S> <C> <C> <C> <C> <C>
CANNED RAW MATERIAL 4,390,387 (4,390,387) 0 65.00% 0
FG CANNED 42,412,842 (151,577) 42,261,265 65.00% 27,469,822
FROZEN RAW MATERIAL 1,729,045 (1,729,045) 0 65.00% 0
FG FROZEN 18,680,592 (448,368) 18,232,224 65.00% 11,850,946
----------------------------------------------- ----------
67,212,867 (6,719,377) 60,493,489 38,320,768
=============================================== ==========
</TABLE>
<PAGE> 266
STOKELY USA, INC.
22-MAY-95
BORROWING BASE CERTIFICATE
<TABLE>
<CAPTION>
NON PRIME-CANNED
- -------------------------------------------------
<S> <C> <C>
SEED INVENTORY 1,626,843
CANNERY RETAIL INVENTORY 0
PLASTIC INVENTORY 0
GLASS INVENTORY 27,215
BOX INVENTORY 315,394
LABEL INVENTORY 1,385,175
FARM SUPPLIES 48,598
FACTORY SUPPLIES 987,161
-------------
SUBTOTAL RAW MATERIALS 4,390,367
NON-PRIME FINISHED GOODS CANNED
- -------------------------------
GROWER PAYABLES PER TRIAL BALANCE 0
GROWER PAYMENTS 0
MONTH TO DATE INCREASE IN GROWER PAYABLE 0
GRADE 8 & 9 151,577
---------
SUBTOTAL NP FINISHED 151,577
---------
TOTAL NON PRIME CANNED 4,541,964
=========
</TABLE>
<PAGE> 267
STOKELY USA, INC.
22-MAY-95
BORROWING BASE CERTIFICATE
[CAPTION]
<TABLE>
NON PRIME FROZEN
- ---------------------------------
<S> <C>
SEED INVENTORY 907,639
HANDLING AND STORAGE 0
BOX INVENTORY 315,394
POLYBAG INVENTORY 140,547
FROZEN TOTE INVENTORY 233,179
FROZEN OVERWRAP 28,669
FARM SUPPLIES 0
FACTORY SUPPLIES 103,618
INGREDIENTS 0
---------
SUBTOTAL 1,729,045
ESTIMATED PAYABLES 0
GROWER PAYMENTS 0
ESTIMATED MONTH TO DATE INCREASE IN GROWERS 0
20% OF U INVENTORY 381,691 PER 4/7/95 PERPETUAL INVENTORY REPORT
ALL OF Z INVENTORY 66,678 PER 4/7/95 PERPETUAL INVENTORY REPORT
---------
SUBTOTAL 448,369
</TABLE>
<PAGE> 268
STOKELY USA, INC.
22-MAY-95
BORROWING BASE CERTIFICATE
[CAPTION]
<TABLE>
VARIABLE COST
DOLLARS UNITS PER CASE OR POUND
---------------------------- -----------------
<S> <C> <C> <C>
FINISHED GOODS CANNED PER RPT 30,733,944 6,972,467 CASES 4.41
----------
30,733,944
BURDEN RATE 1,380
----------
CANNED FINISHED GOODS W/ BURDEN 42,412,642
==========
FINISHED GOODS FROZEN PER RPT 14,854,515 64,718,565 POUNDS 0.23
BURDEN RATE 1,257,570
----------
FROZ FINISHED GOODS W/ BURDEN 16,680,592
==========
</TABLE>
<PAGE> 269
STOKELY USA, INC.
22-MAY-95
BORROWING BASE CERTIFICATE
ACCOUNTS RECEIVABLE
<TABLE>
<CAPTION>
TOTAL NONPRIME PRIME ADVANCE % ADVANCE
------------ -------- --------- ---------- -----------
<S> <C> <C> <C> <C> <C>
PRIVATE LABEL 8,694,258 (1,498,426) 7,195,832 85.00% 6,116,457
BRAND 3,567,075 (1,047,277) 2,539,798 85.00% 2,158,829
FROZEN 4,637,014 (316,122) 4,320,891 85.00% 3,672,758
---------- -------------------------- ----------
16,918,347 (2,861,825) 14,056,522 11,948,043
========== =========== ========== ==========
</TABLE>
NONPRIME ACCOUNTS RECEIVABLE
<TABLE>
<CAPTION>
PRIVATE BRAND FROZEN TOTAL
---------- ----------- ------------ ----------
<S> <C> <C> <C> <C> <C>
OVER 90 DAYS 463,026 497,986 54,319 1,015,333 PER 3/31/95 AGING
CROSS AGE 83,637 528,079 0 611,716 PER 3/31/95 AGING
0
FOREIGN <90 996,236 0 261,804 1,258,040 PER 3/31/95 AGING
LESS FOREIGN ALLOWED (44,475) 0 (44,475)
GOVERNMENT 810,870 0 0 810,870 PER 3/31/95 AGING
LESS GOV'T ALLOWED (810,870) 0 0 (810,870)
AGED REC. -- PACKER FOODS 0 21,212 21,212 PER 3/7/95 AGING
---------------------------------------- ---------
1,498,426 1,047,277 316,122 2,861,825
======================================== =========
</TABLE>
<PAGE> 1
Marked to show changes from draft dated 05/23/95
05/25/95
DRAFT
SECURITY AGREEMENT
THIS SECURITY AGREEMENT made as of this 31st day of May, 1995, by and among
STOKELY USA, INC., a Wisconsin corporation (the "Borrower"), and NATIONWIDE
LIFE INSURANCE COMPANY ("Nationwide"), EMPLOYERS LIFE INSURANCE COMPANY OF
WAUSAU ("Employers"), WEST COAST LIFE INSURANCE COMPANY ("West Coast"), and
STATE OF WISCONSIN INVESTMENT BOARD ("SWIB").
WHEREAS, Nationwide, Employers and West Coast (collectively being
hereinafter called the "Insurance Companies") and the Borrower are parties to a
Note Agreement, dated as of January 1, 1990, as amended by an Amendment to Note
Agreement dated August 18, 1992, a Second Amendment to Note Agreement dated
June 11, 1993, and a Third Amendment to Note Agreement dated May 31, 1995 (said
Note Agreement, as so amended, and as further amended, modified or supplemented
from time to time, is hereinafter referred to as the "Nationwide Note
Agreement"), pursuant to which the Borrower has issued its 9.37% Senior Secured
Notes due January 15, 2000 (collectively, together with any other notes issued
pursuant to the Nationwide Note Agreement the "Nationwide Notes"); and
WHEREAS, SWIB and the Borrower are parties to a Note Agreement, dated as
of December 1, 1991, as amended by a First Amendment to Note Agreement dated as
of August 18, 1992, a Second Amendment to Note Agreement dated as of June 11,
1993, and a Third Amendment to Note Agreement dated as of May 31, 1995 (said
Note Agreement, as so amended, and as further amended, modified or supplemented
from time to time, is hereinafter referred to as the "SWIB Note Agreement"),
pursuant to which the Borrower has issued a certain 9.49% Senior Note due
December 15, 2001 (collectively, together with any other notes issued pursuant
to the SWIB Note Agreement, the "SWIB Notes"); and
WHEREAS, the Borrower and Bank One, Milwaukee, National Association ("Bank
One"), as agent for the Insurance Companies, SWIB and certain other lenders
including Bank One (Bank One and such other lenders are hereinafter referred to
as the "Other Lenders"), entered into a Security Agreement dated as of August
18, 1992, as amended by a First Amendment to Security Agreement dated as of
June 11, 1993 (said Security Agreement as so amended is hereinafter referred to
as the "Old Security Agreement"), pursuant to which the Borrower granted to
Bank One, as agent for the benefit of the Insurance Companies, SWIB and such
Other Lenders, a Lien on and security interest in certain assets of the
Borrower for the benefit of the Insurance Companies, SWIB and the Other
Lenders; and
WHEREAS, in connection with the payment and satisfaction in full of all
obligations of the Borrower to the Other Lenders, (i) the Other Lenders have
released all of their claims on the assets of the Borrower, (ii) the Insurance
Companies and SWIB have released their claim as to certain assets of the
Borrower but have not released their claim as to certain other assets of the
<PAGE> 2
Borrower, and (iii) Bank One, as agent, has assigned to the Insurance Companies
and SWIB all of its Liens on and security interests in the Collateral (as
hereinafter defined), and all rights and powers therein granted pursuant to the
Intercreditor and Collateral Agency Agreement (as hereinafter defined) and the
Security Documents (as defined in the Intercreditor and Collateral Agency
Agreement); and
WHEREAS, in order to evidence the transactions described in the
immediately preceding paragraphs, including, without limitation, the continuing
Lien of the Insurance Companies and SWIB on and security interest in the
Collateral (as hereinafter defined) to secure the prompt and complete payment,
observance, performance and discharge of the Obligations (as hereinafter
defined) which remain outstanding, the Insurance Companies and SWIB have
required the Borrower to execute and deliver this Agreement.
NOW, THEREFORE, in consideration of the foregoing, and the mutual
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Borrower, the
Insurance Companies and SWIB agree as follows:
1. DEFINITIONS.
As used herein, the following terms shall have the meanings ascribed to
them set forth below:
AGENT -- shall have the meaning assigned to such term in the Intercreditor
Agreement.
APPLETON FACILITY -- shall have the meaning assigned to such term in
Section 3N hereof.
APPLETON SALE PROCEEDS -- shall have the meaning assigned to such term in
Section 3N hereof.
ASSIGNMENT OF CONTRACTS, WARRANTIES AND PERMITS -- shall mean the
Assignment of Contracts, Warranties and Permits dated as of May 31, 1995,
granted by the Borrower to the Secured Parties, as amended, modified or
supplemented from time to time.
BANK ONE -- shall have the meaning assigned to such term in the third
WHEREAS clause hereof.
BOOKS AND RECORDS -- shall have the meaning assigned to such term in
Section 2C hereof.
BUSINESS DAY -- shall mean any day except a Saturday, a Sunday or day
on which commercial banks in Milwaukee, Wisconsin are authorized or required by
law to close.
Collateral -- shall have the meaning assigned to such term in Section 2
hereof.
ENVIRONMENTAL INDEMNIFICATION AGREEMENT -- shall mean the Environmental
Indemnification Agreement dated as of May 31, 1995, entered into by and among
the Borrower and the Secured Parties, as amended, modified or supplemented from
time to time.
2
<PAGE> 3
EQUIPMENT -- shall have the meaning assigned thereto by the UCC and shall
include, but not be limited to all machinery, all manufacturing, distribution,
selling, data processing and office equipment, all computer hardware, computer
software, furniture, furnishings, fixtures (including, but not limited to
heating, cooling, fire protection equipment and plumbing, electrical
distribution and other utility connections or equipment), and trade fixtures,
tools, tooling, molds, dies, all canning and processing equipment, and
facilities and other personal property of whatsoever kind or nature, used or
useful in the business of the Borrower, including, but not by way of
limitation, all engines, conveyors, boilers, dynamos, generators, power lines
and other electrical apparatus, hoppers, briners, elevators, pumps, piping,
tanks, dryers, blanchers, cutters, slicers, labeling equipment, automobiles,
trucks, tractors, combines, harvesters, harrows, planters, loaders, railroad
tracks and equipment, equipment for canning, farming, manufacturing, drainage,
irrigation and water supply office and shop equipment, heating plants,
storehouses, preparation and canning plants and all goods, tools, supplies,
equipment and personal property of every name, kind, sort or character used or
usable in the aforesaid connections, vehicles, vessels and aircraft, and each
case whether now owned or hereafter acquired and wherever located, and all
accessions and additions thereto, parts and appurtenances thereof,
substitutions therefor and replacements thereof; but excluding therefrom that
certain FMC Sterile Matic Continuous Cooker - Two Shell located within the
Borrower's facility at Waunakee, Wisconsin.
EVENT OF DEFAULT -- shall have the meaning assigned to such term in
Section 5 hereof.
FIXTURES -- shall mean all fixtures (as that term is defined in the UCC)
now or hereafter attached to or located upon the Real Property Parcels.
GOVERNMENTAL AUTHORITY -- shall mean any nation or government, any state
or other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government and any corporation or other entity owned or controlled (through
stock or capital ownership or otherwise) by any of the foregoing.
INSURANCE COMPANIES -- shall have the meaning assigned to such term in the
first WHEREAS clause hereof.
INTERCREDITOR AGREEMENT -- shall mean the Intercreditor and Collateral
Agency Agreement dated as of May 31, 1995, by and among the Secured Parties and
acknowledged by the Borrower, as amended, modified or supplemented from time to
time.
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT -- shall mean the
Intercreditor and Collateral Agency Agreement dated as of August 18, 1992, by
and among Bank One, First Bank (N.A.), the Insurance Companies and SWIB, and
acknowledged by the Borrower and certain subsidiaries of the Borrower, as
amended by a First Amendment to Intercreditor and Collateral Agency Agreement
dated as of June 11, 1993, by and among Bank One, First Bank (N.A.), NBD Bank,
N.A., the Insurance Companies, SWIB, Barclays Business Credit, Inc., LaSalle
National Bank, and BA Business Credit, Inc., and acknowledged by the Borrower
and certain subsidiaries of the Borrower.
3
<PAGE> 4
LIEN -- shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, any conditional sale or other
title retention agreement, any financing lease having substantially the same
economic effect as any of the foregoing and any arrangement involving the
filing of any financing statement under the UCC or comparable law of any
jurisdiction).
LOAN DOCUMENTS -- shall mean the Nationwide Note Agreement, the SWIB Note
Agreement, the Notes and the Security Documents.
MORTAGES -- shall mean those certain Mortgages, Assignments of Leases and
Rents, Security Agreements and Financing Statements and/or Deed of Trusts, each
dated as of May 31, 1995, given by the Borrower to the Secured Parties, with
respect to each of the Real Property Parcels, as amended, modified or
supplemented from time to time.
NATIONWIDE NOTES -- shall have the meaning assigned to such term in the
first WHEREAS clause hereof.
NATIONWIDE NOTE AGREEMENT -- shall have the meaning assigned to such term
in the first WHEREAS clause hereof.
NATIONWIDE NOTE OBLIGATIONS -- shall mean all obligations of the Borrower
to the Insurance Companies and any other holders from time to time of the
Nationwide Notes under the Nationwide Note Agreement and the Nationwide Notes,
whether arising out of credit previously granted, credit contemporaneously
granted, or granted in the future, and, however arising, whether voluntary or
involuntary, due or not due, absolute or contingent, liquidated or
unliquidated, determined or undetermined, secured or unsecured, whether the
Borrower is liable individually or jointly with others, whether for principal,
interest, premium or other debts, obligations or liabilities, and whether or
not any or all such debts, obligations and liabilities are or become barred by
any statute of limitations or otherwise unenforceable.
NET PROCEEDS -- shall mean the amount obtained by subtracting from the
gross proceeds of the sale of the Appleton Facility the sum of (i) direct costs
arising in connection with such sale, plus (ii) taxes resulting from such sale
(but excluding income used to offset operating losses and that does not
generate any actual tax liability), plus (iii) the amount necessary to repay
any secured industrial revenue bond financing related to the Appleton Facility.
NOTES -- shall mean the Nationwide Notes and the SWIB Notes.
OBLIGATIONS -- shall mean the Nationwide Note Obligations, the SWIB Note
Obligations and any obligations of the Borrower to the Secured Parties arising
under this Agreement or any of the other Security Documents.
OLD SECURITY AGREEMENT -- shall have the meaning assigned to such term in
the third WHEREAS clause hereof.
OTHER LENDERS -- shall have the meaning assigned to such term in the third
WHEREAS clause hereof.
4
<PAGE> 5
PERMITTED LIEN -- shall mean a Lien permitted under (i) one of clauses
(a), (b), (c), (d), (e), (g) and (h) of Section 5.7 of the Nationwide Note
Agreement and (ii) one of clauses (a), (b), (c), (d), (e), (g) and (k) of
Section 5.7 of the SWIB Note Agreement.
PERSON -- shall mean an individual, partnership, joint venture,
corporation, business trust, joint stock company, trust, unincorporated
organization, Governmental Authority or other entity of whatever nature.
PROCEEDS -- shall have the meaning assigned to that term under the UCC
and, in any event, shall include, but not be limited to, (a) any and all
proceeds of any insurance, indemnity, warranty or guaranty payable to the
Borrower from time to time with respect to any of the Collateral, including,
but not limited to, any and all proceeds of business interruption insurance and
any and all proceeds of unearned insurance premiums, (b) any and all payments
(in any form whatsoever made or due and payable to the Borrower from time to
time in connection with any of the Collateral including, but not limited to,
any rents, lease payments, or profits derived therefrom.
REAL PROPERTY PARCELS -- shall have the meaning assigned to that term in
Section 31 hereof.
REQUIRED LENDERS -- shall have the meaning assigned to that term in the
Intercreditor Agreement.
SECURED PARTIES -- shall mean the Insurance Companies, SWIB and any other
holders from time to time of the Nationwide Note Obligations or the SWIB Note
Obligations.
SECURITY DOCUMENTS -- shall mean this Agreement, the Assignment of
Contracts, Warranties and Permits, the Mortgages and the Environmental
Indemnification Agreement.
SHORT-TERM LENDERS -- shall mean the lenders party to the Secured Credit
Agreement dated as of May 22, 1995, entered into by and among such lenders, the
Borrower, and Harris Trust and Savings Bank, as agent for itself, as a lender,
and such other lenders, and their respective successors and assigns.
SWIB NOTES -- shall have the meaning assigned to such term in the second
WHEREAS clause hereof.
SWIB NOTE AGREEMENT -- shall have the meaning assigned to such term in the
second WHEREAS clause hereof.
SWIB NOTE OBLIGATIONS -- shall mean all obligations of the Borrower to SWIB
and any other holders from time to time of the SWIB Notes under the SWIB Note
Agreement and/or the SWIB Notes, whether arising out of credit previously
granted, credit contemporaneously granted, or credit granted in the future,
and, however arising, whether voluntary or involuntary, due or not due,
absolute or contingent, liquidated or unliquidated, determined or undetermined,
secured or unsecured, whether the Borrower is liable individually or jointly
with others, whether for principal, interest, premium or other debts,
obligations or liabilities, and wether or not any or all such
5
<PAGE> 6
debts, obligations and liabilities are or become barred by any statute of
limitations or otherwise unenforceable.
UCC -- shall mean the Uniform Commercial Code as the same may from time to
time be in effect in the State of Wisconsin.
2. SECURITY INTEREST.
To secure the Obligations, the Borrower grants to the Secured Parties, and
the Secured Parties hereby take and retain, a continuing Lien on and security
interest in and to the following described property and interest in such
property (collectively, the "Collateral"), whether now owned or existing or
hereafter created, acquired or arising and wheresoever located:
A. All Equipment and Fixtures of the Borrower, whether now owned or
hereafter acquired by the Borrower, and all spare and repair parts, special
tools and replacements for the same;
B. All accessions to, substitutions for and all replacements, products
and cash and non-cash proceeds of the property described in clause A above,
including, without limitation, proceeds of and unearned premiums with respect
to insurance policies insuring any of the Collateral; and
C. All books and records (including, without limitation, customer lists,
credit files, computer programs, print-outs and other computer materials and
records) of the Borrower pertaining to any of the property described in clauses
A and B above (the "Books and Records").
It is the true, clear, and express intention of the Borrower that the
continuing grant of the security interests provided for herein remain as
security for payment and performance of the Obligations, whether or not
existing or hereinafter incurred by future advances or otherwise; and whether
or not such Obligations are related to the transactions described herein or in
any of the other Loan Documents, by class or kind, or whether or not
contemplated by the parties at the time of the granting of this security
interest. The notice of the continuing grant of this security interest
therefore shall not be required to be stated on the face of any document
representing any such Obligation, nor otherwise identify it as being secured
hereby. Any such Obligation shall be deemed to have been made pursuant to
Section 409.204(3) of the Wisconsin Statutes.
3. WARRANTIES AND COVENANTS.
The Borrower hereby warrants, represents and covenants to the Secured
Parties that:
A. (1) Except as provided in subparagraph (2), below:
(a) the Collateral consisting of Equipment is kept at the
addresses listed on Annex 1 hereto ("Equipment Locations");
(b) the original Books and Records are kept at the address
listed below:
6
<PAGE> 7
1055 Corporate Center Drive
Oconomowoc, WI 53066
and (c) the Borrower's chief executive office and chief
place of business is at the address listed below:
1055 Corporate Center Drive
Oconomowoc, WI 53066
(2) The Borrower will not establish any different location
for its Equipment, its chief executive office, its registered office
or its principal place of business, or its Books and Records, until
(i) it shall have given the Secured Parties prior written notice of
not less than ten (10) days, of its intention to establish such new
location, clearly describing each such new location and providing such
other information in connection therewith as the Secured Parties may
reasonably request, and (ii) with respect to each such new location,
it shall have taken such action, satisfactory to the Required Lenders,
as may be necessary to maintain the security interest of the Secured
Parties in the Collateral at all times fully perfected and in full
force and effect; provided, that notwithstanding anything herein to
the contrary, the Borrower may from time to time move Equipment as
needed in the ordinary course of the operations of the Borrower's
business to any other location within a state, or in another state
provided such location is identified on Annex 1 hereto, so long as the
security interest of the Secured Parties in such Equipment remains at
all times validly perfected. The Borrower shall give the Secured
Parties written notice of any relocation of Equipment described in the
above proviso within ten (10) days of such relocation.
B. Except as disclosed in Annex 3 hereto, there are no actions or
proceedings which are pending or threatened against the Borrower which might
result in any material adverse change in its financial condition or materially
affect the Collateral pledged hereunder.
C. Except for Permitted Liens, and except as specifically
consented to in writing by the Required Lenders, the Liens granted to the
Secured Parties shall be first and prior on the Collateral and proceeds,
including insurance proceeds, resulting from the sale, disposition or loss
thereof. Except as otherwise provided by law, no further action need be taken
to perfect the Liens granted to the Secured Parties, other than the filing of
continuation statements under the UCC or other applicable law, or continued
possession by the Secured Parties of that portion of the Collateral
constituting instruments or documents.
D. The Borrower shall not sell, lease, transfer, assign, pledge or
otherwise dispose of any of the Collateral or any interest therein, without the
prior written consent of the Required Lenders in each instance; provided,
however, that the foregoing restriction shall not apply, for so long as no
Event of Default exists, to (i) the replacement of any Equipment that is
substantially worn, damaged or obsolete with Equipment of like kind, function
and value, provided that the replacement Equipment shall be acquired prior to
or concurrently with any disposition of the Equipment that is to be replaced
and shall be free and clear of Liens other than Permitted Liens that are not
Liens securing the purchase price or cost of construction of such replacement
Equipment, or (ii) the disposal, in any fiscal year of the Borrower, of any
other Equipment that is substantially worn, damaged or obsolete, provided that
(a) in the good faith
7
<PAGE> 8
Borrower's Responsible Financial Officer, the disposition of such Equipment is
for fair market value and is in the best interests of the Borrower, and (b) the
net proceeds received and/or to be received in respect of such Equipment and
all other Equipment disposed of pursuant to this clause (ii) during such fiscal
year shall not exceed $50,000 in the aggregate.
E. Upon prior notice to the Borrower, the Borrower shall, at all
times during normal business hours, permit any Secured Party or its authorized
representatives to examine and inspect the Collateral as well as the Books and
Records, and to make extracts and copies thereof; provided that after the
occurrence of an Event of Default hereunder, no such notice shall be required.
F. The Borrower shall notify the Secured Parties in writing of any
intended change of the Borrower's name, at least ten (10) days prior to such
change or use, and will notify the Secured Parties immediately when such change
or use becomes effective. The Borrower shall take such action, satisfactory to
the Secured Parties, as may be necessary to maintain the security interest of
the Secured Parties in the Collateral at all times fully perfected and in full
force and effect.
G. The Borrower will keep the Collateral insured, in amounts and by
insurers satisfactory to the Required Lenders, against the risks of fire,
explosion, theft and such other risks as are usually insured against by
companies engaged in the same or a similar business or as the Required Lenders
may reasonably require. The Borrower will deliver to the Secured Parties
copies of all insurance policies with respect to the Collateral, together with
appropriate certificates thereof, naming the Secured Parties as loss payees (as
their interests may appear). The Borrowers shall cause each of the Secured
Parties to be at all times named as additional insureds under each of its
liability policies.
H. All information, certificates or statements given to the
Secured Parties pursuant to this Security Agreement shall be true and complete,
in all material respects, when given.
I. With respect to all Collateral which is, or is to be, attached
to real estate, the legal description of such real estate and the name of the
record owner are annexed hereto as Annex 2 hereto (the "Real Property
Parcels").
J. The Borrower shall (i) maintain the Collateral in good
condition and repair (ordinary wear and tear excepted) and not permit its value
to be impaired, (ii) keep the Collateral free from all Liens, encumbrances and
security interests, other than Permitted Liens and other Liens expressly
permitted by the Required Lenders, (iii) defend the Collateral against all
claims and legal proceedings by persons other than the Secured Parties, (iv)
pay and discharge, when due, all taxes, license fees, levies and other charges
upon the Collateral, (v) not sell, lease or otherwise dispose of the
Collateral, except for sales or leases of Collateral authorized as provided in
this Agreement, and (v) not permit the Collateral to be used in violation of
any applicable law, regulation or policy of insurance. Loss of or damage to
the Collateral shall not release the Borrower from any of the Obligations.
K. The Borrower shall keep accurate and complete records of the
Collateral in such form as the Required Lenders may approve. At such times as
the Required Lenders may reasonably require, the Borrower shall furnish to the
Secured Parties a statement certified by the
8
<PAGE> 9
Borrower and in such form and containing such information as may be prescribed
by the Required Lenders, showing the current status and value of the Collateral.
L. Throughout the term of this Agreement, the Borrower shall pay
to the Secured Parties any and all costs incurred by the Secured Parties
arising out of or in any way connected with the Security Documents, including,
but not limited to, legal, appraisal, environmental and accounting fees and
out-of-pocket expenses.
M. Throughout the term of this Agreement, the Borrower shall
deliver, or cause to be delivered, to the Secured Parties, mortgages/deeds of
trust and related security documents reasonably required by the Required
Lenders encumbering any and all real property hereafter acquired and/or
otherwise obtained by the Borrower and/or any of its subsidiaries, in such form
as reasonably required by Required Lenders, together with title insurance
insuring the lien of such mortgage/deed of trust as a first lien on such real
property.
N. The Borrower has entered into an agreement for the sale of its
facility located in Appleton, Wisconsin (the "Appleton Facility") for an all
cash consideration of approximately $900,000, and agrees that on the date of
the sale of the Appleton Facility (the "Appleton Sale Date"), the Borrower
shall pay over, by federal wire transfer of immediately available funds, (a)
the Net Proceeds of such sale to the Agent, to be applied to the prepayment of
the Notes in accordance with Section 4.1(c) of the Intercreditor Agreement, at
par, and (b) accrued interest on the principal amount so prepaid, but without
premium. The Borrower will give each Secured Party written notice under this
Section 3N at least one Business Day and not more than 10 Business Days prior
to the Appleton Sale Date, specifying (i) such date, (ii) the estimated Net
Proceeds of the sale of the Appleton Facility (including a description of all
amounts subtracted from the gross proceeds of such sale in computing such Net
Proceeds), (iii) the principal amount of each Note held by such Secured Party
to be prepaid (determined in accordance with Section 4.1(c) of the
Intercreditor Agreement) on the Appleton Sale Date, and (iv) the interest to be
paid on the Appleton Sale Date with respect to such principal amount being
prepaid. Notwithstanding the foregoing, in the event that the Appleton
Facility is not sold in accordance with the provisions hereof on or prior to
October 1, 1995, the Borrower shall, on or prior to such date, grant a mortgage
on the Appleton Facility for the benefit of the Secured Parties substantially
in the form of the Mortgages, and deliver or cause to be delivered to the
Secured Parties a loan policy of title insurance with respect to the Appleton
Facility, satisfactory to the Agent and showing no exceptions to title except
as acceptable to the Agent.
O. The Borrower shall not permit any Collateral including, without
limitation, the proceeds of any Collateral (except Collateral disposed of
within the limitations of Section 3D(ii)), to be deposited in any accounts in
which the Borrower's Short-Term Lenders or any agent for such Short-Term
Lenders has a security interest without the express written consent of the
Required Lenders.
4. FURTHER ASSURANCE.
The Borrower agrees that at any time and from time to time, upon the
written request of any Secured Party, the Borrower will promptly and duly
execute and deliver any and all such further instruments and documents as such
Secured Party may reasonably request in obtaining the full benefits of this
Agreement or any of the other Security Documents, of the rights and
9
<PAGE> 10
Parties hereby or thereby, including, without limitation, the filing of any
financing or continuation statement under the Uniform Commercial Code in effect
in any jurisdiction with respect to the Liens and security interests granted
hereby as any Secured Party may now or hereafter from time to time request.
Upon the Borrower's failure to so execute and deliver further instruments and
documents, each Secured Party is authorized as agent of the Borrower to sign
any such instruments and documents. The Borrower hereby also authorizes each
Secured Party to file any such financing or continuation statement without the
signature of the Borrower to the extent permitted by applicable law.
5. EVENTS OF DEFAULT; REMEDIES.
A. The following shall constitute Events of Default under this
Agreement:
(1) if the Borrower shall fail to make, when due, the
payment of any amount due under this Agreement within the time period
provided for herein, or if no time period is otherwise provided, within
5 days after the same becomes due; or
(2) if the Borrower shall fail to perform or observe, or
cause to be performed or observed, (i) any covenant or condition
contained in Section 3D, Section 3G, Section 3J(ii) or Section 3N of
this Agreement, and such failure shall continue for a period of five
(5) days, or (ii) any other covenant or condition contained in this
Agreement, and such failure shall continue for a period of twenty (20)
days, in either case after the earlier of (a) receipt of notice thereof
from any Secured Party or (b) the date an officer of the Borrower
learns of such default; or
(3) if any representation or warranty made by the Borrower
in this Agreement, or in any certificate furnished by or on behalf of
the Borrower in connection with the consummation of the
transactions contemplated hereby, shall be untrue in any material
respect as of the date of the issuance or making thereof; or
(4) if any "Event of Default," as defined in the Nationwide
Note Agreement or the SWIB Note Agreement, shall occur; or
(5) if any indebtedness secured by any Lien encumbering all
or any portion of the Collateral and/or Real Property Parcels having
priority over the Liens created and granted to the Secured Parties is
accelerated or any other action is commenced against or affecting the
Collateral and/or the Real Property Parcels to enforce or realize upon
such Lien.
B. Upon the occurrence and continuation of an Event of Default,
the Secured Parties shall have, without limitation, any and all rights and
remedies for default provided by the UCC, by any other applicable law or by any
of the other Loan Documents. With respect to such rights and remedies:
(1) all payments received by the Borrower under or in
connection with the Collateral shall be held by the Borrower in trust
for the Secured Parties, shall be segregated from other funds of the
Borrower and shall be turned over the Secured
10
<PAGE> 11
Parties upon request by the Required Lenders, in the same form as
received by the Borrower duly endorsed by the Borrower to the Secured
Parties, if required); and
(2) any and all such payments so received by the Secured
Parties (whether from the Borrower or otherwise) may, in the sole
discretion of the Required Lenders, be held as collateral security for
and/or then, or at any time thereafter, be applied in whole or in part
by the Secured Parties against all or any part of the Obligations in
accordance with the provisions of the Intercreditor Agreement.
6. OTHER RIGHTS AND REMEDIES.
Upon the occurrence of any Event of Default and at any time thereafter,
the Required Lenders may require the Borrower to assemble the Collateral and
make it available to the Secured Parties at a place to be designated in writing
by the Required Lenders. If notice to the Borrower of an intended disposition
of Collateral is required by law, five (5) days notice shall constitute
reasonable notification. In the event the Required Lenders institute an action
to recover any Collateral or seek recovery of any Collateral by way of
prejudgment remedy in an action against the Borrower, the Borrower waives the
posting of any bond which might otherwise be required. All rights and
remedies of the Secured Parties under this Agreement shall be cumulative and
none are exclusive. Whether or not an Event of Default has occurred, all
payments made by or on behalf of the Borrower and all credits due the Borrower
under this Agreement and under any other agreement between the Borrower and the
Secured Parties may be applied to the Obligations in whatever order and amounts
the Required Lenders choose.
The Borrower hereby appoints each Secured Party, and their respective
successors and assigns, the Borrower's true and lawful attorney, irrevocably,
with full power (in the name of the Borrower or otherwise) upon the occurrence
of an Event of Default and at any time thereafter, to ask, require, demand,
receive, compound and give acquittance for any and all moneys, claims (if the
Required Lenders make a determination that the Borrower is not then pursuing
such claims diligently through appropriate proceedings or if an Enforcement
Period (as defined in the Intercreditor Agreement) shall have commenced), and
other amounts due and to become due at any time under, or arising out of, the
Collateral, to endorse any checks or other instruments or orders in connection
therewith, and to file any claims or take any action or institute any
proceedings which the Required Lenders may deem to be necessary or advisable in
the premises.
If the Borrower fails to act as required by this Agreement, each
Secured Party is authorized, in the Borrower's name or otherwise, to take any
such action including, without limitation, signing the Borrower's name or
paying any amount so required, and the cost shall be one of the Obligations
secured hereby and shall be payable by the Borrower upon demand with interest
from the date of payment by such Secured Party, at the annual rate of four and
one-quarter percent (4.25%) plus the Bank One reference rate as announced from
time to time by Bank One.
No Secured Party shall have any duty to determine the validity of any
invoice or compliance with any order of the Borrower. No Secured Party shall
have any duty to protect, insure, collect or realize upon the Collateral or
preserve rights in it against prior parties. The Borrower releases the Secured
Parties from any liability for any act or omission relating to the
11
<PAGE> 12
Obligations, the Collateral or this Agreement, except for the Secured Parties'
gross negligence or willful misconduct.
The Borrower shall reimburse the Secured Parties for any reasonable
expense incurred by the Secured Parties in protecting or enforcing their rights
under this Agreement, including, without limitation, reasonable fees of
attorneys, legal assistants or paralegals; all expenses of taking possession,
holding, preparing for disposition and disposing of the Collateral; and all
expenses and costs (including, without limitation, fees of attorneys, legal
assistants and paralegals) in connection with any proceeding instituted
pursuant to 11 U.S.C. Section 101 et. seq. After deduction of such expenses,
the Secured Parties may apply the proceeds of disposition to the Obligations in
such order and amounts as the Required Lenders elect.
7. OPINION OF COUNSEL.
On or prior to May 31 of each year, the Borrower shall provide each
Secured Party an opinion of counsel (which may be the chief legal officer of
the Borrower), stating that, in the opinion of such counsel, all actions have
been taken under United States law with respect to the filing of such financing
and continuation statements as may be necessary to fully preserve and protect
the rights of the Secured Parties under this Agreement and the other Security
Documents with respect to all Collateral and stating that, in the opinion of
such counsel, based on then existing law and the state of facts existing as of
the date of such opinion, no additional actions of the type referred to herein
are or will become necessary during the fourteen (14) month period following the
date of such opinion or, if any such action shall be required, stating the
nature of such action.
8. MISCELLANEOUS.
A. Any failure or delay by the Secured Parties to require strict
performance by the Borrower of any of the provisions, warranties, terms and
conditions contained in this Agreement or in any other agreement, document or
instrument, shall not affect the right of the Secured Parties to demand strict
compliance and performance therewith, and any waiver of any default shall not
waive or affect any other default, whether prior to subsequent thereto, and
whether of the same or of a different type. None of the warranties,
conditions, provisions and terms contained in this Agreement or in any other
agreement, document or instrument shall be deemed to have been waived by any
act or knowledge of the Secured Parties or any of their respective agents,
officers or employees, but only by an instrument in writing, signed by an
officer of each Secured Party constituting the Required Lenders, directed to
the Borrower and specifying such waiver.
B. All notices hereunder shall be in writing, shall be hand
delivered, deposited into the United States mail (registered or certified
mail), postage prepaid, sent by overnight courier, or sent by telecopy
transmission to the telecopy number designated on the signature pages hereto
beneath the address of each party to receive such notice, and shall be
addressed to the parties at their respective addresses set forth beneath their
signatures below, or to such other address as any party designates to the
others in the manner herein described.
C. In the event that any provision hereof shall be deemed to be
invalid by any court, such invalidity shall not affect the remainder of this
Agreement.
12
<PAGE> 13
D. This Agreement shall be binding upon and for the benefit of the
parties hereto and their respective successors and assigns.
E. This Agreement may not be amended, changed, waived, discharged
or terminated without the written consent of the Required Lenders and the
Borrower.
F. Wherever the context requires, the singular form of any word
shall include the plural, and the neuter form of any word shall include the
masculine and feminine forms, and vice versa.
G. THE BORROWER IRREVOCABLY AGREES THAT, SUBJECT TO THE SOLE AND
ABSOLUTE ELECTION OF THE SECURED PARTIES, ALL SUITS, ACTIONS OR OTHER
PROCEEDINGS IN ANY WAY, MANNER, OR RESPECT ARISING OUT OF OR FROM OR RELATED
TO THIS AGREEMENT OR ANY DOCUMENTS EXECUTED IN CONNECTION HEREWITH, SHALL BE
SUBJECT TO LITIGATION IN COURTS HAVING SITUS WITHIN MILWAUKEE, WISCONSIN. THE
BORROWER HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR
FEDERAL COURT LOCATED WITHIN MILWAUKEE, WISCONSIN. THE BORROWER HEREBY WAIVES
ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY SUIT, ACTION OR
ORDER PROCEEDING BROUGHT AGAINST THE BORROWER BY THE SECURED PARTIES IN
ACCORDANCE WITH THIS SECTION. THE BORROWER HEREBY WAIVES, TO THE EXTENT
PERMITTED BY LAW, TRIAL BY JURY. THE BORROWER FURTHER WAIVES ANY BOND
OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE
REQUIRED OF THE SECURED PARTIES.
H. This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
I. THIS AGREEMENT SHALL BE INTERPRETED, GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF WISCONSIN OR SUCH OTHER
LAW AS MAY BE REQUIRED UNDER THE UCC.
[Remainder of page intentionally left blank. Next page is signature page.]
13
<PAGE> 14
IN WITNESS WHEREOF, the undersigned have executed and delivered this
Agreement as of the date first above written.
BORROWER:
STOKELY USA, INC.
By: _______________________________
Title: Vice Chairman
Address: 1055 Corporate Center Drive
Oconomowoc, WI 53066
Attn: Treasurer
Facsimile: (414) 569-3761
[Signature page to SECURITY AGREEMENT of STOKELY USA, INC.]
<PAGE> 15
SECURED PARTIES:
NATIONWIDE LIFE INSURANCE COMPANY
By: ____________________________________
Title: _________________________________
Address: One Nationwide Plaza
Columbus, OH 43216
Attn: Corporate-Fixed
Income Securities
Facsimile: (614) 249-4553
with a copy to:
One Nationwide Plaza-Floor 35
Columbus, OH 43216
Attn: Roger Craig, Esq.
Facsimile: (614) 249-2418
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU
By: ____________________________________
Title: _________________________________
Address: One Nationwide Plaza
Columbus, OH 43216
Attn: Corporate-Fixed
Income Securities
Facsimile: (614) 249-4553
[Signature page to SECURITY AGREEMENT of STOKELY USA, INC.]
<PAGE> 16
WEST COAST LIFE INSURANCE COMPANY
By: ____________________________________
Title: _________________________________
Address: One Nationwide Plaza
Columbus, OH 43216
Attn: Corporate-Fixed
Income Securities
Facsimile: (614) 249-4553
STATE OF WISCONSIN INVESTMENT BOARD
By: ____________________________________
Title: _________________________________
Address: 121 E. Wilson Street
Madison, WI 53702
Attn: Private Placements
Facsimile: (608) 266-2436
with a copy to:
Solheim Billing & Grimmer, S.C.
2 East Gilman Street, Suite 402
Madison, WI 53701-1644
Attn: Thomas P. Solheim, Esq.
Facsimile: (608) 283-3079
[Signature page to SECURITY AGREEMENT of STOKELY USA, INC.]
<PAGE> 17
ANNEX 1
STOKELY USA, INC.
EQUIPMENT LOCATIONS
Hwy 20 West Pickett, WI 54964
P.O. Box 99 414-589-4411
Ackley, IA 50601
515-847-2643 W8070 Kent Road
Poynette, WI 53955-9713
1820 W. Eighth Street 608-635-4396
54914
P.O. Box 1457 - 54913
Appleton, WI 506 E. State Street
414-734-5737/749-3020 Box 218
Scottville, MI 49454
840 Bakke Street 616-757-4715
Deforest, WI 53532
608-846-2490 151 Market Street
Box 65
Avenue A - P.O. Box 400 Sun Prairie, WI 53590
Grandview, WA 98930 608-837-5177
D&K Frozen Foods, Inc.
509-882-3322 1164 Dell Avenue, P.O. Box 818
Walla Walla, WA 99362
1425 Main Street D&K Frozen Foods, Inc.
P.O. Box 841 509-525-7890
Green Bay, WI 54302
414-435-3793 300 East Third Street
Box 307
102 North First Avenue Waunakee, WI 53597
Box 250 608-849-4131
Hoopeston, IL 60942 608-849-8810 (QA)/#8 32
217-283-5141
Hwy 22 North, P.O. Box 8
2001 Water Street Wells, MN 56097
Merrill, WI 54452 507-553-3171
715-536-8308
Highway 80
7740 State Road 44 Cobb, WI 53526
Box 279
Annex 1-1
<PAGE> 18
ANNEX 2
REAL PROPERTY PARCELS
Annex 2-1
<PAGE> 19
ANNEX 3
DESCRIPTION OF PENDING LITIGATION
Annex 3-1
<PAGE> 20
ENVIRONMENTAL INDEMNIFICATION AGREEMENT
THIS ENVIRONMENTAL INDEMNIFICATION AGREEMENT ("Agreement") is made as
of the 31st day of May, 1995, by STOKELY USA, INC., a Wisconsin corporation
(the "Indemnifying Party") to, and for the ratable benefit of, NATIONWIDE LIFE
INSURANCE COMPANY ("Nationwide"), EMPLOYERS LIFE INSURANCE COMPANY
("Employers"), WEST COAST LIFE INSURANCE COMPANY ("West Coast") and STATE OF
WISCONSIN INVESTMENT BOARD (Nationwide, Employers, West Coast and SWIB are
collectively referred to hereinafter as the "Lenders").
R E C I T A L S:
WHEREAS, Nationwide, Employers, West Coast and the Indemnifying Party
are parties to a Note Agreement, dated as of January 1, 1990, as amended by an
Amendment to Note Agreement dated August 18, 1992, a Second Amendment to Note
Agreement dated June 11, 1993, and a Third Amendment to Note Agreement dated
May 31, 1995 (said Note Agreement, as so amended, and as further amended,
modified or supplemented from time to time, is referred to hereinafter as the
"Nationwide Note Agreement"), pursuant to which the Indemnifying Party has
issued its 9.37% Senior Secured Notes due January 15, 2000 (collectively,
together with any other notes issued pursuant to the Nationwide Note Agreement,
the "Nationwide Notes"); and
WHEREAS, SWIB and the Indemnifying Party are parties to a Note
Agreement, dated as of December 1, 1991, as amended by a First Amendment to
Note Agreement dated as of August 18, 1992, a Second Amendment to Note
Agreement dated as of June 11, 1993, and a Third Amendment to Note Agreement
dated as of May 31, 1995 (said Note Agreement, as so amended, and as further
amended, modified or supplemented from time to time, is referred to hereinafter
as the "SWIB Note Agreement"), pursuant to which the Indemnifying Party has
issued a certain 9.49% Senior Note due December 15, 2001 (collectively,
together with any other notes issued pursuant to the SWIB Note Agreement, the
"SWIB Notes"); and
WHEREAS, the Indemnifying Party has on this date entered into a
Security Agreement (as amended, modified or supplemented from time to time, the
"Security Agreement") with the Lenders, granting to, and for the ratable
benefit of, the Lenders a security interest in certain Collateral (as defined
in the Security Agreement) to secure the Nationwide Notes, the SWIB Notes and
the other Obligations (as defined in the Security Agreement); and
WHEREAS, as additional security for the Obligations, the Indemnifying
Party has granted to, and for the ratable benefit of, the Lenders certain real
estate mortgages/deeds or trust (as amended, modified or supplemented from time
to time, the "Mortgages"), encumbering certain real estate legally described on
Annex 1 hereto and the improvements and fixtures
<PAGE> 21
and other property described in the Mortgages (said real estate, improvements,
fixtures and other property, the "Mortgaged Property"), together with certain
other documents evidencing and/or securing the Obligations (the Security
Agreement, the Mortgages, this Agreement and such other documents being
described and defined in the Security Agreement and collectively referred to
hereinafter as the "Security Documents"); and
WHEREAS, as additional security for the Obligations, the Lenders have
required that the Indemnifying Party execute and deliver to the Lenders this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Indemnifying Party hereby agrees as
follows:
1. (a) The Indemnifying Party represents and warrants that:
(i) each of the Indemnifying Party, its affiliates and
the Mortgaged Property is in compliance in all material
respects with all Environmental Laws (defined below):
(ii) except as disclosed on Annex 2 hereto, there are no
environmental conditions with respect to the soil, surface
waters, groundwater, air or similar environmental media, either
on or off the Mortgaged Property, resulting from any activity,
inactivity or operations on or off the Mortgaged Property,
presently existing or likely to exist during the term of the
Obligations which would subject the Indemnifying Party to
damages, penalties, injunctive relief or cleanup costs under
any Environmental Law or any assertion thereof, or which
require or are likely to require cleanup, removal, remedial
action or other response by the Indemnifying Party pursuant to
any Environmental Law;
(iii) except as disclosed on Annex 2 hereto, the
Indemnifying Party is not a party to any litigation or
administrative proceeding, and, so far as is known by the
Indemnifying Party, no litigation or administrative proceeding
is threatened against it, which asserts or alleges that the
Indemnifying Party or any of its subsidiary companies has
violated or is violating any Environmental Law relative to the
Mortgaged Property or the activity or operations thereon, or
that the Indemnifying Party is required to clean up, remove or
take remedial or other responsive action pursuant to any
Environmental Law;
(iv) except as disclosed on Annex 2 hereto, neither the
Mortgaged Property nor the Indemnifying Party or any of its
affiliates is subject to any judgment, decree, order or
citation related to or arising out of any Environmental Law
relative to the Mortgaged Property or any activity or
operations thereon and neither the Indemnifying Party nor any
of its affiliates has been named or listed as a potentially
responsible party by any governmental body or agency in a
matter arising under any Environmental Law relative to the
Mortgaged Property;
(v) no permits, licenses, approvals, certificates,
plans, consent agreements or stipulations are required under
any Environmental Law relative to
2
<PAGE> 22
the Mortgaged Property, or the activities and
operations of the Indemnifying Party on the Mortgaged Property
or the activity or operations thereon, that have not been
obtained; and
(vi) there are not now, nor to the Indemnifying Party's
knowledge after reasonable investigation have there ever been,
Hazardous Materials generated, produced, stored, deposited,
treated, handled, recycled, spilled, discharged, leaked or
disposed of on, under or at the Mortgaged Property (or tanks or
other facilities thereon containing such Hazardous Materials)
which require, or would require, cleanup, removal or some other
remedial action or other response under any Environmental Law.
(b) As used herein, the following terms shall have the
meanings ascribed to them set forth below:
"Environmental Laws" shall mean all federal, state and local
laws, including statutes, regulations, ordinances, codes, rules and
other governmental restrictions and requirements, and all permits,
licenses, approvals, certificates, plans, consent agreements and
stipulations, relating to the discharge of air pollutants, water
pollutants or process waste water or otherwise relating to the
environment or hazardous or toxic wastes or substances including, but
not limited to, the Federal Solid Waste Disposal Act, the Federal Clean
Air Act, the Federal Clean Water Act, the Safe Drinking Water Act, the
Federal Resource Conservation and Recovery Act of 1976, the Federal
Comprehensive Environmental Responsibility Cleanup and Liability Act of
1980, the Occupational Safety and Health Act, the Toxic Substance
Control Act, the Hazardous Materials Transportation Act, the Federal
Insecticide, Fungicide and Rodenticide Act, regulations of the
Environmental Protection Agency, regulations of the Nuclear Regulatory
Agency, and regulations of the State of Wisconsin Department of Natural
Resources now in effect or, for purposes of Section 1(c) below, as
amended, modified, supplimented or created from time to time.
"Hazardous Materials" shall mean any petroleum, petroleum
products, fuel oil, derivatives of or additives to petroleum products
or fuel oil, explosives, reactive materials, ignitable materials,
corrosive materials, hazardous chemicals, hazardous wastes, hazardous
substances, hazardous air pollutants, air pollutants, extremely
hazardous substances, toxic substances, toxic chemicals, radioactive
materials, medical waste, biomedical waste, any mixture of sewage or
other waste material that passes through a sewer system to a treatment
facility, any industrial waste-water discharges subject to regulation
and any infectious materials, as such foregoing terms may be defined in
the Environmental Laws, and any other element, compound, mixture,
solution or substance which may pose a present or potential hazard to
human health or the environment.
(c) The Indemnifying Party shall comply in all material
respects with all applicable Environmental Laws relative to the Mortgaged
Property and shall provide to the Lenders, immediately upon receipt, copies of
any correspondence, notice, pleading, citation, indictment, complaint, order,
decree or other document from any source asserting or alleging a circumstance
or condition on the Mortgaged Property which requires or may require a
financial contribution by the Indemnifying Party or a cleanup, removal,
remedial action, or other response
3
<PAGE> 23
by or on the part of the Indemnifying Party under any Environmental Law, or
which seeks damages or civil, criminal or punitive penalties from the
Indemnifying Party for an alleged violation of any Environmental Law relative
to the Mortgaged Property. The Indemnifying Party shall advise the Lenders in
writing, as soon as the Indemnifying Party becomes aware of any condition or
circumstance on the Mortgaged Property which makes the environmental warranties
contained in this Agreement incomplete or inaccurate. The Indemnifying Party
shall, at its expense and at the request of the Lenders at any time having a
reasonable basis for believing that a condition or circumstance exists which
causes the environmental warranties contained in this Agreement to be
inaccurate and at any time following an Event of Default hereunder, permit an
environmental audit to be conducted by the Lenders or an independent agent
selected by the Lenders. This provision shall not relieve the Indemnifying
Party from conducting its own environmental audits or taking any other steps
necessary to comply with any Environmental Law relative to the Mortgaged
Property, it being understood that the Indemnifying Party has and shall retain
exclusive management control over the management of Hazardous Materials on or
about the Mortgaged Property and responsibility for compliance with
Environmental Laws. If, in the reasonable belief of the Lenders based on any
report prepared by one or more environmental engineering/consulting firms,
there exists any uncorrected violation of any Environmental Law relative to the
Mortgaged Property or any condition on the Mortgaged Property which requires a
cleanup, removal or other remedial action under any Environmental Law, and such
cleanup, removal or other remedial action is not completed within one hundred
twenty (120) days from the date of written notice from the Lenders to the
Indemnifying Party (or if such cleanup, removal or other remedial action cannot
reasonably be completed within said one hundred twenty (120) day period, such
longer period of time as may reasonably be necessary for the Indemnifying Party
to complete such cleanup, removal or other remedial action, as long as the
Indemnifying Party proceeds diligently to complete the same), the same shall,
at the option of the Lenders, constitute an Event of Default hereunder.
2. The Indemnifying Party covenants that, except for claims, losses,
damages, response costs or expenses caused by or contributed (to the extent of
such contribution) to by the grossly negligent or intentional misconduct of the
Lenders, it will at all times, unconditionally, absolutely and irrevocably,
indemnify, hold harmless and defend the Lenders and their respective successors
and assigns from any and all claims, losses, damages, response costs and
expenses arising out of or in any way relating to a breach and/or
misrepresentation of any and/or all of the environmental representations,
warranties, certifications and/or covenants set forth above and/or in any of
the other Security Documents, or in any way relating to a breach or violation,
or alleged breach or violation, of any one or more of the Environmental Laws,
including, but not limited to: (a) claims of third parties (including
governmental agencies) for damages, penalties, response costs, injunctive or
other relief; (b) costs of removal, treatment, disposal and restoration,
including fees of attorneys and experts, costs of reporting the existence of
Hazardous Materials to any governmental agency and costs of preparing and/or
causing to be prepared any and all studies, tests, analyses and/or reports in
connection with any environmental matter; and (c) any and all expenses or
obligations, including attorneys' fees, incurred at, before and after any trial
or appeal therefrom, whether or not taxable as costs, including, without
limitation, attorneys' fees, witness fees, deposition costs, copying and
telephone charges and other expenses, all of which shall be paid by the
Indemnifying Party when incurred.
3. Except for claims, losses, damages, response costs or expenses
caused or contributed (to the extent of such contribution) by the grossly
negligent or intentional misconduct
4
<PAGE> 24
of the Lenders, the representations, warranties, certifications and/or
covenants contained herein and the obligations of the Indemnifying Party to
indemnify the Lenders as provided in this Agreement, including, without
limitation, indemnification for the expenses, damages, losses, costs, damages
and liabilities set forth in Section 2 above, shall survive the repayment of
all amounts due under the Security Documents and the release and/or
cancellation of any and all of the Security Documents, the foreclosure of any
liens on the Mortgaged Property by the Lenders and/or a third party, or the
conveyance thereof by deed in lieu of foreclosure, and the relationship between
the Indemnifying Party and the Lenders shall not be limited to the amount of
any deficiency in any foreclosure sale of the Mortgaged Property.
4. The Indemnifying Party shall be fully, unconditionally,
irrevocably and personally liable for all of its respective obligations
hereunder, notwithstanding any exculpatory clauses of any kind contained, or
which may be contained, in any of the Security Documents or in any of the
underlying documents evidencing or otherwise securing the Obligations. The
Indemnifying Party hereby expressly acknowledges and agrees that the Lenders
may pursue any and/or all of their rights and remedies existing hereunder, or
otherwise existing at law and/or in equity, whether separately or concurrently,
and at the option of the Lenders, without seeking to enforce their rights under
any and/or all of the other Security Documents.
5. The Indemnifying Party agrees that at any time and from time to
time, upon the written request of any Lender, the Indemnifying Party will
promptly and duly execute and deliver any and all such further instruments and
documents as such Lender may reasonably request in obtaining the full benefits
of this Agreement and of the rights and powers herein granted. Upon the
Indemnifying Party's failure to do so execute and deliver such further
instruments and documents, each Lender is authorized as agent of the
Indemnifying Party to sign any such instrument and document.
6. In the event that the Lenders shall incur any costs (including,
without limitation, attorneys' fees and court costs) to collect and enforce the
obligations of the Indemnifying Party hereunder, the Indemnifying Party shall,
upon demand by any Lender, immediately reimburse such Lender or Lenders
therefor, including, without limitation, for attorneys' fees incurred in any
litigation and bankruptcy and administrative proceedings, and appeals
therefrom.
7. This Agreement may not be changed or amended orally but only by an
instrument in writing signed by the Lenders and the Indemnifying Party.
8. Any notices to be delivered hereunder shall be delivered in
accordance with the terms of the Security Agreement.
9. This Agreement including, without limitation, the indemnities
contained herein, shall be binding upon the Indemnifying Party and its
successors and assigns. This Agreement shall inure to the benefit of and may be
enforceable by the Lenders, their affiliates, and their respective successors
and assigns.
10. In the event one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal or unenforceable
in any respect by a court of competent jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision of this
5
<PAGE> 25
Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had not been contained herein.
11. This Agreement and all the terms hereof shall be governed by and
construed in accordance with the laws of the State of Wisconsin.
12. THE INDEMNIFYING PARTY IRREVOCABLY AGREES THAT, SUBJECT TO THE
SOLE AND ABSOLUTE ELECTION OF THE LENDERS, ALL SUITS, ACTIONS OR OTHER
PROCEEDINGS IN ANY WAY, MANNER OR RESPECT ARISING OUT OF OR FROM OR RELATED TO
THIS AGREEMENT, OR ANY DOCUMENTS EXECUTED IN CONNECTION HEREWITH, SHALL BE
SUBJECT TO LITIGATION IN COURTS HAVING SITUS WITHIN MILWAUKEE, WISCONSIN. THE
INDEMNIFYING PARTY HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY
LOCAL, STATE OR FEDERAL COURT LOCATED WITHIN MILWAUKEE, WISCONSIN. THE
INDEMNIFYING PARTY HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE
VENUE OF ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT AGAINST THE INDEMNIFYING
PARTY BY THE LENDERS IN ACCORDANCE WITH THIS SECTION. THE INDEMNIFYING PARTY
AND THE LENDERS EACH HEREBY WAIVE, TO THE EXTENT PERMITTED BY LAW, TRIAL BY
JURY. THE INDEMNIFYING PARTY FURTHER WAIVES ANY BOND OR SURETY OR SECURITY UPON
SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED OF THE LENDERS.
[Remainder of page intentionally blank. Next page is signature page.]
6
<PAGE> 26
IN WITNESS WHEREOF, the undersigned have executed this Agreement in one or more
counterparts, which when combined shall constitute one agreement, to take
effect as of the date first above written.
INDEMNIFYING PARTY:
STOKELY USA, INC., a Wisconsin
corporation
By:____________________________________
Name:
Its:
Attest:_____________________________
Name:
Its:
[Signature page to ENVIRONMENTAL INDEMNIFICATION AGREEMENT
of STOCKELY USA, INC.]
<PAGE> 27
ANNEX 1
REAL PROPERTY PARCELS
Annex 1-1
<PAGE> 28
ANNEX 2
ENVIRONMENTAL MATTERS
Annex 2-1
<PAGE> 29
Marked to show changes from draft dated 05/23/95
STOKELY USA, INC.
---------------
THIRD AMENDMENT TO NOTE AGREEMENT
---------------
Re:
Note Agreement Dated as of January 1, 1990
and
$25,000,000 Original Principal Amount of
9.37% Senior Notes Due January 15, 2000
DATED MAY 31, 1995
<PAGE> 30
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
SECTION 1. DEFINED TERMS.......................................... 2
SECTION 2. REPRESENTATIONS AND WARRANTIES......................... 2
SECTION 3. CONDITIONS PRECEDENT................................... 4
SECTION 4. AMENDMENTS TO EXISTING NOTE AGREEMENT.................. 7
SECTION 5. CONSENT TO PARTIAL RELEASE............................. 14
SECTION 6. EFFECT OF AMENDMENT.................................... 15
SECTION 7. NO LEGEND REQUIRED..................................... 16
SECTION 8. FEES AND EXPENSES...................................... 16
SECTION 10. DUPLICATE ORIGINALS; EXECUTION IN COUNTERPART.......... 16
SECTION 11. GOVERNING LAW.......................................... 16
Annex 1 -- Schedule of Holders
Annex 2 -- Schedule of Pending Litigation
Annex 3 -- Schedule of IRB Indebtedness
Exhibit A -- Form of Closing Opinion of Special Counsel to the Company
Exhibit B -- Form of Officers' Certificate of the Company
Exhibit C -- Form of Secretary's Certificate of the Company
</TABLE>
i
<PAGE> 31
STOKELY USA, INC.
THIRD AMENDMENT TO NOTE AGREEMENT
Re:
Note Agreement Dated as of January 1, 1990
and
$25,000,000 Original Principal Amount of
9.37% Senior Notes Due January 15, 2000
Dated May 31, 1995
To the Institutional Investors
listed on Annex 1 hereto which
are signatories to this Agreement
Ladies and Gentlemen:
Reference is made to the Note Agreement dated as of January 1, 1990, as
amended by an Amendment to Note Agreement dated August 18, 1992 and a Second
Amendment to Note Agreement dated June 11, 1993 (said Note Agreement as so
amended is herein referred to as the "Existing Note Agreement"), among
Stokely USA, Inc., a Wisconsin corporation (the "Company"), and each of the
institutions named in Schedule I hereto (the "Holders"), under and pursuant
to which Twenty-Five Million Dollars ($25,000,000) aggregate principal amount
of 9.37% Senior Notes due January 15, 2000 (the "Notes") were originally
issued.
The Company desires to enter into a proposed transaction in which:
(i) the Company will enter into a Secured Credit Agreement
dated as of May 22, 1995 (the "Credit Agreement") with Harris Trust
and Savings Bank ("Harris Bank") and the other lenders referred to
therein (Harris Bank and such other lenders, along with their
respective successors and assigns, are herein collectively referred to
as the "Short-Term Lenders"), and Harris Bank, as agent for the
Short-Term Lenders, pursuant to which the Short-Term Lenders will
agree to make certain loans and advances to, and issue certain standby
letters of credit for the account of, the Company in the aggregate
principal amount of up to Sixty-Five Million Dollars ($65,000,000);
(ii) the obligations of the Company under the Credit
Agreement will be secured by a security interest in the Lien upon the
Current Asset Collateral (defined below), all as more fully set forth
in the Security Agreement dated as of May 22, 1995 (the "Bank
Security Agreement"), by and among the Company, the Short-Term
Lenders, and Harris Bank, as agent for the Short-Term Lenders;
(iii) all indebtedness and other obligations of the Company and
its Subsidiaries under the Loan and Security Agreement will be paid in
full and the lenders party to the
<PAGE> 32
Loan and Security Agreement having any Lien on or security interest in
the collateral securing the Notes (the "Old Lenders") shall consent
to or acknowledge the release of all such Liens (the "Old Lenders'
Lien Releases") held for the benefit of the Old Lenders; and
(iv) the Holders and State of Wisconsin Investment Board
("SWIB") will consent to the release by Bank One, as agent for the
Holders and SWIB, of the Lien on and security interest in the Current
Asset Collateral heretofore granted to Bank One as agent for the
Holders and SWIB.
In exchange for the Holders' consent to the Partial Release (defined
below), the Company agrees to amend certain terms and provisions of the
Existing Note Agreement to conform certain provisions of the Existing Note
Agreement to the terms and provisions of the Credit Agreement.
In consideration of the foregoing and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the Company and the Holders (subject to satisfaction of the conditions set
forth below) hereby agree to the amendments set forth below and the Holders
(subject to satisfaction of the conditions set forth below) hereby consent to
the Partial Release, in the manner herein provided.
SECTION 1. DEFINED TERMS.
All capitalized terms used but not specifically defined in this
Amendment have the respective meanings assigned to them in, or pursuant to the
provisions of, the Existing Note Agreement as amended by this Amendment (as so
amended herein referred to as the "Amended Note Agreement").
SECTION 2. REPRESENTATIONS AND WARRANTIES.
The Company warrants and represents to each Holder that as of the date
of this Amendement and as of the Effective Date (as defined in Section 3):
(A) ORGANIZATION AND AUTHORITY; SUBSIDIARIES. The Company is a
corporation duly organized and existing and in good standing under the laws of
the State of Wisconsin, has full and adequate corporate power to carry on its
business as now conducted, is duly licensed or qualified in all jurisdictions
wherein the nature of its activities requires such licensing or qualification
except where the failure to be so licensed or qualified would not have a
material adverse effect on the business, prospects, profits. Properties or
condition (financial or otherwise) of the Company, and has full right and
authority to enter into this Amendment and the Security Documents (defined
below), and to perform each and all of the matters and things herein and
therein provided for. The aggregate amount of assets of the U.S. Subsidiaries
does not exceed One Hundred Thousand Dollars ($100,000).
(B) PENDING LITIGATION. Except as disclosed on Annex 2 hereto, there
is no litigation or governmental proceeding pending, or to the knowledge of the
company threatened, against the Company or any Subsidiary which, if adversely
determined, is likely to have a material adverse effect on the business,
prospects, profits, Properties or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or the ability of the Company
to perform
2
<PAGE> 33
its obligations set forth in this Amendment, the Amended Note Agreement, the
Notes or any of the Security Documents.
(C) NO DEFAULTS. No event has occurred and is continuing and no
condition exists which, upon execution and delivery of this Amendment, would
constitute a Default or Event of Default. The Company is not in default in the
payment of principal or interest on any Indebtedness and is not in default
under any instrument or instruments or agreements under and subject to which
any Indebtedness has been issued and no event has occurred and is continuing
under the provisions of any such instrument or agreement which with the lapse
of time or the giving of notice, or both, would constitute a default or an
event of default thereunder, except for a possible default with respect to
certain Indebtedness in principal amount not exceeding $400,000, which possible
default could have a material adverse effect on the business, prospects,
profits, Properties or condition (financial or otherwise) of the Company and
its Subsidiaries, taken as a whole, or the ability of the Company to perform
its obligations set forth in this Amendment, the Amended Note Agreement, the
Notes or any of the Security Documents.
(D) SECURITY INTERESTS AND DEBT. There are no Liens on any of the
Property of the Company and its Subsidiaries except Liens permitted by Section
5.7 of the Amended Note Agreement. The Company and its Subsidiaries have no
Funded Debt outstanding other than Funded Debt that would be permitted to be
incurred by Section 5.6 of the Amended Note Agreement. Annex 3 to this
Amendment correctly lists all outstanding IRB Indebtedness of the Company as of
the Effective Date (defined below).
(E) FULL DISCLOSURE. Each written statement and all written
materials furnished by, or on behalf of, the Company to the Holders in
connection with this Amendment or pursuant to the provisions of Section 5.14 of
the Existing Note Agreement do not contain any untrue statement of a material
fact or omit a material fact necessary to make the statements contained therein
or herein not misleading in light of the circumstances in which they were made.
There is no fact known to the Company which the Company has not disclosed to
the Holders in writing which materially affects adversely or, so far as the
Company can now foresee, shall materially affect adversely the business,
prospects, profits, Properties or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or the ability of the Company
to perform its obligations set forth in this Amendment, the Amended Note
Agreement, the Notes or any of the Security Documents.
(F) TRANSACTION IS LEGAL AND AUTHORIZED. The execution and delivery
by the Company of this Amendment and the Security Documents, the consummation
of each of the transactions contemplated by this Amendment and the compliance
by the Company with all the provisions of this Amendment, the Amended Note
Agreement and each Security Document: (i) are within the corporate powers of
the Company; and (ii) are legal and do not conflict with, result in any breach
in any of the provisions of, or constitute a default (or require any consent
other than the consents heretofore obtained) under, or result in the creation
of any Lien upon any Property of the Company or any Subsidiary under the
provisions of, the articles of incorporation or by-laws of the Company or any
Subsidiary or any agreement or instrument to which the Company or any
Subsidiary is a party or by which it or any of its Property may be bound.
(G) GOVERNMENTAL CONSENT. Neither the nature of the Company or any
Subsidiary, or of any of their respective businesses or Properties, nor any
relationship between the Company
3
<PAGE> 34
or any Subsidiary and any other Person, nor any circumstance in connection with
the execution and delivery of this Amendment and the Security Documents (except
as provided under Section 3), is such as to require an order, consent,
approval, license, authorization or validation of, or filing, recording,
registration or qualification with, any Governmental Authority on the part of
the Company as a condition to the execution, delivery or performance of this
Amendment, the Amended Note Agreement or any Security Document, or the
legality, validity, binding effect or enforceability of this Amendment, the
Amended Note Agreement or any Security Document.
(H) OBLIGATIONS ARE ENFORCEABLE. The obligations of the Company set
forth in this Amendment, the Amended Note Agreement, the Notes and the Security
Documents are valid, binding the enforceable in accordance with their
respective terms, except as such enforceability may be; (i) limited by
bankruptcy, insolvency or other similar laws affecting the enforceability of
creditors' rights generally and (ii) subject to the availability of equitable
remedies.
(I) COMPLIANCE WITH LAW. The Company and each Subsidiary is in
compliance with all laws, ordinances, governmental rules or regulations to
which it is subject, including without limitation the Occupational Safety and
Health Act of 1970. ERISA and all Environmental Legal Requirements, the
violation of which could have a material adverse effect on the business,
prospects, profits, Properties or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or the ability of the Company
or any U.S. Subsidiary to perform its respective obligations set forth in this
Amendment, the Amended Note Agreement, the Notes or any of the Security
Documents.
SECTION 3. CONDITIONS PRECEDENT.
The consent to the Partial Release set forth in Section 5 and each of
the amendments to the Existing Note Agreement shall have no effect until all of
the following conditions precedent shall have been satisfied or waived by each
of the Holders (such time of effectiveness is herein referred to as the
"Effective Date"):
(A) OPINION OF COUNSEL. The Holders shall have received from
Michael, Best & Friedrich, special counsel to the Company, a favorable opinion
satisfactory to the Holders and substantially in the form appended to this
Amendment as Exhibit A.
(B) WARRANTIES AND REPRESENTATIONS TRUE. The warranties and
representations set forth in Section 2 shall be true in all material respects;
there shall exist on the Effective Date no Default or Event of Default; and the
Holders shall have received an Officers' Certificate of the Company, dated the
Effective Date, substantially in the form of Exhibit B to this Amendment,
certifying to both such effects and that the conditions specified in this
Section 3 have been fulfilled, and a certificate dated the Effective Date and
signed by the Secretary or an Assistant Secretary of the Company, substantially
in the form of Exhibit C to this Amendment, with respect to the matters therein
set forth.
(C) CONSENT OF ALL NOTEHOLDERS. The Company and the Holders of one
hundred percent (100%) of the outstanding principal amount of the Notes shall
have executed this Amendement.
4
<PAGE> 35
(D) CREDIT AGREEMENT AND BANK SECURITY AGREEMENT. The Company, the
Short-Term Lenders and Harris Bank, as agent for the Short-Term Lenders, shall
have executed and delivered to the Holders copies of the Credit Agreement and
the Bank Security Agreement, in form and substance satisfactory to the Holders.
(E) OLD LENDERS' LIEN RELEASE. Each of the Old Lenders shall have
executed and delivered to the Holders consents to or acknowledgements of the
Old Lenders' Lien Release and Bank One shall have executed and delivered to the
Holders the Old Lenders' Lien Release, such consents or acknowledgements and
such Release each being in form and substance satisfactory to the Holders.
(F) ASSIGNMENT BY BANK ONE; UCC STATEMENTS. Bank One, as agent for
the benefit of the Holders and SWIB, shall have executed and delivered to the
Holders an assignment of the Lien on and security interest in the Property of
the Company described in the Security Documents heretofore granted to Bank One,
as agent, and a release of the Current Asset Collateral, such assignment and
such release each being in form and substance satisfactory to the Holders,
together with appropriate forms of UCC financing statements reflecting such
assignment and release (the "UCC Amendments"). The Company shall have
executed the UCC Amendments and shall have executed and delivered such other
UCC financing statements as shall be necessary to perfect the security interest
of the Holders and SWIB in certain other Property described in the Security
Documents acquired by the Company from one of its Subsidiaries.
(G) SECURITY DOCUMENTS. The following agreements (herein
collectively referred to as the "Security Documents") shall have been duly
executed and delivered to the Holders by the parties thereto, in form and
substance satisfactory to the Holders and their special counsel:
(i) a Security Agreement among the Company and the Lenders,
pursuant to which the Company will grant the Lenders a Lien on and
security interest in certain assets of the Company therein described;
(ii) an Assignment of Contracts, Warranties and Permits by the
Company, pursuant to which the Company will assign to the Lenders all
contracts, warranties and permits affecting the Properties (as defined
therein);
(iii) one or more mortgages or deeds of trust (collectively,
the "Mortgages") on all interests in real property of the Company
(other than the real property described in Section 3N of the Security
Agreement) in favor of the Lenders; and
(iv) an Environmental Indemnification Agreement by the
Company, pursuant to which the Company will agree to indemnify the
Lenders for losses relating to environmental matters.
(H) INTERCREDITOR AGREEMENT. SWIB shall have delivered to the
Holders a fully executed counterpart of the Intercreditor Agreement, in form
and substance satisfactory to the Holders and their special counsel.
5
<PAGE> 36
(J) LIEN SEARCHES. The Company shall have delivered to the Holders
Lien searches showing that the Property of the Company and its Subsidiaries is
subject to no Liens other that Liens permitted under Section 5.7 of the Amended
Note Agreement.
(K) CERTIFICATES OF INSURANCE. The Company shall have delivered to
the Holders certificates of insurance evidencing the insurance required by
Section 3G of the Security Agreement, showing the Holders and SWIB as loss
payees (as their interests may appear) thereunder.
(L) EXPENSES. The Company shall have paid all costs and expenses of
the Holders relating to this Amendment and the Security Documents in accordance
with Section 8.
(M) PROCEEDINGS SATISFACTORY. All proceedings taken in connection
with the execution and delivery of this Amendment and the transactions
contemplated hereby shall be satisfactory to the Holders and their special
counsel; and the Holders and their special counsel shall have received copies
of such documents and papers as they may reasonably request in connection
therewith.
SECTION 4. AMENDMENTS TO EXISTING NOTE AGREEMENT.
(A) SECTION 5.6. Clauses (a)(3) and (a)(4) of Section 5.6 of the
Existing Note Agreement are hereby amended and restated in their entirety to
read as follows:
(3) Funded Debt of the Company and its Subsidiaries from time
to time outstanding under the Credit Agreement in an aggregate
principal amount not exceeding $65,000,000 and renewals, extensions,
refundings and replacements thereof, provided that any renewal,
extension, refunding or replacement of such Funded Debt in excess of
$65,000,000 shall be deemed to constitute the issuance of new Funded
Debt subject to the limitations of Section 5.6(a)(4);
(4) additional Funded Debt of the Company and its
Subsidiaries, provided that at the time of issuance thereof and after
giving effect thereto and to the application of the proceeds thereof,
Consolidated Funded Debt would not exceed 65% of Consolidated Total
Capitalization if such time is prior to May 1, 1996, and if such time
is in any fiscal quarter of the Company thereafter, a percentage of
Consolidated Total Capitalization determined by substracting from 65%,
.5% for each fiscal quarter ending after April 30, 1996 (so that the
applicable percentage would be 64.5% for the fiscal quarter ending
June 30, 1996, 64% for the fiscal quarter ending September 30, 1996,
and so on), except that such percentage shall not be decreased to less
than 60% of Consolidated Total Capitalization;
(B) SECTION 5.6. Section 5.6 of the Existing Note Agreement is hereby
amended by adding a new clause (d) which shall read as follows:
(d) The Company will not permit the sum of (i) the aggregate
amount of Indebtedness secured by Liens described in Section 5.7(j)
outstanding at any time, plus (ii) the aggregate amount of unsecured
Indebtedness of Subsidiaries outstanding at such time, to exceed 15%
of Consolidated Tangible Net Worth at such time.
6
<PAGE> 37
(C) SECTION 5.7. Clause (h) of Section 5.7 of the Existing Note
Agreement is hereby amended and restated in its entirety so that the same shall
read as follows:
(h) Liens (i) on the Current Asset Collateral securing the
Indebtedness referred to in Section 5.6(a)(3) and (ii) on all Property
of the Company and its Subsidiaries other than the Current Asset
Collateral securing the Notes and other Indebtedness as described in
the Security Agreement;
(D) SECTION 5.8. Section 5.8 of the Existing Note Agreement is
hereby amended and restated in its entirety so that the same shall read as
follows:
5.8. Maintenance of Consolidated Tangible Net Worth. The
Company will at all times maintain Consolidated Tangible Net Worth of
no less than $45,000,000, which amount shall be increased on the first
day of each fiscal quarter of the Company, beginning July 1, 1995, by
an amount equal to 50% of Consolidated Net Income (but not less than
zero) for the immediately preceding fiscal quarter than most recently
ended.
(E) SECTION 5.10. Section 5.10 of the Existing Note Agreement is
hereby amended by
(1) amending and restating clause (c) in its entirety so
that the same shall read as follows:
(c) subject to the last paragraph of this Section
5.10, in addition to transactions permitted by subsections (a)
or (b), the Company may sell, lease, transfer or otherwise
dispose of assets (a "Transfer") if such Transfer does not
involve a Substantial Portion of the assets of the Company and
its Subsidiaries;
and (2) amending and restating clause (f) in its entirety so
that the same shall read as follows:
(f) subject to the last paragraph of this Section
5.10, in addition to the transactions permitted by
subsections (a), (b), (c), (d) or (e), the Company may sell,
lease or otherwise dispose of assets within the limitations of
Section 3D of the Security Agreement.
(F) SECTION 5.11. Clause (c) of Section 5.11 of the Existing Note
Agreement is hereby amended by deleting the reference to "Section 5.6" therein
and replacing it with "Section 5.6(a)(3)."
(G) SECTION 5.15. Section 5 of the Existing Note Agreement is
hereby amended to add a new Section 5.15 which shall read as follows:
5.15 Subsidiaries. The Company will not permit the aggregate
amount of assets of all U.S. Subsidiaries to exceed $200,000 at any
time.
(H) SECTION 5.16. Section 5 of the Existing Note Agreement is
hereby amended to add a new Section 5.16 which shall read as follows:
7
<PAGE> 38
5.16. Transactions with Subsidiaries. The Company will not enter
into any transaction, including, without limitation, the purchase, sale, lease
or exchange of any Property, or the rendering of any service, with any
Subsidiary, except in the ordinary course of and pursuant to the reasonable
requirements of the Company's business and upon fair and reasonable terms not
materially less favorable to the Company than would be obtained in comparable
arm's-length transaction with a Person not a Subsidiary.
(I) SECTION 6.1. Section 6.1 of the Existing Note Agreement is
hereby amended by
(1) amending and restating clause (d) so that the same
shall read as follows:
(d) (i) Default shall occur in the performance or
observance of any covenant or agreement contained in (x) any indenture,
agreement or other instrument under which any Indebtedness of the
Company in excess of $3,000,000 in the aggregate is outstanding (other
than IRB Indebtedness) or (y) any agreement or other instrument under
which any IRB Indebtedness is outstanding and any such default shall
result in acceleration of the maturity of any Indebtedness evidenced
thereby or outstanding or secured thereunder, or (ii) any event of
default shall occur under the Credit Agreement, any of the Other
Agreements, or any Security Document; or
and (2) amending and restating clause (e) so that the same shall read
as follows:
(e) Default shall occur in the observance or performance of
any covenant or agreement contained in Section 5.5, 5.6, 5.7, 5.8, 5.9,
5.10, 5.11, 5.15 or 5.16 hereof; or Default shall occur in the
performance or observance of any other covenant or agreement contained
in this Agreement which is not remedied within thirty days after the
earlier of: (1) the date on which such Default shall first become known
to a Responsible Financial Officer of the Company, or (2) written
notice thereof to the Company by the holder of any Note, which notice
shall specify the Default to be remedied and state that it is a notice
hereunder; or
(J) SECTION 8.1. Section 8.1 of the Existing Note Agreement is
hereby amended by amending the definitions of "Consolidated Tangible Net
Worth," "Funded Debt," "Intercreditor Agreement," "Lenders," "Other Agreements"
and "Security Agreement" in their entirety to read as follows:
"Consolidated Tangible Net Worth" shall mean, as of the date of
any determination thereof, Consolidated Net Worth as of such date minus
the amount of all Intangible Assets of the Company and its Subsidiaries
as of such date, determined on a consolidated basis in accordance with
GAAP.
"Funded Debt" with respect to any Person shall mean all
indebtedness for borrowed money of such Person maturing by its terms
more than one year after, or which is renewable or extendible at the
option of such Person for a period ending one year or more after, the
date of determination, and shall include indebtedness for borrowed
money of such maturity created, assumed or guaranteed by such Person
either directly or indirectly, including obligations of such maturity
secured by liens upon Property of such
8
<PAGE> 39
Person and upon which such entity customarily pays the interest, all
current maturities of all such indebtedness of such maturity and all
rental payments under Capitalized Leases of such maturity, and
including, in the case of the Company, the lesser of the amount
outstanding under the Credit Agreement as of the date of determination
or the amount that is not required to be prepaid at such time
pursuant to Section 7.25 of the Credit Agreement.
"Intercreditor Agreement" shall mean the Intercreditor
Agreement dated as of May 31, 1995, by and among the Lenders, as from
time to time amended, modified or supplemented.
"Lenders" shall mean the holders of the Notes and the holders
of the Company's 9.49% Senior Notes due December 15, 2001.
"Other Agreements" shall mean any and all agreements,
instruments and documents (other than the Security Documents),
heretofore, now or hereafter executed by the Company and delivered to
the holders of the Notes, or to any agent appointed to act on behalf of
the holders of the Notes, in respect to the transactions contemplated
by this Agreement.
"Security Agreement" shall mean the Security Agreement dated as
of May 31, 1995, by and among the Company and the Lenders, as from time
to time amended, modified or supplemented, including, without
limitation, any amendment or supplement pursuant to which an agent or
trustee is appointed to act on behalf of the Notes and any other
Indebtedness secured by the Security Agreement.
(K) NEW DEFINITIONS. Section 8.1 of the Existing Note Agreement is
hereby amended to add the following definitions in appropriate alphabetical
order:
"Assignment of Contracts, Warranties and Permits" shall mean
the Assignment of Contracts, Warranties and Permits dated as of May 31,
1995, entered into by the Company for the benefit of the Lenders, as
from time to time amended, modified or supplemented.
"Consolidated Net Worth" shall mean, as of the date of any
determination thereof, Total Assets as of such date minus Total
Liabilities as of such date, determined on a consolidated basis in
accordance with GAAP.
"Credit Agreement" shall mean the Secured Credit Agreement
dated as of May 22, 1995 (the "Credit Agreement") entered into by and
among the Company, Harris Trust and Savings Bank ("Harris Bank") and
the other lenders referred to therein (collectively, along with their
respective successors and assigns, the "Short-Term Lenders"), and
Harris Bank, as agent for the Short-Term Lenders.
"Current Asset Collateral" is defined in Section 5 of the Third
Amendment.
"Disposition Value" shall mean, as of the date of any
determination thereof, with respect to any assets,
9
<PAGE> 40
(a) in the case of any asset that does not constitute
Subsidiary Stock, the book value, thereof, valued at the time of such
disposition in good faith by the Company, and
(b) in the case of any asset that constitutes Subsidiary
Stock, an amount equal to that percentage of the book value of the
assets of the Subsidiary that issued such stock as is equal to the
percentage that the book value of such Subsidiary Stock represents of
the book value of all of the outstanding capital stock of such
Subsidiary (assuming, in making such calculations, that all Securities
convertible into such capital stock are so converted and giving full
effect to all transactions that would occur or be required in
connection with such conversion) determined at the time of the
disposition thereof, in good faith by the Company.
"Intangible Assets" shall mean license agreements, trademarks, trade
names, patents, capitalized research and development, proprietary products (the
results of past research and development treated as long-term assets and
excluded from inventory), goodwill and all other Property which would be
considered to be intangible under GAAP.
"Partial Release" is defined in Section 5 of the Third Amendment.
"Subsidiary Stock" shall mean, with respect to any Person, the stock
(or any options or warrants to purchase stock or other Securities exchangeable
for or convertible into stock) of any Subsidiary of such Person.
"Substantial Portion" shall mean, with respect to any Transfer of
assets, any portion of assets of the Company and its Subsidiaries, if
(a) the Disposition Value of such assets, when added to the
Disposition Value of all other assets of the Company and its
Subsidiaries that were subject to a Transfer (other than pursuant to
clause (a) or clause (b) of Section 5.10) during the period beginning
on the first day of such fiscal year and ending on and including the
date of the Transfer of such assets, exceeds an amount equal to 10% of
Consolidated Total Assets determined as of the end of the then most
recently ended fiscal quarter of the Company, or
(b) the Disposition Value of such assets, when added to the
Disposition Value of all other assets of the Company and its
Subsidiaries that were subject to a Transfer (other than pursuant to
clause (a) or clause (b) of Section 5.10) during the period beginning
on the Closing Date and ending on and including the date of the
Transfer of such assets, exceeds an amount equal to 25% of Consolidated
Total Assets determined as of the end of the then most recently ended
fiscal quarter of the Company.
"Third Amendment" shall mean the Third Amendment to Note Agreement
dated May 31, 1995, by and among the Company and the holders of the Notes.
10
<PAGE> 41
"Total Assets" shall mean, as of the date of any determination
thereof, the aggregate amount of assets of the Company and its
Subsidiaries as of such date, determined on a consolidated basis in
accordance with GAAP.
"Total Liabilities" shall mean, as of the date of any
determination thereof, the aggregate amount of liabilities of the
Company and its Subsidiaries as of such date, determined on a
consolidated basis in accordance with GAAP.
"Transfer" is defined in Section 5.10.
"U.S. Subsidiaries" shall mean, all Subsidiaries organized and
existing under the laws of the United States or any state thereof.
SECTION 5. CONSENT TO PARTIAL RELEASE
Subject to satisfaction of the conditions set forth in Section 3, the
Holders hereby consent to the release of the Lien on and security interest in
the following described property and interest in such property (collectively,
the "Current Asset Collateral") heretofore granted to Bank One as agent for the
Holders (the "Partial Release"):
(a) Receivables. Receivables of the Company and its
Subsidiaries, whether now existing or hereafter arising, and however
evidenced or acquired, or in which the Company or any Subsidiary now
has or hereafter acquires any rights (the term "Receivables" means and
includes accounts, accounts receivable, contract rights, instruments,
notes, drafts, acceptances, documents, chattel paper, general
intangibles, any right of the Company or any such Subsidiary to payment
for goods sold or leased or for services rendered, whether arising out
of the sale of Inventory (as hereinafter defined) or otherwise and
whether or not earned by performance, and all other forms of
obligations owing to the Company or any such Subsidiary, and all rights
of the Company or any such Subsidiary to any merchandise (including
without limitation any returned or repossessed goods and the right of
stoppage in transit) which is represented by, arises from or is related
to any of the foregoing); provided that the term "Receivables" shall
not include the "Collateral" (as defined in the Assignment of
Contracts, Warranties and Permits as in effect on the date hereof):
(b) Inventory. Inventory of the Company and its
Subsidiaries, whether now owned or hereafter acquired, and all
documents of title at any time evidencing or representing any part
thereof (the term "Inventory" means and includes all goods which are
held for sale or lease or are to be furnished under contracts of
service, or which are raw materials, work-in-process, finished goods,
materials and supplies of every nature used or usable in connection
with the manufacture, processing, supply, servicing, storing, packing,
shipping, advertising, selling, leasing or furnishing of such goods and
any constituents or ingredients thereof, and returned or repossessed
goods, and all of the Company's or such Subsidiary's right, title and
interest in and to all trademarks, trademark registrations, trademark
licenses, trade names, trade styles, patents, patent applications,
patent licenses and similar properties, rights, interests and
privileges used or usable in connections with, or in any way related to
or being a part of, any of the foregoing), and without limiting the
foregoing, all of the Company's inventory of
11
<PAGE> 42
fresh vegetables and canned and frozen vegetables produced or
acquired in the ordinary course of business:
(c) Deposits and Property in Possession. All deposit
accounts and investment accounts (whether general, specific or
otherwise) of the Company and its Subsidiaries and all sums now or
hereafter in possession of any of the Short-Term Lenders or Harris
Bank, as agent for the Short-Term Lenders, or any agent or affiliate of
any of them, in any way and for any purpose (whether for safekeeping,
custody, pledge, transmission, collection or otherwise), other than
proceeds of the disposition of Property of the Company securing the
Notes;
(d) Records and Cabinets. Supporting evidence and documents
relating to any of the above described property, including without
limitation, computer programs, discs, tapes and related electronic data
processing media, and all rights of the Company and its Subsidiaries to
retrieve the same from third parties, written applications, credit
information, account information, account cards, payment records,
correspondence, invoice copies, delivery receipts, notes and other
evidences of indebtedness, insurance certificates and the like,
together with all books of account, ledgers and cabinets in which the
same are reflected or maintained, all whether now existing or hereafter
arising; and
(e) Proceeds and Products. All proceeds and products of the
foregoing and all insurance of the foregoing and proceeds thereof,
whether now existing or hereafter arising.
Bank One shall be entitled to rely upon the consent set forth herein
and is hereby authorized to execute all such documents, instruments and
financing statements as are reasonably requested by the Lenders in order to
effect the partial Release consented to herein.
SECTION 6. EFFECT OF AMENDMENT
If the foregoing is acceptable to you, please note your acceptance in
the space provided below. Upon the execution and delivery by the Company and
the Holders of one hundred percent (100%) in aggregate principal amount of the
outstanding Notes and the satisfaction of the conditions set forth in Section
3, the Existing Note Agreement shall be deemed to be amended as set forth above
and the Partial Release shall be deemed to be effective. This Amendment shall
be binding upon, and shall inure to the benefit of, the successors and assigns
of the parties hereto and the holders from time to time of the Notes. Except as
amended herein, the terms and provisions of the Existing Note Agreement are
hereby ratified, confirmed and approved in all respects.
SECTION 7. NO LEGEND REQUIRED.
Any and all notices, requests, certificates and other instruments
including, without limitation, the Notes, may refer to the Note Agreement or
the Note Agreement dated as of January 1, 1990 without making specific
reference to this Third Amendment to Note Agreement, but nevertheless all such
references shall be deemed to include this Third Amendment to Note Agreement
unless the context shall otherwise require.
12
<PAGE> 43
SECTION 8. FEES AND EXPENSES.
On the Effective Date, the Company shall pay all costs and expenses of
the Holders relating to this Amendment and the Security Documents, including,
but not limited to, the statement for reasonable fees and disbursements of the
Holders' special counsel presented to the Company on or prior to the Effective
Date. The Company will also pay, upon receipt of any statement thereof, (i)
each additional statement for reasonable fees and disbursements of the Holders'
special counsel rendered after the Effective Date in connection with this
Amendment, the Amended Note Agreement or the Security Documents, and (i) all
fees and expenses of any trustee which may be appointed pursuant to the
Intercreditor Agreement to act as agent for the Lenders for the purpose of
administration of collateral under the Security Documents. The obligations of
the Company under this Section 8 shall survive the termination of this
Amendment.
SECTION 9. SURVIVAL.
All warranties, representations, certifications and covenants made by
the Company in this Amendment or in any certificate or other instrument
delivered by it or on its behalf under this Amendment shall be considered to
have been relied upon by the Holders and shall survive the execution of this
Amendment, regardless of any investigation made by or on behalf of any Holder.
All statements in any such certificate or other instrument shall constitute
warranties and representations of the Company under this Amendment.
SECTION 10. DUPLICATE ORIGINALS; EXECUTION IN COUNTERPART.
Two or more duplicate originals of this Amendment may be signed by the
parties, each of which shall be an original but all of which together shall
constitute one and the same instrument. This Amendment may be executed in one
or more counterparts and shall be effective when at least one counterpart shall
have been executed by each party to this Amendment, and each set of
counterparts which, collectively, show execution by each such party to this
Amendment shall constitute one duplicate original.
SECTION 11. GOVERNING LAW.
This Amendment shall be governed by, and construed in accordance with,
internal Wisconsin law.
[Remainder of Page Intentionally Blank. Next Page is signature page.]
13
<PAGE> 44
IN WITNESS WHEREOF, the Company and the Holders have executed this
Amendment as of the date first above written.
STOKELY USA, INC.
By: ______________________________
Name:
Title:
NATIONWIDE LIFE INSURANCE COMPANY
By: ______________________________
Name:
Title:
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU
By: ______________________________
Name:
Title:
WEST COAST LIFE INSURANCE COMPANY
By: ______________________________
Name:
Title:
[Signature page to THIRD AMENDMENT TO NOTE AGREEMENT of STOKELY USA, INC.]
<PAGE> 45
ANNEX 1
(TO THIRD AMENDMENT)
[CAPTION]
<TABLE>
PRINCIPAL AMOUNT
NOTEHOLDER OF NOTES
- ---------- ----------------
<S> <C>
Nationwide Life Insurance Company
[$17,182,733.83]
Columbus, Ohio 43216
Employers Life Insurance Company of Wausau
[$2,514,546.42]
Columbus, Ohio 43216
West Coast Life Insurance Company
[$1,257,273.21]
Columbus, Ohio 43216
</TABLE>
Annex 1-1
<PAGE> 46
ANNEX 2
(TO THIRD AMENDMENT)
DESCRIPTION OF IRB INDEBTEDNESS
IRB Indebtedness of the Company and its Subsidiaries outstanding on the
date hereof is as follows:
[CAPTION]
<TABLE>
ISSUE COUPON/ DATED PRINCIPAL MATURES BALANCE DUE OUTSTANDING
RATE BALANCE
<S> <C> <C> <C> <C> <C> <C> <C>
DeForest (Town of Windsor) First Trust 6.000 01-Mar-85 1,500,000 01-Mar-95 0 0
1989 Poynette IRB NationsBK 7.750 01-Dec-89 1,600,000 01-Dec-2004 1,600,000 1,600,000
City of Jefferson IRB NationsBK 8.500 15-Dec-85 6,500,000 15-Dec-95 700,000 700,000
County of Paulding IRB Society 7.375 01-Jun-89 1,400,000 6/1/99-7/5/94 0 0
Port of Walla Walla IRB NationsBK 8.250 01-Sep-90 4,000,000 01-Sep-2002 2,500,000 4,000,000
8.500 01-Sep-2005 1,500,000
Scottville IRB (MI Job) First Trust 3.960 16-Oct-84 1,800,000 01-Oct-94 0 0
Pickett IRB (Town of Utica) NationsBK 7.750 01-Jun-90 3,000,000 01-Jun-2005 3,000,000 3,000,000
Appleton IRB First Trust 3.960 01-Dec-85 1,000,000 01-Jun-95 50,000 350,000
01-Jan-96 300,000
1988 Poynette Kraut IRB Norwest 8.000 01-Aug-88 6,000,000 01-Aug-98 1,065,000 4,645,000
8.500 01-Aug-2001 3,580,000
Green Bay IRB NationsBK 8.000 01-Dec-88 3,000,000 01-Dec-98 3,000,000 3,000,000
Waunakee IRB NationsBK 8.000 01-Dec-88 4,000,000 01-Jul-2001 1,000,000 4,000,000
01-Jul-2002 1,000,000
01-Jul-2003 1,000,000
01-Jul-2004 1,000,000
</TABLE>
Annex 2-1
<PAGE> 47
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
Ackley IA IRB Norwest 7.750 01-Jul-89 3,000,000 01-Jul-2002 1,000,000 3,000,000
01-Jul-2004 1,000,000
01-Jul-2005 1,000,000
City of Wells First Trust 4.050 01-Dec-91 3,000,000 01-Dec-95 150,000 2,550,000
01-Dec-96 150,000
01-Dec-97 150,000
01-Dec-98 150,000
01-Dec-99 150,000
01-Dec-2000 150,000
01-Dec-2001 150,000
01-Dec-2002 150,000
01-Dec-2003 150,000
01-Dec-2004 150,000
01-Dec-2005 150,000
01-Dec-2006 150,000
01-Dec-2007 150,000
01-Dec-2008 150,000
01-Dec-2009 150,000
01-Dec-2010 150,000
01-Dec-2011 150,000
</TABLE>
Annex 2-2
<PAGE> 48
ANNEX 3
(TO THIRD AMENDMENT)
DESCRIPTION OF PENDING LITIGATION
Annex 3-1
<PAGE> 49
DELETIONS
DEBT
ORIGINAL OUTSTANDING
CREDITOR SECURITY DEBT 5-15-90
Exhibit C-6
<PAGE> 50
Marked to show changes for draft dated 05/09/95
05/23/95
DRAFT
ASSIGNMENT OF CONTRACTS, WARRANTIES AND PERMITS
THIS ASSIGNMENT OF CONTRACTS, WARRANTIES AND PERMITS (this
"Assignment"), made as of May 31, 1995, by STOKELY USA, INC., a Wisconsin
corporation (the "Assignor").
W I T N E S S E T H
WHEREAS, Nationwide Life Insurance Company, Employers Life Insurance
Company of Wausau and West Coast Life Insurance Company (collectively being
hereinafter called the "Insurance Companies") and the Assignor are parties to a
Note Agreement, dated as of January 1, 1990, as amended by an Amendment to Note
Agreement dated August 18, 1992, a Second Amendment to Note Agreement dated
June 11, 1993, and a Third Amendment to Note Agreement dated May 31, 1995 (said
Note Agreement, as so amended, and as further amended, modified or supplemented
from time to time, is hereinafter referred to as the "Nationwide Note
Agreement"), pursuant to which the Assignor has issued its 9.37% Senior Secured
Notes due January 15, 2000 (collectively, together with any other notes issued
pursuant to the Nationwide Note Agreement, the "Nationwide Notes"); and
WHEREAS, State of Wisconsin Investment Board ("SWIB") and the Assignor
are parties to a Note Agreement, dated as of December 1, 1991, as amended by a
First Amendment to Note Agreement dated as of August 18, 1992, a Second
Amendment to Note Agreement dated as of June 11, 1993, and a Third Amendment to
Note Agreement dated as of May 31, 1995 (said Note Agreement, as so amended,
and as further amended, modified or supplemented from time to time, is
hereinafter referred to as the "SWIB Note Agreement"), pursuant to which the
Assignor has issued a certain 9.49% Senior Note due December 15, 2001
(collectively, together with any other notes issued pursuant to the SWIB Note
Agreement, the "SWIB Notes"); and
WHEREAS, the Insurance Companies and SWIB (collectively being
hereinafter called the "Assignees") have entered into an Intercreditor and
Collateral Agency Agreement, dated as of even date herewith (the "Intercreditor
Agreement"); and
WHEREAS, in order to secure the prompt and complete payment, observance
and performance of the Nationwide Notes, the SWIB Notes, and all of the other
Obligations (as hereinafter defined), the Assignor has given to, and for the
ratable benefit of, the Assignees, certain Mortgages/Deeds of Trust, each dated
as of even date herewith (the "Mortgages"), encumbering certain land described
on Annex 1 attached hereto (such land, together with the buildings and other
improvements located or to be located thereon, collectively being hereinafter
called the "Properties"); and
<PAGE> 51
WHEREAS, in order further to secure the prompt and complete payment,
observance and performance of the Obligations, the Assignees have required that
the Assignor execute and deliver this Assignment.
NOW, THEREFORE, FOR VALUE RECEIVED, the Assignor hereby absolutely and
unconditionally, grants, transfers and assigns, to the extent transferable, to,
and for the ratable benefit of, the Assignees, their successors and assigns:
(A) all issues and profits from the Properties; and
(B) all other right, title and interest of the Assignor in and to:
(i) any and all agreements and contracts, now in existence
or hereafter executed, for the operation, construction, management,
selling, leasing (to the extent not assigned under the Mortgages from
the Assignor to the Assignees) and maintenance of the Properties; and
(ii) any leases of, or maintenance or service agreements or
contracts, now in existence or hereafter executed, with respect to
furniture, furnishings or equipment now owned or hereafter acquired and
located on and used in the operation, management, sale or maintenance
of the Properties or the operation or management of the Assignor's
business; and
(iii) all permits, licenses, governmental approvals and
authorizations, now owned or hereafter acquired, relating to the
operation or management of the Assignor's business, the construction of
any improvements on the Properties, or the operation thereof
(collectively, the "Permits"); and
(iv) any extensions, renewals or modifications of collateral
described in clauses (i), (ii) and (iii) above, and any guarantees, now
or hereafter owed the Assignor, relating to the obligations described
in clause (i) or clause (ii) above; and
(v) all warranties and guaranties now or hereafter received
by, or in favor of, the Assignor regarding materials, equipment and
other items of personal property supplied to, and services performed in
respect of, the Properties, or any portion thereof, or any improvements
thereto, or any portion thereof; and
(vi) all proceeds of any of the foregoing or substitutes
therefor.
Each and all of said agreements described in clauses (i), (ii), (iv)
and (v), together with the Permits, are hereinafter referred to singularly as
the "Contracts," the payments, if any, due the Assignor thereunder are
collectively hereinafter referred to as the "Proceeds" and the Contracts, the
Proceeds and the Permits are collectively hereinafter referred to as the
"Collateral." Notwithstanding the foregoing, the term "Contracts" shall not
include any agreement or contract the assignment or transfer of which, for
collateral purposes, would result in a default or require, or cause a
forfeiture, or permit a revocation, of rights under such contract or agreement.
All capitalized terms not otherwise defined herein (including, but not limited
to, the terms "Loan Documents" and "Obligations") have the meanings assigned
to such terms in the
2
<PAGE> 52
Security Agreement, dated as of even date herewith, by and among the Assignor
and the Assignees (the "Security Agreement").
FOR THE PURPOSES OF SECURING: payment, performance and discharge of
the Obligations.
THE ASSIGNOR AGREES WITH RESPECT TO EACH CONTRACT THAT:
1. (a) The Assignor will give prompt written notice to
the Assignees of any notice received by the Assignor of a default by
the Assignor under any Contract, together with a complete copy of any
such notice; and
(b) The Assignor will, to the fullest extent commercially
reasonable to do so:
(i) perform or observe each and every material
covenant and condition of the Assignor to be performed or
observed under each Contract;
(ii) at the cost and expense of the Assignor,
enforce, short of termination of any Contract, the performance
or observance of each and every material covenant and condition
of each Contract to be performed or observed by the other
parties thereto, to the fullest extent commercially reasonable
to do so;
(iii) not modify or in any way alter the terms of any
Contract, except to the extent permitted by the terms of the
Mortgages;
(iv) not terminate the term of any Contract or
accept a surrender thereof if such termination or surrender,
together with the termination or surrender of all other
Contracts terminated or surrendered at such time or
contemplated by the Assignor to be terminated or surrendered in
the future, could materially and adversely affect the
Properties, business or financial condition of the Assignor;
and
(v) not waive or release the other parties thereto
from any material obligations or conditions by them to be
performed under any Contract, if such waiver or release,
together with all other waivers and releases of any parties
under all other Contracts at such time or contemplated by the
Assignor to be waived or released in the future, could
materially and adversely affect the Properties, business or
financial condition of the Assignor.
2. The rights assigned hereunder include all of the Assignor's
right and power to modify or terminate the Contracts or to accept a surrender
or termination thereof, or to waive or release the other parties from the
performance or observance by them of any obligation or condition thereof;
provided, however, that the Assignees may not, and the Assignor may, to the
extent permitted by the terms of the Mortgages, exercise any such rights and
powers described in this Assignment so long as no Event of Default (as
hereinafter defined) shall have occurred and be continuing.
3
<PAGE> 53
3. The Assignor, at its sole cost and expense, will appear in and
prosecute its claims and defend its rights in any action growing out of or in
any manner connected with the Contracts or the obligations or liabilities of
the Assignor, other parties or any guarantor thereunder, and any Assignee, if
made a party to any such action, may employ counsel and incur and pay
reasonable costs and expenses including, without limitation, reasonable
attorneys' fees, and all such sums, with interest at the annual rate of four
and one-quarter percent (4.25%) plus the Bank One reference rate as announced
from time to time by Bank One, shall be due from the Assignor upon demand and
secured hereby and by the Mortgages.
4. If the Assignor shall fail to make any payment required to be
made, or to perform or observe any covenant or condition required to be
performed or observed, under any Contract as herein provided, then the
Assignees, but without obligation so to do and without notice to or demand on
the Assignor and without releasing the Assignor from any obligation herein, may
make, perform or observe the same, including specifically, without limiting
their general powers, appearing in and defending any action purporting to
affect the security hereof or the rights or powers of the Assignees, and
performing or observing any covenant or condition in such Contract contained,
and in exercising any such powers, paying reasonable costs and expenses,
employing counsel and incurring and paying reasonable attorneys' fees and
expenses; and the Assignor will pay immediately upon demand all sums expended
by the Assignees under the authority hereof, together with interest thereon at
the annual rate of four and one-quarter percent (4.25%) plus the Bank One
reference rate as announced from time to time by Bank One, and the same shall
be added to said Obligations and shall be secured hereby and by the Mortgages.
Notwithstanding anything contained herein to the contrary, if the Assignees
elect to exercise the rights granted hereunder, the Assignees shall endeavor to
notify the Assignor of the election to exercise such rights prior to the
exercise thereof; provided, however, the failure by the Assignees to so notify
the Assignor, or the Assignor's failure to receive such notice, shall not
affect the Assignees' rights under this Section 4.
5. Upon the occurrence of any Event of Default, the Assignees, at
their option, without notice and without regard to the adequacy of the security
for the Obligations, with or without bringing any action or proceeding, or by a
receiver to be appointed by a court, may:
(a) notify parties to the Contracts that such Contracts
have been assigned to the Assignees and that performance thereunder
shall be made on behalf of the Assignees;
(b) enter upon, take possession of, and operate the
Properties;
(c) make, enforce, modify, terminate and accept any
surrender of any Contract;
(d) perform any acts which the Assignees deem proper to
protect the security hereof until all Obligations are paid in full; and
(e) either with or without taking possession of the
Properties, in the name of the Assignees, sue for or otherwise collect
and receive all Proceeds, and apply the same, less reasonable costs and
expenses of operation and collection including, without
4
<PAGE> 54
limitation, reasonable attorneys' fees and expenses, to pay the
Obligations in such order as the Assignees may determine.
The entering upon and taking possession of the Properties, the collection of
such proceeds and the application thereof as aforesaid shall not cure or waive
any Event of Default under (and as defined in) any of the Loan Documents or
waive, modify or affect any notice of an Event of Default under (and as defined
in) any of the Loan Documents or invalidate any act performed pursuant to such
notice.
6. The Assignees and the purchaser at any foreclosure sale shall
have the right, but not the obligation, to preserve any Contract and the rights
of the Assignor thereunder.
7. The Assignor warrants that as of the date hereof:
(a) each Contract (excluding the Permits) is a bona fide,
valid and legally enforceable obligation of the Assignor, and all
consents, licenses, approvals or authorizations of, or declarations
with any governmental authority required to be obtained, effected or
given in connection with the execution, delivery and performance of any
Contract by the Assignor have been duly obtained, effected or given,
are in full force and effect and do not subject the scope of such
Contract to any materially adverse limitation, either specific or
general in nature;
(b) the Permits are in full force and effect;
(c) the Assignor has not executed any prior assignment of
any of its rights under the Collateral;
(d) the Assignor has not done anything which might prevent
the Assignees from, or limit the Assignees in, operating under any of
the provisions hereof; and
(e) no defaults have occurred and are continuing under the
Contracts which, in the aggregate, could reasonably be expected to have
a material adverse effect upon the business, prospects, profits,
Properties or condition (financial or otherwise) of the Company.
8. The occurrence of any of the following shall be and constitute
an "Event of Default" hereunder:
(a) the Assignor shall fail to make, when due, the payment
of any amount due under this Assignment; or
(b) the Assignor shall fail to perform or observe, or cause
to be performed or observed, (i) any covenant or condition contained in
Section 1, Section 2, Section 3 or Section 9(c) of this Agreement, and
such failure shall continue for a period of five (5) days, or (ii) any
other covenant or condition contained in this Agreement, and such
failure shall continue for a period of twenty (20) days, in either case
after the earlier of (a) receipt of notice thereof from any Assignee or
(b) the date an officer of the Assignor learns of such default; or
5
<PAGE> 55
(c) the occurrence of an "Event of Default" as defined in
the Security Agreement; or
(d) any representation or warranty made by the Assignor in
this Assignment, or in any certificate furnished by or on behalf of the
Assignor in connection with the consummation of the transactions
contemplated hereby, shall be untrue in any material respect as of the
date of the issuance or making thereof.
9. The Assignor covenants and agrees with the Assignees that from
and after the date of this Assignment and until the termination of this
Assignment pursuant to Section 11:
(a) At any time and from time to time, upon written request
of the Assignees, and at the sole expense of the Assignor, the Assignor
shall promptly and duly execute and deliver any and all such further
instruments and documents and take such further action as the Assignees
may reasonably deem desirable in obtaining the full benefits of this
Assignment and of the rights and powers herein granted.
(b) The Assignor shall keep and maintain, at its own cost
and expense, satisfactory and complete records of all payments made and
received under the Contracts. For the Assignees' further security, the
Assignor agrees that the Assignees shall have a special property
interest in all of the Assignor's books and records pertaining to the
contract accounts and the Assignor shall make available any books and
records to the Assignees or to their representatives, at any reasonable
time on reasonable notice; provided that after the occurrence of an
Event of Default hereunder, no such notice shall be required.
(c) In any suit, proceeding or action brought by the
Assignees under any Contract to enforce any provisions of such
Contract, the Assignor will save, indemnify and keep the Assignees
harmless from and against all reasonable expenses, losses or damages
suffered by reason of any defense, setoff, counterclaim, recoupment or
reduction of liability whatsoever of the obligee thereunder, except in
respect of any such matter arising out of the Assignees' bad faith,
gross negligence or wilful misconduct (provided that such bad faith,
gross negligence or wilful misconduct is determined to have occurred by
a final and nonappealable decision of a court of competent
jurisdiction) arising out of any other agreement, indebtedness or
liability at any time owing to or in favor of such obligee or its
successors from the Assignor, and all such obligations of the Assignor
shall be and remain enforceable against, and only against, the
Assignor, and shall not be enforceable against the Assignees.
(d) The Assignor shall, except to the extent otherwise
permitted under the terms of the Mortgages and except with respect to
claims that do not give rise to a statutory lien on the Properties and
for which the Assignor is disputing in a commercially reasonable
manner, pay promptly when due all claims of any kind under the
Contracts (including claims for labor, materials and supplies).
(e) The Assignor shall comply, in all material respects,
with all acts, rules, regulations, orders, decrees and directions of
any governmental authority applicable to the operation of the
Assignor's business.
6
<PAGE> 56
10. If an Event of Default shall have occurred and be continuing,
the Assignees or their representatives may communicate at any time and from time
to time with parties to the Contracts in order to verify, to the Assignees'
satisfaction, the existence and terms of the Contracts.
11. Upon the payment in full of all Obligations, as evidenced by
the recording of an instrument of reconveyance, satisfaction, release or
assignment of the Mortgages without the recording of another mortgage in favor
of, or for the benefit of, the Assignees encumbering the Properties, this
Assignment shall be released and terminated.
12. The Assignor hereby irrevocably constitutes and appoints each
Assignee, and any officer or agent thereof, with full power of substitution, as
its true and lawful attorneys-in-fact with full irrevocable power and authority
in the place and stead of the Assignor and in the name of the Assignor or in
such Assignee's own name, from time to time, after an Event of Default, at the
discretion of the Assignees, for the purpose of carrying out the terms of this
Assignment, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Assignment. The Assignor hereby ratifies all that said
attorneys shall lawfully do or cause to be done by virtue hereof. This power
of attorney is a power coupled with an interest and shall be irrevocable.
13. Any notices to be delivered hereunder shall be delivered in
accordance with the terms of the Security Agreement.
14. The Assignees shall not by any act, delay, omission, or
otherwise, be deemed to have waived any of their rights or remedies hereunder
and no waiver shall be valid unless in writing, signed by the Required
Lenders, and then only to the extent therein set forth. A waiver by the
Assignees of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Assignees would otherwise
have had on any future occasion. No failure to exercise, nor any delay in
exercising, on the part of the Assignees, any right, power or privilege
hereunder, shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
future exercise thereof or the exercise or any other right, power or privilege.
The rights and remedies hereunder provided are cumulative and may be exercised
singly or concurrently at law.
15. This Assignment and all obligations of the Assignor hereunder
shall be binding upon the successors and assigns of the Assignor, and shall,
together with the rights and remedies of the Assignees hereunder, inure to the
benefit of the Assignees and their successors and assigns. This Assignment
shall be governed by, and be construed and interpreted in accordance with, the
laws of the State of Wisconsin.
16. Any provision of this Assignment which is prohibited or
unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.
17. The Assignor agrees to pay, and to save the Assignees harmless
from, any and all liabilities with respect to, or resulting from any delay in
paying, any and all excise, sales or other taxes which may be payable or
determined to be payable in connection with any of the transactions
contemplated by this Assignment.
7
<PAGE> 57
18. THE ASSIGNOR IRREVOCABLY AGREES THAT, SUBJECT TO THE SOLE AND
ABSOLUTE ELECTION OF THE ASSIGNEES, ALL SUITS, ACTIONS OR OTHER PROCEEDINGS IN
ANY WAY, MANNER OR RESPECT ARISING OUT OF OR FROM OR RELATED TO THIS
ASSIGNMENT, OR ANY DOCUMENTS EXECUTED IN CONNECTION HEREWITH, SHALL BE SUBJECT
TO LITIGATION IN COURTS HAVING SITUS WITHIN MILWAUKEE, WISCONSIN. THE ASSIGNOR
HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR FEDERAL
COURT LOCATED WITHIN MILWAUKEE, WISCONSIN. THE ASSIGNOR HEREBY WAIVES ANY
RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY SUIT, ACTION OR OTHER
PROCEEDING BROUGHT AGAINST THE ASSIGNOR BY THE ASSIGNEES IN ACCORDANCE WITH
THIS SECTION. THE ASSIGNOR AND THE ASSIGNEES EACH HEREBY WAIVE, TO THE EXTENT
PERMITTED BY LAW, TRIAL BY JURY. THE ASSIGNOR FURTHER WAIVES ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED
OF THE ASSIGNEES.
[Remainder of page intentionally blank. Next page is signature page.]
8
<PAGE> 58
IN WITNESS WHEREOF, the Assignor has duly executed this
Assignment the day and year first above written.
STOKELY USA, INC.
By:______________________________
Its
Address: 1055 Corporate Center Dr.
Oconomowoc, WI 53066
[Signature page for ASSIGNMENT OF CONTRACTS, WARRANTIES AND PERMITS
of STOKELY USA, INC.]
<PAGE> 59
ANNEX 1
REAL PROPERTY PARCELS
Annex 1-1
<PAGE> 60
- --------------- DELETIONS ---------------
____
____
____
Notwithstanding
forfeiture
agreement
without the consent of the Assignees, which consent will not be unreasonably
withheld, unless such surrender is required by the terms of such Contract
parties thereto
The
Deletions - 1
<PAGE> 1
STATE OF WISCONSIN INVESTMENT BOARD
STOKELY USA, INC.
1995 LOAN RESTRUCTURING
<PAGE> 2
DOCUMENTS
Only the main documents are contained in this volume. They include:
1. Third Amendment to Note Agreement, amending the original SWIB Note
Agreement.
2. Intercreditor and Collateral Agency Agreement among SWIB and the
Nationwide group.
3. Security Agreement from Stokely to Fixed Asset Lenders.
4. Environmental Indemnification Agreement from Stokely to Fixed Asset
Lenders.
5. Assignment of Contracts, Warranties and Permits from Stokely to Fixed
Asset Lenders.
6. Mortgage, specimen form (Waunakee, Wisconsin).
7. Deed of Trust, specimen form (Hoopeston, Illinois), as recorded.
8. List of Mortgage/Deed of Trust locations.
9. Certificate of Officers.
10. Certificate of Secretary.
11. Opinion of Counsel to Borrower.
12. Certificates of Insurance Coverage.
13. Old Lenders' Release (Bank One Letter).
14. Old Lenders' Consent (Shawmut Capital Letter).
15. Third Amendment to Note Agreement, amending the original Nationwide
Note Agreement.
16. Secured Credit Agreement for Current Asset Lenders.
<PAGE> 3
ANNEX A
ARTICLE VI
REPURCHASE OF COMMON STOCK
6.1 REPURCHASE RIGHTS.
6.1.1. In the event that any person (Acquiring Person) (i) who is the
beneficial owner, directly or indirectly, of fifty percent (50%) or more of the
Common Stock then outstanding and any of such Common Stock was acquired
pursuant to a tender offer, each holder of Common Stock shall have the right,
until and including the ninetieth (90th) day following the date the notice to
holders of Common Stock referred to in Section 6.3 herein is mailed, to have
the Common Stock held by such holder repurchased by the Corporation at the
Repurchase Price determined as provided in Section 6.5 herein, and each holder
of securities convertible into Common Stock or of options, warrants or rights
exercisable to acquire Common Stock prior to such thirtieth (30th) day shall
have the right simultaneously with the conversion of such securities or
exercise of such options, warrants or rights to have the Common Stock to be
received by such holder repurchased by the Corporation at the Repurchase Price.
6.1.2. All repurchase rights hereunder shall be subject to, and
limited by, any provision contained in the Wisconsin Business Corporation Law
which limits the amounts which may be used by the Corporation to repurchase its
Common Stock.
6.1.3. No holder of Common Stock of the Corporation shall have any
right to have Common Stock repurchased by the Corporation pursuant to this
Article VI if the Corporation, acting through a majority of its Board of
Directors, shall within ten (10) business days following the publication of
such
<PAGE> 4
tender offer or following publication of any amendment of such tender offer
recommend to the holders of Common Stock that such tender offer be accepted.
6.2 DEFINITIONS.
6.2.1. The term "person" shall include an individual, a Corporation,
partnership, trust or other entity. When two or more persons act as a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring Common Stock, such partnership, syndicate or group shall be deemed a
"person."
6.2.2. For the purpose of determining whether a person is an Acquiring
Person, such person shall be deemed to beneficially own (i) all Common Stock
with respect to which such person has the capability to control or influence
the voting or dispositive power in respect thereof and (ii) all Common Stock
which such person has the immediate or future right to acquire, directly or
indirectly, pursuant to agreements, through the exercise of options, warrants
or rights or through the conversion of convertible securities or otherwise; and
all Common Stock which an Acquiring Person has the right to acquire in such
manner shall be deemed to be outstanding shares, but Common Stock which any
other person has the right to acquire in such manner shall not be deemed to be
outstanding shares.
6.2.3. The acquisition of Common Stock by the Corporation or by any
person controlled by the Corporation shall not engender the right to have
Common Stock repurchased pursuant to this Article VI.
6.2.4. The right to have Common Stock repurchased pursuant to this
Article VI shall attach to such shares and shall not be personal to the holder
thereof.
6.2.5. The term "tender offer" shall mean an offer to acquire or an
acquisition of Common Stock pursuant to a request or invitation for tenders or
an offer to purchase such shares for cash, securities or any other
consideration.
6.2.6. The term "market purchases" shall mean the acquisition of
Common Stock from holders of such shares in privately negotiated transactions
or in transactions effected through a broker or dealer.
6.2.7. Subject to the provisions of Section 6.2.2 herein, "outstanding
shares" shall mean shares of Common Stock which at the time in question have
been issued by the Corporation and not reacquired and held or retired by it or
held by any subsidiary of the Corporation.
-2-
<PAGE> 5
6.3 REPURCHASE PROCEDURE
Not later than thirty (30) days following the date on which the
Corporation receives notice that any person has become an Acquiring Person and,
as a result, the right to have Common Stock repurchased by the Corporation
under this Article VI shall have been created, the Corporation shall give
written notice, by first class mail, postage prepaid, at the address shown on
the records of the Corporation to each holder of record of Common Stock (and to
any other person known by the Corporation, to have rights to demand repurchase
pursuant to Section 6.1 of this Article) as of the date not more than seven (7)
days prior to the date of the mailing pursuant to this Section 6.3 and shall
advise each such holder of the right to have shares repurchased and the
procedures for such repurchase. In the event that the Corporation fails to give
notice as required by this Section 6.3, any holder entitled to receive such
notice may, within thirty (30) days thereafter, serve written demand upon the
Corporation to give such notice. If within ten (10) days after the receipt of
written demand the Corporation fails to give the required notice, such holder
may at the expense and on behalf of the Corporation take such reasonable action
as may be appropriate to give notice or to cause notice to be given pursuant to
this Section 6.3.
6.3.1. In the event Common Stock is subject to repurchase in accordance
with this Article VI, the Directors of the Corporation shall designate a
Repurchase Agent, which shall be a corporation or association (i) organized and
doing business under the laws of the United States or any state, (ii) subject
to supervision or examination by federal or state authority, (iii) having
combined capital and surplus of at least $5,000,000 and (iv) having the power
to exercise corporate trust powers.
6.3.2. For a period of ninety (90) days from the date of the mailing of
the notice to holders of Common Stock referred to in this Section 6.3, holders
of Common Stock and other persons entitled to have Common Stock repurchased
pursuant to this Article VI may, at their option, deposit certificates
representing all or less than all Common Stock held of record by them with the
Repurchase Agent together with written notice that the holder elects to have
such shares repurchased pursuant to this Article VI. Repurchase shall be deemed
to have been effected at the close of business on the day such certificates are
deposited in proper form with the Repurchase Agent.
-3-
<PAGE> 6
6.3.3. The Corporation shall promptly deposit in trust with the
Repurchase Agent cash in an amount equal to the aggregate Repurchase Price of
all of the Common Stock deposited with the Repurchase Agent for the purposes of
repurchase.
6.3.4. As soon as practicable after receipt by the Repurchase Agent of
the cash deposit by the Corporation referred to in this Section 6.3, the
Repurchase Agent shall issue its checks payable to the order of the persons
entitled to receive the Repurchase Price of the Common Stock in respect of
which such cash deposit was made.
6.3.5. In the event the Corporation is unable to deposit with the
Repurchase Agent cash in full amount of the aggregate Repurchase Price of all
shares deposited for repurchase, because of limitations upon repurchase of
Common Stock contained in the Wisconsin Business Corporation Law, the
Corporation shall promptly deposit with the Repurchase Agent the maximum amount
of cash which may be used for the repurchase of Common Stock, under the most
restrictive of the applicable limitations upon such repurchase. In the event of
deposit of less than the full aggregate Repurchase Price pursuant to the
provisions of this subsection, the Repurchase Agent shall, after the expiration
of the notice period provided for in this Section 6.3.4, use the amount so
deposited to repurchase shares pro lanto, in proportion to the number of shares
deposited by each shareholder for repurchase. Certificates representing all
shares which remain unpurchased shall be returned to the depositors thereof as
soon as practicable thereafter, and there shall be no further repurchase rights
with respect to such shares arising in connection with the transactions already
completed.
6.4. RETIRED STOCK.
All Common Stock with respect to which repurchase has been effected
pursuant to this Article VI shall thereupon be deemed retired.
6.5 REPURCHASE PRICE.
The Repurchase Price shall be the amount payable by the Corporation in
respect of each share of Common Stock with respect to which repurchase has been
demanded pursuant to this Article VI and shall be the greatest amount
determined on any of the following three bases:
(i) The highest price per share of Common Stock, including any
commission paid to brokers or dealers for solicitation or whatever, at
which Common Stock held by the Acquiring Person were acquired pursuant
to a tender offer regardless of when such tender offer was made or were
-4-
<PAGE> 7
acquired pursuant to any market purchase or otherwise within
eighteen (18) months prior to the notice to holders of Common Stock
referred to in Section 6.3 herein. For purposes of this subsection (i),
if the consideration paid in any such acquisition of Common Stock
consisted, in whole or part, of consideration other than cash, the
Board of Directors of the Corporation shall take such action, as in its
judgment it deems appropriate, to establish the cash value of such
consideration, but such valuation shall not be less than the cash
value, if any, ascribed to such consideration by the Acquiring Person.
(ii) The highest sale price per share of Common Stock for any
trading day during the eighteen (18) months prior to the notice to
holders of Common Stock referred to in Section 6.3 herein. For purposes
of this subsection (ii), the sale price for any trading day shall be
the closing price per share of Common Stock as furnished by the
National Association of Securities Dealers Automated Quotation System
(NASDAQ) or the last sale price per share traded on any national
securities exchange.
(iii) The amount of shareholders' equity in respect of each
outstanding share of Common Stock as determined in accordance with
generally accepted accounting principles and as reflected in any
published report by the Corporation as of the quarter ending
immediately preceding the notice to shareholders referred to in Section
6.3 herein.
6.5.1. The determinations to be made pursuant to Section 6.5 shall be
made by the Board of Directors not later than the date of the notice to holders
of Common Stock referred to in Section 6.3 herein. In making such
determination, the Board of Directors may engage such persons, including
investment banking firms and the independent accountants who have reported on
the most recent financial statements of the Corporation, and may utilize
employees and agents of the Corporation, who will, in the judgment of the Board
of Directors, be of assistance to the Board of Directors.
6.5.2. The determinations to be made pursuant to this Section 6.5, when
made by the Board of Directors acting in good faith on the basis of such
information and assistance as was then reasonably available for such purpose,
shall be conclusive and binding upon the Corporation and its shareholders,
including any person referred to in Section 6.1 herein.
-5-
<PAGE> 8
$24.00 RD
Amendment to Restated Articles
- -Increases authorized shares from: 12,000,000 Common at $0.05 P.V.
To: 20,000,000 Shares Common at $0.05 P.V.
1,000,000 Shares Preferred at $0.10 P.V.
- -adds Directors provision (Art V)
- -adds Stock Repurchase Provisions (new Art VI)
$650.00 plus $25.00 Exp
Michael, Best & Friedrich
P.O. Box 1806
Madison, WI 53701
Attn: Julie Bretl
STATE OF WISCONSIN
FILED
JUL 07 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 9
Form 38(88)
UNITED STATES OF AMERICA
STATE OF WISCONSIN )
) SS.
OFFICE OF THE )
SECRETARY OF STATE )
TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETING:
I, DOUGLAS La FOLLETTE, Secretary of State of the State of Wisconsin and Keeper
of the Great Seal thereof, do hereby certify that the annexed copy has been
compared by me with the record on file in this Office and that the same is a
true copy thereof, and of the whole of such record; and that I am the legal
custodian of such record, and that this certification is in due form.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed the
Great Seal of the State.
[State Seal of Wisconsin]
DOUGLAS LA FOLLETTE
DOUGLAS La FOLLETTE
Secretary of State
BY: [SIG] DATE: JULY 31, 1992
Corporation Division
<PAGE> 10
KNOW ALL MEN BY THESE PRESENTS: That the undersigned, adult
residents of the State of Wisconsin, do hereby make, sign and agree to
the following
ARTICLES OF ORGANIZATION
ARTICLE FIRST. - The undersigned have associated, and do
hereby associate themselves together for the purpose of forming a
corporation under Chapter 86 of the Wisconsin Statutes and the acts
amendatory thereof and supplementary thereto, the business and
purposes of which corporation shall be: to own, operate, run and
manage canning factories, and own real estate, buildings, structures
and all the necessary machinery and appliances for running and
operating canning factories for the purpose of canning, preserving and
packing fruits, grain, meats, foods and vegetables and their
by-products; to own and hold by lease or otherwise farming lands, from
which to produce and raise such articles, vegetables and fruit; and to
furnish and supply farmers, gardeners and such laborers and workmen
As with seed and seeds with which to grow and produce such vegetables and
Amended products to be sold, canned, packed and preserved, and to deal in
Mar. 27, canned goods, and to buy and sell all such canned goods generally, and
1936 to sell and dispose of all by-products made and resulting in the
operation of such factories, and to do all things necessary and proper
in running and operating such factories, and to do and transact all
business usual and incident to such business.
To purchase or otherwise acquire, apply for, register, hold, use,
sell or in any manner dispose of, and to grant licenses or other
rights in, and in any manner deal with patents, inventions,
improvements, processes, formulas, trade-marks, trade names, rights
and licenses secured under letters patent, copyrights or otherwise.
To purchase, hold, sell and reissue the shares of its own
capital stock; to buy, sell, lease, pledge, mort-
<PAGE> 11
gage or otherwise deal in real estate and personal property of
every kind and description, necessary and proper to effectuate the
purposes for which this company is organized.
To purchase, hold, sell, assign, transfer, mortgage, pledge or
otherwise dispose of the shares of the capital stock of, or any bonds,
securities or evidence of indebtedness created by any other
corporation or corporations of this or any other state, territory or
As country, and, while owner of such stock, to exercise all the rights
Amended and powers and privileges of ownership, including the right to vote
Mar. 27, thereon; to guarantee any dividends, bonds, stocks, contracts or other
1936 obligations of any corporation in which this corporation is an owner
or has an interest; to aid in any lawful manner such corporations, and
to do all legal acts and things designed for the preservation,
protection, improvement, development, or enhancement of the value of
any such corporation, or of its stock, bonds, securities, evidences of
indebtedness, contracts or other obligations.
As
Amended ARTICLE SECOND. - The name of said corporation shall be
January OCONOMOWOC CANNING COMPANY, and its location shall be in Oconomowoc
31, 1923 Wisconsin.
As ARTICLE THIRD. - The capital stock of said corporation shall be
Amended six hundred thousand dollars ($600,000.00) and the same shall consist
May 27, of six thousand (6000) shares, each of which said shares shall be of
1936 the face or par value of one hundred dollars ($100.00).
ARTICLE FOURTH. - The general officers of said corporation
shall be a President, Vice-President, Secretary and Treasurer, and the
Board of Directors shall consist of five (5) stockholders.
<PAGE> 12
-3-
ARTICLE FIFTH. - The principal duties of the President shall be
to preside at all meetings of the Board of Directors and to have a
general supervision of the affairs of the corporation.
The principal duties of the Vice-President
shall be to discharge the duties of the President in the event of the
absence or disability, for any cause whatever, of the latter.
The principal duties of the Secretary shall
be to countersign all deeds, leases and conveyances executed by the
corporation, affix the seal of the corporation thereto, and to such
other papers as shall be required or directed to be sealed, and to
keep a record of the proceedings of the Board of Directors, and to
safely and systematically keep all books, papers, records and
documents belonging to the corporation, or in anywise pertaining to
the business thereof.
The principal duties of the Treasurer shall
be to keep and account for all moneys, credits and property, of any
and every nature, of the corporation, which shall come into his hands,
and keep an accurate account of all moneys received and disbursed,
and proper vouchers for moneys disbursed, and to render such accounts,
statements and inventories of moneys received and disbursed, and of
moneys and property on hand, and generally of all matters
pertaining to this office, as shall be required by the Board of
Directors.
The Board of Directors may provide for the
appointment of such additional officers as they may deem for the best
interests of the corporation.
Whenever the Board of Directors may so order,
the offices of Secretary and Treasurer may be held by the same person.
The said officers shall perform such
additional or different duties as shall from time to time be imposed
or required by the Board of Directors, or as may be prescribed from
time to time by the by-laws.
ARTICLE SIXTH. - Only persons holding stock according to the
regulations of the corporation shall be members of it.
ARTICLE SEVENTH. - These Articles may be amended by resolution
setting forth such amendment or amendments, adopted at any meeting of
the stockholders by a vote of at least two-thirds of all the stock of
said corporation then outstanding.
<PAGE> 13
-4-
ARTICLE 8.- NAMES AND RESIDENCES. The names and residences of the
persons forming this corporation are:
Rudolph P. Binzel, residing at Beaver Dam, Wis.
Ernest C. Theobald, residing at Oconomowoc, Wis.
H. P. MacDermott, residing at 254 Mason St., Apt. 211, Milwaukee, Wis.
Philip Binzel, residing at Oconomowoc, Wis.
IN WITNESS WHEREOF, we have hereunto set our hands this 13th day of
February, A. D. 1920.
Signed in Presence of:
PHILIP BINZEL
N. W. EVANS ) RUDOLPH P. BINZEL
JOS. A. MC CAFFREY ) ERNEST C. THEOBALD
HARRY MAC DERMOTT
STATE OF WISCONSIN, )
) SS.
COUNTY OF WAUKESHA. )
Personally came before me this 13th day of February, A.D. 1920, the
above named RUDOLPH P. BINZEL, ERNEST C. THEOBALD, HARRY MacDERMOTT and PHILIP
BINZEL, to me known to be the persons who executed the foregoing instrument,
and acknowledged the same.
N. W. EVANS,
(Notarial Seal) Notary Public, Wisconsin.
My Commission expires)
Aug. 14, 1921. )
STATE OF WISCONSIN, )
) SS.
COUNTY OF WAUKESHA. )
PHILIP BINZEL and ERNEST C. THEOBALD, being each duly sworn, doth each
for himself depose and say that he is one of the original signers of the above
declaration and articles; that the above and foregoing is a true, correct and
complete copy of such original declaration and articles, and of the whole
thereof.
Subscribed and sworn to before me
this 18th day of February, A.D. 1920 ERNEST C. THEOBALD
PHILIP BINZEL
N. W. EVANS,
Notary Public, Wisconsin.
(Notarial Seal)
<PAGE> 14
REEL 258 IMAGE 115
ARTICLES OF AMENDMENT TO
THE ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
The undersigned officers of Oconomowoc Canning Company, a Wisconsin
corporation, do hereby certify that at the annual meeting of the shareholders
of said corporation, held at Oconomowoc, Wisconsin on June 20, 1977, pursuant
to the By-Laws and notice duly given, the following Amendments to the Articles
of Incorporation of said corporation were duly adopted by the shareholders:
RESOLVED, that Article FOURTH of the Articles of Incorporation
be, and the same is hereby amended to read as follows:
"ARTICLE FOURTH: The general officers of said corporation
shall be a President, Vice President, Secretary, and Treasurer, and the
Board of Directors shall consist of such number, not less than three
(3), as shall from time to time be fixed by the By-Laws. Directors
need not be shareholders."
FURTHER RESOLVED, that the first paragraph of Article FIFTH of
the Articles of Incoporation be, and the same is hereby amended to read
as follows:
"ARTICLE FIFTH: The principal duties of the President shall be
to have general supervision of the affairs of the corporation."
The foregoing amendments to the Articles of Incorporation were adopted
by the following vote:
<PAGE> 15
REEL 258 IMAGE 116
<TABLE>
<CAPTION>
Number Number Voted
Classes of Number Of Entitled ------------
Shares Shares Outstanding to Vote For Against
- ---------- ------------------ -------- --- -------
<S> <C> <C> <C> <C>
Common Stock 4,122 4,122 4,122 0
</TABLE>
Dated and the seal of the corporation affixed this 30th day of June,
1977.
By THOMAS W. MOUNT
---------------------------
Thomas W. Mount, President
[CORPORATE SEAL]
DUANE W. THORSEN
---------------------------
Duane W. Thorsen, Secretary
This instrument was prepared by John S. Best.
<PAGE> 16
REEL 652 IMAGE 864
ARTICLES OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
At a meeting of the stockholders of Oconomowoc Canning Company held
on June 17, 1983, pursuant to the Wisconsin Statutes and the Articles and
By-Laws of said corporation, the following Articles of Amendment to the
Articles of Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Oconomowoc Canning Company.
SECOND: The Amendment to the Articles of Incorporation so adopted is as
follows:
RESOLVED, that Article Third of the Articles of Incorporation
of this corporation be, and it hereby is, amended to read as follows:
"Third: The authorized capital of this corporation shall be Six
Hundred Thousand Dollars ($600,000) consisting of One Million Two
Hundred Thousand (1,200,000) shares of common stock of a par value of
Fifty cents ($.50) per share."
THIRD: The date of adoption of the Amendment by the stockholders was
June 17, 1983.
FOURTH: The foregoing Amendment was adopted by the stockholders
entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ----- ----------- -------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Common 4,122 4,122 2,749 3,854 none
</TABLE>
FIFTH: The Amendment effects a change in the authorized capital stock
of the corporation. The total number
<PAGE> 17
REEL 652 IMAGE 865
of authorized shares of common stock are increased from 6,000 shares of a par
value of $100 per share to 1,200,000 shares of a par value of $.50 per share.
There is no change in the stated capital of the corporation which remains at
$600,000 represented by 1,200,000 shares of a par value of $.50 per share.
Following the effectiveness of the Amendment, the presently outstanding shares
of common stock of the corporation will be split 200 for 1, effected in the
form of a stock dividend of 199 shares of common stock ($.50 par value) for
each share then outstanding.
IN WITNESS WHEREOF, the undersigned officers of Oconomowoc Canning
Company have hereunto set their hands this 2nd day of January, 1985.
OCONOMOWOC CANNING COMPANY
By THOMAS W. MOUNT
--------------------------
Thomas W. Mount, President
D. W. THORSEN
---------------------------
D. W. Thorsen, Secretary
[STATE OF WISCONSIN SEAL]
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
-2-
<PAGE> 18
FORM 14 REEL 652 IMAGE 863
UNITED STATES OF AMERICA
STATE OF WISCONSIN
OFFICE OF THE SECRETARY OF STATE
To All to Whom These Presents Shall Come.
The undersigned, as Secretary of State of the State of Wisconsin,
certifies that the attached is a duplicate of a document accepted and filed in
my office.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed
my official seal, at Madison, on
the date of filing of said
document.
DOUGLAS LA FOLLETTE
----------------------
Douglas La Follette
Secretary of State
<PAGE> 19
REEL 652 IMAGE 861
ARTICLES OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
At a meeting of the stockholders of Oconomowoc Canning Company held on
January 2, 1985, pursuant to the Wisconsin Statutes and the Articles and
By-Laws of said corporation, the following Articles of Amendment to the
Articles of Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Oconomowoc Canning Company.
SECOND: The Amendment to the Articles of Incorporation so adopted is
as follows:
RESOLVED, that Article Second of the Articles of Incorporation
of this corporation be, and it hereby is, amended to read as follows:
"Second: The name of this corporation shall be Stokely USA,
Inc."
THIRD: The date of adoption of the Amendment by the stockholders was
January 2, 1985.
FOURTH: The foregoing Amendment was adopted by the stockholders
entitled to vote by the following vote:
[CAPTION]
<TABLE>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
----- ----------- -------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Common 824,400 824,400 549,600 684,583.32 55,333.34
</TABLE>
FIFTH: The Amendment will not effect a change in the stated capital or
authorized capital stock of the corporation.
<PAGE> 20
REEL 652 IMAGE 862
IN WITNESS WHEREOF, the undersigned officers of Oconomowoc Canning
Company have hereunto set their hands this 2nd day of January, 1985.
OCONOMOWOC CANNING COMPANY
By THOMAS W. MOUNT
-----------------------------
Thomas W. Mount, President
DUANE W. THORSEN
-----------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
-2-
<PAGE> 21
FORM 14 REEL 652 IMAGE 860
UNITED STATES OF AMERICA
STATE OF WISCONSIN
OFFICE OF THE SECRETARY OF STATE
To All to Whom These Presents Shall Come.
The undersigned, as Secretary of State of the State of Wisconsin,
certifies that the attached is a duplicate of a document accepted and filed in
my office.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed
my official seal, at Madison, on
the date of filing of said
document.
DOUGLAS LA FOLLETTE
----------------------
Douglas La Follette
Secretary of State
<PAGE> 22
STOKELY USA, INC.
THIRD AMENDMENT TO NOTE AGREEMENT
Re:
Note Agreement Dated as of December 1, 1991
and
$20,000,000 Original Principal Amount of
9.74% Senior Note Due December 15, 2001
Held by State of Wisconsin Investment Board
DATED MAY 31, 1995
May 23, 1995
<PAGE> 23
STOKELY USA, INC.
THIRD AMENDMENT TO NOTE AGREEMENT
RE:
Note Agreement Dated as of December 1, 1991
and
$20,000,000 Original Principal Amount of
9.74% Senior Note Due December 15, 2001
Dated May 31, 1995
To State of Wisconsin Investment Board
121 East Wilson Street
Madison, Wisconsin 53702
Attention: Private Placements
Ladies and Gentlemen:
Reference is made to the Note Agreement dated as of December 1, 1991, as
amended by an Amendment to Note Agreement dated August 18, 1992 and a Second
Amendment to Note Agreement dated June 11, 1993 (said Note Agreement as so
amended is herein referred to as the "Existing Note Agreement"), among
Stokely USA, Inc., a Wisconsin corporation (the "Company"), and you (the
"Holder"), under and pursuant to which a certain Twenty Million Dollars
($20,000,000) principal amount 9.74% Senior Note due December 15, 2001 (the
"Note) was originally issued.
The Company desires to enter into a proposed transaction in which:
(i) the Company will enter into a Secured Credit Agreement
dated as of May 22, 1995 (the "Credit Agreement") with Harris Trust and
Savings Bank ("Harris Bank"), as agent, and other parties (Harris Bank
and the other parties, along with their respective successors and
assigns, are herein collectively referred to as the "Short-Term
Lenders"), and Harris Bank, as agent for the Short-Term Lenders,
pursuant to which the Short-Term Lenders will agree to make certain
loans and advances to, and issue certain standby letters of credit for
the account of, the Company in the aggregate principal amount of up to
Sixty-Five Million Dollars ($65,000,000);
May 23, 1995
1
<PAGE> 24
(ii) the obligations of the Company under the Credit Agreement
will be secured by a security interest in and Lien upon the Current
Asset Collateral (defined below), all as more fully set forth in the
Security Agreement dated as of May 31, 1995 (the "Bank Security
Agreement"), by and among the Company, the Short-Term Lenders, and
Harris Bank, as agent for the Short-Term Lenders;
(iii) all indebtedness and other obligations of the Company
under the Loan and Security Agreement will be paid in full and the
lenders party to the Loan and Security Agreement (the "Old Lenders")
shall consent to the release of all Liens on and security interests in
all collateral of the Company and its subsidiaries, D&K Frozen Foods,
Inc., a Washington corporation ("D&K"), ANC Express, Inc., an Iowa
corporation ("ANC"), and Oconomowoc Canning Company, Inc., a Wisconsin
corporation ("Oconomowoc"), heretofore granted (the "Old Lenders' Lien
Release"); and
(iv) the Holder and Nationwide Life Insurance Company
("Nationwide"), West Coast Life Insurance Company ("West Coast"),
Employers Life Insurance Company of Wausau ("Employers") (Nationwide,
West Coast, and Employers being referred to collectively as the
"Nationwide Group") will consent to the release by Bank One, as agent
for the Holder and the Nationwide Group, of the Lien on and security
interest in the Current Asset Collateral heretofore granted to Bank One
as agent for the Holder and the Nationwide Group.
In exchange for the Holder's consent to the Partial Release (defined
below), the Company agrees to amend certain terms and provisions of the
Existing Note Agreement.
In consideration of the foregoing and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the Company and the Holder (subject to satisfaction of the conditions set forth
below) hereby agree to the amendments set forth below and the Holder (subject
to satisfaction of the conditions set forth below) hereby consents to the
Partial Release, in the manner herein provided.
SECTION 1. DEFINED TERMS.
All capitalized terms used but not specifically defined in this
Amendment have the respective meanings assigned to them in, or pursuant to the
provisions of, the Existing Note Agreement as amended by this Amendment (as so
amended herein referred to as the "Amended Note Agreement").
May 23, 1995
2
<PAGE> 25
SECTION 2. REPRESENTATIONS AND WARRANTIES.
The Company warrants and represents to Holder as of the date of this
Amendment and as of the Effective Date (as defined in Section 3):
(A) ORGANIZATION AND AUTHORITY. The Company is a corporation duly
organized and existing and in good standing under the laws of the State of
Wisconsin, has full and adequate corporate power to carry on its business as
now conducted, is duly licensed or qualified in all jurisdictions wherein the
nature of its activities requires such licensing or qualification except where
the failure to be so licensed or qualified would not have a material adverse
effect on the business, prospects, profits, Properties or condition (financial
or otherwise) of the Company, and has full right and authority to enter into
this Amendment and the Security Documents (defined below), and to perform each
and all of the matters and things herein and therein provided for. The Company
has no Subsidiaries organized under the laws of the United States or any state
thereof other than D&K, ANC and Oconomowoc. The Company owns 100% of the
outstanding capital stock of each Subsidiary (excluding directors' qualifying
shares as required by law). The aggregate amount of assets of the Subsidiaries
organized under the laws of the United States or any state thereof does not
exceed One Hundred Thousand Dollars ($100,000).
(B) PENDING LITIGATION. Except as disclosed on Annex 2 hereto for
the fiscal quarter of the Company ending December 31, 1994, there is no
litigation or governmental proceeding pending, or to the knowledge of the
Company threatened, against the Company or any Subsidiary which, if adversely
determined, is likely to have a material adverse effect on the business,
prospects, profits, Properties or condition (financial or otherwise) of the
Company, or the ability of the Company to perform its respective obligations
set forth in this Amendment, the Amended Note Agreement, the Note or any of the
Security Documents.
(C) NO DEFAULTS. No event has occurred and is continuing and no
condition exists which, upon execution and delivery of this Amendment, would
constitute a Default or Event of Default. The Company is not in default in the
payment of principal or interest on any Indebtedness and is not in default
under any instrument or instruments or agreements under and subject to which
any Indebtedness has been issued and no event has occurred and is continuing
under the provisions of any such instrument or agreement which with the lapse
of time or the giving of notice, or both, would constitute a default or an
event of default thereunder, except for a possible default with respect to
certain indebtedness in principal amount not exceeding $400,000, which possible
default could have a material adverse effect on the business, prospects,
profits, Properties or condition (financial or otherwise) of the Company and
its Subsidiaries, taken as a whole, or the ability of the Company to perform
its obligations set forth in this Amendment, The Amended Note Agreement, the
Notes or any of the Security Documents.
(D) SECURITY INTERESTS AND DEBT. There are no Liens on any of the
Property of the Company and its Subsidiaries except Liens permitted by Section
5.7 of the Amended Note Agreement. The Company and its Subsidiaries have no
Funded Debt outstanding other than Funded Debt that would be permitted to be
incurred by Section 5.6 of the Amended Note
May 25, 1995
3
<PAGE> 26
Agreement. Annex 1 to this Amendment correctly lists all outstanding IRB
Indebtedness of the Company as of the Effective Date (defined below).
(E) FULL DISCLOSURE. Each written statement and all written materials
furnished by, or on behalf of, the Company to the Holder in connection with
this Amendment or pursuant to the provisions of Section 5.14 of the Existing
Note Agreement do not contain any untrue statement of a material fact or omit a
material fact necessary to make the statements contained therein or herein not
misleading in light of the circumstances in which they were made. There is no
fact known to the Company which the Company has not disclosed to the Holder in
writing which materially affects adversely or, so far as the Company can now
foresee, shall materially affect adversely the business, prospects, profits,
Properties or condition (financial or otherwise) of the Company, or the ability
of the Company to perform its respective obligations set forth in this
Amendment, the Amended Note Agreement, the Note or any of the Security
Documents.
(F) TRANSACTION IS LEGAL AND AUTHORIZED. The execution and delivery
by the Company of this Amendment and the Security Documents, the consummation
of each of the transactions contemplated by this Amendment and the compliance
by the Company with all the provisions of this Amendment, the Amended Note
Agreement and each Security Document: (i) are within the corporate powers of
the Company; and (ii) are legal and do not conflict with, result in any breach
in any of the provisions of, or constitute a default (or require any consent
other than the consents heretofore obtained) under, or result in the creation
of any Lien upon any Property of the Company or any Subsidiary under the
provisions of the articles of incorporation or by-laws of the Company or any
Subsidiary or any agreement or instrument to which the Company or any
Subsidiary is a party or by which it or any of its Property may be bound.
(G) GOVERNMENTAL CONSENT. Neither the nature of the Company or any
Subsidiary, or of any of their respective businesses or Properties, nor any
relationship between the Company or any Subsidiary and any other Person, nor
any circumstance in connection with the execution and delivery of this
Amendment and the Security Documents, is such as to require an order, consent,
approval, license, authorization or validation of, or filing, recording,
registration or qualification with, any Governmental Authority on the part of
the Company as a condition to the execution, delivery or performance of this
Amendment, the Amended Note Agreement or any Security Document, or the
legality, validity, binding effect or enforceability of this Amendment, the
Amended Note Agreement or any Security Document except as contemplated under
Section 3 of this Amendment.
(H) OBLIGATIONS ARE ENFORCEABLE. The obligations of the Company set
forth in this Amendment, the Amended Note Agreement, the Note and the Security
Documents are valid, binding and enforceable in accordance with their
respective terms, except as such enforceability may be: (i) limited by
bankruptcy, insolvency or other similar laws affecting the enforceability of
creditors' rights generally and (ii) subject to the availability of equitable
remedies.
4
May 23, 1995
<PAGE> 27
(I) COMPLIANCE WITH LAW. The Company and each Subsidiary is in
compliance with all laws, ordinances, governmental rules and regulations to
which it is subject, including without limitation the Occupational Safety and
Health Act of 1970, ERISA and all Environmental Legal Requirements, the
violation of which could have a material adverse effect on the business,
prospects, profits, Properties or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or the ability of the Company
or any Subsidiary to perform its respective obligations set forth in this
Amendment, the Amended Note Agreement, the Note or any of the Security
Documents.
SECTION 3. CONDITIONS PRECEDENT.
The consent to the Partial Release set forth in Section 5 and each of
the amendments to the Existing Note Agreement shall have no effect until all of
the following conditions precendent shall have been satisfied or waived by the
Holder (such time of effectiveness is herein referred to as the "Effective
Date"):
(A) OPINION OF COUNSEL. The Holder shall have received from Michael,
Best & Friedrich, special counsel to the Company, a favorable opinion
satisfactory to the Holder and substantially in the form appended to this
Amendment as Exhibit A.
(B) WARRANTIES AND REPRESENTATIONS TRUE. The warranties and
representations set forth in Section 2 shall be true in all material respects;
there shall exist on the Effective Date no Default or Event of Default; and the
Holder shall have received an Officers' Certificate of the Company, dated the
Effective Date, substantially in the form of Exhibit B to this Amendment,
certifying to both such effects and that the conditions specified in this
Section 3 have been fulfilled, and a certificate dated the Effective Date and
signed by the Secretary or and Assistant Secretary of the Company, substantially
in the form of Exhibit C to this Amendment, with respect to the matters
therein set forth.
(C) CONSENT OF NOTEHOLDER. The Company and the Holder of the Note shall
have executed this Amendment.
(D) CREDIT AGREEMENT AND BANK SECURITY AGREEMENT. The Company, the
Short-Term Lenders and Harris Bank, as agent for the Short-Term Lenders, shall
have executed and delivered to the Holder copies of the Credit Agreement and
the Bank Security Agreement, in form and substance satisfactory to the Holder.
(E) OLD LENDERS' LIEN RELEASE. Each of the Old Lenders shall have
executed and delivered to the Holder consents to the Old Lenders' Lien Release
and Bank One shall have executed and delivered to the Holder the Old Lenders'
Lien Release, such consents and such Release each being in form and substance
satisfactory to the Holder.
(F) ASSIGNMENT BY BANK ONE. Bank One, as agent for the benefit of the
Holder and the Nationwide Group, shall have executed and delivered to the
Holder an assignment of certain
5
May 23, 1995
<PAGE> 28
of its interests in collateral securing the Notes, together with appropriate
forms of UCC financing statements reflecting the assignment, and release the
Current Asset Collateral, all in form and substance satisfactory to the
Holders.
(G) SECURITY DOCUMENTS. The following agreements (herein collectively
referred to as the "Security Documents") shall have been duly executed and
delivered to the Holder by the parties thereto, in form and substance
satisfactory to the Holder and its special counsel:
(i) a Security Agreement among the Company, the Holder, and the
Nationwide Group (the Holder and the Nationwide Group referred to
herein collectively as the "Lenders"), pursuant to which the Company
will grant the Lenders a Lien on and security interest in certain
assets of the Company therein described;
(ii) an Assignment of Contracts, Warranties and Permits by the
Company, pursuant to which the Company will assign to the Lenders all
contracts, warranties and permits affecting the Properties (as defined
therein);
(iii) one or more mortgages or deeds of trust (collectively,
the "Mortgages") on all interests in real property of the Company and
any Subsidiary in favor of the Lenders; and
(iv) an Environmental Indemnification Agreement among the
Company and the Lenders, pursuant to which the Company will agree to
indemnify the Lenders for losses relating to environmental matters.
(H) INTERCREDITOR AGREEMENT. The Nationwide Group shall have delivered
to the Holder a fully executed counterpart of the Intercreditor Agreement, in
form and substance satisfactory to the Holder and its special counsel.
(I) TITLE MATTERS. The Company shall have delivered or caused to be
delivered to the Holder one or more loan policies of title insurance, or
endorsements to existing loan policies down-dating such policies to the date of
the recording of the Mortgages, in either case satisfactory to the Lenders and
showing no exceptions to title except as contained in the existing loan
policies or otherwise acceptable to the Holder.
(J) LIEN SEARCHES. The Company shall have delivered to the Holder Lien
searches showing that the Property of the Company and its Subsidiaries is
subject to no Liens other than Liens permitted under Section 5.7 of the Amended
Note Agreement.
(K) CERTIFICATES OF INSURANCE. The Company shall have delivered to the
Holder certificates of insurance evidencing the insurance required by Section
2G of the Security Agreement, showing the Holder and the Nationwide Group as
loss payees thereunder (as their interests may appear).
6
May 25, 1995
<PAGE> 29
(L) EXPENSES. The Company shall have paid all costs and expenses of the
Holder relating to this Amendment and the Security Documents in accordance
with Section 8.
(M) PROCEEDINGS SATISFACTORY. All proceedings taken in connection with
the execution and delivery of this Amendment and the transactions contemplated
hereby shall be satisfactory to the Holder and its special counsel; and the
Holder and its special counsel shall have received copies of such documents
and papers as they may reasonably request in connection therewith.
SECTION 4. AMENDMENTS TO EXISTING NOTE AGREEMENT.
(A) SECTION 5.6. Clause (a)(2A), (a)(3) an (a)(6) of Section 5.6 of the
Existing Note Agreement are hereby amended and restated in their entirety to
read as follows:
(2A) Funded Debt of the Company from time to time outstanding
under the Credit Agreement in the aggregate principal amount of up to
$65 million, and renewals, extensions, refundings and replacements
thereof, provided that any renewal, extension, refunding or replacement
of such Funded Debt in excess of $65 million shall be deemed to
constitute the issuance of new Funded Debt subject to the limitations
of Section 5.6(a)(3);
(3) Additional Funded Debt of the Company and its Subsidiaries,
provided that at the time of issuance thereof and after giving effect
thereto and to the application of the proceeds thereof Consolidated
Funded Debt would not exceed 65% of Consolidated Total Capitalization
prior to May 1, 1996, and in any quarter thereafter, a percent of
Consolidated Total Capitalization determined by subtracting, from 65%,
.5% for each quarter ending after April 30, 1996 (so that the
applicable percentage would be 64.5% for the quarter ending June 30,
1996, 64% for the quarter ending September 30, 1996, and so on), except
that such percentage shall not be decreased to less than 60% of
Consolidated Total Capitalization;
(6) Subject to Section 5.7(k), additional unsecured Funded Debt
of a Subsidiary.
(B) SECTION 5.6. Section 5.6 of the Existing Note Agreement is hereby
amended by adding a new clause (d) which shall read as follows:
(d) the Company will not permit the sum of (i) the aggregate
amount of Indebtedness secured by Liens described in Section 5.7(k)
outstanding at any time, plus (ii) the aggregate amount of unsecured
Indebtedness of Subsidiaries outstanding at such time, to exceed 15% of
Consolidated Tangible Net Worth at such time;
(C) SECTION 5.7. Clause (h) of Section 5.7 of the Existing Note
Agreement is hereby amended and restated in its entirety to read as follows:
7
May 23, 1995
<PAGE> 30
(h) Liens (i) on the Current Asset Collateral securing the
Indebtedness under the Credit Agreement referred to in Section
5.6(a)(2A) and (ii) on all Property of the Company and its Subsidiaries
other than the Current Asset Collateral securing the Note and other
Indebtedness as described in the Security Agreement;
(D) SECTION 5.7. Section 5.7 of the Existing Note Agreement is hereby
amended by adding clause (k), which recreates a previous provision and shall
read as follows:
(k) additional Liens not otherwise permitted by this Section
5.7, provided that the sum of the Indebtedness secured by Liens
described in this subsection (k) and the unsecured Indebtedness
created, incurred or assumed by any Subsidiary pursuant to Section
5.6(a)(6) shall not exceed 15% of Consolidated Tangible Net Worth.
and the "." at the end of clause (j) is replaced with "; and".
(E) SECTION 5.8. Section 5.8 of the Existing Note Agreement is hereby
amended and restated in its entirety so that the same shall read as follows:
5.8. Maintenance of Consolidated Tangible Net Worth. The
Company will at all times maintain Consolidated tangible Net Worth of
no less than $45,000,000, which amount shall be increased on the first
day of each fiscal year of the Company, beginning with the fiscal year
commencing on July 1, 1996, by an amount equal to 50% of Consolidated
Net Income (but not less than zero) for the immediately preceding
fiscal year.
(F) SECTION 5.10. Section 5.10 of the Existing Note Agreement is hereby
amended by
(1) amending and restating clause (c) in its entirety so that
the same shall read as follows:
(c) subject to the last paragraph of this Section 5.10,
in addition to transactions permitted by subsections (a) or
(b), the Company may sell, lease, transfer or otherwise dispose
of assets (a "Transfer") if such Transfer does not involve a
Substantial Portion of the assets of the Company and its
Subsidiaries;
and (2) amending and restating clause (f) in its entirety so
that the same shall read as follows:
(f) subject to the last paragraph of this Section 5.10,
in addition to the transactions permitted by subsections (a),
(b), (c), (d) or (e), the Company may sell, lease or otherwise
dispose of assets within the limitations of Section 3D of the
Security Agreement.
8
May 23, 1995
<PAGE> 31
(G) SECTION 5.11. Clause (c) of Section 5.11 of the Existing Note
Agreement is hereby amended by deleting the reference to "Section 5.6" therein
and replacing it with "Section 5.6(a)(3)."
(H) SECTION 5.16. Section 5 of the Existing Note Agreement is hereby
amended to add a new Section 5.16 which shall read as follows:
5.16. Assets of Subsidiaries. The Company will not permit the
aggregate amount of assets of all Subsidiaries organized under the laws
of the United States or any state thereof to exceed $200,000 at any
time.
(I) SECTION 5.17. Section 5 of the Existing Note Agreement is hereby
amended to add a new Section 5.17 which shall read as follows:
5.17 Transactions with Subsidiaries. The Company will not enter
into any transaction, including, without limitation, the purchase,
sale, lease or exchange of any Property, or the rendering of any
service, with any Subsidiary, except in the ordinary course of and
pursuant to the reasonable requirements of the Company's business and
upon fair and reasonable terms not materially less favorable to the
Company than would be obtained in a comparable arm's-length transaction
with a Person not a Subsidiary.
(J) SECTION 6.1. Section 6.1 of the Existing Note Agreement is hereby
amended by
(1) amending and restating clause (c) so that the same shall
read as follows:
(c) Default shall occur in the payment of the principal
or premium of or interest on (i) any evidence of Indebtedness
of the Company in a principal amount exceeding $3,000,000 or
(ii) any IRB Indebtedness, as and when the same shall become
due and payable by lapse of time, by declaration, by prepayment
or otherwise; or
(2) amending and restating clause (d) so that the same shall
read as follows:
(d) (i) Default shall occur in the performance or
observance of any covenant or agreement contained in (x) any
indenture, agreement or other instrument under which any
Indebtedness of the Company in excess of $3,000,000 (other
than IRB Indebtedness described in (y), following) in the
aggregate is outstanding or (y) any agreement or other
instrument under which any IRB Indebtedness is outstanding and
any such default shall result in acceleration of the maturity
of any Indebtedness evidenced thereby or outstanding or
secured thereunder, or (ii) any event of default shall occur
under the Credit Agreement, any of the Other Agreements, or
any Security Document; or
9
May 25, 1995
<PAGE> 32
(3) amending and restating clause (e) so that the same shall read as
follows:
(e) Default shall occur in the observance or performance of
any covenant or agreement contained in Section 5.3(c), 5.5, 5.6, 5.7,
5.8, 5.9, 5.10, 5.11, 5.16, or 5.17 hereof; or Default shall occur in
the performance or observance of any other covenant or agreement
contained in this Agreement which is not remedied within thirty days
after the earlier of: (1) the date on which such Default shall first
become known to a Responsible Financial Officer of the Company, or (2)
written notice thereof to the Company by the holder of any Note, which
notice shall specify the Default to be remedied and state that it is a
notice hereunder;
(K) SECTION 8.1. Section 8.1 of the Existing Note Agreement is
hereby amended by amending the definitions of "Consolidated Tangible Net
Worth," and "Funded Debt" in their entirety to read as follows:
"Consolidated Tangible Net Worth" shall mean, as of the date of
any determination thereof, Consolidated Net Worth as of such date minus
the amount of all Intangible Assets of the Company and is Subsidiaries
as of such date, determined on a consolidated basis in accordance with
GAAP.
"Funded Debt" with respect to any Person shall mean all
indebtedness for borrowed money of such person maturing by its terms
more than one year after, or which is renewable or extendible at the
option of such person for a period ending one year or more after, the
date of determination, and shall include indebtedness for borrowed
money of such maturity created, assumed or guaranteed by such Person
either directly or indirectly, including obligations of such maturity
secured by liens upon Property of such Person and upon which such
entity customarily pays the interest, all current maturities of all
such indebtedness of such maturity and all rental payments under
Capitalized Leases of such maturity, and including, in the case of the
Company, the lesser of the amount outstanding under the Credit
Agreement as of the date of determination or the amount that is not
required to be prepaid at such time pursuant to Section 7.25 of the
Credit Agreement.
(L) NEW DEFINITIONS. Section 8.1 of the Existing Note Agreement
is hereby amended to add the following definitions in appropriate alphabetical
order:
"Consolidated Net Worth" shall mean, as of the date of any
determination thereof, Total Assets as of such date minus Total
Liabilities as of such date, determined on a consolidated basis in
accordance with GAAP.
"Credit Agreement" shall mean the Secured Credit Agreement dated
as of May 22, 1995 (the "Credit Agreement") entered into by and among
the Company, Harris Trust and Savings Bank ("Harris Bank"), and the
other lenders referred to therein
10
May 25, 1995
<PAGE> 33
(collectively, along with their respective successors and assigns, the
"Short-Term Lenders"), and Harris Bank, as agent for the Short-Term
Lenders.
"Current Asset Collateral" is defined in Section 5 of the Third
Amendment.
"Disposition Value" shall mean, as of the date of any
determination thereof, with respect to any assets,
(a) in the case of any asset that does not constitute
Subsidiary Stock, the book value thereof, valued at the time of
such disposition in good faith by the Company, and
(b) in the case of any asset that constitutes
Subsidiary Stock, an amount equal to that percentage of the
book value of the assets of the Subsidiary that issued
such stock as is equal to the percentage that the book value of
such Subsidiary Stock represents of the book value of all of
the outstanding capital stock of such Subsidiary (assuming, in
making such calculations, that all Securities convertible into
such capital stock are so converted and giving full effect to
all transactions that would occur or be required in connection
with such conversion) determined at the time of the disposition
thereof, in good faith by the Company.
"Intangible Assets" shall mean license agreements, trademarks,
trade names, patents, capitalized research and development,
proprietary products (the results of past research and development
treated as long-term assets and excluded from inventory), goodwill and
all other Property which would be considered to be intangible under
GAAP.
"Intercreditor Agreement" shall mean the Intercreditor Amended
dated as of May 31, 1995, by and among the Lenders, and from time to
time amended, modified or supplemented.
"Lenders" shall mean the holders of the Note and the holders of
the Company's 9.37% Senior Notes due January 15, 2000.
"Other Agreements" shall mean any and all agreements,
instruments and documents (other than the Security Documents),
heretofore, now or hereafter executed by the Company and delivered
to the holder of the Note, or to any agent appointed to act on behalf
of the holder of the Note, in respect to the transactions contemplated
by this Agreement.
"Security Agreement" shall mean the Security Agreement dated as
of May 31, 1995, by and among the Company and the Lenders, as from
time to time amended, modified or supplemented, including, without
limitation, any amendment or supplement
11
May 23, 1995
<PAGE> 34
pursuant to which an agent or trustee is appointed to act on behalf of
the Note and any other Indebtedness secured by the Security
Agreement.
"Subsidiary Stock" shall mean, with respect to any Person, the
stock (or any options or warrants to purchase stock or other Securities
exchangeable for or convertible into stock) of any Subsidiary of
such Person.
"Substantial Portion" shall mean, with respect to any Transfer
of assets, any portion of assets of the Company and its Subsidiaries, if
(a) the Disposition Value of such assets, when added
to the Disposition Value of all other assets of the Company and
its Subsidiaries that were subject to a Transfer (other than
pursuant to clause (a) or clause (b) of Section 5.10)
during the period beginning on the first day of such fiscal
year and ending on and including the date of the Transfer of
such assets, exceeds an amount equal to 10% of Consolidated
Total Assets determined as of the end of the then most recently
ended fiscal quarter of the Company, or
(b) the Disposition Value of such assets, when added
to the Disposition Value of all other assets of the Company and
its Subsidiaries that were subject to a Transfer (other than
pursuant to clause (a) or clause (b) of Section 5.10)
during the period beginning on the Closing Date and ending on
and including the date of the transfer of such assets, exceeds
an amount equal to 25% of Consolidated Total Assets determined
as of the end of the then most recently ended fiscal quarter of
the Company.
"Third Amendment" shall mean the Third Amendment to Note
Agreement dated May 15, 1995, by and among the Company and the holder
of the Note.
"Total Assets" shall mean, as of the date of any determination
thereof, the aggregate amount of assets of the Company and its
Subsidiaries as of such date, determined on a consolidated basis in
accordance with GAAP.
"Total Liabilities" shall mean, as of the date of any
determination thereof, the aggregate amount of liabilities of the
Company and its Subsidiaries as of such date, determined on a
consolidated basis in accordance with GAAP.
"Transfer" is defined in Section 5.10.
SECTION 5. CONSENT TO PARTIAL RELEASE.
Subject to satisfaction of the conditions set forth in Section 3, the
Holder hereby consent to the release of the Lien on and security interest in the
following described property and interest
12
May 23, 1995
<PAGE> 35
in such property (collectively, the "Current Asset Collateral") heretofore
granted to Bank One as agent for the Holder (the "Partial Release"):
(A) RECEIVABLES. Receivables of the Company and its
Subsidiaries, whether now existing or hereafter arising, and however
evidenced or acquired, or in which the Company or any Subsidiary now
has or hereafter acquires any rights (the term "Receivables" means and
includes accounts, accounts receivable, contract rights, instruments,
notes, drafts, acceptances, documents, chattel paper, general
intangibles, any right of the Company or any such Subsidiary to payment
for goods sold or leased or for services rendered, whether arising out
of the sale of Inventory (as hereinafter defined) or otherwise and
whether or not earned by performance, and all other forms of
obligations owing to the Company or any such Subsidiary, and all rights
of the Company or any such Subsidiary to any merchandise [including
without limitation any returned or repossessed goods and the right of
the stoppage in transit] which is represented by, arises from or is
related to any of the foregoing); provided that the term "receivables"
shall not include the "Collateral" (as defined in the Assignment of
Contracts, Warranties and Permits from Company to the Holders, dated
the date hereof);
(B) INVENTORY. Inventory of the Company and its
Subsidiaries, whether now owned or hereafter acquired, and all
documents of title at any time evidencing or representing any part
thereof (the term "Inventory" means and includes all goods which are
held for sale or lease or are to be furnished under contracts of
service, or which are raw materials, work-in-process, finished goods,
materials and supplies of every nature used or usable in connection
with the manufacture, processing, supply, servicing, storing, packing,
shipping, advertising, selling, leasing or furnishing of such goods and
any constituents or ingredients thereof, and returned or repossessed
goods, and all of the Company's or such Subsidiary's right, title and
interest in and to all trademarks, trademark registrations, trademark
licenses, trade names, trade styles, patents, patent applications,
patent licenses and similar properties, rights, interests and
privileges used or usable in connection with, or in any way related to
or being a part of, any of the foregoing), and without limiting the
foregoing, all of the Company's inventory of fresh vegetables and
canned and frozen vegetables produced or acquired in the ordinary
course of business;
(C) DEPOSITS AND PROPERTY IN POSSESSION. All deposit
accounts and investment accounts (whether general, specific or
otherwise) of the Company and its Subsidiaries and all sums now or
hereafter in possession of any of the Short-Term Lenders or Harris
Bank, as agent for the Short-Term Lenders, or any agent or affiliate of
any of them, in any way and for any purpose (whether for safekeeping,
custody, pledge, transmission, collection or otherwise), other than
proceeds of the disposition of Property of the Company securing the
Notes; and
(D) RECORDS AND CABINETS. Supporting evidence and documents
relating to any of the above described property, including without
limitation, computer programs,
13
May 23, 1995
<PAGE> 36
discs, tapes and related electronic data processing media, and all
rights of the Company and its Subsidiaries to retrieve the same from
third parties, written applications, credit information, account
information, account cards, payment records, correspondence, invoices
copies, delivery receipts, notes and other evidences of indebtedness,
insurance certificates and the like, together with all books of
account, ledgers and cabinets in which the same are reflected or
maintained, all whether now existing or hereafter arising;
(E) PROCEEDS AND PRODUCTS. All proceeds and products of the
foregoing and all insurance of the foregoing and proceeds thereof,
whether now existing or hereafter arising.
Bank One shall be entitled to rely upon the consent set forth herein
and is hereby authorized to execute all such documents, instruments and
financing statements as are reasonably requested by the Lenders in order to
effect the Partial Release consented to herein.
SECTION 6. EFFECT OF AMENDMENT.
If the foregoing is acceptable to you, please note your acceptance in
the space provided below. Upon the execution and delivery by the Company and
the Holder of the Note and the satisfaction of the conditions set forth in
Section 3, the Existing Note Agreement shall be deemed to be amended as set
forth above and the Partial Release shall be deemed to be effective. This
Amendment shall be binding upon, and shall inure to the benefit of, the
successors and assigns of the parties hereto and the holder from time to time
of the Note. Except as amended herein, the terms and provisions of the Existing
Note Agreement are hereby ratified, confirmed and approved in all respects.
SECTION 7. NO LEGEND REQUIRED.
Any and all notices, requests, certificates and other instruments
including, without limitation, the Note, may refer to the Note Agreement or the
Note Agreement dated as of December 1, 1991 without making specific reference
to this Third Amendment to Note Agreement, but nevertheless all such references
shall be deemed to include this Third Amendment to Note Agreement unless the
context shall otherwise require.
SECTION 8. FEES AND EXPENSES.
On the Effective Date, the Company shall pay all costs and expenses of
the Holder relating to this Amendment and the Security Documents, including,
but not limited to, the statement for reasonable fees and disbursements of the
Holder's special counsel presented to the Company on or prior to the Effective
Date. The Company will also pay, upon receipt of any statement thereof, (i)
each additional statement for reasonable fees and disbursements of the Holder's
special counsel rendered after the Effective Date in connection with this
Amendment, the Amended Note Agreement or the Security Documents, and (i) all
fees and expenses of any
14
May 23, 1995
<PAGE> 37
trustee which may be appointed pursuant to the Intercreditor Agreement to act
as agent for the Lenders for the purpose of administration of collateral under
the Security Documents. The obligations of the Company under this Section 8
shall survive the termination of this Amendment.
SECTION 9. SURVIVAL.
All warranties, representations, certifications and covenants made by
the Company in this Amendment or in any certificate or other instrument
delivered by it or on its behalf under this Amendment shall be considered to
have been relied upon by the Holder and shall survive the execution of this
Amendment, regardless of any investigation made by or on behalf of any
Holder. All statements in any such certificate or other instrument shall
constitute warranties and representations of the Company under this Amendment.
SECTION 10. DUPLICATE ORIGINALS; EXECUTION IN COUNTERPART.
Two or more duplicate originals of this Amendment may be signed by the
parties, each of which shall be an original but all of which together shall
constitute one and the same instrument. This Amendment may be executed in one
or more counterparts and shall be effective when at least one counterpart shall
have been executed by each party to this Amendment, and each set of
counterparts which, collectively, show execution by each such party to this
Amendment shall constitute one duplicate original.
SECTION 11. GOVERNING LAW.
This Amendment shall be governed by, and construed in accordance with,
internal Wisconsin law.
[Remainder of Page Intentionally Blank. Next Page is signature page.]
15
May 23, 1995
<PAGE> 38
IN WITNESS WHEREOF, the Company and the Holder have executed this
Amendment as of the date first above written.
STOKELY USA, INC.
By: ROBERT BRILL
---------------------------
Name
Title Secretary
STATE OF WISCONSIN INVESTMENT BOARD
By:
---------------------------
Name
Title
[Signature page to THIRD AMENDMENT TO NOTE AGREEMENT of STOKELY USA, INC.]
16
May 23, 1995
<PAGE> 39
IN WITNESS WHEREOF, the Company and the Holder have executed this
Amendment as of the date first above written.
STOKELY USA, INC.
By:
---------------------------
Name
Title
STATE OF WISCONSIN INVESTMENT BOARD
By: ROBERT ZOBEL
---------------------------
Name Robert Zobel
Title Investment Director
[Signature page to THIRD AMENDMENT TO NOTE AGREEMENT of STOKELY USA, INC.]
16
May 24, 1995
<PAGE> 40
ANNEX 1
(TO THIRD AMENDMENT)
DESCRIPTION OF IRB INDEBTEDNESS
IRB Indebtedness of the Company and its Subsidiaries outstanding on the
date hereof is as follows:
<TABLE>
<CAPTION>
COUPON/ BALANCE OUTSTANDING
ISSUE RATE DATED PRINCIPAL MATURES DUE BALANCE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
DeForest (Town of Windsor) First Trust 6.000 01-Mar-85 1,500,000 01-Mar-95 0 0
- ------------------------------------------------------------------------------------------------------------------------------------
1989 Poynette IRB NationsBk 7.750 01-Dec-89 1,600,000 01-Dec-2004 1,600,000 1,600,000
- ------------------------------------------------------------------------------------------------------------------------------------
City of Jefferson IRB NationsBk 8.500 15-Dec-85 6,500,000 15-Dec-95 700,000 700,000
- ------------------------------------------------------------------------------------------------------------------------------------
County of Paulding IRB Society 7.375 01-Jun-89 1,400,000 6/1/99-7/5/94 0 0
- ------------------------------------------------------------------------------------------------------------------------------------
Port of Walla Walla IRB NationsBk 8.250 01-Sep-90 4,000,000 01-Sep-2002 2,500,000 4,000,000
8.500 01-Sep-2005 1,500,000
- ------------------------------------------------------------------------------------------------------------------------------------
Scottville IRB (MI Job) First Trust 3.960 16-Oct-84 1,800,000 01-Oct-94 0 0
- ------------------------------------------------------------------------------------------------------------------------------------
Pickett IRB (Town of Utica) NationsBk 7.750 01-Jun-90 3,000,000 01-Jun-2005 3,000,000 3,000,000
- ------------------------------------------------------------------------------------------------------------------------------------
Appleton IRB First Trust 3.960 01-Dec-85 1,000,000 01-Jun-95 50,000 350,000
01-Jan-96 300,000
- ------------------------------------------------------------------------------------------------------------------------------------
1988 Poynette Kraut IRB Norwest 8.000 01-Aug-88 6,000,000 01-Aug-98 1,065,000 4,645,000
8.500 01-Aug-2001 3,580,000
- ------------------------------------------------------------------------------------------------------------------------------------
Green Bay IRB NationsBk 8.000 01-Dec-88 3,000,000 01-Dec-96 3,000,000 3,000,000
- ------------------------------------------------------------------------------------------------------------------------------------
Waunakee IRB NationsBk 8.000 01-Dec-88 4,000,000 01-Jul-2001 1,000,000 4,000,000
01-Jul-2002 1,000,000
01-Jul-2003 1,000,000
01-Jul-2004 1,000,000
- ------------------------------------------------------------------------------------------------------------------------------------
Ackley IA IRB Norwest 7.750 01-Jul-89 3,000,000 01-Jul-2002 1,000,000 3,000,000
01-Jul-2004 1,000,000
01-Jul-2005 1,000,000
- ------------------------------------------------------------------------------------------------------------------------------------
City of Wells First Trust 4.050 01-Dec-91 3,000,000 01-Dec-95 150,000 2,550,000
01-Dec-96 150,000
01-Dec-97 150,000
01-Dec-98 150,000
01-Dec-99 150,000
01-Dec-2000 150,000
01-Dec-2001 150,000
01-Dec-2002 150,000
01-Dec-2003 150,000
01-Dec-2004 150,000
01-Dec-2005 150,000
01-Dec-2006 150,000
01-Dec-2007 150,000
01-Dec-2008 150,000
01-Dec-2009 150,000
01-Dec-2010 150,000
01-Dec-2011 150,000
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 41
Annex 2
LITIGATION
1. Walter Reinholdt v. Stokely USA, Inc. (Law No. C2017 in the Iowa
District Court for Franklin County, Iowa)
This is an action brought by plaintiff for damages of
$56,633.43 plus interest and costs. The claim is based on the Company's
alleged negligence in connection with the storage of dark red kidney
beans at its plant in Ackley, Iowa. The Company denies liability.
This case was tried to a jury in July of 1994, and a verdict
was returned which found no liability on the part of the Company.
Plaintiff has, however, appealed to the Court of Appeals of the State
of Iowa. A decision on that appeal is expected later this year.
Davis, Hockenberg, Wine, Brown, Koehn & Shors of Des Moines,
Iowa represents the Company in this matter.
2. Kurt Boehm v. Stokely USA, Inc., et al. (Case No. 93-L-003414 in the
Circuit Court of Cook County, Illinois)
This action was filed in April of 1993 and is for personal
injuries suffered by plaintiff in a boiler explosion that occurred at
the Company's plant in Hoopeston, Illinois while plaintiff was present
as a business invitee.
The Company has liability insurance in force for this claim
through Crum and Forster Commercial Insurance Co., and the Company's
defense has been undertaken by Crum and Forster Insurance Co. through
the law firm of Crystal, Heytow and Warnick, P.C. of Chicago, IL.
3. Robert Potratz and James Potratz v. Stokely USA, Inc. (Case No.
93-CV-811 in the Circuit Court of Winnebago County, Wisconsin.)
This action sought damages of $180,000 on a breach of contract
claim plus punitive damages of an unstated amount. The Company denied
liability, and the case was tried to a jury in April of 1995. The jury
found that the Company breached the contract and returned a damage
verdict of $73,283 against the Company.
The Company has filed motions after verdict to set aside or
reduce the damages to $34,788. These motions are scheduled to be heard
by the court on May 11, 1995. The Company plans to appeal if the
verdict as to damages is not
<PAGE> 42
set aside. Robert Brill, general counsel of the Company, represents the
Company in this action.
4. Renee Estrada v. Arnold Bowman and Stokely USA, Inc. (Cause No.
C-1327-94-D, Hidalgo County, Texas District Court).
This action was filed on March 18, 1994 and is an action for
damages based on plaintiff's claim that he was wrongfully discharged as
an employee at the Company's plant in McAllen, Texas. There is no
substance to the plaintiff's claim. Damages sought include lost
earnings and punitive damages. The Complaint, however, fails to state
a specific damage amount. The exposure is minimal.
The Company is represented by the law firm of Adams and Grahan,
L.L.P. of Harlingen, Texas in this action.
5. Baker's Best Frozen Commodities Co., v. Stokely USA, Inc. et al. (Case
No. BC102425 Los Angeles County Superior Court).
This action was filed on April 11, 1994 and seeks compensatory
and punitive damages arising from an alleged breach of contract. The
amount of damages is not stated in the Complaint but is generally
represented to be in excess of $500,000; of which sum the compensatory
damage claim comprises a small part. Stokely USA, Inc. denies
liability.
A tentative settlement has been reached which is in the process
of being reduced to writing. Pursuant to this settlement, the Company
will forgive outstanding invoices owed it by Plaintiff in the amount of
$16,700 and will provide $15,000 of trade discounts to Plaintiff
in each of the next 3 years.
The Company is represented in this action by Lane, Powell,
Spears and Lubersky of Los Angeles, California.
6. Duane C. Klingler v. Stokely USA, Inc. (Case No. CI-95-046 in the
Common Pleas Court of Paulding County, Ohio).
This action was filed in March of 1995 and claims that the
Company breached a warehouse lease agreement with Plaintiff. Damages of
$44,000 are claimed.
The Company has denied liability. Glenn Troth of Paulding, Ohio
represents the Company in this action.
7. Pedro Rodriguez v. Stokely USA, Inc. (Case No. C94-3057 in the United
States District Court for the Northern District of Iowa).
2
<PAGE> 43
This action was filed in August of 1994 and claims that the
Company breached an employment agreement with Plaintiff. Damages are
unstated in the complaint but are estimated by the Company to be less
than $5,000.
The Company has denied liability. No trial date has been set.
Robert Brill, general counsel of the Company, represents the Company in
this action.
8. Philip D. Freeman v. Stokely USA, Inc. (Case No. 95-C-003 in the United
States District Court for the Eastern District of Wisconsin).
This is a class action lawsuit which was filed on January 3,
1995, in the United States District Court for the Eastern District of
Wisconsin, by Philip D. Freeman, a Minnesota resident, against the
Company, all of the individual members of the Board of Directors of the
Company (in both their capacity as a member of the Board of Directors
and as an executive officer, as applicable), William Blair & Company
and Dain Bosworth, Inc. The plaintiff brought the action pursuant to
Sections 11, 12(2) and 15 of the Securities Act of 1934, as amended,
and Rule 10b-5 promulgated thereunder. The plaintiff alleges that he
sustained losses in connection with his purchase of shares of Common
Stock of the Company following a secondary offering by the Company
during the period from October 17, 1994 to December 19, 1994, as a
result of defendants' alleged misleading statements and omission to
state material facts. The complaint seeks rescission and/or
compensatory damages, and costs and expenses related to the bringing of
the lawsuit. The Company believes that the allegations are without
merit or substance.
The Company retained the law firm of Gibbs, Roper, Loots and
Williams of Milwaukee, Wisconsin to represent the Company and its
officers. The Company has retained the law firm of Michael, Best &
Friedrich of Milwaukee, Wisconsin, to represent the Copany's
non-employee directors. The Company has Directors and Officers
Liability Insurance coverage through two carriers with total coverage
of $10,000,000, less retention of $250,000. The Company has negotiated
allocation of defense costs with the primary carrier assuming 75% of
such costs and the Company 25% after the retention.
Motions for dismissal of the Complaint have been filed on behalf
of all defendants and remain pending.
9. Daniel J. Sweeney v. Stokely USA, Inc., et al. (Case No. 95-C-0501) in
the United States District Court for Eastern District of Wisconsin).
3
<PAGE> 44
This case was filed on 5/10/95 and served 5/17/95. It is a
class action suit arising from the same events as the Freeman case.
The Company has retained the law firm of Gibbs, Roper, Loots &
Williams of Milwaukee, Wisconsin to represent it and its employees
named as defendants.
ADMINISTRATIVE PROCEEDINGS PENDING
1. Cynthia A. Spencer v. Stokely USA, Inc. (Case No. CP 08-92-22838 Iowa
Civil Rights Commission)
Cynthia A. Spencer filed a complaint with the Iowa Civil Rights
Commission in August of 1992. She claims that she was not hired in 1992
as a mechanic due to her gender. This is no substance to her complaint
which remains under investigation by the Iowa Civil Rights Commission.
The Company is represented in this matter by its general
counsel, Robert Brill.
2. John Areklet v. Stokely USA, Inc. (PACA N-7964 in the United States
Department of Agriculture)
John Areklet filed a complaint with the United States
Department of Agriculture in February of 1995 which claims the Company
violated the Perishable Agricultural Commodities Act by rejecting a
quantity of green beans grown under contract with the Company by Mr.
Areklet in 1994. Mr. Areklet claims damages of $12,474.
Stokely has denied liability. An administrative decision on the
claim is forthcoming. The Company is represented in this matter by its
general counsel, Robert Brill.
3. Robert Van der Zanden v. Stokely USA, Inc. (PACA N-8003 in the United
States Department of Agriculture).
Robert Van der Zanden filed a complaint with the United States
Department of Agricluture in March of 1995 which claims the Company
violated the Perishable Agricultural Commodities Act by rejecting a
quantity of green beans grown under contract with the Company by Mr.
Van der Zanden in 1994. Mr. Van der Zanden claims damages of $5,770.
Stokely has denied liability. An administrative decision on the
claim is forthcoming. The Company is represented in this matter by its
general counsel, Rovert Brill.
4
<PAGE> 45
THREATENED LITIGATION
1. Middleton Refuse Hideaway. The Company has been named as a potentially
responsible party with regard to the Middleton Refuse Hideaway Landfill
Site in Dane County, Wisconsin. The Company believes its
responsibility, if any, is de minimus on the basis that it contributed
no hazardous materials to the landfill site and an insignificant
volume of materials in a volumetric ranking scheme.
The Company joined with several other de minimus parties to
retain the law firm of Michael Best and Friedrich of Madison, Wisconsin
to represent it with regard to this matter; although there is no legal
action pending against the Company at this time. The Company is
currently negotiating the de minimums settlement.
5
<PAGE> 46
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 31, 1995
Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43215
Employers Life Insurance Company of Wausau
One Nationwide Plaza
Columbus, Ohio 43215
West Coast Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43215
State of Wisconsin Investment Board
121 East Wilson Street
Madison, Wisconsin 53702
Ladies and Gentlemen:
We have served as counsel to Stokely USA, Inc., a Wisconsin corporation
(the "Borrower"), in connection with the execution and delivery of the
instruments and documents identified on Exhibit A to this letter (collectively
the "Loan Documents," individual Loan Documents and other capitalized terms
used below being hereinafter referred to by the designations appearing on
Exhibit A).
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of all such corporate records of the Borrower, agreements
and other instruments, certificates of officers of the Borrower, certificates
of public officials, and other documents which we have deemed relevant and
necessary to render this opinion. In rendering this opinion, we have assumed
the genuineness of all signatures (other than those of officers of the
Borrower), the authenticity of all documents submitted to us as originals, the
conformity to originals of all documents submitted to us as copies, the due
execution of the Loan Documents by, and the enforceability of the Loan
Documents against, you, and the legal capacity of all natural persons. Whenever
this opinion refers to matters within our "knowledge," "known to us," or of
which we "know," such reference is limited to (i) the representations and
warranties of the Borrower as to factual matters contained in the Loan
Documents; and (ii) facts within our actual knowledge after an inquiry of the
attorneys of this firm who
<PAGE> 47
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 31, 1995
Page 2
have provided legal services to the Borrower within the past year, without
further inquiry. Furthermore, we have not undertaken any further factual
investigation of the business, properties, agreements, or litigation of the
Borrower for purposes of rendering this opinion.
Based upon the foregoing, and subject to the qualifications stated
herein, we are of the opinion that:
1. The Borrower is a corporation existing under the laws of the
State of Wisconsin and, based solely on a certificate of status of the
Wisconsin Secretary of State, (a) has filed with the Wisconsin Secretary of
State during its most recently completed report year the required annual
report; (b) is not the subject of a proceeding under Wisconsin Statutes Section
180.1421 to cause its administrative dissolution; and (c) Articles of
Dissolution of the Borrower have not been filed with such Secretary of State.
2. The Borrower has the corporate power and authority to execute,
deliver, and perform its obligations under the Loan Documents.
3. The execution and delivery of the Loan Documents and the
performance by the Borrower of their terms do not and will not (i) contravene
any provisions of the Articles of Incorporation or Bylaws of the Borrower; (ii)
to our knowledge, contravene any presently existing provision of any law known
to us to be applicable to the Borrower; (iii) contravene any provision of any
agreement known to us under which the Borrower has borrowed money (except for
such violation or default as has been waived or consented to by the relevant
party thereto); (iv) to our knowledge, result in the creation or imposition of
any lien upon any of the property of the Borrower except pursuant to the Loan
Documents; or (v) require the consent or approval of, or any filing or
registration with, any governmental body, agency, or authority other than the
filing of the Financing Statements.
4. The Loan Documents have been duly authorized by all necessary
corporate action (no stockholder approval being required), have been executed
and delivered by the Borrower, and constitute valid and binding agreements of
the Borrower enforceable against it in accordance with their respective terms.
The Note Agreement dated as of December 1, 1991 between the Borrower and SWIB,
as amended by the SWIB Amendment, and the Note Agreement dated August 18, 1992
among the Borrower and the Insurance Companies, as amended by the Nationwide
Amendment, constitute valid
<PAGE> 48
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 31, 1995
Page 3
and binding agreements of the Borrower enforceable against it in accordance
with their respective terms.
5. Each of the Security Agreement and the Assignment of Contracts,
Warranties and Permits is adequate to create and provide for the liens and
security interests contemplated thereby for the benefit and security of all the
indebtedness secured thereby. The description of the Collateral set forth in
the Financing Statements is sufficient to perfect, and upon the due filing
thereof in the offices noted in Exhibit A hereto will perfect, a security
interest in the terms and types of Collateral in which a security interest may
be perfected by the filing of a financing statement under the Uniform
Commercial Code of the State of Wisconsin as in effect on the date hereof (the
"UCC") to the extent that (i) Wisconsin is the proper state for filing; (ii)
the Collateral consists of the type of property for which a security interest
may be perfected by filing a financing statement in Wisconsin under the UCC;
and (iii) any part of the Collateral or the proceeds or products thereof does
not constitute trust property or a trust fund which by virtue of federal or
state law is not subject to the claims, liens, or security interests of
creditors.
6. To our knowledge, there is no action, suit, proceeding, or
investigation at law or in equity before or by any court or public body pending
or threatened against or affecting the Borrower or any of its assets and
properties which, if adversely determined, could result in any material adverse
change in the properties, business, operations, or financial condition of the
Borrower or in the value of the collateral security for your loans and other
credit accommodations to the Borrower except as described in Annex 2 to each of
the Nationwide Amendment and the SWIB Amendment.
7. The rates of interest provided for under the Loan Documents and
any other amounts payable thereunder that would constitute interest would not
violate any usury law of the State of Wisconsin.
All of the foregoing opinions are subject to the following additional
assumptions, limitations, and qualifications:
(a) We express no opinion as to the effect of the compliance or
noncompliance by you with any state or federal laws or regulations applicable
to you because of legal or regulatory status or the nature of your business.
<PAGE> 49
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 31, 1995
Page 4
(b) Our opinions relating to the enforceability of the Loan
Documents are subject to and limited by:
(i) Bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, marshalling, and other similar laws now or hereafter in
effect relating to or affecting the rights and remedies of creditors generally;
(ii) Limitations imposed by general principles of equity
upon the specific enforceability of any of the remedies or other provisions of
such documents and upon the availability of injunctive relief and other
equitable remedies (regardless of whether enforcement is considered in
proceedings at law or in equity);
(iii) The qualification that certain provisions of the Loan
Documents are or may be unenforceable in whole or in part under the laws of the
State of Wisconsin, but the inclusion of such provisions does not render the
Loan Documents invalid as a whole and there exist either in the Loan Documents
or under applicable law adequate remedies for the practicable realization of
the principal legal rights and benefits intended to be provided thereby
(except for the economic consequences of any delay resulting from such
unenforceability);
(iv) Such enforcement is subject to recent court decisions
which may require lenders to act reasonably and in good faith in exercising
their rights and remedies under the Loan Documents; and
(v) The provisions of the Mortgages which (A) purport to
give the mortgagee the right, prior to the date of confirmation of a
foreclosure sale by the court (assuming the mortgagee is a successful bidder at
the foreclosure sale), to take control of the real estate described in the
Mortgages, or which (B) purport to give the mortgagee the right, prior to the
date of confirmation of a foreclosure sale by the court (assuming the mortgagee
is a successful bidder at the foreclosure sale), to collect the rents, issues,
or profit thereof, are subject to acquiescence of the Borrower after a default,
unless the mortgagee obtains a court order and the appointment of a receiver
for such purpose. Such rights will not be available in any event if the
mortgagee elects certain redemption periods pursuant to Wisconsin Statutes. We
note that under Wisconsin law, despite an assignment of rents, the equitable
right ot rent remains with the mortgagor in
<PAGE> 50
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 31, 1995
Page 5
the event of default, until such time as the mortgagee's interest in the rents
is perfected.
(c) We render no advice concerning and do not express any opinion
as to:
(i) the priority of any security interest; or
(ii) items of Collateral which by operation of law cannot be
subject to a consensual security interest.
(d) We express no opinion as to the following:
(i) the Borrower's rights in or title to the Collateral;
(ii) any security interest that is terminated or released;
(iii) the effect of noncompliance with the federal Assignment
of Claims Act; or
(iv) future advances.
(e) In the case of property which becomes Collateral after the date
hereof, (i) Section 547 of the United States Bankruptcy Code provides that a
transfer is not made until the debtor has rights in the property transferred so
a security interest in after-acquired property may be treated as a voidable
preference under the conditions (and subject to the exceptions) provided by
Section 547; (ii) Chapter 128 of the Wisconsin Statutes contains a four-month
preference provision that may apply to after-acquired property; and (iii)
Section 552 of the United States Bankruptcy Code limits the extent to which
property acquired by a debtor after the commencement of a case under the United
States Bankruptcy Code may be subject to a security interest arising from a
security agreement entered into by the debtor before the commencement of such
case.
(f) In the case of any interest in or claim in or under any policy
of insurance covering the Collateral, the security interest of the secured party
therein is limited to proceeds payable to the named insured (and not to any
other party named as loss payee under such policy) by reason of loss or damage
to the collateral insured under such insurance policies.
<PAGE> 51
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 31, 1995
Page 6
(g) In the case of all Collateral in which the security interest of
the secured party has been perfected by the filing of the Financing Statements,
Article 9 of the UCC requires the filing of continuation statements within the
period of six months prior to the expiration of five years from the date of the
original filings in order to maintain the effectiveness of the filings referred
to in this paragraph.
(h) The duties to exercise reasonable care in the custody and
preservation of the Collateral in a secured party's possession and to deal with
and dispose of the collateral in a commercially reasonable manner as required
by the UCC may not be disclaimed by agreement, waived, or released.
We call to your attention that the perfection of the above security interests
will be terminated (i) as to any Collateral acquired by the Borrower more than
four months after the Borrower so changes its name, identity, or corporate
structure as to make any financing statements filed against such party
seriously misleading, unless new appropriate financing statements indicating
the new name, identity, or corporate structure of such party are properly filed
before the expiration of such four months; (ii) as to any Collateral consisting
of accounts or general intangibles, four months after the Borrower changes its
chief executive office to a new jurisdiction outside Wisconsin unless such
security interests are perfected in such new jurisdiction before that
termination; (iii) as against buyers of items of the Collateral consisting of
goods of the Borrower sold in the ordinary course of business; and (iv) as to
Collateral otherwise disposed of by the Borrower if such disposition is
authorized under the Loan Documents.
We express no opinion as to (i) any provision affording indemnification
to you; (ii) provisions imposing penalties, forfeitures, or increases in rates
of interest upon delinquency in any payment or upon any breach or default under
the Loan Documents; or (iii) broadly stated waivers of presentment, protest,
demand, notice, appraisement, valuation, stay, extension, moratorium,
redemption, marshalling of assets, or other rights granted by law to the extent
such waivers or rights are held to be against public policy or prohibited by
law.
This opinion deals only with the specific legal issues that it
explicitly addresses and no opinion shall be implied as to matters not so
addressed. The opinions expressed herein are specifically limited to the laws
of the State of Wisconsin and the federal laws of the United States. The
opinions expressed herein
<PAGE> 52
[MICHAEL BEST & FRIEDRICH LETTERHEAD]
May 31, 1995
Page 7
are given as of the date of this letter and are intended to apply only to those
facts and circumstances that exist as of the date hereof, and we assume no
obligation or responsibility to update or supplement this opinion to reflect
any facts or circumstances occurring after the date hereof that would alter the
opinions contained herein. This opinion is rendered solely for your information
and assistance in connection with the transactions described above and may not
be relied upon by any other person or for any other purpose without our prior
written consent.
Sincerely,
MICHAEL, BEST & FRIEDRICH
Michael, Best & Friedrich
<PAGE> 53
EXHIBIT A
THE LOAN DOCUMENTS
(All Loan Documents are dated as of May 31, 1995. The "Insurance
Companies" shall mean Nationwide Life Insurance Company, Employers Life
Insurance Company of Wausau, and West Coast Life Insurance Company. "SWIB"
shall mean State of Wisconsin Investment Board.)
1. Third Amendment to Note Agreement among the Borrower and the Insurance
Companies (the "Nationwide Amendment").
2. Third Amendment to Note Agreement between the Borrower and SWIB (the "SWIB
Amendment").
3. Security Agreement among the Borrower, the Insurance Companies, and SWIB.
4. Mortgages executed by the Borrower in favor of the Insurance Companies and
SWIB.
5. Environmental Indemnification Agreement from the Borrower to the Insurance
Companies and SWIB.
6. Assignment of Contracts, Warranties and Permits from the Borrower to the
Insurance Companies and SWIB.
7. Intercreditor Agreement among the Insurance Companies and SWIB,
acknowledged by the Borrower.
8. UCC financing statements to be filed in the offices of the Wisconsin
Secretary of State and the Register of Deeds for the following Wisconsin
counties (the "Financing Statements"):
Brown Jefferson
Columbia Lincoln
Dane Waukesha
Iowa Winnebago
<PAGE> 54
EXHIBIT B
STOKELY USA, INC.
CERTIFICATE OF OFFICERS
We, Stephen Theobald and Robert Brill, each hereby certify that we are,
respectively, the Vice Chairman and the Secretary of STOKELY USA, INC., a
Wisconsin corporation (the "Company"), and that, as such officers, we are
authorized to execute and deliver this Certificate in the name and on behalf of
the Company, and that:
1. This Certificate is being delivered pursuant to Section 3(b) of
the Third Amendment to Note Agreement (the "Third Amendment"), dated May 31,
1995, entered into by the Company and each of the noteholders listed on Annex
1 thereto (collectively, the "Noteholders").
2. The representations and warranties contained in Section 2 of
the Third Amendment are (except as affected by transactions contemplated by the
Third Amendment) true in all material respects on the date hereof with the same
effect as though made on and as of the date hereof.
3. The Company has performed and complied with all agreements and
conditions contained in the Third Amendment that are required to be performed
or complied with by the Company before or at the date hereof.
4. Robert Brill is on and as of the date hereof, and at all times
subsequent to May, 1995 has been, the duly elected, qualified and acting
Secretary of the Company, and the signature appearing on the Certificate of
Secretary dated the date hereof and delivered to the Noteholders
contemporaneously herewith is his genuine signature.
IN WITNESS WHEREOF, we have executed this Certificate in the name and
on behalf of the Company and under its corporate seal this 25th day of May,
1995.
STOKELY USA, INC.
By: STEPHEN THEOBALD
------------------------
Stephen Theobald
Vice Chairman
ROBERT BRILL
------------------------
Robert Brill
Secretary
Exhibit B1-1
<PAGE> 55
STOKELY USA, INC.
CERTIFICATE OF SECRETARY
I, Robert Brill, hereby certify that:
(a) I am the duly elected, qualified and acting Secretary of
STOKELY USA, INC. (the "Company"), a Wisconsin corporation;
(b) Attached hereto as Attachment A is a true and complete copy of
the Articles of Incorporation of the Company, as in full force and effect on
the date hereof;
(c) Attached hereto as Attachment B is a true and complete copy of
the By-Laws of the Company, including all amendments thereto;
(d) Each person who, as an officer or director of the Company,
signed any of the agreements, instruments or documents in connection with the
financing arrangements described in the resolutions attached hereto was, at the
respective time of signing and the delivery thereof, duly elected, qualified
and acting as such officer or director;
(e) Attached hereto as Attachment C is a true and complete list of
the executive officers and directors of the Company. The signature set forth
opposite the name of each officer is his or her genuine signature; and
(f) Attached hereto as Attachment D is a true and complete copy of
all resolutions duly adopted by the Board of Directors and/or stockholders of
the Company with respect to the Third Amendment to Note Agreement dated May 31,
1995, among the Company and the noteholders listed on Annex 1 thereto, and all
transactions and documents contemplated thereby, including agreements and
documents relating to holders of the Company's long-term notes; such
resolutions have not been modified, amended, repealed or rescinded and remain
in full force and effect as of the date hereof; and such resolutions are the
only resolutions adopted by the Company's Board of Directors or stockholders
relating to the matters described therein.
IN WITNESS WHEREOF, I have hereunto set my hand this 25th day of May,
1995.
STOKELY USA, INC.
ROBERT BRILL
---------------------
Secretary
<PAGE> 56
ATTACHMENT A
ARTICLES OF INCORPORATION
OF THE COMPANY
Exhibit C1-2
<PAGE> 57
UNITED STATES OF AMERICA
STATE OF WISCONSIN )
)
OFFICE OF THE ) SS.
SECRETARY OF STATE )
TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETING:
I, DOUGLAS La FOLLETTE, Secretary of State of the State of Wisconsin
and Keeper of the Great Seal thereof, do hereby certify that the annexed copy
has been compared by me with the record on file in this Office and that the
same is a true copy thereof, and of the whole of such record; and that I am the
legal custodian of such record, and that this certification is in due form.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed the
Great Seal of the State.
[GREAT SEAL OF THE
STATE OF WISCONSIN.]
DOUGLAS LA FOLLETTE
DOUGLAS La FOLLETTE
Secretary of State
BY: Robert Karis DATE: APR 26, 1995
Corporation Division
FORM 38
<PAGE> 58
ARTICLES OF AMENDMENT AND
RESTATED ARTICLES OF INCORPORATION
OF STOKELY USA, INC.
At a meeting of the stockholders of Stokely USA, Inc. held on September
16, 1985, pursuant to the Wisconsin Statutes and the Articles and By-Laws of
said corporation, the following Articles of Amendment and Restated Articles of
Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendment and Restated Articles of Incorporation so adopted
are set forth in Exhibit A attached hereto and made a part hereof.
THIRD: The date of adoption of the Amendment and Restated Articles of
Incorporation by the stockholders was September 16, 1985.
FOURTH: The foregoing Amendment and Restated Articles of Incorporation
were adopted by the stockholders entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ----- ----------- --------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Common 6,635,200 6,635,200 4,423,467 6,238,800 None
</TABLE>
<PAGE> 59
FIFTH: The Amendment and Restated Articles of Incorporation effect a
change in the authorized capital stock of the corporation. The total number of
authorized shares of common stock is increased from 10,000,000 shares of a par
value of $.06 per share to 12,000,000 shares of a par value of $.05 per share.
There is no change in the stated capital of the corporation, which remains at
$600,000 respresented by 12,000,000 shares of a par value of $.05 per share.
Each presently outstanding share of a par value of $.06 per share shall be
converted into a share of a par value of $.05 and no new shares shall be issued
in connection with such reduction of par value.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 16th day of September, 1985.
STOKELY USA, Inc.
By THOMAS W. MOUNT
--------------------------
Thomas W. Mount, President
DUANE W. THORSEN
--------------------------
D.W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
-2-
<PAGE> 60
EXHIBIT A
RESTATED
ARTICLES OF INCORPORATION
OF
STOKELY USA, INC.
The following Restated Articles of Incorporation of Stokely USA, Inc.
supersede and take the place of the heretofore existing Articles of
Incorporation of said corporation and all prior amendments thereto:
ARTICLE I
The name of the corporation is Stokely USA, Inc.
ARTICLE II
The purpose or purposes for which the corporation is organized are to
engage in any lawful activity within the purposes for which a corporation may
be organized under the Wisconsin Business Corporation Law, Chapter 180 of the
Wisconsin Statutes.
ARTICLE III
The number of shares of capital stock which the corporation shall be
authorized to issue is Twelve Million (12,000,000) shares. Such shares shall be
designated common stock and shall be of a par value of $.05 per share. The
holders of the capital stock shall not have any preemptive rights to purchase
or to subscribe for shares of any class
<PAGE> 61
of shares of capital stock or securities convertible into capital stock, now or
hereafter authorized.
ARTICLE IV
The address of the registered office of the corporation is 626 East
Wisconsin Avenue, Box 248, Oconomowoc, Waukesha County, Wisconsin 53066, and
the name of its registered agent at such address is Joseph B. Weix.
ARTICLE V
The number of directors constituting the Board of Directors of the
corporation shall be fixed from time to time by the By-Laws of the corporation.
-2-
<PAGE> 62
STATE OF WISCONSIN
FILED
SEP 17 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 63
ARTICLES OF MERGER
OF
STOKELY USA, INC.
a Wisconsin Corporation
AND
AMERICAN NATIONAL CORP.
an Iowa Corporation
The following Articles of Merger have been duly adopted by the Board of
Directors of Stokely USA, Inc. pursuant to the provisions of Section 180.685 of
the Wisconsin Statutes.
FIRST: The Plan of Merger so adopted is set forth on Exhibit A
attached hereto and made a part hereof.
SECOND: Stokely USA, Inc., the surviving corporation, is the owner of
all of the outstanding shares of American National Corp., the merging
corporation. The Plan of Merger does not provide for any changes in the
Articles of Incorporation of Stokely USA, Inc. or any issuance of capital stock
by Stokely USA, Inc. The Plan of Merger provides for the cancellation of the
currently outstanding capital stock of American National Corp. held by Stokely
USA, Inc.
THIRD: The merger shall become effective at the close of business on
May 31, 1989 if these Articles of Merger are duly filed prior to such time. If
these Articles of Merger are not duly filed until after the close of business
on May 31, 1989, the merger shall become effective upon the due filing thereof.
FOURTH: The number of outstanding shares of each class of American
National Corp. and the number of such shares of each class owned by Stokely
USA, Inc. is as follows:
Class Outstanding Owned by Stokely USA, Inc.
----- ----------- --------------------------
Common 75,000 75,000
FIFTH: As Stokely USA, Inc., the surviving corporation, is the sole
owner of all of the outstanding capital stock of American National Corp., no
notice of the merger to each shareholder of record of American National Corp.
is required by Section 180.685(2) of the Wisconsin Statutes. Stokely USA, Inc.
<PAGE> 64
waives any and all rights to be paid the fair value of its shares as provided
in Section 180.72 of the Wisconsin Statutes.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc., the
surviving corporation, and of American National Corp., the merging corporation,
have caused these Articles of Merger to be executed as of the 26th day of May,
1989.
STOKELY USA, INC. AMERICAN NATIONAL CORP.
By: THOMAS W. MOUNT By: THOMAS W. MOUNT
--------------- ---------------
Thomas W. Mount Thomas W. Mount
President President
Attest: DUANE W. THORSEN Attest: WILLIAM SIMONS
---------------- --------------
Duane W. Thorsen William Simons
Secretary Secretary
[CORPORATE SEAL] [NO CORPORATE SEAL]
This document was drafted by and should be returned to:
F. J. Pelisek, Esq.
Michael, Best & Friedrich
250 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
(414) 271-6560
<PAGE> 65
EXHIBIT A
PLAN OF MERGER
WHEREAS, Stokely USA, Inc., a Wisconsin corporation ("Stokely"), owns
all of the outstanding shares of stock of American National Corp., an Iowa
corporation ("American"); and
WHEREAS, it is deemed advisable that Stokely be merged with American,
with Stokely being the surviving corporation:
NOW, THEREFORE, this Plan of Merger is hereby adopted under and
pursuant to Section 496A.72 of the Iowa Code by the Board of Directors of
Stokely, the surviving corporation.
1. The corporations proposing to merge are Stokely and American, with
Stokely being the surviving corporation.
2. The terms and conditions of the proposed merger are that upon the
merger becoming effective the parties to this Plan of Merger shall become a
single corporation and shall have and succeed to all of the rights, privileges
and powers now possessed by both parties to the merger. The surviving
corporation shall assume and discharge all of the obligations and liabilities
of both of the parties to the merger.
3. All of the outstanding shares of common stock of American currently
owned by Stokely will be surrendered and cancelled. There shall be no
conversion of the shares of American into shares, obligations or other
securities of Stokely or any other corporation or, in whole or in part, into
cash or other property. Stokely will not issue any shares of its capital stock
as a result of the merger. There will be no change in the Articles of
Incorporation of Stokely as a result of the merger.
4. This Plan of Merger shall become effective at the close of business
on May 31, 1989, or upon the filing of Articles of Merger if such filing shall
occur after such time.
5. Stokely's registered office is located in Waukesha County. The
registered office of Stokely, the surviving corporation, shall remain in
Waukesha County.
<PAGE> 66
STATE OF WISCONSIN
FILED
MAY 30 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 67
ARTICLES OF AMENDMENT TO THE
RESTATED ARTICLES OF INCORPORATION OF
STOKELY USA, INC.
By action of the shareholders of Stokely USA, Inc. on June 24, 1989 at
a meeting duly convened pursuant to the provisions of the Wisconsin Statutes
and the Articles and By-Laws of said corporation, the following Articles of
Amendment to the Restated Articles of Incorporation of said corporation were
duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendments to the Restated Articles of Incorporation so
adopted are as follows:
(1) RESOLVED, that Article III of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended
to read as follows:
"Article III. The number of shares of capital stock which the
Corporation shall be authorized to issue is Twenty-One Million
(21,000,000) shares, divided into Twenty Million (20,000,000) shares of
Common Stock, $.05 par value per share, and One Million (1,000,000)
shares of Preferred Stock, $.10 par value per share.
(1) The Board of Directors of the Corporation is authorized at
any time or from time to time to divide the shares of preferred stock
into classes and into series within any class or classes of preferred
stock; and to determine for any such class or series its
<PAGE> 68
designation, relative rights, preferences and limitations, including,
if applicable, the rate of dividend, the price at and the terms and
conditions upon which shares may be redeemed, the amount payable upon
shares in event of voluntary or involuntary liquidation, sinking fund
provisions for the redemption or purchase of shares, and the terms and
conditions upon which shares may be converted.
(2) No holder of any shares of Common or preferred stock of
the Corporation shall have any right as such holder (other than such
right, if any, as the Board of Directors in its discretion may
determine) to purchase or to subscribe for shares of any class of
shares of capital stock or securities convertible into capital stock,
now or hereafter authorized."
(2) RESOLVED, that Article V of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended
to read as follows:
"Article V. The number of Directors constituting the Board of
Directors of this Corporation, not less than nine (9) nor more than
fifteen (15), shall be fixed from time to time by the By-Laws of this
Corporation. The Board of Directors of this Corporation shall be
divided into three (3) classes of not less than three (3) nor more than
five (5) Directors each. The term of office of the first class of
Directors shall expire at the first annual meeting after their initial
election under the provisions of this Article V, the term of office of
the second class shall expire at the second annual meeting after their
initial election under the provisions of this Article V, and that of
the third class shall expire at the third annual meeting after their
initial election under the provisions of this Article V. At each
annual meeting after the initial classification of the Board of
Directors under this Article V, the class of Directors whose term
expires at the time of such election shall be elected to hold office
until the third succeeding annual meeting.
Any Director may be removed from office by affirmative vote of
80% of the outstanding shares entitled to vote for the election of such
Director, taken at an annual meeting or a special meeting of
shareholders called for that purpose, and any vacancy so created may be
filled by the affirmative vote of 80% of such shares.
2
<PAGE> 69
Notwithstanding any other provisions of these Articles of
Incorporation or the By-Laws of the Corporation (and notwithstanding
the fact that a lesser percentage may be specified by law, these
Articles of Incorporation or the By-laws of the Corporation), the
affirmative vote of the holders of at least 80% of the voting power of
all the shares of the Corporation entitled to vote for the election of
directors, voting together as a single class, shall be required to
amend or repeal, or adopt any provisions inconsistent with, this
Article V of these Articles of Incorporation."
(3) RESOLVED, that Article VI of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, created
to read as follows:
Article VI is attached to these Articles of Amendment of
Stokely USA, Inc. as Annex A.
THIRD: The date of adoption of the Amendments by the shareholders was
June 24, 1989.
FOURTH: The foregoing Amendments were adopted by the shareholders
entitled to vote as set forth below. At the record date for the meeting of
June 24, 1989, the outstanding shares of Common Stock, all of which were
entitled to vote, are as set forth below:
(1) AMENDMENT OF ARTICLE III - INCREASE IN CAPITAL STOCK
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
Class to Vote Required For Against
- ------- -------------- -------------- --------- -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,966,124 694,026
</TABLE>
3
<PAGE> 70
(2) AMENDMENT OF ARTICLE V - CLASSIFIED BOARD OF DIRECTORS
[CAPTION]
<TABLE>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- ------ -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,951,984 634,951
</TABLE>
(3) ADDITION OF ARTICLE VI - REPURCHASE RIGHTS
[CAPTION]
<TABLE>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- ------ -------
<S> <C> <C> <C> <C>
COMMON 8,239,145 5,492,797 5,960,405 626,666
</TABLE>
FIFTH: The Amendments will effect a change in the authorized capital
stock of the Corporation. The Amendments increase the authorized capital stock
of the Corporation from 22,000,000 shares of Common Stock of $.05 par value to
20,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value, or an increase in authorized capital stock
of 8,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value. The Amendments do not increase the stated
capital of the Corporation as defined in Section 180.02(12), Wisconsin Statues,
as there are no current plans or proposals for issuance by the Corporation of
the additional authorized Common Stock or the newly authorized Preferred Stock.
4
<PAGE> 71
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 24th day of June, 1989.
STOKELY USA, INC.
THOMAS W. MOUNT
--------------------------
Thomas W. Mount, President
DUANE W. THORSEN
--------------------------
Duane W. Thorsen, Secretary
This document was drafted by:
Frank J. Pelisek, Attorney at Law
Michael, Best & Friedrich
100 East Wisconsin Avenue, Suite 3300
Milwaukee, Wisconsin 53202-4108
Record in Waukesha County, Wisconsin
5
<PAGE> 72
ARTICLES OF AMENDMENT AND
RESTATED ARTICLES OF INCORPORATION
OF STOKELY USA, INC.
At a meeting of the stockholders of Stokely USA, Inc. held on September
16, 1985, pursuant to the Wisconsin Statutes and the Articles and By-Laws of
said corporation, the following Articles of Amendment and Restated Articles of
Incorporation of said corporation were duly adopted.
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendment and Restated Articles of Incorporation so adopted
are set forth in Exhibit A attached hereto and made a part hereof.
THIRD: The date of adoption of the Amendment and Restated Articles of
Incorporation by the stockholders was September 16, 1985.
FOURTH: The foregoing Amendment and Restated Articles of Incorporation
were adopted by the stockholders entitled to vote by the following vote:
[CAPTION]
<TABLE>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
----- ----------- -------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Common 6,635,200 6,635,200 4,423,467 6,238,800 None
</TABLE>
<PAGE> 73
FIFTH: The Amendment and Restated Articles of Incorporation effect a
change in the authorized capital stock of the corporation. The total number of
authorized shares of common stock is increased from 10,000,000 shares of a par
value of $.06 per share to 12,000,000 shares of a par value of $.05 per share.
There is no change in the stated capital of the corporation, which remains at
$600,000 represented by 12,000,000 shares of a par value of $.05 per share.
Each presently outstanding share of a par value of $.06 per share shall be
converted into a share of a par value of $.05 and no new shares shall be issued
in connection with such reduction of par value.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 16th day of September, 1985.
STOKELY USA, INC.
By THOMAS W. MOUNT
--------------------------
Thomas W. Mount, President
D. W. THORSEN
---------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
-2-
<PAGE> 74
EXHIBIT A
RESTATED
ARTICLES OF INCORPORATION
OF
STOKELY USA, INC.
The following Restated Articles of Incorporation of Stokely USA, Inc.
supersede and take the place of the heretofore existing Articles of
Incorporation of said corporation and all prior amendments thereto:
ARTICLE I
The name of the corporation is Stokely USA, Inc.
ARTICLE II
The purpose or purposes for which the corporation is organized are to
engage in any lawful activity within the purposes for which a corporation may
be organized under the Wisconsin Business Corporation Law, Chapter 180 of the
Wisconsin Statutes.
ARTICLE III
The number of shares of capital stock which the corporation shall be
authorized to issue is Twelve Million (12,000,000) shares. Such shares shall
be designated common stock and shall be of a par value of $.05 per share. The
holders of the capital stock shall not have any preemptive rights to purchase
or to subscribe for shares of any class
<PAGE> 75
of shares of capital stock or securities convertible into capital stock, now or
hereafter authorized.
ARTICLE IV
The address of the registered office of the corporation is 626 East
Wisconsin Avenue, Box 248, Oconomowoc, Waukesha County, Wisconsin 53066, and
the name of its registered agent at such address is Joseph B. Weix.
ARTICLE V
The number of directors constituting the Board of Directors of the
corporation shall be fixed from time to time by the By-Laws of the corporation.
-2-
<PAGE> 76
STATE OF WISCONSIN
FILED
SEP 17 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 77
ARTICLES OF AMENDMENT TO THE
RESTATED ARTICLES OF INCORPORATION OF
STOKELY USA, INC.
By action of the shareholders of Stokely USA, Inc. on June 24, 1989 at
a meeting duly convened pursuant to the provisions of the Wisconsin Statutes
and the Articles and By-Laws of said corporation, the following Articles of
Amendment to the Restated Articles of Incorporation of said corporation were
duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendments to the Restated Articles of Incorporation so
adopted are as follows:
(1) RESOLVED, that Article III of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended
to read as follows:
"Article III. The number of shares of capital stock which the
Corporation shall be authorized to issue is Twenty-One Million
(21,000,000) shares, divided into Twenty Million (20,000,000) shares of
Common Stock, $.05 par value per share, and One Million (1,000,000)
shares of Preferred Stock, $.10 par value per share."
(1) The Board of Directors of the Corporation is authorized
at any time or from time to time to divide the shares of preferred
stock into classes and into series within any class or classes of
preferred stock; and to determine for any such class or series its
<PAGE> 78
designation, relative rights, preferences and limitations, including,
if applicable, the rate of dividend, the price at and the terms and
conditions upon which shares may be redeemed, the amount payable upon
shares in event of voluntary or involuntary liquidation, sinking fund
provisions for the redemption or purchase of shares, and the terms and
conditions upon which shares may be converted.
(2) No holder of any shares of Common or preferred stock of
the Corporation shall have any right as such holder (other than such
right, if any, as the Board of Directors in its discretion may
determine) to purchase or to subscribe for shares of any class of
shares of capital stock or securities convertible into capital stock,
now or hereafter authorized."
(2) RESOLVED, that Article V of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended
to read as follows:
"ARTICLE V. The number of Directors constituting the Board of
Directors of this Corporation, not less than nine (9) nor more than
fifteen (15), shall be fixed from time to time by the By-Laws of this
Corporation. The Board of Directors of this Corporation shall be
divided into three (3) classes of not less than three (3) nor more than
five (5) Directors each. The term of office of the first class of
Directors shall expire at the first annual meeting after their initial
election under the provisions of this Article V, the term of office of
the second class shall expire at the second annual meeting after their
initial election under the provisions of this Article V, and that of
the third class shall expire at the third annual meeting after their
initial election under the provisions of this Article V. At each annual
meeting after the initial classification of the Board of Directors
under this Article V, the class of Directors whose term expires at the
time of such election shall be elected to hold office until the third
succeeding annual meeting."
Any Director may be removed from office by affirmative vote of
80% of the outstanding shares entitled to vote for the election of such
Director, taken at an annual meeting or a special meeting of
shareholders called for that purpose, and any vacancy so created may be
filled by the affirmative vote of 80% of such shares.
2
<PAGE> 79
Notwithstanding any other provisions of these Articles of
Incorporation or the By-Laws of the Corporation (and notwithstanding
the fact that a lesser percentage may be specified by law, these
Articles of Incorporation or the By-Laws of the Corporation), the
affirmative vote of the holders of at least 80% of the voting power of
all the shares of the Corporation entitled to vote for the election of
directors, voting together as a single class, shall be required to
amend or repeal, or adopt any provisions inconsistent with, this
Article V of these Articles of Incorporation."
(3) RESOLVED, the Article VI of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, created
to read as follows:
Article VI is attached to these Articles of Amendment of
Stokely USA, Inc. as Annex A.
THIRD: The date of adoption of the Amendments by the shareholders was
June 24, 1989.
FOURTH: The foregoing Amendments were adopted by the shareholders
entitled to vote as set forth below. At the record date for the meeting of June
24, 1989, the outstanding shares of Common Stock, all of which were entitled to
vote, are as set forth below:
(1) AMENDMENT OF ARTICLE III - INCREASE IN CAPITAL STOCK
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
Class to Vote Required For Against
- --------- ------------ ------------- ----------- --------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,966,124 694,026
</TABLE>
3
<PAGE> 80
(2) AMENDMENT OF ARTICLE V - CLASSIFIED BOARD OF DIRECTORS
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ------------- ----------- --------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,951,984 634,951
</TABLE>
(3) ADDITION OF ARTICLE VI - REPURCHASE RIGHTS
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ------------- ----------- --------
<S> <C> <C> <C> <C>
Common 8,239,145 5,492,797 5,960,405 626,666
</TABLE>
FIFTH: The Amendments will effect a change in the authorized capital
stock of the Corporation. The Amendments increase the authorized capital stock
of the Corporation from 12,000,000 shares of Common Stock of $.05 par value to
20,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value, or an increase in authorized capital stock
of 8,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value. The Amendments do not increase the stated
capital of the Corporation as defined in Section 180.02(12), Wisconsin
Statutes, as there are no current plans or proposals for issuance by the
Corporation of the additional authorized Common Stock or the newly authorized
Preferred Stock.
4
<PAGE> 81
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 24th day of June, 1989.
STOKELY USA, INC.
By THOMAS W. MOUNT
--------------------------------
Thomas W. Mount, President
By DUANE W. THORSEN
--------------------------------
Duane W. Thorsen, Secretary
This document was drafted by:
Frank J. Pelisek, Attorney at Law
Michael, Best & Friedrich
100 East Wisconsin Avenue, Suite 3300
Milwaukee, Wisconsin 53202-4108
Record in Waukesha County, Wisconsin
5
<PAGE> 82
ANNEX A
ARTICLE VI
REPURCHASE OF COMMON STOCK
6.1 REPURCHASE RIGHTS.
6.1.1. In the event that any person (Acquiring Person)(i) who is the
beneficial owner, directly or indirectly, of fifty percent (50%) or more of the
Common Stock then outstanding and any of such Common Stock was acquired
pursuant to a tender offer, each holder of Common Stock shall have the right,
until and including the ninetieth (90th) day following the date the notice to
holders of Common Stock referred to in Section 6.3 herein is mailed, to have
the Common Stock held by such holder repurchased by the Corporation at the
Repurchase Price determined as provided in Section 6.5 herein, and each holder
of securities convertible into Common Stock or of options, warrants or rights
exercisable to acquire Common Stock prior to such thirtieth (30th) day shall
have the right simultaneously with the conversion of such securities or
exercise of such options, warrants or rights to have the Common Stock to be
received by such holder repurchased by the Corporation at the Repurchase Price.
6.1.2. All repurchase rights hereunder shall be subject to, and
limited by, any provision contained in the Wisconsin Business Corporation Law
which limits the amounts which may be used by the Corporation to repurchase its
Common Stock.
6.1.3. No holder of Common Stock of the Corporation shall have any
right to have Common Stock repurchased by the Corporation pursuant to this
Article VI if the Corporation, acting through a majority of its Board of
Directors, shall within ten (10) business days following the publication of
such
<PAGE> 83
tender offer or following publication of any amendment of such tender offer
recommend to the holders of Common Stock that such tender offer be accepted.
6.2 DEFINITIONS.
6.2.1. The term "person" shall include an individual, a Corporation,
partnership, trust or other entity. When two or more persons act as a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring Common Stock, such partnership, syndicate or group shall be deemed a
"person."
6.2.2. For the purpose of determining whether a person is an Acquiring
Person, such person shall be deemed to beneficially own (i) all Common Stock
with respect to which such person has the capability to control or influence
the voting or dispositive power in respect thereof and (ii) all Common Stock
which such person has the immediate or future right to acquire, directly or
indirectly, pursuant to agreements, through the exercise of options, warrants
or rights or through the conversion of convertible securities or otherwise; and
all Common Stock which an Acquiring Person has the right to acquire in such
manner shall be deemed to be outstanding shares, but Common Stock which any
other person has the right to acquire in such manner shall not be deemed to be
outstanding shares.
6.2.3. The acquisition of Common Stock by the Corporation or by any
person controlled by the Corporation shall not engender the right to have
Common Stock repurchased pursuant to this Article VI.
6.2.4. The right to have Common Stock repurchased pursuant to this
Article VI shall attach to such shares and shall not be personal to the holder
thereof.
6.2.5. The term "tender offer" shall mean an offer to acquire or an
acquisition of Common Stock pursuant to a request or invitation for tenders or
an offer to purchase such shares for cash, securities or any other
consideration.
6.2.6. The term "market purchases" shall mean the acquisition of
Common Stock from holders of such shares in privately negotiated transactions
or in transactions effected through a broker or dealer.
6.2.7. Subject to the provisions of Section 6.2.2 herein, "outstanding
shares" shall mean shares of Common Stock which at the time in question have
been issued by the Corporation and not reacquired and held or retired by it or
held by any subsidiary of the Corporation.
-2-
<PAGE> 84
6.3 REPURCHASE PROCEDURE.
Not later than thirty (30) days following the date on which the
Corporation receives notice that any person has become an Acquiring Person and,
as a result, the right to have Common Stock repurchased by the Corporation
under this Article VI shall have been created, the Corporation shall give
written notice, by first class mail, postage prepaid, at the address shown on
the records of the Corporation to each holder of record of Common Stock (and to
any other person known by the Corporation, to have rights to demand repurchase
pursuant to Section 6.1 of this Article) as of the date not more than seven (7)
days prior to the date of the mailing pursuant to this Section 6.3 and shall
advise each such holder of the right to have shares repurchased and the
procedures for such repurchase. In the event that the Corporation fails to give
notice as required by this Section 6.3, any holder entitled to receive such
notice may, within thirty (30) days thereafter, serve written demand upon the
Corporation to give such notice. If within ten (10) days after the receipt of
written demand the Corporation fails to give the required notice, such holder
may at the expense and on behalf of the Corporation take such reasonable action
as may be appropriate to give notice or to cause notice to be given pursuant to
this Section 6.3.
6.3.1. In the event Common Stock is subject to repurchase in
accordance with this Article VI, the Directors of the Corporation shall
designate a Repurchase Agent, which shall be a corporation or association (i)
organized and doing business under the laws of the United States or any state,
(ii) subject to supervision or examination by federal or state authority, (iii)
having combined capital and surplus of at least $5,000,000 and (iv) having the
power to exercise corporate trust powers.
6.3.2. For a period of ninety (90) days from the date of the mailing
of the notice to holders of Common Stock referred to in this Section 6.3,
holders of Common Stock and other persons entitled to have Common Stock
repurchased pursuant to this Article VI may, at their option, deposit
certificates representing all or less than all Common Stock held of record by
them with the Repurchase Agent together with written notice that the holder
elects to have such shares repurchased pursuant to this Article VI. Repurchase
shall be deemed to have been effected at the close of business on the day such
certificates are deposited in proper form with the Repurchase Agent.
-3-
<PAGE> 85
6.3.3. The Corporation shall promptly deposit in trust with the
Repurchase Agent cash in an amount equal to the aggregate Repurchase Price of
all of the Common Stock deposited with the Repurchase Agent for the purposes of
repurchase.
6.3.4. As soon as practicable after receipt by the Repurchase Agent of
the cash deposit by the Corporation referred to in this Section 6.3, the
Repurchase Agent shall issue its checks payable to the order of the persons
entitled to receive the Repurchase Price of the Common Stock in respect of
which such cash deposit was made.
6.3.5. In the event the Corporation is unable to deposit with the
Repurchase Agent cash in full amount of the aggregate Repurchase Price of all
shares deposited for repurchase, because of limitations upon repurchase of
Common Stock contained in the Wisconsin Business Corporation Law, the
Corporation shall promptly deposit with the Repurchase Agent the maximum amount
of cash which may be used for the repurchase of Common Stock, under the most
restrictive of the applicable limitations upon such repurchase. In the event of
deposit of less than the full aggregate Repurchase Price pursuant to the
provisions of this subsection, the Repurchase Agent shall, after the expiration
of the notice period provided for in this Section 6.3.4, use the amount so
deposited to repurchase shares pro tanto, in proportion to the number of shares
deposited by each shareholder for repurchase. Certificates representing all
shares which remain unpurchased shall be returned to the depositors thereof as
soon as practicable thereafter, and there shall be no further repurchase rights
with respect to such shares arising in connection with the transactions already
completed.
6.4. RETIRED STOCK.
All Common Stock with respect to which repurchase has been effected
pursuant to this Article VI shall thereupon be deemed retired.
6.5. REPURCHASE PRICE.
The Repurchase Price shall be the amount payable by the Corporation in
respect of each share of Common Stock with respect to which repurchase has been
demanded pursuant to this Article VI and shall be the greatest amount
determined on any of the following three bases:
(i) The highest price per share of Common Stock, including any
commission paid to brokers or dealers for solicitation or whatever, at
which Common Stock held by the Acquiring Person were acquired pursuant
to a tender offer regardless of when such tender offer was made or were
-4-
<PAGE> 86
acquired pursuant to any market purchase or otherwise within
eighteen (18) months prior to the notice to holders or Common Stock
referred to in Section 6.3 herein. For purposes of this subsection (i),
if the consideration paid in any such acquisition of Common Stock
consisted, in whole or part, of consideration other than cash, the
Board of Directors of the Corporation shall take such action, as in its
judgment it deems appropriate, to establish the cash value of such
consideration, but such valuation shall not be less than the cash
value, if any, ascribed to such consideration by the Acquiring Person.
(ii) The highest sale price per share of Common Stock for
any trading day during the eighteen (18) months prior to the notice to
holders of Common Stock referred to in Section 6.3 herein. For purposes
of this subsection (ii), the sale price for any trading day shall be
the closing price per share of Common Stock as furnished by the
National Association of Securities Dealers Automated Quotation System
(NASDAQ) or the last sale price per share traded on any national
securities exchange.
(iii) The amount of shareholders' equity in respect of each
outstanding share of Common Stock as determined in accordance with
generally accepted accounting principles and as reflected in any
published report by the Corporation as of the quarter ending
immediately preceding the notice to shareholders referred to in Section
6.3 herein.
6.5.1. The determinations to be made pursuant to Section 6.5 shall be
made by the Board of Directors not later than the date of the notice to holders
of Common Stock referred to in Section 6.3 herein. In making such
determination, the Board of Directors may engage such persons, including
investment banking firms and the independent accountants who have reported on
the most recent financial statements of the Corporation, and may utilize
employees and agents of the Corporation, who will, in the judgment of the Board
of Directors, be of assistance to the Board of Directors.
6.5.2. The determinations to be made pursuant to this Section 6.5, when
made by the Board of Directors acting in good faith on the basis of such
information and assistance as was then reasonably available for such purpose,
shall be conclusive and binding upon the Corporation and its shareholders,
including any person referred to in Section 6.1 herein.
-5-
<PAGE> 87
$24.00 RD
Amendment to Restated Articles
- -Increases authorized shares
from: 12,000,000 Common at $0.05 P.V.
To: 20,000,000 Shares Common at $0.05 P.V.
1,000,000 Shares Preferred at $0.10 P.V.
- -adds Directors provision (Art V)
- -adds Stock Repurchase Provisions (new Art VI)
$650.00 plus $25.00 Exp
Michael, Best & Friedrich
P.O. Box 1806
Madison, WI 53701
Attn: Julie Bretl
STATE OF WISCONSIN
FILED
JUL 07 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 88
ATTACHMENT B
BY-LAWS OF THE COMPANY
Exhibit C1-3
<PAGE> 89
BY-LAWS
OF
STOKELY USA, INC.
(a Wisconsin corporation)
<PAGE> 90
BY-LAWS
OF
STOKELY USA, INC.
Introduction - Variable References
0.01. Date of annual shareholders' meeting: the last Saturday in June
beginning at 11:00 a.m. central standard time (See also Section 2.01)
10:00 a.m. First Tuesday June 1991
- ---------- ----- ------- ---- ----
(HOUR) (WEEK) (DAY) (MONTH) (FIRST YEAR)
0.02. Required notice of shareholders' meeting (See Section 2.04): not less
than 10 days.
0.03. Authorized number of Directors (See Section 3.01): 12.
0.04. Required notice of Directors' meeting (See Section 3.05): not less
than 24 hours.
0.05. Authorized number of Vice Presidents (See Section 4.01): 12.
0.06. Fiscal year of the Corporation shall commence on the first day of
April and end on the last day of March.
<PAGE> 91
TABLE OF CONTENTS
ARTICLE I. OFFICES
<TABLE>
<S> <C> <C>
1.01 Principal and Business Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.02 Registered Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II. SHAREHOLDERS
2.01 Annual Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.02 Special Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.03 Place of Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.04 Notice of Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.05 Closing of Stock Transfer Books or Fixing of Record Date . . . . . . . . . . . . . . 2
2.06 Voting Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.07 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.08 Conduct of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.09 Proxies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.10 Voting of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.11 Voting of Shares by Certain Holders . . . . . . . . . . . . . . . . . . . . . . . . . 5
(a) Other Corporations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(b) Legal Representatives and Fiduciaries . . . . . . . . . . . . . . . . . . . . . 5
(c) Pledgees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(d) Treasury Stock and Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . 6
(e) Minors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(f) Incompetents and Spendthrifts . . . . . . . . . . . . . . . . . . . . . . . . . 6
(g) Joint Tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.12 Waiver of Notice By Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.13 Unanimous Consent Without Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE III. BOARD OF DIRECTORS
3.01 General Powers and Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.02 Tenure and Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.03 Nominations For Election to the Board of Directors. . . . . . . . . . . . . . . . . . 8
3.04 Regular Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.05 Special Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.06 Notice; Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.07 Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.08 Manner of Acting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.09 Conduct of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.10 Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.11 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.12 Presumption of Assent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.13 Committees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.14 Unanimous Consent Without Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.15 Meetings By Telephone Or By Other Communication Technology. . . . . . . . . . . . . . 12
</TABLE>
(i)
<PAGE> 92
ARTICLE IV. OFFICERS
<TABLE>
<S> <C> <C>
4.01 Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.02 Election and Term of Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.03 Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.04 Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.05 Chairman of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.06 President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.07 Executive Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.08 The Vice Presidents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.09 The Secretary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.10 The Treasurer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.11 Assistant Secretaries and Assistant Treasurers . . . . . . . . . . . . . . . . . . 15
4.12 Other Assistants and Acting Officers . . . . . . . . . . . . . . . . . . . . . . . 15
4.13 Salaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE V. CONFLICT OF INTEREST TRANSACTIONS,
CONTRACTS, LOANS, CHECKS AND DEPOSITS:
SPECIAL CORPORATE ACTS
5.01 Conflict of Interest Transactions . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.02 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.03 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.04 Checks, Drafts, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.05 Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.06 Voting of Securities Owned by this Corporation . . . . . . . . . . . . . . . . . . . 17
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
6.01 Certificate for Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.02 Facsimile Signatures and Seal . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.03 Signature by Former Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.04 Transfer of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.05 Restrictions on Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.06 Lost, Destroyed or Stolen Certificates . . . . . . . . . . . . . . . . . . . . . . . 19
6.07 Consideration for Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.08 Uncertificated Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.09 Transfer Agent and Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.10 Stock Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE VII. INDEMNIFICATION
7.01 Indemnification for Successful Defense . . . . . . . . . . . . . . . . . . . . . . . 20
7.02 Other Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.03 Written Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.04 Nonduplication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
7.05 Determination of Right to Indemnification . . . . . . . . . . . . . . . . . . . . . 22
7.06 Advance Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
7.07 Nonexclusivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
7.08 Court-Ordered Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
7.09 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.10 Securities Law Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.11 Liberal Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.12 Definitions Applicable to This Article . . . . . . . . . . . . . . . . . . . . . . . 26
</TABLE>
(ii)
<PAGE> 93
ARTICLE VIII. SEAL
ARTICLE IX. AMENDMENTS
<TABLE>
<S> <C> <C>
9.01 By Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
9.02 By Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
9.03 Implied Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
</TABLE>
ARTICLE X. FISCAL YEAR
(iii)
<PAGE> 94
ARTICLE I. OFFICES
1.01 Principal and Business Offices. The Corporation may have
such principal and other business offices, either within or without the State
of Wisconsin, as the Board of Directors may designate or as the business of the
Corporation may require from time to time.
1.02 Registered office. The registered office of the Corporation
required by the Wisconsin Business Corporation Law to be maintained in the
State of Wisconsin may be, but need not be, identical with the principal office
in the State of Wisconsin, and the address of the registered office may be
changed from time to time by the Board of Directors or by the registered agent.
The business office of the registered agent of the Corporation shall be
identical to such registered office.
ARTICLE II. SHAREHOLDERS
2.01 Annual Meeting. The annual meeting of the shareholders
shall be held at the date and hour in each year set forth in Section 0.01, or
at such other time and date within thirty days before or after said date as may
be fixed by or under the authority of the Board of Directors, for the purpose
of electing Directors and for the transaction of such other business as may
come before the meeting. If the day fixed for the annual meeting shall be a
legal holiday in the State of Wisconsin, such meeting shall be held on the next
succeeding business day. If the election of Directors shall not be held on the
day designated herein, or fixed as herein provided, for any annual meeting of
the shareholders, or at any adjournment thereof, the Board of Directors shall
cause the election to be held at a special meeting of the shareholders as soon
thereafter as conveniently may be.
2.02 Special Meeting. Special meetings of the shareholders, for
any purpose or purposes, unless otherwise prescribed by the Wisconsin Business
Corporation Law, may be called by the Chairman of the Board or a majority of
the Board of Directors or by the holders of at least ten percent of all the
votes entitled to be cast on any issue proposed to be considered at the
proposed special meeting who sign, date and deliver to the Corporation one or
more written demands for the meeting describing one or more purposes for which
it is to be held. If duly called, the Corporation shall communicate notice of
a special meeting as set forth in Section 2.04.
-1-
<PAGE> 95
2.03 Place of Meeting. The Board of Directors may designate any
place, either within or without the State of Wisconsin, as the place of meeting
for any annual meeting or for any special meeting. If no designation is made,
the place of meeting shall be the principal business office of the Corporation
in the State of Wisconsin, but any meeting may be adjourned to reconvene at any
place designated by vote of a majority of the shares represented thereat.
2.04 Notice of Meeting. Notice may be communicated in person, by
telephone, telegraph, teletype, facsimile or other form of wire or
wireless communication, or by mail or private carrier, and, if these forms of
personal notice are impracticable, notice may be communicated by a newspaper of
general circulation in the area where published, or by radio, television or
other form of public broadcast communication. Such notice stating the place,
day and hour of the meeting and, in case of a special meeting, a description of
each purpose for which the meeting is called, shall be communicated or sent not
less than the number of days set forth in Section 0.02 (unless a longer period
is required by the Wisconsin Business Corporation Law or the articles of
incorporation) nor more than sixty days before the date of the meeting, by or at
the direction of the Chairman of the Board or the Secretary, or other officer or
persons calling the meeting, to each shareholder of record entitled to vote at
such meeting. Written notice by the Corporation to its shareholders is effective
when mailed and may be addressed to the shareholder's address shown in the
Corporation's current record of shareholders. Oral notice is effective when
communicated and the Corporation shall maintain a record setting forth the date,
time, manner and recipient of the notice.
2.05 Closing of Stock Transfer Books or Fixing of Record Date. A
"shareholder" of the Corporation shall mean the person in whose name shares are
registered in the stock transfer books of the Corporation or the beneficial
owner of shares to the extent of the rights granted by a nominee certificate on
file with the Corporation. Such nominee certificates, if any, shall be
reflected in the stock transfer books of the Corporation. For the purpose of
determining shareholders entitled to notice of or to vote at any meeting of
shareholders or any adjournment thereof, or shareholders entitled to receive
payment of any dividend, or in order to make a determination of shareholders
for any other proper purpose, the Board of Directors may provide that the
stock transfer books shall be closed for a stated period but not to exceed, in
any case, seventy days. If the stock transfer books shall be closed for the
purpose of determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for at least ten days
immediately preceding such meeting. In lieu of closing the stock transfer
-2-
<PAGE> 96
books, the Board of Directors may fix in advance a date as the record date for
any such determination of shareholders, such date in any case to be not more
than seventy days and, in case of a meeting of shareholders, not less than ten
days prior to the date on which the particular action requiring such
determination of shareholders is to be taken. If the stock transfer books are
not closed and no record date is fixed for the determination of shareholders
entitled to notice of or to vote at a meeting of shareholders, or shareholders
entitled to receive payment of a dividend, the close of business on the date on
which notice of the meeting is mailed or on the date on which the resolution of
the Board of Directors declaring such dividend is adopted, as the case may be,
shall be the record date for such determination of shareholders. When a
determination of shareholders entitled to vote at any meeting of shareholders
has been made as provided in this section, such determination shall be applied
to any adjournment thereof except where the determination has been made through
the closing of the stock transfer books and the stated period of closing has
expired.
2.06 Voting Record. The Officer or agent having charge of the
stock transfer books for shares of the Corporation shall, before each meeting
of shareholders, make a complete list of the shareholders entitled to vote at
such meeting, or any adjournment thereof, with the address of and the number of
shares held by each. Such record shall be produced and kept open at the time
and place of the meeting and shall be subject to the inspection of any
shareholder during the whole time of the meeting for the purposes of the
meeting. The original stock transfer books shall be prima facie evidence as to
who are the shareholders entitled to examine such record or transfer books or
to vote at any meeting of shareholders. Failure to comply with the
requirements of this section shall not affect the validity of any action taken
at such meeting.
2.07 Quorum. Shares entitled to vote as a separate voting group
as defined in the Wisconsin Business Corporation Law may take action on a
matter at a meeting only if a quorum of those shares exists with respect to
that matter. Unless the articles of incorporation or the Wisconsin Business
Corporation Law provides otherwise, a majority of the votes entitled to be cast
on the matter by the voting group constitutes a quorum of that voting group for
action on that matter.
Once a share is represented for any purpose at a meeting, other than for
the purpose of objecting to holding the meeting or transacting business at the
meeting, it is considered present for purposes of determining whether a quorum
exists, for the remainder of the meeting and for any adjournment of that meeting
unless a new record date is or must be set for that adjourned meeting.
-3-
<PAGE> 97
If a quorum exists, action on a matter by a voting group is approved
if the votes cast within the voting group favoring the action exceed the votes
cast opposing the action, unless the articles of incorporation or the Wisconsin
Business Corporation Law requires a greater number of affirmative votes.
"Voting group" means any of the following:
(a) All shares of one or more classes or series that under the
articles of incorporation or the Wisconsin Business Corporation Law are
entitled to vote and be counted together collectively on a matter at a meeting
of shareholders.
(b) All shares that under the articles of incorporation or the
Wisconsin Business Corporation Law are entitled to vote generally on a matter.
Though less than a quorum of the outstanding shares are represented at
a meeting, a majority of the shares so represented may adjourn the meeting from
time to time without further notice. At such adjourned meeting at which a
quorum shall be present or represented, any business may be transacted which
might have been transacted at the meeting as originally notified.
2.08 Conduct of Meetings. The Chairman of the Board, or in the
Chairman's absence, the President, or in the President's absence, the Executive
Vice President, or in the Executive Vice President's absence, a Vice President
in the order provided under Section 4.08, and in their absence, any person
chosen by the shareholders present shall call the meeting of the shareholders
to order and shall act as chairman of the meeting, and the Secretary of the
Corporation shall act as Secretary of all meetings of the shareholders, but, in
the absence of the Secretary, the presiding Officer may appoint any other
person to act as Secretary of the meeting.
2.09 Proxies. At all meetings of shareholders, a shareholder
entitled to vote may vote in person or by proxy. A shareholder may appoint a
proxy to vote or otherwise act for the shareholder by signing an appointment
form, either personally or by his or her attorney-in-fact. Such proxy
appointment is effective when received by the Secretary of the Corporation
before or at the time of the meeting. Unless otherwise provided in the
appointment form of proxy, a proxy appointment may be revoked at any time
before it is voted, either by written notice filed with the Secretary or the
acting Secretary of the meeting or by oral notice given by the shareholder to
the presiding officer during the meeting. The presence of a shareholder who
has filed his or her proxy
-4-
<PAGE> 98
appointment shall not of itself constitute a revocation. No proxy appointment
shall be valid after eleven months from the date of its execution, unless
otherwise provided in the appointment form of proxy. The Board of Directors
shall have the power and authority to make rules establishing presumptions as
to the validity and sufficiency of proxy appointments.
2.10 Voting of Shares. Each outstanding share shall be entitled to
one vote upon each matter submitted to a vote at a meeting of shareholders,
except to the extent that the voting rights of the shares of any voting group
or groups are enlarged, limited or denied by the articles of incorporation.
2.11 Voting of Shares by Certain Holders.
(a) Other Corporations. Shares standing in the name of
another corporation may be voted either in person or by proxy, by the president
of such corporation or any other officer appointed by such president. An
appointment form of proxy executed by any principal officer of such other
corporation or assistant thereto shall be conclusive evidence of the signer's
authority to act, in the absence of express notice to this Corporation, given
in writing to the Secretary of this Corporation, or the designation of some
other person by the Board of Directors or by the by-laws of such other
corporation.
(b) Legal Representatives and Fiduciaries. Shares held
by an administrator, executor, guardian, conservator, trustee in bankruptcy,
receiver or assignee for creditors may be voted by him, either in person or by
proxy, without a transfer of such shares into his or her name, provided that
there is filed with the Secretary before or at the time of meeting proper
evidence of his or her incumbency and the number of shares held or her. Shares
standing in the name of a fiduciary may be voted by him, either in person or by
proxy. An appointment form of proxy executed by a fiduciary shall be
conclusive evidence of the signer's authority to act, in the absence of express
notice to this Corporation, given in writing to the Secretary of this
Corporation, that such manner of voting is expressly prohibited or otherwise
directed by the document creating the fiduciary relationship.
(c) Pledgees. A shareholder whose shares are pledged
shall be entitled to vote such shares until the shares have been transferred
into the name of the pledgee, and thereafter the pledgee shall be entitled to
vote the shares so transferred; provided, however, a pledgee shall be entitled
to vote shares held of record by the pledgor if the Corporation receives
acceptable evidence of the pledgee's authority to sign.
-5-
<PAGE> 99
(d) Treasury Stock and Subsidiaries. Neither treasury
shares, nor shares held by another corporation if a majority of the shares
entitled to vote for the election of Directors of such other corporation is
held by this Corporation, shall be voted at any meeting or counted in
determining the total number of outstanding shares entitled to vote, but shares
of its own issue held by this Corporation in a fiduciary capacity, or held by
such other corporation in a fiduciary capacity, may be voted and shall be
counted in determining the total number of outstanding shares entitled to vote.
(e) Minors. Shares held by a minor may be voted by such
minor in person or by proxy and no such vote shall be subject to disaffirmance
or avoidance, unless prior to such vote the Secretary of the Corporation has
received written notice or has actual knowledge that such shareholder is a
minor. Shares held by a minor may be voted by a personal representative,
administrator, executor, guardian or conservator representing the minor if
evidence of such fiduciary status is presented and acceptable to the
Corporation.
(f) Incompetents and Spendthrifts. Shares held by an
incompetent or spendthrift may be voted by such incompetent or spendthrift in
person or by proxy and no such vote shall be subject to disaffirmance or
avoidance, unless prior to such vote the Secretary of the Corporation has
actual knowledge that such shareholder has been adjudicated an incompetent or
spendthrift or actual knowledge of filing of judicial proceedings for
appointment of a guardian. Shares held by an incompetent or spendthrift may be
voted by a personal representative, administrator, executor, guardian or
conservator representing the minor if evidence of such fiduciary status is
presented and acceptable to the Corporation.
(g) Joint Tenants. Shares registered in the names of
two or more individuals who are named in the registration as joint tenants may
be voted in person or by proxy signed by any one or more of such individuals if
either (i) no other such individual or his or her legal representative is
present and claims the right to participate in the voting of such shares or
prior to the vote files with the Secretary of the Corporation a contrary
written voting authorization or direction or written denial or authority of the
individual present or signing the appointment form of proxy proposed to be
voted or (ii) all such other individuals are deceased and the Secretary of the
Corporation has no actual knowledge that the survivor has been adjudicated not
to be the successor to the interests of those deceased.
-6-
<PAGE> 100
2.12 Waiver of Notice by Shareholders. Whenever any notice
whatever is required to be given to any shareholder of the Corporation under
the articles of incorporation or by-laws or any provision of law, a waiver
thereof in writing, signed at any time, whether before or after the time of
meeting, by the shareholder entitled to such notice, shall be deemed equivalent
to the giving of such notice and the Corporation shall include copies of such
waivers in its corporate records; provided that such waiver in respect to any
matter of which notice is required under any provision of the Wisconsin
Business Corporation Law, shall contain the same information as would have been
required to be included in such notice, except the time and place of meeting.
2.13 Unanimous Consent Without Meeting. Any action required or
permitted by the articles of incorporation or by-laws or any provision of law
to be taken at a meeting of the shareholders, may be taken without a meeting if
a consent in writing, setting forth the action so taken, shall be signed by all
of the shareholders entitled to vote with respect to the subject matter
thereof.
ARTICLE III. BOARD OF DIRECTORS
3.01 General Powers and Number. All corporate powers shall be
exercised by or under the authority of, and the business and affairs of the
Corporation managed under the direction of, the Board of Directors, subject to
any limitation set forth in the articles of incorporation. The number of
Directors of the Corporation shall be as provided in Section 0.03, but shall be
not less than nine (9) nor more than fifteen (15).
The Board of Directors shall be divided into three (3) classes of not
less than three (3) nor more than five (5) Directors each. The term of office
of the first class of Directors shall expire at the first annual meeting after
their initial election and until their successors are elected and qualified,
the term of office of the second class shall expire at the second annual
meeting after their initial election and until their successors are elected and
qualified, and the term of office of the third class shall expire at the third
annual meeting after the initial election and until their successors are
elected and qualified. At each annual meeting after the initial classification
of the Board of Directors, the class of Directors whose term expires at the
time of such election shall be elected to hold office until the third
succeeding annual meeting and until their successors are elected and qualified.
-7-
<PAGE> 101
[STOKELY LOGO]
FAX number: 414-569-3860
TELECOPIES/FAX TRANSMISSION
TO: Steven Wolf DATE: 9-2-92
--------------------------- -----------------------
COMPANY: Securities and Exchange Commission
---------------------------------------------
FROM: Robert Brill
---------------------------------
NUMBER OF PAGES (including this page) 62
-------
MESSAGE: Following are copies of relevant Articles and By-Laws of Stokely USA,
Inc. Due to age of corporation I have not included all Amendments as I fear
that doing so would tie up your fax unduly.
-- Continuation of fax --
FORM 4012 C
626 East Wisconsin Ave. P.O. Box 248 Oconomowoc, WI 53066 0248 414-567-1731
<PAGE> 102
3.02 Tenure and Qualifications. Each Director shall hold office
until the next annual meeting of shareholders in the year in which such
Director's term expires and until his successor shall have been elected, or
until his prior death, resignation or removal for cause only. A Director may
be removed from office for cause only by affirmative vote of 80% of the
outstanding shares entitled to vote for the election of such Director, taken at
an annual meeting or a special meeting of shareholders called for that purpose,
and any vacancy so created may be filled by the affirmative vote of 80% of such
shares. A Director may resign at any time by filing his written resignation
with the Secretary of the Corporation. Directors need not be residents of the
State of Wisconsin or shareholders of the Corporation.
3.03 Nominations for Election to the Board of
Directors. Nominations for election to the Board of Directors may be made by
the Board of Directors or by any shareholder of any outstanding class of
capital stock of the Corporation entitled to vote for election of Directors.
Nominations, other than those made by or on behalf of the existing management
of the Corporation, shall be made in writing and shall be delivered or mailed
to the Chief Executive Officer and/or President of the Corporation, not less
than 14 days nor more than 60 days prior to any meeting of shareholders called
for the election of directors; provided, however, that if less than 14 days'
notice of the meeting is given to shareholders, such nomination shall be mailed
or delivered to the Chief Executive Officer and/or President of the Corporation
not later than the close of business on the fourth day following the day on
which the notice of meeting was mailed. Such notification shall contain the
following information to the extent known to the nominating shareholder: (a)
the name and address of each proposed nominee; (b) the principal occupation of
each proposed nominee; (c) the name and residence address of the nominating
shareholder; and (d) the number of shares of capital stock of the Corporation
owned by the nominating shareholder. Nominations not made in accordance
herewith may be disregarded by the chairman of the meeting, in his or her
discretion, and upon his or her instructions, the vote tellers may disregard
all votes cast for each such nominee.
3.04 Regular Meetings. A regular meeting of the Board of
Directors shall be held without other notice than this by-law immediately after
the annual meeting of shareholders, and each adjourned session thereof. The
place of such regular meeting shall be the same as the place of the meeting of
shareholders which precedes it, or such other suitable place as may be
announced at such meeting of shareholders. The Board of Directors may provide,
by resolution, the time and place,
-8-
<PAGE> 103
either within or without the State of Wisconsin, for the holding of additional
regular meetings without other notice than such resolution.
3.05 Special Meetings. Special meetings of the Board of Directors
may be called by or at the request of the Chairman of the Board, Secretary or
any two Directors. The Chairman or Secretary calling any special meeting of
the Board of Directors may fix any place, either within or without the State of
Wisconsin, as the place for holding any special meeting of the Board of
Directors called by them, and if no other place is fixed, the place of meeting
shall be the principal business office of the Corporation in the State of
Wisconsin.
3.06 Notice; Waiver. Notice may be communicated in person, by
telephone, telegraph, teletype, facsimile or other form of wire or wireless
communication, or by mail or private carrier, and, if these forms of personal
notice are impracticable, notice may be communicated by a newspaper of general
circulation in the area where published, or by radio, television or other form
of public broadcast communication. Notice of each meeting of the Board of
Directors (unless otherwise provided in or pursuant to Section 3.03) shall be
communicated to each Director at his or her business address or telephone
number or at such other address or telephone number as such Director shall have
designated in writing filed with the Secretary, in each case not less than that
number of hours prior thereto as set forth in Section 0.04. Written notice is
effective at the earliest of the following:
(i) when received;
(ii) five days after its deposit in the U.S.
Mail, if mailed postpaid and correctly addressed; or
(iii) on the date shown on the return receipt, if sent by
registered or certified mail, return receipt
requested and the receipt is signed by or on behalf
of the addressee.
Oral notice is effective when communicated and the Corporation shall maintain a
record setting forth the date, time, manner and recipient of the notice.
Whenever any notice whatever is required to be given to any Director of
the Corporation under the articles of incorporation or by-laws or any provision
of law, a waiver thereof in writing, signed at any time, whether before or
after the time of meeting, by the Director entitled to such notice,
-9-
<PAGE> 104
shall be deemed equivalent to the giving of such notice, and the Corporation
shall retain copies of such waivers in its' corporate records. A Director's
attendance at or participation in a meeting waives any required notice to him
or her of the meeting unless the director at the beginning of the meeting or
promptly upon his or her arrival objects to holding the meeting or transacting
business at the meeting and does not thereafter vote for or assert to action
taken at the meeting. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Board of Directors need be
specified in the notice or waiver of notice of such meeting.
3.07 Quorum. Except as otherwise provided by the Wisconsin Business
Corporation Law or by the articles of incorporation or these by-laws, a
majority of the number of Directors as provided in Section 0.03 shall
constitute a quorum for the transaction of business at any meeting of the Board
of Directors, but a majority of the Directors present or participating (though
less than such quorum) may adjourn the meeting from time to time without
further notice.
3.08 Manner of Acting. If a quorum is present or participating when a
vote is taken, the affirmative vote of a majority of directors present or
participating is the act of the Board of Directors or a committee of the Board
of Directors, unless the Wisconsin Business Corporation Law or the articles of
incorporation or these by-laws require the vote of a greater number of
directors.
3.09 Conduct of Meetings. The Chairman of the Board, or in the
Chairman's absence, the President, or in the President's absence, the Executive
Vice President, or in the Executive Vice President's absence, a Vice President
in the order provided under Section 4.08, and in their absence, any Director
chosen by the Directors present, shall call meetings of the Board of Directors
to order and shall act as chairman of the meeting. The Secretary of the
Corporation shall act as Secretary of all meetings of the Board of Directors,
but in the absence of the Secretary, the presiding Officer may appoint any
Assistant Secretary or any Director or other person present or participating to
act as Secretary of the meeting.
3.10 Vacancies. Any vacancy occurring in the Board of Directors,
including a vacancy created by an increase in the number of Directors, may be
filled until the next succeeding annual election by the affirmative vote of a
majority of the Directors then in office, though less than a quorum of the
Board of Directors; provided, that in case of a vacancy created by the removal
of a Director for cause by vote of the shareholders, the shareholders shall
have the right to fill
-10-
<PAGE> 105
such vacancy at the same meeting or any adjournment thereof by the affirmative
vote of 80% of the outstanding shares entitled to vote for the election of such
Director.
3.11 Compensation. The Board of Directors, by affirmative vote of a
majority of the Directors then in office, and irrespective of any personal
interest of any of its members, may establish reasonable compensation of all
Directors for services to the Corporation as Directors, Officers or otherwise,
or may delegate such authority to an appropriate committee. The Board of
Directors also shall have authority to provide for or to delegate authority to
an appropriate committee to provide for reasonable pensions, disability or
death benefits, and other benefits of payments, to Directors, Officers and
employees and to their estates, families, dependents or beneficiaries on
account of prior services rendered by such Directors, Officers and employees to
the Corporation.
3.12 Presumption of Assent. A Director of the Corporation who is
present at or participates in a meeting of the Board of Directors or a
committee thereof of which he or she is a member, at which action on any
corporate matter is taken, shall be presumed to have assented to the action
taken unless his or her dissent shall be entered in the minutes of the meeting
or unless he or she shall file his or her written dissent to such action with
the person acting as the Secretary of the meeting before the adjournment
thereof or shall forward such dissent by registered mail to the Secretary of
the Corporation immediately after the adjournment of the meeting. Such right
to dissent shall not apply to a Director who voted in favor of such action.
3.13 Committees. The Board of Directors, by resolution adopted by the
affirmative vote of a majority of the number of Directors as provided in
Section 0.03, may designate one or more committees, each committee to consist
of two or more Directors elected by the Board of Directors, which to the extent
provided in said resolution as initially adopted, and as thereafter
supplemented or amended by further resolution adopted by a like vote, shall
have and may exercise, when the Board of Directors is not in session, the
powers of the Board of Directors in the management of the business and affairs
of the Corporation, except that a committee may not do any of the following:
(a) authorize distributions; (b) approve or propose to shareholders action that
the Wisconsin Business Corporation Law requires be approved by shareholders;
(c) fill vacancies on the Board of Directors or on any of its committees,
unless the Board of Directors provides by resolution that any vacancies on a
committee shall be filled by the affirmative vote of a
-11-
<PAGE> 106
majority of the remaining committee members; (d) amend articles of
incorporation under Section 180.1002 of the Wisconsin Business Corporation Law;
(e) adopt, amend or repeal by-laws; (f) approve a plan of merger not requiring
shareholder approval; (g) authorize or approve reacquisition of shares, except
according to a formula or method prescribed by the Board of Directors; or (h)
authorize or approve the issuance or sale or contract for sale of shares, or
determine the designation and relative rights, preferences and limitations of a
class or series of shares, except that the Board of Directors may authorize a
committee or a senior executive officer of the Corporation to do so within
limits prescribed by the Board of Directors. The Board of Directors may elect
one or more of its members as alternate members of any such committee who may
take the place of any absent member or members at any meeting of such
committee, upon request by the President or upon request by the chairman of
such meeting. Each such committee shall fix its own rules governing the
conduct of its activities and shall make such reports to the Board of Directors
of its activities as the Board of Directors may request.
3.14 Unanimous Consent Without Meeting. Any action required or
permitted by the articles of incorporation or by-laws or any provision of law
to be taken by the Board of Directors at a meeting or by resolution may be
taken without a meeting if a consent in writing, setting forth the action so
taken, shall be signed by all of the Directors then in office.
3.15 Meetings By Telephone Or By Other Communication Technology.
Meetings of the Board of Directors or committees may be conducted by telephone
or by other communication technology in accordance with Section 180.0820 of the
Wisconsin Business Corporation Law.
ARTICLE IV. OFFICERS
4.01 Number. The principal Officers of the Corporation shall be a
Chairman of the Board, a President, an Executive Vice President, the number of
Vice Presidents as provided in Section 0.05, a Secretary, and a Treasurer, each
of whom shall be elected annually by the Board of Directors. Such other
Officers and assistant officers as may be deemed necessary may be elected or
appointed by the Board of Directors, and shall have such powers and perform
such duties as may be assigned by the Board of Directors or Chairman of the
Board. The Board of Directors may authorize a duly appointed officer to
appoint one or more officers or assistant officers. The same natural person
may simultaneously hold more than one office in the Corporation, provided that
such person holding any two or more offices may sign documents in only one
capacity as an officer of the Corporation.
-12-
<PAGE> 107
4.02 Election and Term of Office. The Officers of the Corporation
to be elected by the Board of Directors shall be elected annually by the Board
of Directors at the first meeting of the Board of Directors held after each
annual meeting of the shareholders. If the election of Officers shall not be
held at such meeting, such election shall be held as soon thereafter as
conveniently may be. Each Officer shall hold office until his or her successor
shall have been duly elected or until his or her prior death, resignation or
removal.
4.03 Removal. Any Officer or agent may be removed by the Board of
Directors with or without cause whenever in its judgment the best interests of
the Corporation will be served thereby, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment shall not of itself create contract rights.
4.04 Vacancies. A vacancy in any principal office because of
death, resignation, removal, disqualification or otherwise, shall be filled by
the Board of Directors for the unexpired portion of the term.
4.05 Chairman of the Board. The Chairman shall be the chief
executive officer of the Corporation and, subject to the control of the Board
of Directors, shall in general supervise and control all of the business and
affairs of the Corporation. He or she shall, when present, preside at all
meetings of the shareholders and of the Board of Directors. The Chairman shall
have authority, subject to such rules as may be prescribed by the Board of
Directors, to appoint such agents and employees of the corporation as he or she
shall deem necessary, to prescribe their powers, duties and compensation, and
to delegate authority to them. Such agents and employees shall hold office at
the discretion of the Chairman. The Chairman shall have authority to sign,
execute and acknowledge, on behalf of the Corporation, all deeds, mortgages,
bonds, stock certificates, contracts, leases, reports and all other documents
or instruments necessary or proper to be executed in the course of the
corporation's regular business, or which shall be authorized by resolution of
the Board of Directors; and, except as otherwise provided by law or the Board
of Directors, the Chairman may authorize the President, the Executive Vice
President, or any Vice President or other officer or agent of the Corporation
to sign, execute and acknowledge such documents or instruments in his or her
place and stead. In general, the Chairman shall perform all duties incident to
the office of chief executive officer and such other duties as may be
prescribed by the Board of Directors from time to time.
-13-
<PAGE> 108
4.06 President. The President shall be the chief operating officer
of the Corporation and, subject to the control of the Chairman, shall supervise
and control the operations of the Corporation. He or she shall, in the absence
of the Chairman, preside at all meetings of the shareholders and of the Board
of Directors. He or she shall have authority to sign, execute and acknowledge,
on behalf of the Corporation, all deeds, mortgages, bonds, stock certificates,
contracts, leases, reports and all other documents or instruments necessary or
proper to be executed in the course of the Corporation's regular business, or
which shall be authorized by resolution of the Board of Directors; and, except
as otherwise provided by law or the Board of Directors, he or she may authorize
the Executive Vice President or any Vice President or other Officer or agent of
the Corporation to sign, execute and acknowledge such documents or instruments
in his or her place and stead. In general, he or she shall perform all duties
incident to the office of chief operating officer and such other duties as may
be prescribed by the Board of Directors or Chairman from time to time.
4.07 The Executive Vice President. The Executive Vice President
shall assist the President in the discharge of supervisory, managerial and
executive duties and functions. In the absence of the President or in the
event of his or her death, inability or refusal to act, the Executive Vice
President shall perform the duties of the President and when so acting shall
have all the powers and duties of the President. He or she shall perform such
other duties as from time to time may be assigned to him or her by the Board of
Directors, the Chairman or the President.
4.08 The Vice Presidents. In the absence of the Chairman,
President and the Executive Vice President or in the event of their death,
inability or refusal to act, or in the event for any reason it shall be
impracticable for them to act personally, the Vice President (or in the event
there be more than one Vice President, the Vice Presidents in the order
designated by the Board of Directors, or in the absence of any designation,
then in the order of their election) shall perform the duties of the President,
and when so acting, shall have all the powers of and be subject to all the
restrictions upon the President. Any Vice President may sign, with the
Secretary or Assistant Secretary, certificates for shares of the Corporation;
and shall perform such other duties and have such authority as from time to
time may be delegated or assigned to him or her by the Chairman, the
President, the Executive Vice President or by the Board of Directors. The
execution of any instrument of the Corporation by any Vice President shall be
conclusive evidence, as to third parties, of his or her authority to act in the
stead of the Chairman or the President.
-14-
<PAGE> 109
4.09 The Secretary. The Secretary shall: (a) keep the minutes of
the meetings of the shareholders and of the Board of Directors in one or more
books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these by-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the Corporation and see
that the seal of the Corporation is affixed to all documents, the execution of
which on behalf of the Corporation under its seal is duly authorized; (d) keep
or arrange for the keeping of a register of the post office address of each
shareholder which shall be furnished to the Secretary by such shareholder; (e)
have general charge of the stock transfer books of the Corporation; and (f) in
general, perform all duties incident to the office of Secretary and have such
other duties and exercise such authority as from time to time may be delegated
or assigned to him or her by the Chairman or President or by the Board of
Directors.
4.10 The Treasurer. The Treasurer shall: (a) have charge and
custody of and be responsible for all funds and securities of the Corporation;
(b) receive and give receipts for moneys due and payable to the Corporation
from any source whatsoever, and deposit all such moneys in the name of the
Corporation in such banks, trust companies or other depositories as shall be
selected in accordance with the provisions of Section 5.05; and (c) in general,
perform all of the duties incident to the office of Treasurer and have such
other duties and exercise such other authority as from time to time may be
delegated or assigned to him or her by the Chairman or President or by the
Board of Directors. If required by the Board of Directors, the Treasurer shall
give a bond for the faithful discharge of his duties in such sum and with such
surety or sureties as the Board of Directors shall determine.
4.11 Assistant Secretaries and Assistant Treasurers. There shall
be such number of Assistant Secretaries and Assistant Treasurers as the Board
of Directors may from time to time authorize. The Assistant Treasurers shall,
respectively, if required by the Board of Directors, give bonds for the
faithful discharge of their duties in such sums and with such sureties as the
Board of Directors shall determine. The Assistant Secretaries and Assistant
Treasurers, in general, shall perform such duties and have such authority as
shall from time to time be delegated or assigned to them by the Secretary or
the Treasurer, respectively, or by the Chairman or President or the Board of
Directors.
4.12 Other Assistants and Acting Officers. The Board of Directors
shall have the power to appoint any person to act as assistant to any Officer,
or as agent for the Corporation in his or her stead, or to perform the duties
of such Officer
-15-
<PAGE> 110
whenever for any reason it is impracticable for such Officer to act personally
and such assistant or acting Officer or other agent so appointed by the Board
of Directors shall have the power to perform all the duties of the office to
which he or her is so appointed to be assistant, or as to which he or her is so
appointed to act, except as such power may be otherwise defined or restricted
by the Board of Directors.
4.13 Salaries. The salaries of the principal Officers shall be
fixed from time to time by the Board of Directors or by a duly authorized
committee thereof, and no Officer shall be prevented from receiving such salary
by reason of the fact that he or she is also a Director of the Corporation.
ARTICLE V. CONFLICT OF INTEREST TRANSACTIONS,
CONTRACTS, LOANS, CHECKS AND DEPOSITS: SPECIAL CORPORATE ACTS
5.01 Conflict of Interest Transactions. A "conflict of interest"
transaction means a transaction with the Corporation in which a Director of the
Corporation has a direct or indirect interest. The circumstances in which a
Director of the Corporation has an indirect interest in a transaction include
but are not limited to a transaction under any of the following circumstances:
(1) another entity in which the Director has a material financial interest or
in which the Director is a general partner is a party to the transaction; or
(2) another entity of which the Director is a director, officer or trustee is a
party to the transaction and the transaction is or, because of its significance
to the Corporation, should be considered by the Board of Directors of the
Corporation. A conflict of interest transaction is not voidable by the
Corporation solely because of the Director's interest in the transaction if any
of the circumstances set forth in Section 180.0831 of the Wisconsin Business
Corporation Law are true or occur.
5.02 Contracts. The Board of Directors may authorize any Officer
or Officers, agent or agents, to enter into any contract or execute or deliver
any instrument in the name of and on behalf of the Corporation, and such
authorization may be general or confined to specific instances. In the absence
of other designation, all deeds, mortgages and instruments of assignment or
pledge made by the Corporation shall be executed in the name of the Corporation
by the Chairman of the Board, President or Executive Vice President or one of
the Vice Presidents and by the Secretary, or Assistant Secretary, the Treasurer
or Assistant Treasurer; the Secretary or an Assistant Secretary, when necessary
or required, shall affix the
-16-
<PAGE> 111
corporate seal thereto; and when so executed no other party to such instrument
or any third party shall be required to make any inquiry into the authority of
the signing officer or officers.
5.03 Loans. No indebtedness for borrowed money shall be contracted
on behalf of the Corporation and no evidences of such indebtedness shall be
issued in its name unless authorized by or under the authority of a resolution
of the Board of Directors. Such authorization may be general or confined to
specific instances.
5.04 Checks, Drafts, etc. All checks, drafts or other orders for
the payment of money, notes or other evidences of indebtedness issued in the
name of the Corporation, shall be signed by such Officer or Officers, agent or
agents of the Corporation and in such manner as shall from time to time be
determined by or under the authority of a resolution of the Board of Directors.
5.05 Deposits. All funds of the Corporation not otherwise employed
shall be deposited from time to time to the credit of the Corporation in such
banks, trust companies or other depositories as may be selected by or under the
authority of a resolution of the Board of Directors.
5.06 Voting of Securities Owned by this Corporation. Subject
always to the specific directions of the Board of Directors, (a) any shares or
other securities issued by any other corporation and owned or controlled by
this Corporation may be voted at any meeting of security holders of such other
corporation by the Chairman of the Board of this Corporation if he or she be
present, or in the Chairman's absence, by the President, or in the President's
absence, by the Executive Vice President, or in the Executive Vice President's
absence, by any Vice President of this Corporation who may be present, and (b)
whenever, in the judgment of the Chairman of the Board, or in the Chairman's
absence, the President, or in the President's absence, the Executive Vice
President, or in the Executive Vice President's absence, by any Vice President,
it is desirable for this Corporation to execute a proxy or written consent in
respect to any shares or other securities issued by any other corporation and
owned by this Corporation, such proxy or consent shall be executed in the name
of this Corporation by the Chairman, the President, the Executive Vice
President, or one of the Vice Presidents of this Corporation in the order as
provided in clause (a) of this Section, without necessity of any authorization
by the Board of Directors, affixation of corporate seal or countersignature or
attestation by another officer. Any person or persons designated in the manner
above
-17-
<PAGE> 112
stated as the proxy or proxies of this Corporation shall have full right, power
and authority to vote the shares or other securities issued by such other
corporation and owned by this Corporation the same as such shares or other
securities might be voted by this Corporation.
ARTICLE VI. CERTIFICATES FOR
SHARES AND THEIR TRANSFER
6.01 Certificates for Shares. Certificates representing shares of
the Corporation shall be in such form, consistent with law, as shall be
determined by the Board of Directors. Such Certificates shall be signed by the
Chairman or the President or by another Officer designated by the Chairman or
the Board of Directors. All certificates for shares shall be consecutively
numbered or otherwise identified. The name and address of the person to whom
the shares represented thereby are issued, with the number of shares and date
of issue, shall be entered on the stock transfer books of the Corporation. All
certificates surrendered to the Corporation for transfer shall be cancelled and
no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and cancelled, except as provided
in Section 6.06.
6.02 Facsimile Signatures and Seal. The seal of the Corporation
on any certificates for shares may be a facsimile. The signature of the
Chairman or the President or other authorized Officer upon a certificate may be
a facsimile if the certificate is manually signed on behalf of a transfer
agent, or a registrar, other than the Corporation itself or an employee of the
Corporation.
6.03 Signature by Former Officers. In case any Officer, who has
signed or whose facsimile signature has been placed upon, any certificate for
shares, shall have ceased to be such Officer before such certificate is issued,
it may be issued by the Corporation with the same effect as if he or she were
such Officer at the date of its issue.
6.04 Transfer of Shares. Prior to due presentment of a certificate
for shares for registration of transfer, the Corporation may treat the
shareholder of such shares as the person exclusively entitled to vote, to
receive notifications and otherwise to have and exercise all the rights and
powers of an owner. Where a certificate for shares is presented to the
Corporation with a request to register for transfer, the Corporation shall not
be liable to the owner or any other person suffering loss as a result of such
registration of
-18-
<PAGE> 113
transfer if (a) there were on or with the certificate the necessary
endorsements, and (b) the corporation had no duty to inquire into adverse
claims or has discharged any such duty. The Corporation may require reasonable
assurance that said endorsements are genuine and effective and in compliance
with such other regulations as may be prescribed by or under the authority of
the Board of Directors.
6.05 Restrictions on Transfer. The face or reverse side of each
certificate representing shares shall bear a conspicuous notation of any
restriction imposed by the Corporation upon the transfer of such shares.
6.06 Lost, Destroyed or Stolen Certificates. Where the owner
claims that his or her certificate for shares has been lost, destroyed or
wrongfully taken, a new certificate shall be issued in place thereof if the
owner (a) so requests before the Corporation has notice that such shares have
been acquired by a bona fide purchaser, and (b) files with the Corporation a
sufficient indemnity bond, and (c) satisfies such other reasonable requirements
as may be prescribed by or under the authority of the Board of Directors.
6.07 Consideration for Shares. The shares of the Corporation may
be issued for such consideration as shall be fixed from time to time by the
Board of Directors, provided that any shares having a par value shall not be
issued for a consideration less than the par value thereof. The consideration
to be received for shares may consist of any tangible or intangible property or
benefit to the Corporation, including cash, promissory notes, services
performed, contracts for services to be performed or other securities of the
Corporation. When the Corporation receives the consideration for which the
Board of Directors authorized the issuance of shares, the shares issued for
that consideration are fully paid and nonassessable, except as provided by
Section 180.0622 of the Wisconsin Business Corporation Law which may require
further assessment for unpaid wages to employees under certain circumstances.
The Corporation may place in escrow shares issued for a contract for future
services or benefits or a promissory note, or make other arrangements to
restrict the transfer of the shares, and may credit distributions in respect of
the shares against their purchase price, until the services are performed, the
benefits are received or the note is paid. If the services are not performed,
the benefits are not received or the note is not paid, the Corporation may
cancel, in whole or in part, the shares escrowed or restricted and the
distributions credited.
-19-
<PAGE> 114
6.08 Uncertificated Shares. In accordance with Section 180.0626 of
the Wisconsin Business Corporation Law, the Board of Directors may issue any
shares of any of its classes or series without certificates. The authorization
does not affect shares already represented by certificates until the
certificates are surrendered to the Corporation. Within a reasonable time
after the issuance or transfer of shares without certificates, the Corporation
shall send the shareholder a written statement of the information required on
share certificates by Sections 180.0625 and 180.0627, if applicable, of the
Wisconsin Business Corporation Law, and by the By-laws of the Corporation.
The Corporation shall maintain at its offices, or at the office of
its transfer agent, an original or duplicate stock transfer book containing the
names and addresses of all shareholders and the number of shares held by each
shareholder. If the shares are uncertificated, the Corporation shall be
entitled to recognize the exclusive right of a person registered on its books
as such, as the owner of shares for all purposes, and shall not be bound to
recognize any equitable or other claim to or interest in such shares on the
part of any other person, whether or not it shall have express or other notice
thereof, except as otherwise provided by the laws of the State of Wisconsin.
6.09 Transfer Agent and Registrar. The Corporation may maintain
one or more transfer offices or agencies, each in charge of a transfer agent
designated by the Board of Directors, where the shares of stock of the
Corporation shall be transferable. The Corporation may also maintain one or
more registry offices, each in charge of a registrar designated by the Board of
Directors, where such shares of stock shall be registered. The same person or
entity may be both a transfer agent and registrar.
6.10 Stock Regulations. The Board of Directors shall have the
power and authority to make all such further rules and regulations not
inconsistent with the statutes of the State of Wisconsin as it may deem
expedient concerning the issue, transfer and registration of certificates
representing shares of the Corporation.
ARTICLE VII. INDEMNIFICATION
7.01 Indemnification for Successful Defense. Within 20 days after
receipt of a written request pursuant to Section 7.03, the Corporation shall
indemnify a Director, Officer, Employee or Agent, to the extent he or she has
been
-20-
<PAGE> 115
successful on the merits or otherwise in the defense of a proceeding, for all
reasonable expenses incurred in the proceeding if the Director, Officer,
Employee or Agent was a party because he or she is a Director, Officer,
Employee or Agent of the Corporation.
7.02 Other Indemnification. (a) In cases not included under
Section 7.01, the Corporation shall indemnify a Director, Officer, Employee or
Agent against all liabilities and expenses incurred by the Director, Officer,
Employee or Agent in a proceeding to which the Director, Officer, Employee or
Agent was a party because he or she is a Director, Officer, Employee or Agent
of the Corporation, unless liability was incurred because the Director,
Officer, Employee or Agent breached or failed to perform a duty he or she owes
to the Corporation and the breach or failure to perform constitutes any of the
following:
(1) A willful failure to deal fairly with the Corporation
or its shareholders in connection with a matter in which the Director,
Officer, Employee or Agent has a material conflict of interest.
(2) A violation of criminal law, unless the Director,
Officer, Employee or Agent had reasonable cause to believe his or her
conduct was lawful or no reasonable cause to believe his or her
conduct was unlawful.
(3) A transaction from which the Director, Officer,
Employee, or Agent derived an improper personal profit.
(4) Willful misconduct.
(b) Determination of whether indemnification is required under this
Section shall be made pursuant to Section 7.05.
(c) The termination of a proceeding by judgment, order, settlement
or conviction, or upon a plea of no contest or an equivalent plea, does not, by
itself, create a presumption that indemnification of the Director, Officer,
Employee or Agent is not required under this Section.
7.03 Written Request. A Director, Officer, Employee or Agent who
seeks indemnification under Sections 7.01 or 7.02 shall make a written request
to the Corporation.
-21-
<PAGE> 116
7.04 Nonduplication. The Corporation shall not indemnify a
Director, Officer, Employee or Agent under Sections 7.01 or 7.02 if the
Director, Officer, Employee or Agent has previously received indemnification or
allowance of expenses from any person, including the Corporation, in connection
with the same proceeding. However, the Director, Officer, Employee or Agent
has no affirmative duty to look to any other person for indemnification nor to
first exhaust his remedies to seek indemnification from such other person.
7.05 Determination of Right to Indemnification.
(a) Unless otherwise provided by the articles of incorporation or
by written agreement between the Director, Officer, Employee or Agent and the
Corporation, the Director, Officer, Employee or Agent seeking indemnification
under Section 7.02 shall select one of the following means for determining his
or her right to indemnification:
(1) By a majority vote of a quorum of the Board of
Directors consisting of Directors not at the time parties to the same
or related proceedings. If a quorum of disinterested Directors
cannot be obtained, by majority vote of a committee duly appointed by
the Board of Directors and consisting solely of two or more Directors
not at the time parties to the same or related proceedings. Directors
who are parties to the same or related proceedings may participate in
the designation of members of the committee.
(2) By independent legal counsel selected by a quorum of
the Board of Directors or its committee in the manner prescribed in
sub. (1) or, if unable to obtain such a quorum or committee, by a
majority vote of the full Board of Directors, including Directors who
are parties to the same or related proceedings.
(3) By a panel of three arbitrators consisting of one
arbitrator selected by those Directors entitled under sub. (2) to
select independent legal counsel, one arbitrator selected by the
Director or Officer seeking indemnification and one arbitrator
selected by the two arbitrators previously selected.
(4) By an affirmative vote of the majority of shares
represented at a meeting of shareholders at which a quorum is present.
Shares owned by, or voted under the control of, persons who are at the
time parties to the same or related proceedings, whether as plaintiffs
or defendants or in any other capacity, may not be voted in making the
determination.
-22-
<PAGE> 117
(5) By a court under Section 7.08.
(6) By any other method provided for in any additional
right to indemnification permitted under Section 7.07.
(b) In any determination under (a), the burden of proof is on the
Corporation to prove by clear and convincing evidence that indemnification
under Section 7.02 should not be allowed.
(c) A written determination as to a Director, Officer, Employee or
Agent's indemnification under Section 7.02 shall be submitted to both the
Corporation and the Director, Officer, Employee or Agent within 60 days of the
selection made under (a).
(d) If it is determined that indemnification is required under
Section 7.02, the Corporation shall pay all liabilities and expenses not
prohibited by Section 7.04 within 10 days after receipt of the written
determination under (c). The Corporation shall also pay all expenses incurred
by the Director, Officer, Employee or Agent, in the determination process under
(a).
7.06 Advance Expenses. Within 10 days after receipt of a written
request by a Director, Officer, Employee or Agent who is a party to a
proceeding, the Corporation shall pay or reimburse his or her reasonable
expenses as incurred if the Director, Officer, Employee or Agent provides the
Corporation with all of the following:
(1) A written affirmation of his or her good faith belief
that he or she has not breached or failed to perform his or her duties
to the Corporation.
(2) A written undertaking, executed personally or on his
or her behalf, to repay the allowance (together with reasonable
interest thereon) to the extent that it is ultimately determined under
Section 7.05 that indemnification under Section 7.02 is not required
and that indemnification is not ordered by a court under Section
7.08(b)(2). The undertaking under this subsection shall be an
unlimited general obligation of the Director, Officer, Employee or
Agent, and may be accepted without reference to his or her ability to
repay the allowance. The undertaking may be secured or unsecured.
-23-
<PAGE> 118
7.07 Nonexclusivity. (a) Except as provided in (b), Sections 7.01,
7.02 and 7.06 do not preclude any additional right to indemnification or
allowance of expenses that a Director, Officer, Employee or Agent may have
under any of the following:
(1) The articles of incorporation.
(2) A written agreement between the Director, Officer,
Employee or Agent, and the Corporation.
(3) A resolution of the Board of Directors.
(4) A resolution, after notice, adopted by a majority
vote of all of the Corporation's voting shares then issued and
outstanding.
(b) Regardless of the existence of an additional right under (a),
the Corporation shall not indemnify a Director, Officer, Employee or Agent, or
permit a Director, Officer, Employee or Agent to retain any allowance of
expenses, unless it is determined by or on behalf of the Corporation that the
Director, Officer, Employee or Agent did not breach or fail to perform a duty
he or she owes to the Corporation which constitutes conduct under Section
7.02(a)(1), (2), (3) or (4). A Director, Officer, Employee or Agent who is a
party to the same or related proceeding for which indemnification or an
allowance of expenses is sought may not participate in a determination under
this subsection.
(c) Sections 7.01 to 7.12 do not affect the Corporation's power to
pay or reimburse expenses incurred by a Director, Officer, Employee or Agent in
any of the following circumstances.
(1) As a witness in a proceeding to which he or she is
not a party.
(2) As a plaintiff or petitioner in a proceeding because
he or she is or was a Director, Officer, Employee or Agent of the
Corporation.
7.08 Court-Ordered Indemnification. (a) Except as provided
otherwise by written agreement between the Director, Officer, Employee or Agent
and the Corporation, a Director, Officer, Employee or Agent who is a party to a
proceeding may apply for indemnification to the court conducting the proceeding
or to another court of competent jurisdiction. Application may be made for an
initial determination by the court under Section 7.05(a)(5) or for review by
the court of an
-24-
<PAGE> 119
adverse determination under Section 7.05(a) (1), (2), (3), (4) or (6). After
receipt of an application, the court shall give any notice it considers
necessary.
(b) The court shall order indemnification if it determines any of
the following:
(1) That the Director, Officer, Employee or Agent is
entitled to indemnification under Sections 7.01 or 7.02.
(2) That the Director, Officer, Employee or Agent is
fairly and reasonably entitled to indemnification in view of all the
relevant circumstances, regardless of whether indemnification is
required under Section 7.02.
(c) If the court determines under (b) that the Director, Officer,
Employee or Agent is entitled to indemnification, the Corporation shall pay the
Director, Officer, Employee or Agent's expenses incurred to obtain the
court-ordered indemnification.
7.09 Insurance. The Corporation may purchase and maintain insurance
on behalf of an individual who is a Director, Officer, Employee or Agent of the
Corporation against liability asserted against or incurred by the individual in
his or her capacity as a Director, Officer, Employee or Agent, regardless of
whether the Corporation is required or authorized to indemnify or allow
expenses to the individual against the same liability under Sections 7.01,
7.02, or 7.06.
7.10 Securities Law Claims. (a) Pursuant to the public policy of
the State of Wisconsin, the Corporation shall provide indemnification,
allowance of expenses and insurance for any liability incurred in connection
with a proceeding involving securities regulation described under (b) to the
extent required or permitted under Sections 7.01 to 7.09.
(b) Sections 7.01 to 7.09 apply, to the extent applicable to any
other proceeding, to any proceeding involving a federal or state statute, rule
or regulation regulating the offer, sale or purchase of securities, securities
brokers or dealers, or investment companies or investment advisers.
7.11 Liberal Construction. In order for the corporation to obtain
and retain qualified Directors, Officers, Employees and Agents, the foregoing
provisions shall be liberally administered in order to afford maximum
indemnification of Directors, Officers, Employees or Agents
-25-
<PAGE> 120
and, accordingly, the indemnification above provided for shall be granted in
all cases unless to do so would clearly contravene applicable law, controlling
precedent or public policy.
7.12 Definitions Applicable to This Article.
(a) "Affiliate" shall include, without limitation, any
corporation, partnership, joint venture, employee benefit plan, trust or other
enterprise that directly or indirectly through one or more intermediaries,
controls or is controlled by, or is under common control with, the Corporation.
(b) "Corporation" means this Corporation and any domestic or
foreign predecessor of this Corporation where the predecessor corporation's
existence ceased upon the consummation of a merger or other transaction.
(c) "Director, Officer, Employee or Agent" means any of the
following:
(1) A natural person who is or was a director, officer,
employee or agent (including attorneys) of this Corporation; provided,
however, that no attorney of the Corporation shall be considered an
agent with respect to those actions taken by such attorney solely in
his capacity as an independent contractor to the Corporation.
(2) A natural person who, while a director, officer,
employee or agent, of this Corporation, is or was serving at the
Corporation's request as a director, officer, employee, agent,
partner, trustee, member of any governing or decision-making
committee, of another Corporation or foreign corporation, partnership,
joint venture, trust or other enterprise.
(3) A natural person who, while a director, officer,
employee or agent of this Corporation, is or was serving an employee
benefit plan because his or her duties to the Corporation also impose
duties on, or otherwise involve services by, the person to the plan or
to participants or beneficiaries of the plan.
(4) Unless the context requires otherwise, the estate or
personal representative of a Director, Officer, Employee or Agent.
For purposes of this Article, it shall be conclusively presumed that any
Director, Officer, Employee or Agent serving as a
-26-
<PAGE> 121
director, officer, employee, agent, partner, trustee, member of any governing
or decision-making committee of an Affiliate shall be so serving at the request
of the Corporation.
(d) "Expenses" include fees, costs, charges, disbursements,
attorney fees and other expenses incurred in connection with a proceeding.
(e) "Liability" includes the obligation to pay a judgment,
settlement, penalty, assessment, forfeiture or fine, including an excise tax
assessed with respect to an employee benefit plan, and reasonable expenses.
(f) "Party" includes a natural person who was or is, or who is
threatened to be made, a named defendant or respondent in a proceeding.
(g) "Proceeding" means any threatened, pending or completed civil,
criminal, administrative or investigative action, suit, arbitration or other
proceeding, whether formal or informal, which involves foreign, federal, state
or local law and which is brought by or in the right of the Corporation or by
any other person.
ARTICLE VIII. SEAL
The Board of Directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the Corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE IX. AMENDMENTS
9.01. By Shareholders. These by-laws may be altered, amended or
repealed and new by-laws may be adopted by the shareholders by affirmative vote
of not less than a majority of the shares present or represented at an annual
or special meeting of the shareholders at which a quorum is in attendance.
9.02. By Directors. These by-laws may also be altered, amended or
repealed and new by-laws may be adopted by the Board of Directors by
affirmative vote of a majority of the number of Directors present at or
participating in any meeting at which a quorum is in attendance; but no by-law
adopted by the shareholders shall be amended or repealed by the Board of
Directors if the by-law so adopted so provides.
-27-
<PAGE> 122
9.03. Implied Amendments. Any action taken or authorized by the
shareholders or by the Board of Directors, which would be inconsistent with the
by-laws then in effect but is taken or authorized by affirmative vote of not
less than the number of shares or the number of Directors required to amend the
by-laws so that the by-laws would be consistent with such action, shall be
given the same effect as though the by-laws had been temporarily amended or
suspended so far, but only so far, as is necessary to permit the specific
action so taken or authorized.
ARTICLE X. FISCAL YEAR
The fiscal year of the Corporation shall be as provided in Section
0.06.
-28-
<PAGE> 123
ATTACHMENT C
LIST OF OFFICERS AND DIRECTORS
OF THE COMPANY
DIRECTORS
- ---------
Vernon L. Wiersma
Stephen W. Theobald
Frank J. Pelisek
Orren J. Bradley
Joseph B. Weix
Thomas W. Mount
James H. DeWees
Russell Britt
Charles J. Carey
Ody J. Fish
Carol Ward Knox
OFFICERS
- --------
Frank J. Pelisek Chairman of the Board
Vernon L. Wiersma President
Stephen W. Theobald Vice Chairman and Treasurer
Russell Trunk Senior Vice President of Operations
Kenneth Murray Vice President Canned Sales and Marketing
Mike Wilkes Vice President of Human Resource Development
Leslie Wilson Vice President of Finance
Robert Brill Secretary
Exhibit C1-4
<PAGE> 124
ATTACHMENT D
BOARD OF DIRECTORS
STOKELY USA, INC.
RESOLUTIONS ADOPTED
Exhibit C1-5
<PAGE> 125
RESOLUTIONS OF
STOKELY USA, INC.
WHEREAS, this Corporation is duly authorized to borrow money and
obtain other credit and financial accommodations for its corporate purposes and
to execute and deliver its promissory notes and other instruments and
agreements for the amounts so borrowed or acquired; and
WHEREAS, the proper officers of this Corporation have negotiated with
Harris Trust and Savings Bank and certain other lenders (individually a "Bank"
and collectively the "Banks") for a three-year revolving credit to be made
available by the Banks to this Corporation in the form of loans and letters of
credit in an aggregate principal amount not to exceed $65,000,000 at any one
time outstanding; and
WHEREAS, as a condition precedent to the extension of said revolving
credit and any other credit or financial accommodations from the Banks to this
Corporation, the Banks require that this Corporation enter into a credit
agreement with the Banks setting forth the terms and conditions applicable
thereto and that this Corporation secure said extensions of credit from the
Banks by granting to Harris Trust and Savings Bank, as agent (the "Agent") for
the Banks, a security interest in and lien on all of this Corporation's
accounts, chattel paper, documents, instruments, general intangibles,
inventory, and certain other assets and property of this Corporation; and
WHEREAS, in order to close the credit agreement with the Banks it will
be necessary to amend (1) that certain Note Agreement with the State of
Wisconsin Investment Board ("SWIB") dated as of December 1, 1991, and (2) that
certain Note Agreement with Nationwide Life Insurance Company, Employers Life
Insurance Company of Wausau and West Coast Life Insurance Company ("Insurance
Companies") dated as of January 1, 1990 in ways to be enumerated in separate
amendment agreements, and
NOW, THEREFORE, BE IT AND IT IS HEREBY RESOLVED by the Board of
Directors of Stokely USA, Inc. as follows:
1. The amendments to the Note Agreement with SWIB dated as of
December 1, 1991, on the terms and conditions set forth in the instruments and
documents now before this Board, are in the judgment of the Board in the best
interest of this Corporation and its shareholders.
2. The amendments to the Note Agreement with the Insurance
Companies dated as of January 1, 1990, on the terms and conditions set forth in
the instruments and documents now before the Board, are in the judgment of the
Board in the best interest of this Corporation and its shareholders.
<PAGE> 126
3. Any one of the following officers of this Corporation:
NAME OFFICE
Stephen Theobald Vice Chairman
Robert Brill Secretary
Les Wilson Vice President
be and the same is hereby authorized, empowered and directed for, in the name
and on behalf of this Corporation (and when requested by SWIB and/or the
Insurance Companies, under the corporate seal and attested to by the Secretary
or Assistant Secretary) to execute and deliver to SWIB and to the Insurance
Companies, as to their respective Note Agreements with the Corporation, all
such amendments to the said Note Agreements with SWIB and with the Insurance
Companies as are necessary and required by the said SWIB and Insurance
Companies, respectively, and to also execute and deliver to SWIB and to the
Insurance Companies such other documents, instruments and agreements and
security agreements as may from time to time be required by SWIB and the
Insurance Companies, respectively, in connection with the said amendments to
the Note Agreements with SWIB and with the Insurance Companies, respectively;
all on such terms and conditions and for such consideration as any of the
foregoing officers may in his sole discretion deem proper as evidenced by his
execution thereof.
4. Any officer, agent or employee of this Corporation is hereby
authorized, empowered and directed for, in the name and on behalf of this
Corporation to execute such further instruments and documents and to perform
such further acts and things as may by any one of them be deemed necessary or
appropriate to comply with or evidence compliance with any of the terms,
provisions or conditions of any instrument or document executed pursuant to the
authority contained in these resolutions and any other requirement or condition
specified by SWIB and the Insurance Companies, respectively, in respect
thereto, including without limiting the execution and filing of any mortgage,
financing statement or similar notice or instrument.
5. The Secretary or Assistant Secretary of this Corporation shall
deliver to SWIB and to the Insurance Companies a certified copy of these
resolutions and shall file with each of them from time to time the names of the
officers, agents and employees of this Corporation at the time authorized by
these resolutions to act in the premises together with the specimen signatures
of such officers, agents and employees. SWIB and the Insurance Companies shall
be entitled as against this Corporation conclusively to presume that the
persons so certified continue to be authorized to act as such on behalf of this
Corporation until otherwise notified in writing by the Secretary or other
officer of this Corporation and that each of the foregoing resolutions shall
continue in force until express written notice of its rescission or
modification has been received by SWIB and the Insurance Companies (but no such
rescission or modification shall affect any transaction occurring before the
actual receipt by SWIB and the Insurance Companies, respectively, of such
written notice), and if the
2
<PAGE> 127
authority therein contained shall be terminated by operation of law without
such notice, it is hereby resolved and agreed for the purposes of inducing SWIB
and the Insurance Companies to act hereunder that SWIB and the Insurance
Companies shall be saved harmless from any loss suffered or liability incurred
by it in so acting under such authority without such notice of its termination.
6. These resolutions shall be in addition to and supplementary of
any and all other resolutions of this Board of Directors now or hereafter on
file with SWIB and the Insurance Companies, respectively, and nothing herein
contained shall be deemed to amend, revoke or modify any of such other
resolutions or any of the authority therein contained.
3
<PAGE> 128
Rev. 5/10/95
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT
THIS AGREEMENT, made and entered into as of the 31st day of May, 1995,
by and among Nationwide Life Insurance Company ("Nationwide"), West Coast Life
Insurance Company ("West Coast"), Employers Life Insurance Company of Wausau
("Employers"), and State of Wisconsin Investment Board ("SWIB") (collectively
the "Lenders").
RECITALS:
WHEREAS, Stokely USA, Inc. ("Stokely") is indebted to SWIB under a
Note Agreement, dated as of December 1, 1991, as amended by a First Amendment
to Note Agreement dated August 18, 1992, a Second Amendment to Note Agreement
dated June 11, 1993, and a Third Amendment to Note Agreement, dated as of May
31, 1995 (said Note Agreement, as so amended, and as further amended, modified
or supplemented from time to time, is hereinafter referred to as the "SWIB Note
Agreement"), the Borrower's 9.74% Senior Note due December 15, 2001
(collectively, together with any other notes issued pursuant to the SWIB Note
Agreement, the "SWIB Note"), issued pursuant to the Nationwide Note Agreement;
and
WHEREAS, Stokely is indebted to Nationwide, West Coast, and Employers
under a Note Agreement, dated as of January 1, 1990, as amended by an Amendment
to Note Agreement dated August 18, 1992, a Second Amendment to Note Agreement
dated June 11, 1993, and a Third Amendment to Note Agreement, dated as of May
31, 1995 (said Note Agreement, as so amended, and as further amended, modified
or supplemented from time to time, is hereinafter referred to as the
"Nationwide Note Agreement"), the Borrower's 9.37% Senior Secured Notes due
January 15, 2000 (collectively, together with any other notes issued pursuant
to the Nationwide Note Agreement, the "Nationwide Notes"), issued pursuant to
the Nationwide Note Agreement; and
WHEREAS, in order to secure such indebtedness Stokely (i) has entered
into a Security Agreement, dated as of the date hereof, by and among Stokely
and the Lenders (as amended from time to time, the "Security Agreement"), (ii)
has granted certain mortgages/deeds of trust dated as of the date hereof
("Mortgages") encumbering all real estate owned by Stokely, and (iii) has
executed and delivered to the Lenders certain additional collateral security
documents, all more particularly described and defined in the Security
Agreement as the "Security Documents";
WHEREAS, the Lenders desire to provide for the possible establishment
of an agent ("Agent") for the Lenders under the Security Documents, to
establish the Agent's duties
May 23, 1995
<PAGE> 129
and powers, to provide for the distribution of any collateral or proceeds
therefrom hereafter coming into the possession of any one or more of the
Lenders or Agent pursuant to the Security Documents and to delineate certain
other agreements reached among the Lenders.
NOW, THEREFORE, in consideration of the foregoing, and the mutual
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto do
hereby agree as follows:
Section 1. Certain Definitions. In addition to other definitions
contained herein, the following terms shall have the meaning set forth below,
unless the context of this Agreement otherwise requires. Additionally, any
capitalized terms not otherwise defined herein shall have the meaning ascribed
thereto in the Security Agreement.
Affiliate shall mean, with respect to any Person, any other Person (i)
directly or indirectly controlling (including, but not limited to, all
directors and officers of such Person), controlled by, or under direct or
indirect common control with, such Person or (ii) that directly or indirectly
owns more than 5% of the voting securities of such Person. A Person shall be
deemed to control a corporation if such Person possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.
Agent shall mean (i) any commercial bank or trust company designated
by the Required Lenders pursuant to Section 2.1 to act as agent for the
Lenders, or (ii) if no such designation pursuant to Section 2.1 has been made,
any Lender designated by the Required Lenders pursuant to Section 2.9 to act as
agent for the Lenders, or (iii) if no such designation pursuant to Section 2.1
or Section 2.9 has been made, the Required Lenders.
Collateral shall mean the collateral described and defined in the
Security Agreement, all real property and fixtures encumbered by the Mortgages
and all other collateral in which any one or more of the Lenders or the Agent
shall have been granted an interest under any of the other Security Documents.
Enforcement Notice shall mean a written notice delivered by the
Required Lenders to the Agent, if any, or if none, to the Lenders, stating that
an "Event of Default" (as defined in such Lender's Note Agreement) or an Event
of Default has occurred and is continuing and that an Enforcement Period has
commenced.
Enforcement Period shall mean the period of time following the receipt
by the Agent or the Lenders, as applicable, of an Enforcement Notice from the
Required Lenders until either (a) the final payment or satisfaction in full of
all Obligations, or (b) the Agent, if any, and the Required Lenders agree in
writing to terminate the Enforcement Period.
Event of Default shall be defined under Section 5. of the Security
Agreement.
2
May 23, 1995
<PAGE> 130
Note Agreement(s) shall mean with respect to Nationwide, Employers and
West Coast, the Nationwide Notes and Nationwide Note Agreement, as defined in
the Security Agreement, and any and all indebtedness arising thereunder; and
with respect to SWIB, shall mean the SWIB Note and SWIB Note Agreement, as
defined in the Security Agreement, and any and all indebtedness arising
thereunder.
Person shall mean an individual, partnership, joint venture,
corporation, business trust, joint stock company, trust unincorporated
organization, Governmental Authority or other entity of whatever nature.
Pro Rata Share shall mean, at any time with respect to each Lender, a
fraction, the numerator of which is the then principal balance outstanding
under the Note Agreement held by such lender and the denominator of which is the
sum of the aggregate principal balances then outstanding under the Nationwide
Note Agreement and the SWIB Note Agreement.
Required Lenders shall have the meaning ascribed to such term in
Section 3.3 of this Agreement.
Section 2. The Agent.
2.1. Appointment. The Required Lenders may, at any time, by
written notice to Stokely, designate a commercial bank or trust company
reasonably acceptable to the Required Lenders to act as the agent as specified
herein and in the other Security Documents. Upon such a designation, each
Lender shall be deemed to have irrevocably authorized, and each holder of any
of the instruments evidencing the Obligations by the acceptance of such
instrument shall be deemed irrevocably to authorize, the Agent to take such
action on its behalf under the provisions of this Agreement and the Security
Documents and to exercise such powers and to perform such duties hereunder and
thereunder as are specifically delegated to or required of the Agent by the
terms hereof and thereof and such other powers as are reasonably incidental
thereto. The Agent may perform any of its duties hereunder by or through its
officers, directors, agents or employees.
2.2. Nature of Duties. The Agent shall have no duties or
responsibilities except (i) those expressly set forth in this Agreement and the
Security Documents and (ii) to take such actions instructed by the Required
Lenders in accordance with the other provisions of this Agreement, the Security
Documents and applicable law. Neither the Agent nor any of its officers,
directors, agents or employees shall be liable for any action taken or omitted
by it or them hereunder or under any Security Document or in connection
herewith or therewith, unless caused by its or their negligence or willful
misconduct. The Agent shall not by reason of this Agreement, the Security
Documents or any other Loan Document be a trustee for any Lender or Stokely or
have any other fiduciary obligation to any Lender or Stokely (including any
obligation under the Trust Indenture Act of 1939, as amended). The duties of
the Agent shall be mechanical and administrative in nature and nothing in this
Agreement or any Security Document, expressed or implied, is intended to or
shall be so construed as to impose upon the
May 23, 1995
3
<PAGE> 131
Agent any obligations in respect of this Agreement or any Security Document
except as expressly set forth herein; provided that the Agent will act under
the Security Documents in a manner consistent with its practices with respect
to similar facilities in which the Agent is acting on its own behalf.
2.3. Lack of Reliance on the Agent. Independently and without
reliance upon any Agent, each Lender, to the extent it deems appropriate, has
made and shall continue to make (i) its own independent investigation of the
financial condition and affairs of Stokely in connection with the making and
the continuance of the Obligations and the taking or not taking of any action
in connection herewith and (ii) its own appraisal of the credit worthiness of
Stokely and, except as expressly provided in this Agreement, the Agent shall
have no duty or responsibility, either initially or on a continuing basis, to
provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before the execution of this Agreement, or
at any time or times thereafter. The Agent shall not be responsible to any
Lender for any recitals, statements, information, representations or warranties
herein or in any document, certificate or other writing delivered in
connection herewith or for the execution, effectiveness, genuineness,
validity, enforceability, perfection, collectibility, priority or sufficiency
of this Agreement or any Security Document or the financial condition of
Stokely or be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of this Agreement or
any Security Document, or the financial condition of Stokely or the existence
or possible existence of any Event of Default.
2.4. Certain Rights of the Agent. If the Agent shall request
instructions from the Required Lenders with respect to any act or action
(including failure to act) in connection with this Agreement or any Security
Document, the Agent shall be entitled to refrain from such act or taking such
action unless and until the Agent shall have received instructions from the
Required Lenders; and the Agent shall not incur liability to any Person by
reason of so refraining. Without limiting the foregoing, no Lender shall have
any right of action whatsoever against the Agent as a result of the Agent
acting or refraining from acting hereunder or under any Security Document in
accordance with the instructions of the Required Lenders.
2.5. Reliance. The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram,
radiogram, order or other document or telephone message signed, sent or
made by any Person that the Agent believed to be the proper Person and, upon
the advice and statements, pertaining to this Agreement, the Security Documents
and any other Loan Document and its duties hereunder and thereunder, of legal
counsel (including counsel to any grantor party to any Security Documents, any
Lender or Stokely or any affiliate of any of the foregoing), independent
accountants and other experts selected in good faith by the Agent. The Agent
shall not be responsible for the negligence or misconduct of any legal counsel
or other agents selected by it with reasonable care.
2.6. Indemnification. To the extent the Agent is not reimbursed and
indemnified by Stokely, the Lenders will reimburse and indemnify the Agent, in
proportion to their Pro Rata
4
May 23, 1995
<PAGE> 132
Share, for and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by or asserted
against the Agent in performing its duties hereunder or under any Security
Document, in any way relating to or arising out of this Agreement or any
Security Document; provided that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Agent's negligence
or willful misconduct.
2.7. Holders. The Agent may deem and treat any payee (or in the
case of any Note issued in the name of a nominee, the beneficial owner) of any
Note as the owner hereof for all purposes hereof unless and until a written
notice of the assignment, transfer or endorsement thereof, as the case may be,
shall have been filed with the Agent. Any request, authority or consent of any
Person or entity who, at the time of making such request or giving such
authority or consent, is the holder of any Note (or in the case of any Note
issued in the name of a nominee, the beneficial owner) shall be conclusive and
binding on any subsequent holder, transferee, assignee or indorsee, as the case
may be, of such Note or of any Note or Notes issued in exchange therefor.
2.8. Resignation by or Removal of the Agent.
(a) The Agent may resign from the performance of all its
functions and duties hereunder and under the Security Documents at any
time by giving sixty (60) days' prior written notice to the Lenders.
Such resignation shall take effect upon the appointment of a
successor Agent or as otherwise provided pursuant to clauses (b) and
(c) below or as otherwise provided below.
(b) Upon any such notice of resignation, the Required
Lenders shall appoint a successor Agent hereunder or thereunder who
shall be a commercial bank or trust company reasonably acceptable to
the Required Lenders.
(c) If a successor Agent shall not have been so appointed
within such sixty (60) day period, there shall be no Agent unless and
until such time, if any, as the Required Lenders appoint a successor
Agent as provided above or pursuant to Section 2.9.
(d) The Required Lenders shall have the right to remove
the Agent and terminate the Agent's rights and duties hereunder by
giving thirty (30) days written notice to the Agent and all other
Lenders. Any such notice of removal of an Agent may also designate a
successor agent hereunder and under the Security Documents who
shall be a commercial bank or trust company reasonably acceptable to
the Required Lenders.
2.9. Lender as Agent; the Agent in its Individual Capacity. In
addition to any commercial bank or trust company, upon the designation of the
Required Lenders, any Lender may serve as Agent. With respect to the
calculation of its Pro Rata Share, such Lender shall
5
May 23, 1995
<PAGE> 133
have the rights and powers specified herein for a "Lender" and may exercise the
same rights and powers as though it were not performing the duties specified
herein; and the term "Lender," "Required Lenders," "holders of Note
Agreements" or any similar terms shall, unless the context clearly otherwise
indicates, include such Lender in its individual capacity as a holder of a
portion of the Obligations. The Agent and/or its Affiliates may engage in any
kind of business with Stokely or any Affiliate of Stokely as if it were not
performing the duties specified herein, and may accept fees and other
consideration from Stokely for services in connection with such activities
without having to account for the same to the Lenders.
2.10. Effect of Absence of Agent. At any time when no Agent has been
designated as provided above, or such designation has been terminated as
provided above without a successor having been designated, the Lenders, or any
Lender, upon the determination of the Required Lenders, shall have the
authority of, and may take any action which might have been taken by, the
Agent.
Section 3. Collections.
3.1. Collection by Lenders. Each Lender shall continue to receive
directly from Stokely all regularly scheduled payments due such Lender under
its respective Note Agreement, including accrued interest payments, scheduled
principal amortization payments, late fees and other charges due under such
Note Agreements. Any other principal prepayment, payments after acceleration,
payments of "put" or other purchase prices, and similar payments received
directly by any Lender during the term of this Agreement (other than scheduled
interest and principal amortization payments, voluntary prepayments as
contemplated or allowed under the respective Note Agreements, and payments
received pursuant to Section 4.1) shall be deemed to be received and held by
such Lender in trust for the benefit of all the Lenders under this Agreement,
and shall be distributed to all of the Lenders in accordance with the
provisions of Section 4.
3.2. Collections. Upon receipt of an Enforcement Notice signed by
the Required Lenders, the Agent shall throughout the Enforcement Period, take
all steps necessary or required to realize upon the Collateral in the order and
in the manner directed by the Required Lenders. Such collection actions shall
include, but not be limited to, the commencement of one or more foreclosure
actions, the sale or other disposition of personal property by public or
private proceedings under the applicable Uniform Commercial code in effect for
the state in which such personal property is located and/or the conveyance of
such Collateral to the Agent or Lenders by deed in lieu of foreclosure or other
conveyance. The Agent agrees to notify Lenders of any Event of Default upon
learning of the same and shall keep the Lenders informed of all collection
actions taken by the Agent and, upon request by the Required Lenders, will take
such other lawful collection actions as the Required Lenders shall direct.
Notwithstanding anything contained herein to the contrary, the Agent and each
Lender agrees that it will not knowingly take any of the following actions
without the written consent of the Required Lenders: (i) waive any default by
Stokely involving the payment of money to the Agent and/or the Lenders pursuant
6
May 23, 1995
<PAGE> 134
to the Security Documents; (ii) extend the time of payment of Stokely's
obligations arising under the Security Documents; or (iii) agree to any change
in the rate of interest payable by Stokely with respect to any obligations
arising under the Security Documents; but nothing contained herein shall
entitle the Agent to extend the time of payment of any obligations under any of
the Note Agreements and/or change the rate of interest charged under any of the
Note Agreements without the written consent of the Lender(s) having an interest
in such Note Agreement. The Agent may release Collateral in aggregate having a
book value of $100,000.00 or less during any calendar year without the written
consent of all Lenders then having an interest in the Collateral.
Notwithstanding the foregoing, the Agent may release Collateral in exchange for
substitute Collateral having equivalent value. The Agent shall be fully
justified in failing or refusing to take any action under the Security
Documents unless it shall first receive such advice or concurrence of the
Required Lenders as the Agent shall deem appropriate.
3.3. Required Lenders. As used in this Agreement, Required Lender(s)
shall mean the following:
(a) Upon the occurrence of any payment default under any of
the SWIB Note Agreement or the Nationwide Note Agreement, which
default shall continue for seven (7) days after such payment is due,
any holder of such Note Agreement shall be deemed to be a "Required
Lender" solely for the purpose of delivering to the Agent an
Enforcement Notice requiring the Agent to commence collection
proceedings against the Collateral.
(b) Upon the occurrence of a bankruptcy or insolvency Event of
Default as described in any of Section 6.1(h)-(j) of the SWIB Note
Agreement or any of Section 6.1(h)-(j) of the Nationwide Note
Agreement, any one Lender shall be deemed to be a "Required Lender"
solely for the purpose of delivering to the Agent an Enforcement
Notice requiring the Agent to commence collection proceedings against
the Collateral.
(c) In all other instances, the "Required Lenders" shall mean
Lenders then entitled to seventy-five percent (75%) or more of the
Pro Rata Share of the distributions under Section 4.1(c).
Section 4. Distribution of Proceeds.
4.1. Except for payments which may be received and retained by Lenders
pursuant to Section 3.1, whenever the Agent receives any payment, collection
or recovery on account of the Collateral or otherwise, whether from Stokely,
the Collateral or otherwise, and including, but not limited to, any
condemnation awards, insurance proceeds, income derived from the Collateral,
foreclosure sale proceeds or proceeds from the sale of Collateral, the Agent
shall allocate and disburse such receipts as follows:
7
May 23, 1995
<PAGE> 135
(a) First, any amount remitted by Stokely to the Agent
for the purpose of paying taxes, assessments, insurance premiums, or
for similar purposes as required by the Security Documents, shall be
disbursed by the Agent in payment of such expenses, or, if previously
paid by the Agent, such amount shall be retained by the Agent in
reimbursement therefor;
(b) Second, an amount equal to that necessary to repay
principal and interest on account of any and all Protective Advances
made in accordance with Section 7 shall be distributed by the Agent to
each Lender in proportion to such Lender's contribution of funds for
all such Protective Advances; and
(c) Third, all remaining amounts shall be allocated among and
disbursed to the Lenders in proportion to their then Pro Rata Share
until all obligations due under the Nationwide Note Agreement and the
SWIB Note Agreement have been paid in full.
4.2. Payment Procedure. After the Agent makes the allocations
required by Sections 4.1(a) and (b), it shall promptly remit to each Lender
the amount to which such Lender is entitled under Section 4.1(c), provided,
however, that the Agent may retain and deduct from such payment to any Lender
any amounts owed the Agent by such Lender pursuant to this Agreement,
including, without limitation, any amounts then owing to the Agent pursuant to
Section 6.
4.3. Payment Returns. If any payment distributed to the Lenders
pursuant to Section 4.2 is under applicable law required to be later rescinded
or is under applicable law otherwise required to be returned by the Agent or
any one or more of the Lenders for whatever reason (including, without
limitation, settlement of an alleged claim approved by Required Lenders), each
Lender, upon demand by the Agent, shall immediately pay to the Agent or the
Lender, whichever shall have been required to make such return or rescission,
the Lender's Pro Rata Share (computed as of the date the original payment was
made) of the amount so returned or rescinded. The covenants contained in this
Section 4.3 shall survive the termination of this Agreement.
4.4. Setoffs. Notwithstanding anything contained herein to the
contrary, if any court of competent jurisdiction finally determines than any
recovery by the Agent under any collection proceedings brought against the
Collateral should be reduced as a result of any counterclaim or setoff asserted
by Stokely against one or more of the Lenders, then in calculating the amounts
distributable to each Lender under Section 4.1(c), the Agent shall first
compute the amount that would have been distributed to each Lender had such
counterclaim or setoff not occurred and the full amount of the reduction in
proceeds attributable to such counterclaim or setoff shall be allocated to the
Lender or Lenders against which the counterclaim or setoff was asserted and the
amounts otherwise payable to such Lenders correspondingly reduced.
8
May 23, 1995
<PAGE> 136
Section 5. Setoffs and Liens.
5.1. Setoffs. Lenders agree that they shall not accept, receive, or
apply against the amounts due them under their respective Note Agreements any
sums obtained by any counterclaim, setoff, banker's lien or other involuntary,
unscheduled payment by Stokely, except upon the prior written consent of the
Required Lenders as defined under Section 3.3(c).
5.2. Liens. Each Lender agrees (i) that any voluntary or
involuntary Lien in such Lender's favor on all or any part of the Collateral or
any security interests granted by Stokely to such Lender therein (other than
any rights in Collateral obtained pursuant to the Security Documents) shall be
subordinate in all respects to the Lien of the Agent or Lenders in the
Collateral granted pursuant to the Security Documents, irrespective of the
actual date of perfection under applicable law and (ii) that such Lender shall
not commence or take any action to realize on any interest it has in the
Collateral without the consent of the Required Lenders as defined in Section
3.3(c).
Section 6. Agent Fees and Reimbursables.
6.1. Servicing Fees. As compensation for providing services
hereunder, the Agent may charge to Stokely, and Stokely agrees to pay, an
annual servicing fee as approved by the Required Lenders. If Stokely fails to
pay any sum due thereunder, each Lender shall pay that Lender's Pro Rata Share
of such outstanding servicing fee.
6.2. Out-of-Pocket Expenses. The Agent shall also charge to Stokely,
and Stokely agrees to pay, all out-of-pocket expenses incurred by the Agent in
carrying out its duties under and under the Security Agreement and under all
other Security Documents, including reasonable attorneys' fees. If Stokely
fails to pay any sums due thereunder, each Lender shall reimburse the Agent for
such Lender's Pro Rata Share of such outstanding unpaid amount. The Agent
shall provide each Lender with a statement setting forth the out-of-pocket
expenses for which the Agent or Lenders seek reimbursement. Payment shall be
due within thirty (30) days after the receipt of such statement.
Section 7. Protective Advances. If at any time during the term of
this Agreement Stokely fails to perform any of its obligations under any of the
Security Documents, the effect of which could reasonably be expected to have a
material adverse effect upon the value and/or utility of the Collateral or for
which such failure to perform may give rise to Liens or other charges against
the Collateral having priority over or parity with the Liens granted under the
Security Documents, the Agent shall, upon learning of any such default, notify
each of the Lenders. Such defaults may include, but are not limited to,
failure to pay real estate taxes, failure to insure the Collateral or failure
to adequately maintain the Collateral. Upon request of the Required Lenders,
the Agent shall take appropriate steps to cure any such default on behalf of
Stokely and any and all expenses incurred in curing such default shall be
deemed to be a "Protective Advance". Each Lender shall contribute such Lender's
Pro Rata share of any such authorized Protective Advance, but if any Lender
fails to contribute its Pro Rata Share, the
9
May 23, 1995
<PAGE> 137
Required Lenders who directed the Agent to make the Protective Advance shall
contribute any shortfall on a proportionate basis (based on each such Lender's
Pro Rata Share) among the Required Lenders. All Protective Advances shall bear
interest from the date of advance at the rate of interest provided for in the
applicable Security Document and shall be entitled to priority repayment under
Section 4.1(b).
Section 8. Miscellaneous.
8.1. Notices. Any notice required or desired to be served, given or
delivered hereunder shall be in writing, and shall be deemed to have been
validly served, given or delivered upon the earlier of (a) personal delivery to
the address set forth below, and (b) in the case of mailed notice, three (3)
days after deposit in the United States mail, with proper postage for certified
mail, return receipt requested, prepaid or in the case of notice by Federal
Express or other reputable overnight courier services, one (1) business day
after delivery to such courier service and (c) in the case of telex, telecopy
or telegram, upon actual receipt by the recipient, addressed to the party to be
notified as follows:
If to the Agent: to the address of such Agent as
communicated in the designation of
such Agent pursuant to Section 2.1,
above
If to State of Wisconsin Investment Board: State of Wisconsin Investment Board
121 East Wilson Street
Madison, Wisconsin 53702
Attention: Private Placements
Telecopy No. (608) 266-2436
If to Nationwide: Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43216
Attention: Corporate Fixed-
Income Securities
Telecopy No. (614) 249-4553
If to Employers Life Insurance Company of Employers Life Insurance Company
Wausau: of Wausau
One Nationwide Plaza
Columbus, Ohio 43216
Attention: Corporate Fixed-
Income Securities
Telecopy No. (614) 249-4553
10
May 23, 1995
<PAGE> 138
If to West Coast Life Company: West Coast Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43216
Attention: Corporate Fixed-
Income Securities
Telecopy No. (614) 249-4553
If to Stokely: Stokely USA, Inc.
1055 Corporate Center Drive
Oconomowoc, Wisconsin 53066
Attention: Treasurer
Telecopy No. (414) 569-3860
or to such other address as each party designates to the other in the manner
herein prescribed.
8.2. Contesting Liens or Security Interests. None of the Lenders
shall contest the validity, perfection, priority or enforceability of any lien
or security interest granted in favor of the Agent or the Lenders under any of
the Security Documents. Each Lender shall also use its best efforts to notify
the Agent of any change in the location of any of the Collateral or the
business operations of Stokely or of any change in law which would make it
necessary or advisable for agent to file additional financing statements in
another location as against Stokely, but the failure to do so shall not create
a cause of action against the party failing to give such notice or create any
claim or right on behalf of any third party.
8.3. Continuation of Provisions. The provisions of this Agreement
shall continue to apply to each Lender's claim under the Loan Documents
notwithstanding that any such claim, any claim in respect thereof or security
interest in Collateral held in respect thereof may be disallowed, avoided or
subordinated pursuant to the Federal Bankruptcy Code or other applicable
insolvency law or equitable principles for any reason, including without
limitation, (a) as a claim for unmatured interest or (b) as a fraudulent
transfer or conveyance. This Agreement shall continue to be effective or
reinstated, as the case may be, if at any time any payment of any claim under
any of the Note Agreements is rescinded or must otherwise be returned by any
Lender upon the insolvency, bankruptcy or reorganization of Stokely, or
otherwise, all as though such payment had not been made. All agreements and
obligations of the parties hereto shall remain in full force and effect
irrespective of (a) any lack of validity or enforceability of the Note
Agreements or any other agreement or instrument relating to the Note
Agreements, or (b) any other circumstance that might otherwise constitute a
defense available to, or a discharge of Stokely.
8.4. No Additional Rights for Stokely or the Lenders. If any party
hereto shall enforce its rights or remedies in violation of the terms of this
Agreement, Stokely agrees that it shall not use such violation as a defense to
any action by such party under the Note Agreements or Security Documents, as
applicable, nor assert such violation as a counter claim
11
May 23, 1995
<PAGE> 139
or basis for setoff or recoupment against any such party. Each party hereto
agrees that this Agreement shall not have the effect of enlarging the rights of
such party vis-a-vis Stokely, and acknowledges that such rights shall be
governed by the respective Note Agreements, as applicable.
8.5. Successors and Assigns; Replacement Financing. This Agreement
shall be binding upon and inure to the benefit of the respective successors and
assigns of each of the parties hereto, but does not otherwise create, and shall
not be construed as creating, any rights enforceable by Stokely or any other
person not a party to this Agreement. No party hereto shall assign its
interest in its respective Note Agreement unless the assignee agrees to be
bound by the terms of this Agreement.
8.6. Governing Law. THIS AGREEMENT SHALL BE GOVERNED AS TO VALIDITY,
INTERPRETATIONS, ENFORCEMENT AND EFFECT BY THE LAWS OF THE STATE OF WISCONSIN
WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREUNDER.
8.7. Agreement Absolute. This Agreement shall be and remain absolute
and unconditional under any and all circumstances, and no act or omission on
the part of any party to this Agreement shall affect or impair the agreement of
the other party hereunder.
8.8. Amendments. All modifications or amendments of this Agreement
must be in writing and duly executed by an authorized officer of each Lender to
be binding and enforceable. Nationwide, West Coast, Employers and SWIB shall
not amend or modify any of their respective Note Agreements or any of the
Security Agreement, Mortgages, or other Security Documents, or any of the terms
thereof, or grant any waivers, consents, forbearances, releases, or similar
modifications under any of the Security Agreement, Mortgages, or other Security
Documents, without the prior written consent of the Required Lenders.
Notwithstanding the foregoing, each Lender retains the right, with respect to
its respective Note Agreement, to grant renewals or extensions of the time for
payment of the obligations of Stokely thereunder, or omit to take any action
for the enforcement of, or waive any rights with respect to any obligation of
Stokely to such Lender without invalidating or impairing Lenders' rights herein
(except as set forth in Section 4.4, above).
8.9. Counterparts. This Agreement may be executed in any number of
counterparts each of which shall be deemed to be an original hereof submissible
into evidence and all of which together shall be deemed to be a single
instrument.
8.10. Assignment by Agent. At such time as only one Lender has an
interest in the Collateral, upon request of such Lender, the Agent shall assign
all of its rights in the Collateral and the Security Documents to such Lender.
8.11. Notices of Defaults. The Agent and each of the Lenders agree to
use their best efforts to give to the other Lenders copies of any notice of the
occurrence of any Event of
12
May 23, 1995
<PAGE> 140
Default, simultaneously with the sending of such notice to Stokely, but the
failure to do so shall not affect the validity of such notice or create a cause
of action against the party failing to give such notice or create any claim or
right on behalf of any third party. The sending or receipt of such notice
shall not obligate the recipient to cure such Event of Default. Unless
specifically noted therein, no notice of an Event of Default shall (a)
constitute an Enforcement Notice; (b) create any obligation on the part of the
party delivering such notice to accelerate its indebtedness; or (c) create any
obligation on the part of any party to cure such Event of Default.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day, month and year first above written.
LENDERS:
State of Wisconsin Investment Board
By: James M. Gannon
-----------------------------
James M. Gannon
Its: Assistant Investment Director
-----------------------------
Nationwide Life Insurance Company
By:
-----------------------------
Its:
-----------------------------
West Coast Life Insurance Company
By:
-----------------------------
Its:
-----------------------------
Employers Life Insurance Company of Wausau
By:
-----------------------------
Its:
-----------------------------
13
May 26, 1995
<PAGE> 141
not affect the validity of such notice or create a cause of action against the
party failing to give such notice or create any claim or right on behalf of any
third party. The sending or receipt of such notice shall not obligate the
recipient to cure such Event of Default. Unless specifically noted therein, no
notice of an Event of Default shall (a) constitute an Enforcement Notice; (b)
create any obligation on the part of the party delivering such notice to
accelerate its indebtedness; or (c) create any obligation on the part of any
party to cure such Event of Default.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day, month and year first above written.
LENDERS:
State of Wisconsin Investment Board
By:
-----------------------------
Its:
-----------------------------
Nationwide Life Insurance Company
By: JEFFREY G. MILBURN
----------------------------------
JEFFREY G. MILBURN, VICE PRESIDENT
Its: CORPORATE FIXED-INCOME SECURITIES
----------------------------------
West Coast Life Insurance Company
By: JEFFREY G. MILBURN
-----------------------------
JEFFREY G. MILBURN
Its: ATTORNEY-IN-FACT
-----------------------------
Employers Life Insurance Company of Wausau
By: JEFFREY G. MILBURN
-----------------------------
JEFFREY G. MILBURN
Its: ATTORNEY-IN-FACT
-----------------------------
13
May 18, 1995
<PAGE> 142
ACKNOWLEDGEMENT
The undersigned hereby acknowledges and agrees to the foregoing terms
and provisions. By executing this Agreement, the undersigned agree to be bound
by the provisions hereof as they relate to the relative rights of each of the
Lenders party thereto. The undersigned further agrees that the terms of this
Agreement shall not, unless specifically set forth in this Agreement, give the
undersigned any substantive rights vis-a-vis any of the Lenders party thereto.
If any of the Lenders party hereto shall enforce its rights or
remedies in violation of the terms of this Agreement, the undersigned Stokely
agrees that it shall not use such violation as a defense to the enforcement by
such Lender under the Note Agreements, as applicable, nor assert such violation
as a counterclaim or basis for setoff or recoupment against such Lender.
Dated as of May 31, 1995.
Stokely USA, Inc., a Wisconsin corporation
By: Robert Brill
------------
Its: Secretary
-----------
14
May 23, 1995
<PAGE> 143
SECURITY AGREEMENT
THIS SECURITY AGREEMENT made as of this 31st day of May, 1995, by and
among STOKELY USA, INC., a Wisconsin corporation (the "Borrower"), and
NATIONWIDE LIFE INSURANCE COMPANY ("Nationwide"), EMPLOYERS LIFE INSURANCE
COMPANY OF WAUSAU ("Employers"), WEST COAST LIFE INSURANCE COMPANY ("West
Coast"), and STATE OF WISCONSIN INVESTMENT BOARD ("SWIB").
WHEREAS, Nationwide, Employers and West Coast (collectively being
hereinafter called the "Insurance Companies") and the Borrower are parties to a
Note Agreement, dated as of January 1, 1990, as amended by an Amendment to Note
Agreement dated August 18, 1992, a Second Amendment to Note Agreement dated
June 11, 1993, and a Third Amendment to Note Agreement dated May 31, 1995 (said
Note Agreement, as so amended, and as further amended, modified or supplemented
from time to time, is hereinafter referred to as the "Nationwide Note
Agreement"), pursuant to which the Borrower has issued its 9.37% Senior Secured
Notes due January 15, 2000 (collectively, together with any other notes issued
pursuant to the Nationwide Note Agreement, the "Nationwide Notes"); and
WHEREAS, SWIB and the Borrower are parties to a Note Agreement, dated
as of December 1, 1991, as amended by a First Amendment to Note Agreement dated
as of August 18, 1992, a Second Amendment to Note Agreement dated as of June
11, 1993, and a Third Amendment to Note Agreement dated as of May 31,1995 (said
Note Agreement, as so amended, and as further amended, modified or supplemented
from time to time, is hereinafter referred to as the "SWIB Note Agreement"),
pursuant to which the Borrower has issued a certain 9.49% Senior Note due
December 15, 2001 (collectively, together with any other notes issued pursuant
to the SWIB Note Agreement, the "SWIB Notes"); and
WHEREAS, the Borrower and Bank One, Milwaukee, National Association
("Bank One"), as agent for the Insurance Companies, SWIB and certain other
lenders including Bank One (Bank One and such other lenders are hereinafter
referred to as the "Other Lenders"), entered into a Security Agreement dated as
of August 18,1992, as amended by a First Amendment to Security Agreement dated
as of June 11, 1993 (said Security Agreement as so amended is hereinafter
referred to as the "Old Security Agreement"), pursuant to which the Borrower
granted to Bank One, as agent for the benefit of the Insurance Companies, SWIB
and such Other Lenders, a Lien on and security interest in certain assets of
the Borrower for the benefit of the Insurance Companies, SWIB and the Other
Lenders; and
WHEREAS, in connection with the payment and satisfaction in full of
all obligations of the Borrower to the Other Lenders, (i) the Other Lenders
have released all of their claims on the assets of the Borrower, (ii) the
Insurance Companies and SWIB have released their claim as to certain assets of
the Borrower but have not released their claim as to certain other assets of
the Borrower, and (iii) Bank One, as agent, has assigned to the Insurance
Companies and SWIB all of its Liens on and security interests in the Collateral
(as hereinafter defined), and all rights and powers therein granted pursuant to
the Intercreditor and Collateral Agency Agreement (as hereinafter defined) and
the Security Documents (as defined in the Intercreditor and Collateral Agency
Agreement); and
<PAGE> 144
WHEREAS, in order to evidence the transactions described in
the immediately preceding paragraphs, including, without limitation, the
continuing Lien of the Insurance Companies and SWIB on and security interest in
the Collateral (as hereinafter defined) to secure the prompt and complete
payment, observance, performance and discharge of the Obligations (as
hereinafter defined) which remain outstanding, the Insurance Companies and SWIB
have required the Borrower to execute and deliver this Agreement.
NOW, THEREFORE, in consideration of the foregoing, and the mutual
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Borrower, the
Insurance Companies and SWIB agree as follows:
1. DEFINITIONS.
As used herein, the following terms shall have the meanings ascribed
to them set forth below:
AGENT -- shall have the meaning assigned to such term in the
Intercreditor Agreement.
APPLETON FACILITY -- shall have the meaning assigned to such term in
Section 3N hereof.
APPLETON SALE PROCEEDS -- shall have the meaning assigned to such term
in Section 3N hereof.
ASSIGNMENT OF CONTRACTS, WARRANTIES AND PERMITS -- shall mean the
Assignment of Contracts, Warranties and Permits dated as of May 31, 1995,
granted by the Borrower to the Secured Parties, as amended, modified or
supplemented from time to time.
BANK ONE -- shall have the meaning assigned to such term in the third
WHEREAS clause hereof.
BOOKS AND RECORDS -- shall have the meaning assigned to such term in
Section 2C hereof.
BUSINESS DAY -- shall mean any day except a Saturday, a Sunday or day
on which commercial banks in Milwaukee, Wisconsin are authorized or required by
law to close.
COLLATERAL -- shall have the meaning assigned to such term in Section
2 hereof.
ENVIRONMENTAL INDEMNIFICATION AGREEMENT -- shall mean the
Environmental Indemnification Agreement dated as of May 31, 1995, entered into
by and among the Borrower and the Secured Parties, as amended, modified or
supplemented from time to time.
EQUIPMENT -- shall have the meaning assigned thereto by the UCC and
shall include, but not be limited to, all machinery, all manufacturing,
distribution, selling, data processing and office equipment, all computer
hardware, computer software, furniture, furnishings, fixtures (including, but
not limited to, heating, cooling, fire protection equipment and plumbing,
electrical distribution and other utility connections or equipment), and trade
fixtures, tools, tooling, molds, dies, all canning and processing equipment,
and facilities and other personal property of whatsoever kind
2
<PAGE> 145
or nature, used or useful in the business of the Borrower, including, but not
by way of limitation, all engines, conveyors, boilers, dynamos, generators,
power lines and other electrical apparatus, hoppers, briners, elevators, pumps,
piping, tanks, dryers, blanchers, cutters, slicers, labeling equipment,
automobiles, trucks, tractors, combines, harvesters, harrows, planters,
loaders, railroad tracks and equipment, equipment for canning, farming,
manufacturing, drainage, irrigation and water supply, office and shop
equipment, heating plants, storehouses, preparation and canning plants and all
goods, tools, supplies, equipment and personal property of every name, kind,
sort or character used or usable in the aforesaid connections, vehicles,
vessels and aircraft, and each case whether now owned or hereafter acquired and
wherever located, and all accessions and additions thereto, parts and
appurtenances thereof, substitutions therefor and replacements thereof; but
excluding therefrom that certain FMC Sterile Matic Continuous Cooker - Two
Shell located within the Borrower's facility at Waunakee, Wisconsin.
EVENT OF DEFAULT -- shall have the meaning assigned to such term in
Section 5 hereof.
FIXTURES -- shall mean all fixtures (as that term is defined in the
UCC) now or hereafter attached to or located upon the Real Property Parcels.
GOVERNMENTAL AUTHORITY -- shall mean any nation or government, any
state or other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government and any corporation or other entity owned or
controlled (through stock or capital ownership or otherwise) by any of the
foregoing.
INSURANCE COMPANIES -- shall have the meaning assigned to such term in
the first WHEREAS clause hereof.
INTERCREDITOR AGREEMENT -- shall mean the Intercreditor and Collateral
Agency Agreement dated as of May 31, 1995, by and among the Secured Parties and
acknowledged by the Borrower, as amended, modified or supplemented from time to
time.
INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT -- shall mean the
Intercreditor and Collateral Agency Agreement dated as of August 18, 1992, by
and among Bank One, First Bank (N.A.), the Insurance Companies and SWIB, and
acknowledged by the Borrower and certain subsidiaries of the Borrower, as
amended by a First Amendment to Intercreditor and Collateral Agency Agreement
dated as of June 11, 1993, by and among Bank One, First Bank (N.A.), NBD Bank,
N.A., the Insurance Companies, SWIB, Barclays Business Credit, Inc., LaSalle
National Bank, and BA Business Credit, Inc., and acknowledged by the Borrower
and certain subsidiaries of the Borrower.
LIEN -- shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, any conditional sale or other
title retention agreement, any financing lease having substantially the same
economic effect as any of the foregoing and any arrangement involving the
filing of any financing statement under the UCC or comparable law of any
jurisdiction).
LOAN DOCUMENTS -- shall mean the Nationwide Note Agreement, the SWIB
Note Agreement, the Notes and the Security Documents.
3
<PAGE> 146
MORTGAGES -- shall mean those certain Mortgages, Assignments of Leases
and Rents, Security Agreements and Financing Statements and/or Deed of Trusts,
each dated as of May 31, 1995, given by the Borrower to the Secured Parties,
with respect to each of the Real Property Parcels, as amended, modified or
supplemented from time to time.
NATIONWIDE NOTES -- shall have the meaning assigned to such term in
the first WHEREAS clause hereof.
NATIONWIDE NOTE AGREEMENT -- shall have the meaning assigned to such
term in the first WHEREAS clause hereof.
NATIONWIDE NOTE OBLIGATIONS -- shall mean all obligations of the
Borrower to the Insurance Companies and any other holders from time to time of
the Nationwide Notes under the Nationwide Note Agreement and the Nationwide
Notes, whether arising out of credit previously granted, credit
contemporaneously granted, or granted in the future, and, however arising,
whether voluntary or involuntary, due or not due, absolute or contingent,
liquidated or unliquidated, determined or undetermined, secured or unsecured,
whether the Borrower is liable individually or jointly with others, whether for
principal, interest, premium or other debts, obligations or liabilities, and
whether or not any or all such debts, obligations and liabilities are or become
barred by any statute of limitations or otherwise unenforceable.
NET PROCEEDS -- shall mean the amount obtained by subtracting from the
gross proceeds of the sale of the Appleton Facility the sum of (i) direct costs
arising in connection with such sale, plus (ii) taxes resulting from such sale
(but excluding income used to offset operating losses and that does not
generate any actual tax liability), plus (iii) the amount necessary to repay
any secured industrial revenue bond financing related to the Appleton Facility.
NOTES -- shall mean the Nationwide Notes and the SWIB Notes.
OBLIGATIONS -- shall mean the Nationwide Note Obligations, the SWIB
Note Obligations and any obligations of the Borrower to the Secured Parties
arising under this Agreement or any of the other Security Documents.
OLD SECURITY AGREEMENT -- shall have the meaning assigned to such term
in the third WHEREAS clause hereof.
OTHER LENDERS -- shall have the meaning assigned to such term in the
third WHEREAS clause hereof.
PERMITTED LIEN -- shall mean a Lien permitted under (i) one of clauses
(a), (b), (c), (d), (e), (g) and (h) of Section 5.7 of the Nationwide Note
Agreement and (ii) one of clauses (a), (b), (c), (d), (e), (g) and (k) of
Section 5.7 of the SWIB Note Agreement.
PERSON -- shall mean an individual, partnership, joint venture,
corporation, business trust, joint stock company, trust, unincorporated
organization, Governmental Authority or other entity of whatever nature.
4
<PAGE> 147
PROCEEDS -- shall have the meaning assigned to that term under the UCC
and, in any event, shall include, but not be limited to, (a) any and all
proceeds of any insurance, indemnity, warranty or guaranty payable to the
Borrower from time to time with respect to any of the Collateral, including,
but not limited to, any and all proceeds of business interruption insurance and
any and all proceeds of unearned insurance premiums, (b) any and all payments
(in any form whatsoever) made or due and payable to the Borrower from time to
time in connection with any of the Collateral including, but not limited to,
any rents, lease payments, or profits derived therefrom.
REAL PROPERTY PARCELS -- shall have the meaning assigned to that term
in Section 31 hereof.
REQUIRED LENDERS -- shall have the meaning assigned to that term in
the Intercreditor Agreement.
SECURED PARTIES -- shall mean the Insurance Companies, SWIB and any
other holders from time to time of the Nationwide Note Obligations or the SWIB
Note Obligations.
SECURITY DOCUMENTS -- shall mean this Agreement, the Assignment of
Contracts, Warranties and Permits, the Mortgages and the Environmental
Indemnification Agreement.
SHORT-TERM LENDERS -- shall mean the lenders party to the Secured
Credit Agreement dated as of May 22, 1995, entered into by and among such
lenders, the Borrower, and Harris Trust and Savings Bank, as agent for itself,
as a lender, and such other lenders, and their respective successors and
assigns.
SWIB NOTES -- shall have the meaning assigned to such term in the
second WHEREAS clause hereof.
SWIB NOTE AGREEMENT -- shall have the meaning assigned to such term in
the second WHEREAS clause hereof.
SWIB NOTE OBLIGATIONS -- shall mean all obligations of the Borrower to
SWIB and any other holders from time to time of the SWIB Notes under the SWIB
Note Agreement and/or the SWIB Notes, whether arising out of credit previously
granted, credit contemporaneously granted, or credit granted in the future,
and, however arising, whether voluntary or involuntary, due or not due,
absolute or contingent, liquidated or unliquidated, determined or undetermined,
secured or unsecured, whether the Borrower is liable individually or jointly
with others, whether for principal, interest, premium or other debts,
obligations or liabilities, and whether or not any or all such debts,
obligations and liabilities are or become barred by any statute of limitations
or otherwise unenforceable.
UCC -- shall mean the Uniform Commercial Code as the same may from
time to time be in effect in the State of Wisconsin.
5
<PAGE> 148
2. SECURITY INTEREST.
To secure the Obligations, the Borrower grants to the Secured Parties,
and the Secured Parties hereby take and retain, a continuing Lien on and
security interest in and to the following described property and interest in
such property (collectively, the "Collateral"), whether now owned or existing
or hereafter created, acquired or arising and wheresoever located:
A. All Equipment and Fixtures of the Borrower, whether now owned
or hereafter acquired by the Borrower, and all spare and repair parts, special
tools and replacements for the same;
B. All accessions to, substitutions for and all replacements,
products and cash and non-cash proceeds of the property described in clause A
above, including, without limitation, proceeds of and unearned premiums with
respect to insurance policies insuring any of the Collateral; and
C. All books and records (including, without limitation, customer
lists, credit files, computer programs, print-outs and other computer materials
and records) of the Borrower pertaining to any of the property described in
clauses A and B above (the "Books and Records").
It is the true, clear, and express intention of the Borrower that the
continuing grant of the security interests provided for herein remain as
security for payment and performance of the Obligations, whether or not
existing or hereinafter incurred by future advances or otherwise; and whether
or not such Obligations are related to the transactions described herein or in
any of the other Loan Documents, by class or kind, or whether or not
contemplated by the parties at the time of the granting of this security
interest. The notice of the continuing grant of this security interest
therefore shall not be required to be stated on the face of any document
representing any such Obligation, nor otherwise identify it as being secured
hereby. Any such Obligation shall be deemed to have been made pursuant to
Section 409.204(3) of the Wisconsin Statutes.
3. WARRANTIES AND COVENANTS.
The Borrower hereby warrants, represents and covenants to the Secured
Parties that:
A. (1) Except as provided in subparagraph (2), below:
(a) the Collateral consisting of Equipment is
kept at the addresses listed on Annex 1 hereto ("Equipment
Locations");
(b) the original Books and Records are kept at the
address listed below:
1055 Corporate Center Drive
Oconomowoc, WI 53066
6
<PAGE> 149
and (c) the Borrower's chief executive office and chief
place of business is at the address listed below:
1055 Corporate Center Drive
Oconomowoc, WI 53066
(2) the Borrower will not establish any different location for its
Equipment, its chief executive office, its registered office or its
principal place of business, or its Books and Records, until (i) it shall
have given the Secured Parties prior written notice of not less than ten
(10) days, of its intention to establish such new location, clearly
describing each such new location and providing such other information in
connection therewith as the Secured Parties may reasonably request, and
(ii) with respect to each such new location, it shall have taken such
action, satisfactory to the Required Lenders, as may be necessary to
maintain the security interest of the Secured Parties in the Collateral
at all times fully perfected and in full force and effect; provided, that
notwithstanding anything herein to the contrary, the Borrower may from
time to time move Equipment as needed in the ordinary course of the
operations of the Borrower's business to any other location within a
state, or in another state provided such location is identified on Annex
1 hereto, so long as the security interest of the Secured Parties in such
Equipment remains at all times validly perfected. The Borrower shall
give the Secured Parties written notice of any relocation of Equipment
described in the above proviso within ten (10) days of such relocation.
B. Except as disclosed in Annex 3 hereto, there are no actions or
proceedings which are pending or threatened against the Borrower which might
result in any material adverse change in its financial condition or materially
affect the Collateral pledged hereunder.
C. Except for Permitted Liens, and except as specifically
consented to in writing by the Required Lenders, the Liens granted to the
Secured Parties shall be first and prior on the Collateral and proceeds,
including insurance proceeds, resulting from the sale, disposition or loss
thereof. Except as otherwise provided by law, no further action need be taken
to perfect the Liens granted to the Secured Parties, other than the filing of
continuation statements under the UCC or other applicable law, or continued
possession by the Secured Parties of that portion of the Collateral
constituting instruments or documents.
D. The Borrower shall not sell, lease, transfer, assign, pledge
or otherwise dispose of any of the Collateral or any interest therein, without
the prior written consent of the Required Lenders in each instance; provided,
however, that the foregoing restriction shall not apply, for so long as no
Event of Default exists, to (i) the replacement of any Equipment that is
substantially worn, damaged or obsolete with Equipment of like kind, function
and value, provided that the replacement Equipment shall be acquired prior to
or concurrently with any disposition of the Equipment that is to be replaced
and shall be free and clear of Liens other than Permitted Liens that are not
Liens securing the purchase price or cost of construction of such replacement
Equipment, or (ii) the disposal, in any fiscal year of the Borrower, of any
other Equipment that is substantially worn, damaged or obsolete, provided that
(a) in the good faith opinion of the Borrower's Responsible Financial Officer,
the disposition of such Equipment is for fair market value and is in the best
interests of the Borrower, and (b) the net proceeds received and/or to
7
<PAGE> 150
be received in respect of such Equipment and all other Equipment disposed of
pursuant to this clause (ii) during such fiscal year shall not exceed $50,000
in the aggregate.
E. Upon prior notice to the Borrower, the Borrower shall, at all
times during normal business hours, permit any Secured Party or its authorized
representatives to examine and inspect the Collateral as well as the Books and
Records, and to make extracts and copies thereof; provided that after the
occurrence of an Event of Default hereunder, no such notice shall be required.
F. The Borrower shall notify the Secured Parties in writing of
any intended change of the Borrower's name, at least ten (10) days prior to
such change or use, and will notify the Secured Parties immediately when such
change or use becomes effective. The Borrower shall take such action,
satisfactory to the Secured Parties, as may be necessary to maintain the
security interest of the Secured Parties in the Collateral at all times fully
perfected and in full force and effect.
G. The Borrower will keep the Collateral insured, in amounts and
by insurers satisfactory to the Required Lenders, against the risks of fire,
explosion, theft and such other risks as are usually insured against by
companies engaged in the same or a similar business or as the Required Lenders
may reasonably require. The Borrower will deliver to the Secured Parties
copies of all insurance policies with respect to the Collateral, together with
appropriate certificates thereof, naming the Secured Parties as loss payees (as
their interests may appear). The Borrower shall cause each of the Secured
Parties to be at all times named as additional insureds under each of its
liability policies.
H. All information, certificates or statements given to the
Secured Parties pursuant to this Security Agreement shall be true and complete,
in all material respects, when given.
I. With respect to all Collateral which is, or is to be, attached
to real estate, the legal description of such real estate and the name of the
record owner are annexed hereto as Annex 2 hereto (the "Real Property
Parcels").
J. The Borrower shall (i) maintain the Collateral in good
condition and repair (ordinary wear and tear excepted) and not permit its value
to be impaired, (ii) keep the Collateral free from all Liens, encumbrances and
security interests, other than Permitted Liens and other Liens expressly
permitted by the Required Lenders, (iii) defend the Collateral against all
claims and legal proceedings by persons other than the Secured Parties, (iv)
pay and discharge, when due, all taxes, license fees, levies and other charges
upon the Collateral, (v) not sell, lease or otherwise dispose of the
Collateral, except for sales or leases of Collateral authorized as provided in
this Agreement, and (v) not permit the Collateral to be used in violation of
any applicable law, regulation or policy of insurance. Loss of or damage to
the Collateral shall not release the Borrower from any of the Obligations.
K. The Borrower shall keep accurate and complete records of the
Collateral in such form as the Required Lenders may approve. At such times as
the Required Lenders may reasonably require, the Borrower shall furnish to the
Secured Parties a statement certified by the Borrower and in such form and
containing such information as may be prescribed by the Required Lenders,
showing the current status and value of the Collateral.
8
<PAGE> 151
L. Throughout the term of this Agreement, the Borrower shall pay
to the Secured Parties any and all costs incurred by the Secured Parties
arising out of or in any way connected with the Security Documents, including,
but not limited to, legal, appraisal, environmental and accounting fees and
out-of-pocket expenses.
M. Throughout the term of this Agreement, the Borrower shall
deliver, or cause to be delivered, to the Secured Parties, mortgages/deeds of
trust and related security documents reasonably required by the Required
Lenders encumbering any and all real property hereafter acquired and/or
otherwise obtained by the Borrower and/or any of its subsidiaries, in such form
as reasonably required by Required Lenders, together with title insurance
insuring the lien of such mortgage/deed of trust as a first lien on such real
property.
N. The Borrower has entered into an agreement for the sale of its
facility located in Appleton, Wisconsin (the "Appleton Facility") for an all
cash consideration of approximately $900,000, and agrees that on the date of
the sale of the Appleton Facility (the "Appleton Sale Date"), the Borrower
shall pay over, by federal wire transfer of immediately available funds, (a)
the Net Proceeds of such sale to the Agent, to be applied to the prepayment of
the Notes in accordance with Section 4.1(c) of the Intercreditor Agreement, at
par, and (b) accrued interest on the principal amount so prepaid, but without
premium. The Borrower will give each Secured Party written notice under this
Section 3N at least one Business Day and not more than 10 Business Days prior
to the Appleton Sale Date, specifying (i) such date, (ii) the estimated Net
Proceeds of the sale of the Appleton Facility (including a description of all
amounts subtracted from the gross proceeds of such sale in computing such Net
Proceeds), (iii) the principal amount of each Note held by such Secured Party
to be prepaid (determined in accordance with Section 4.1(c) of the
Intercreditor Agreement) on the Appleton Sale Date, and (iv) the interest to be
paid on the Appleton Sale Date with respect to such principal amount being
prepaid. Notwithstanding the foregoing, in the event that the Appleton
Facility is not sold in accordance with the provisions hereof on or prior to
October 1, 1995, the Borrower shall, on or prior to such date, grant a mortgage
on the Appleton Facility for the benefit of the Secured Parties substantially
in the form of the Mortgages, and deliver or cause to be delivered to the
Secured Parties a loan policy of title insurance with respect to the Appleton
Facility, satisfactory to the Agent and showing no exceptions to title except
as acceptable to the Agent.
O. The Borrower shall not permit any Collateral including,
without limitation, the proceeds of any Collateral (except Collateral disposed
of within the limitations of Section 3D(ii)), to be deposited in any accounts
in which the Borrower's Short-Term Lenders or any agent for such Short-Term
Lenders has a security interest without the express written consent of the
Required Lenders.
4. FURTHER ASSURANCE.
The Borrower agrees that at any time and from time to time, upon the
written request of any Secured Party, the Borrower will promptly and duly
execute and deliver any and all such further instruments and documents as such
Secured Party may reasonably request in obtaining the full benefits of this
Agreement or any of the other Security Documents, of the rights and powers
herein or therein granted and of the Liens and security interests granted to
the Secured Parties hereby or thereby, including, without limitation, the
filing of any financing or continuation statement under the Uniform Commercial
Code in effect in any jurisdiction with respect to the
9
<PAGE> 152
Liens and security interests granted hereby as any Secured Party may now or
hereafter from time to time request. Upon the Borrower's failure to so execute
and deliver further instruments and documents, each Secured Party is authorized
as agent of the Borrower to sign any such instrument and document. The
Borrower hereby also authorizes each Secured Party to file any such financing
or continuation statement without the signature of the Borrower to the extent
permitted by applicable law.
5. EVENTS OF DEFAULT; REMEDIES.
A. The following shall constitute Events of Default under this
Agreement:
(1) if the Borrower shall fail to make, when due, the
payment of any amount due under this Agreement within the time period
provided for herein, or if no time period is otherwise provided,
within 5 days after the same becomes due; or
(2) if the Borrower shall fail to perform or observe, or
cause to be performed or observed, (i) any covenant or condition
contained in Section 3D, Section 3G, Section 3J(ii) or Section 3N of
this Agreement, and such failure shall continue for a period of five
(5) days, or (ii) any other covenant or condition contained in this
Agreement, and such failure shall continue for a period of twenty (20)
days, in either case after the earlier of (a) receipt of notice
thereof from any Secured Party or (b) the date an officer of the
Borrower learns of such default; or
(3) if any representation or warranty made by the
Borrower in this Agreement, or in any certificate furnished by or on
behalf of the Borrower in connection with the consummation of the
transactions contemplated hereby, shall be untrue in any material
respect as of the date of the issuance or making thereof; or
(4) if any "Event of Default," as defined in the
Nationwide Note Agreement or the SWIB Note Agreement,
shall occur; or
(5) if any indebtedness secured by any Lien
encumbering all or any portion of the Collateral and/or Real Property
Parcels having priority over the Liens created and granted to the
Secured Parties is accelerated or any other action is commenced against
or affecting the Collateral and/or the Real Property Parcels to enforce
or realize upon such Lien.
B. Upon the occurrence and continuation of an Event of Default,
the Secured Parties shall have, without limitation, any and all rights and
remedies for default provided by the UCC, by any other applicable law or by any
of the other Loan Documents. With respect to such rights and remedies:
(1) all payments received by the Borrower under or in
connection with the Collateral shall be held by the Borrower in trust
for the Secured Parties, shall be segregated from other funds of the
Borrower and shall be turned over to the Secured Parties upon request
by the Required Lenders, in the same form as received by the Borrower
(duly endorsed by the Borrower to the Secured Parties, if required);
and
10
<PAGE> 153
(2) any and all such payments so received by the Secured
Parties (whether from the Borrower or otherwise) may, in the sole
discretion of the Required Lenders, be held as collateral security
for, and/or then, or at any time thereafter, be applied in whole or in
part by the Secured Parties against all or any part of the Obligations
in accordance with the provisions of the Intercreditor Agreement.
6. OTHER RIGHTS AND REMEDIES.
Upon the occurrence of any Event of Default and at any time
thereafter, the Required Lenders may require the Borrower to assemble the
Collateral and make it available to the Secured Parties at a place to be
designated in writing by the Required Lenders. If notice to the Borrower of an
intended disposition of Collateral is required by law, five (5) days notice
shall constitute reasonable notification. In the event the Required Lenders
institute an action to recover any Collateral or seek recovery of any
Collateral by way of prejudgment remedy in an action against the Borrower, the
Borrower waives the posting of any bond which might otherwise be required. All
rights and remedies of the Secured Parties under this Agreement shall be
cumulative and none are exclusive. Whether or not an Event of Default has
occurred, all payments made by or on behalf of the Borrower and all credits due
the Borrower under this Agreement and under any other agreement between the
Borrower and the Secured Parties may be applied to the Obligations in whatever
order and amounts the Required Lenders choose.
The Borrower hereby appoints each Secured Party, and their respective
successors and assigns, the Borrower's true and lawful attorney, irrevocably,
with full power (in the name of the Borrower or otherwise) upon the occurrence
of an Event of Default and at any time thereafter, to ask, require, demand,
receive, compound and give acquittance for any and all moneys, claims (if the
Required Lenders make a determination that the Borrower is not then pursuing
such claims diligently through appropriate proceedings or if an Enforcement
Period (as defined in the Intercreditor Agreement) shall have commenced), and
other amounts due and to become due at any time under, or arising out of, the
Collateral, to endorse any checks or other instruments or orders in connection
therewith, and to file any claims or take any action or institute any
proceedings which the Required Lenders may deem to be necessary or advisable in
the premises.
If the Borrower fails to act as required by this Agreement, each
Secured Party is authorized, in the Borrower's name or otherwise, to take any
such action including, without limitation, signing the Borrower's name or
paying any amount so required, and the cost shall be one of the Obligations
secured hereby and shall be payable by the Borrower upon demand with interest
from the date of payment by such Secured Party, at the annual rate of four and
one-quarter percent (4.25%) plus the Bank One reference rate as announced from
time to time by Bank One.
No Secured Party shall have any duty to determine the validity of any
invoice or compliance with any order of the Borrower. No Secured Party shall
have any duty to protect, insure, collect or realize upon the Collateral or
preserve rights in it against prior parties. The Borrower releases the Secured
Parties from any liability for any act or omission relating to the Obligations,
the Collateral or this Agreement, except for the Secured Parties' gross
negligence or willful misconduct.
11
<PAGE> 154
The Borrower shall reimburse the Secured Parties for any reasonable
expense incurred by the Secured Parties in protecting or enforcing their rights
under this Agreement, including, without limitation, reasonable fees of
attorneys, legal assistants or paralegals; all expenses of taking possession,
holding, preparing for disposition and disposing of the Collateral; and all
expenses and costs (including, without limitation, fees of attorneys, legal
assistants and paralegals) in connection with any proceeding instituted
pursuant to 11 U.S.C. Section 101 et. seq. After deduction of such
expenses, the Secured Parties may apply the proceeds of disposition to the
Obligations in such order and amounts as the Required Lenders elect.
7. OPINION OF COUNSEL.
On or prior to May 31 of each year, the Borrower shall provide each
Secured Party an opinion of counsel (which may be the chief legal officer of
the Borrower), stating that, in the opinion of such counsel, all actions have
been taken under United States law with respect to the filing of such financing
and continuation statements as may be necessary to fully preserve and protect
the rights of the Secured Parties under this Agreement and the other Security
Documents with respect to all Collateral and stating that, in the opinion of
such counsel, based on then existing law and the state of facts existing as of
the date of such opinion, no additional actions of the type referred to herein
are or will become necessary during the fourteen (114) month period following
the date of such opinion or, if any such action shall be required, stating the
nature of such action.
8. MISCELLANEOUS.
A. Any failure or delay by the Secured Parties to require strict
performance by the Borrower of any of the provisions, warranties, terms and
conditions contained in this Agreement or in any other agreement, document or
instrument, shall not affect the right of the Secured Parties to demand strict
compliance and performance therewith, and any waiver of any default shall not
waive or affect any other default, whether prior or subsequent thereto, and
whether of the same or of a different type. None of the warranties,
conditions, provisions and terms contained in this Agreement or in any other
agreement, document or instrument shall be deemed to have been waived by any
act or knowledge of the Secured Parties or any of their respective agents,
officers or employees, but only by an instrument in writing, signed by an
officer of each Secured Party constituting the Required Lenders, directed to
the Borrower and specifying such waiver.
B. All notices hereunder shall be in writing, shall be hand
delivered, deposited into the United States mail (registered or certified
mail), postage prepaid, sent by overnight courier, or sent by telecopy
transmission to the telecopy number designated on the signature pages hereto
beneath the address of each party to receive such notice, and shall be
addressed to the parties at their respective addresses set forth beneath their
signatures below, or to such other address as any party designates to the
others in the manner herein described.
C. In the event that any provision hereof shall be deemed to be
invalid by any court, such invalidity shall not affect the remainder of this
Agreement.
D. This Agreement shall be binding upon and for the benefit of
the parties hereto and their respective successors and assigns.
12
<PAGE> 155
E. This Agreement may not be amended, changed, waived, discharged
or terminated without the written consent of the Required Lenders and the
Borrower.
F. Wherever the context requires, the singular form of any word
shall include the plural, and the neuter form of any word shall include the
masculine and feminine forms, and vice versa.
G. THE BORROWER IRREVOCABLY AGREES THAT, SUBJECT TO THE SOLE AND
ABSOLUTE ELECTION OF THE SECURED PARTIES, ALL SUITS, ACTIONS OR OTHER
PROCEEDINGS IN ANYWAY, MANNER OR RESPECT ARISING OUT OF OR FROM OR RELATED TO
THIS AGREEMENT OR ANY DOCUMENTS EXECUTED IN CONNECTION HEREWITH, SHALL BE
SUBJECT TO LITIGATION IN COURTS HAVING SITUS WITHIN MILWAUKEE, WISCONSIN. THE
BORROWER HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR
FEDERAL COURT LOCATED WITHIN MILWAUKEE, WISCONSIN. THE BORROWER HEREBY WAIVES
ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY SUIT, ACTION OR
ORDER PROCEEDING BROUGHT AGAINST THE BORROWER BY THE SECURED PARTIES IN
ACCORDANCE WITH THIS SECTION. THE BORROWER HEREBY WAIVES, TO THE EXTENT
PERMITTED BY LAW, TRIAL BY JURY. THE BORROWER FURTHER WAIVES ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED
OF THE SECURED PARTIES.
H. This Agreement may be executed simultaneously in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
I. THIS AGREEMENT SHALL BE INTERPRETED, GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF WISCONSIN OR
SUCH OTHER LAW AS MAY BE REQUIRED UNDER THE UCC.
[Remainder of page intentionally left blank. Next page is signature page.]
13
<PAGE> 156
IN WITNESS WHEREOF, the undersigned have executed and delivered this
Agreement as of the date first above written.
BORROWER:
STOKELY USA, INC.
BY: S. THEOBALD
------------
Title: Vice Chairman
Address: 1055 Corporate Center Drive
Oconomowoc, WI 53066
Attn: Treasurer
[Signature page to SECURITY AGREEMENT of STOKELY USA, INC.]
<PAGE> 157
SECURED PARTIES:
NATIONWIDE LIFE INSURANCE COMPANY
By: JEFFREY G. MILBURN
-----------------------------------
Title: JEFFREY G.MILBURN, VICE PRESIDENT
CORPORATE FIXED-INCOME SECURITIES
Address: One Nationwide Plaza
Columbus, OH 43216
Attn: Corporate-Fixed
Income Securities
with a copy to:
One Nationwide Plaza-Floor 35
Columbus, OH 43216
Attn: Roger Craig, Esq.
EMPLOYERS LIFE INSURANCE COMPANY
OF WAUSAU
By: JEFFREY G. MILBURN
------------------------------
Title: JEFFREY G. MILBURN
ATTORNEY-IN-FACT
Address: One Nationwide Plaza
Columbus, OH 43216
Attn: Corporate-Fixed
Income Securities
WEST COAST LIFE INSURANCE COMPANY
By: JEFFREY G. MILBURN
--------------------------------
Title: JEFFREY G. MILBURN
ATTORNEY-IN-FACT
Address: One Nationwide Plaza
Columbus, OH 43216
Attn: Corporate-Fixed
Income Securities
[Signature page to SECURITY AGREEMENT of STOKELY USA, INC.]
<PAGE> 158
STATE OF WISCONSIN INVESTMENT
BOARD
By: ROBERT L. ZOBEL
---------------------------
Title: Robert L. Zobel
Investment Director
Address: 121 E. Wilson Street
Madison, WI 53707
Attn: Private Placements
with a copy to:
Solheim Billing & Grimmer, S.C.
2 East Gilman Street, Suite 402
Madison, WI 53701-1644
Attn: Thomas P. Solheim, Esq.
[Signature page to SECURITY AGREEMENT of STOKELY USA, INC.]
<PAGE> 159
ANNEX 1
STOKELY USA, INC.
EQUIPMENT LOCATIONS
Hwy 20 West
P.O. Box 99
Ackley, IA 50601
515-847-2643
1820 W. Eighth Street
54914
P.O. Box 1457 - 54913
Appleton, WI
414-734-5737/749-3020
840 Bakke Street
Deforest, WI 53532
608-846-2490
Avenue A - P.O. Box 400
Grandview, WA 98930
D&K Frozen Foods, Inc.
509-882-3322
1425 Main Street
P.O. Box 841
Green Bay, WI 54302
414-435-3793
102 North First Avenue
Box 250
Hoopeston, IL 60942
217-283-5141
2001 Water Street
Merrill, WI 54452
715-536-8308
7740 State Road 44
Box 279
Pickett, WI 54964
414-589-4411
W8070 Kent Road
Poynette, WI 53955-9713
608-635-4396
506 E. State Street
Box 218
Scottville, MI 49454
616-757-4715
151 Market Street
Box 65
Sun Prairie, WI 53590
608-837-5177
1164 Dell Avenue, P.O. Box
818
Walla Walla, WA 99362
D&K Frozen Foods, Inc.
509-525-7890
300 East Third Street
Box 307
Waunakee, WI 53597
608-849-4131
608-849-8810 (QA)/#8 32
Hwy 22 North, P.O. Box 8
Wells, MN 56097
507-553-3171
Highway 80
Cobb, WI 53526
Annex 1-1
<PAGE> 160
ANNEX 2
Scottville
Mason County
Michigan
Situated in the City of Scottville, Mason County, Michigan.
PARCEL 1: A tract of land described as Beginning at a point on the East and
West Quarter line 384.1 feet South 89 West of the iron bar at the center of
Section 18, Township 18 North, Range 16 West, running thence South 89 West
along the East and West quarter line 548.8 feet to a three-quarter inch gas
pipe, thence South 105.4 feet to a five inch square cedar post set at the forks
of Foster Creek, thence South 28 degrees 10' West 197.7 feet to a three-quarter
inch gas pipe, thence South 17 degrees 15' East 191.5 feet to a three-quarter
inch gas pipe in the center of Foster Creek and 150 feet North of the center of
the Pere Marquette Railroad (now Chesapeake and Ohio Railway) right of way,
thence North 88 degrees 30' East along the North boundary of the said right of
way 596.4 feet to a two inch gas pipe, thence North 1 degree 25' West 457.2
feet to the place of beginning.
PARCEL 2: All that part of the Northeast 1/4 of the Southwest 1/4 of Section
18, Township 18 North, Range 16 West, lying South of the right of way of the
Pere Marquette Railroad (now Chesapeake and Ohio Railway) and East of Foster
Creek.
PARCEL 3: The Southeast 1/4 of the Southwest 1/4 of Section 18, Township 18
North, Range 16 West, EXCEPTING THEREFROM the following described lands: a
piece of land beginning at a point 60 rods West of the Northeast corner of the
above described 40 acres of which this exception is a part, thence west to the
Northwest corner of the said SE 1/4 of SW 1/4 Section 18, thence South to the
Southwest corner of said SE 1/4 of SW 1/4 Section 18, thence East on the
Section line 14 and 1/2 rods, thence North 15 rods, thence East 3 rods, thence
North 26 rods, thence East 2 and 1/2 rods, thence North about 39 rods to point
of beginning. AND ALSO EXCEPTING THEREFROM a parcel described as commencing at
the Northeast corner of said SE 1/4 or SW 1/4 of said Section 18, thence West a
distance of 173 feet (along a line that is parallel to the north boundary
thereof), thence South a distance of 520.5 feet, thence East a distance of 173
feet, thence North along the North and South quarter line a distance of 520.5
feet to said point of beginning; the East 33 feet of said exception being
reserved for right of way for a public road.
Situated in the Township of Custer, Mason County, Michigan.
PARCEL 4: All that part of the Northwest 1/4 of the Southeast 1/4 of Section
18, Township 18 North, Range 16 West, lying South of the Pere Marquette (now
Chesapeake and Ohio) Railway right of way.
Page 1 of 22
<PAGE> 161
Hoopeston
Vermilion County, IL
The Southwest Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated April 14, 1925 and recorded in Deed Record 352 Page 17 of the Records of
Vermilion County, Illinois, and EXCEPT that portion thereof conveyed unto the
State of Illinois by Deed dated January 2, 1959 and recorded in Deed Record 637
Page 522 of the records of Vermilion County, Illinois, situated in Vermilion
County, Illinois.
ALSO:
The Southeast Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records
of Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
That portion of the Northeast Quarter of Section 10 Township 23 North, Range 12
West of the 2nd P. M., lying South of the Lake Erie and Western (now Norfolk
and Western) Right-of-Way, ALSO all that part of the West Half of Section 11
Township 23 North, Range 12 West of the 2nd P. M., lying South of said Railroad
Right-of-Way and West of S.B.I. Route 1; EXCEPT from the last described tract
the following: (A) The South two acres thereof and (b) Beginning at the
intersection of the South line of said Railroad Right-of-Way with the West line
of S.B.I. Route No. 1; thence West 100 feet; thence South 405 feet; thence East
100 feet; thence North to the place of beginning; and (c) Right-of-Ways
conveyed to the State of Illinois by Deeds dated February 14, 1940 and recorded
respectively in Deed Record 463 Pages 431 and 432, and (D) Commencing at the
Northwest Corner of the Southwest Quarter of said Section 11; thence East along
the East and West center line of said Section 11, 185 feet to the true place of
beginning; thence South 2613 feet along a line 300 feet West of and parallel to
the West line of S.B.I. Route No. 1 to a point 30 feet North of the center line
of S.B.I. Route No. 9; thence East 38 feet to
Page 2 of 22
<PAGE> 162
a point; thence North 281.67 feet to a point; thence East 262 feet to the
aforesaid West line of S.B.I. Route No. 1; thence North along said West line
2331.33 feet to the North line of the said Southwest Quarter of said Section
11; thence West 300 feet to the place of beginning and (E) Beginning at a point
238 feet East of and 146.67 feet North of the Southwest Corner of Section 11
Township 23 North, Range 12 West of the 2nd P. M.; thence North 165 feet;
thence East 262 feet to the West line of S.B.I. Route No. 1; thence South 165
feet; thence West 262 feet to the place of beginning, all situated in Vermilion
County, Illinois.
ALSO:
Part of the Southwest Quarter of the Southwest Quarter of Section 11 Township
23 North, Range 12 West of the 2nd P. M., described as: Beginning at the
Southwest Corner of said Section 11; thence North along the Section line 146.67
feet; thence East 238 feet parallel to the South line of said Section; thence
South 146.67 feet to the Section line; thence West to the place of beginning,
EXCEPT that portion thereof conveyed unto the State of Illinois by Deed dated
January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records of
Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
Beginning at the intersection of North side of the Right-of-Way of the Lake
Erie and Western (now Norfolk and Western) Railroad, and Sixth Avenue, in the
City of Hoopeston, as it existed on January 31, 1911; thence North 729.96 feet;
thence East 2593.80 feet to the West side of the Right-of-Way of the Chicago and
Eastern Illinois Railroad; thence South along the West side of the Right-of-Way
of the said Railroad to the North side of the Right-of-Way of the Lake Erie and
Western (now Norfolk and Western Railroad; thence West along the said North
line of said Right-of-Way to the place of beginning, EXCEPT the following: (a)
Beginning at the Northwest Center of Lot 3 in the Clerk's Subdivision of the
North Half of Section 11 Township 23 North, Range 12 West of the 2nd P.M.;
thence Southerly along the West line of said Lot 3, 200 feet; thence
Northeasterly 360.55 feet to a point in the North line of said Lot 3; thence
Westerly 300 feet to the place of beginning, and (B) A strip of land 100 feet
in width across said Section 11, said land having been conveyed to the Chicago,
Danville and Vincennes Railway Company by Deed dated May 16, 1871 and recorded
in Deed Record 30 Page 291, and (C) All that portion of the described tract
conveyed to the Chicago and Eastern Illinois Railway Company by Deed dated
October 12, 1893 and recorded in Deed Record 127 Page 346, all as situated in
the Northeast Quarter and the Northwest Quarter of Section 11 Township 23
North, Range 12 West of the 2nd P. M., situated in Vermilion County, Illinois.
Page 3 of 22
<PAGE> 163
Ackley
Franklin County, IA
Parcel A:
The East 1/2 of the Southeast 1/4 of Section 34 and all that part of the West
1/2 of the Southwest 1/4 and all that part of the South 1/2 of the Southwest
1/4 of the Northwest 1/4 lying West of the rail road right-of-way Section 35,
in Township 90 North, Range 19 West of the 5th P.M., Franklin County, Iowa.
Parcel B:
A tract of land in triangular form in the Southwest corner of the East 1/2 of
the Southwest 1/4 Section 35, Township 90 North, Range 19 West of the 5th P.M.,
Franklin County, Iowa, said land being all of the land in the East 1/2 of the
Southwest 1/4 of said Section 35 cut-off by the Minneapolis & St. Louis Railway
and lying West of said Railway, Franklin County, Iowa.
Parcel C:
Beginning at a point 1125.2 feet North and 65.5 feet East of the Southwest
corner of the Southeast 1/4 of the Southwest 1/4 of Section 35, Township 90
North, Range 19 West of the 5th P.M., Franklin County, Iowa, running thence
Easterly 306.2 feet, thence Northerly 560.0 feet to the center of Beaver Creek,
thence following the low water course of said Creek in the Northwesterly
direction 1520 feet to intersect with the North and South Quarter section line,
thence Southerly 873.4 feet, Southeasterly on the East property line of the M.
& St. L. Railroad 152 feet to the place of beginning, Franklin County, Iowa.
Parcel D:
Beginning at at point 1259.2 feet North of the Southeast corner of the
Southwest 1/4 of the Southwest 1/4 of Section 35, Township 90 North, Range 19
West of the 5th P.M., Franklin County, Iowa, thence North 572 feet, thence West
274 feet, thence in a Southeasterly direction 640 feet along the right-of-way
of the Minneapolis & St. Louis Railroad Company to the point of beginning,
Franklin County, Iowa.
Parcel E:
Lots 7, 8, 9, and 10, Block 3, Burns and Foster's Addition to the City of
Ackley, Hardin County, Iowa, and the East 1/2 of the vacated alley lying
between the extensions westerly of the northerly line of said Lot 7 and the
southerly line of said Lot 10.
Abstract.
Page 4 of 22
<PAGE> 164
Wells
Faribault County, MN
Wells, Minnesota
----------------
TRACT 1 - All that part of the Southeast Quarter (SE1/4) of Section Five (5),
Township One Hundred Three (103) North, Range Twenty-four (24) West, described
as follows:
Commencing at the northeast corner of the Southeast Quarter (SE1/4) of Section
Five (5), Township One Hundred Three (103) North, Range Twenty-four (24) West;
thence north 89 degrees 09'00'' West a distance of 748.5 feet on an assumed
bearing, on the north line of said 1/4 section; thence South 00 degrees 00'00''
West a distance of 1451.98 feet, on a line parallel with the east line of said
Northeast Quarter (NE1/4), to a point on the centerline of vacated Cleveland
Street, as shown on the plat of Garden Addition, as the same is platted and
recorded in the office of the County Recorder of Faribault County, Minnesota;
which point is the point of beginning of the tract to be described;
thence north 89 degrees 09'00'' West a distance of 406.35 feet, on the
centerline of said vacated Cleveland Street, parallel with the north line of
said 1/4 seciton, to a point 66 feet northeasterly, measured at a right angle
from the northeasterly right-of-way line of the Soo Line Railroad (formerly the
Chicago, Milwaukee, St. Paul & Pacific Railroad), said point being 16 feet
northeasterly, measured at a right angle, from the northeasterly line of
Thurman Street, as shown on said plat of Garden Addition;
thence north 41 degrees 09' 28'' West a distance of 238.31 feet, on a line
parallel with and 16 feet northeasterly, measured at a right angle, from the
northeasterly line of said Thurman Street;
thence northwesterly a distance of 226.98 feet, on a line parallel with and 16
feet northeasterly, measured at a right angle, from the northeasterly line of
said Thurman Street, on a non-tangential curve, concave to the northeast, with
a radius of 5613.50 feet, a central angle of 02 degrees 19'00'', and a chord
bearing of north 38 degrees 58'57'' West;
thence north 37 degrees 49'27'' West a distance of 1265.06 feet, on a line
parallel with and 16 feet northeasterly, measured at a right angle, from the
northeasterly line of said Thurman Street, to the point of intersection with a
line drawn perpendicular to the northeasterly line of said Thurman Street, from
a point thereon, which is 100 feet southeasterly from the point of
intersection of the northeasterly line of said Thurman Street, with the
southwesterly right-of-way line of Trunk Highway No. 22;
thence north 52 degrees 10'33'' east a distance of 23.42 feet, on a line
perpendicular to the northeasterly line of said Thurman Street, to a point on
the southwesterly right-of-way line of Trunk Highway No. 22;
Page 5 of 22
<PAGE> 165
thence south 51 degrees 46'10'' east a distance of 1862.72 feet, on the
southwesterly right-of-way line of said Trunk Highway No. 22, to the point of
Intersection with a line parallel with and 748.5 feet west of the east line of
the Southeast Quarter of said Section Five (5), Township One Hundred Three (103)
North, Range Twenty-four (24) West;
thence south 00 degrees 00'00'' west a distance of 222.81 feet, on a line
parallel with and 748.5 feet west of the east line of said Southeast Quarter,
to the point of beginning;
TRACT 2 - The Northwest Quarter of Section Four (4), Township One Hundred Three
(103) North, Range Twenty-four (24) West of the Fifth Principal Meridian.
TRACT 3 - The South Twenty (20) rods of the West Half (W1/2) of the Northeast
Quarter (NE1/4) of Section Five (5) in Township One Hundred Three (103) North,
Range Twenty-four (24) West, excepting Railroad Right-of-Way of the Soo Line
Railroad (formerly the Chicago, Milwaukee, St. Paul and Pacific Railroad), and
subject to the easements for public highways now existing, and subject to the
agreement by second party that it will be permitted to drain only surface water
from above land into tile crossing the land of first parties to the north.
TRACT 4 - A tract commencing at a point 748.5 feet due west of the Southeast
corner of the Northeast Quarter of Section Five (5) Township One Hundred Three
(103) North of Range Twenty-four (24) West of the Fifth Principal Meridian in
the County of Faribault and State of Minnesota, thence running North 20 rods,
thence West to the West line of the East Half of the Northeast Quarter of said
Section Five (5) thence south 20 rods, thence East along the South line of said
East half of Northeast Quarter of said Section Five (5) to the place of
beginning.
TRACT 5 - All that part of the Southeast Quarter of Section Five (5), Township
One Hundred Three (103) North, Range Twenty-four (24) West; described as
follows: Commencing at the Northeast corner of the Southeast Quarter of Section
Five (5), Township One Hundred Three (103) North, Range Twenty-four (24) West;
thence north 89 degrees 09' 00'' west a distance of 748.5 feet on an assumed
bearing on the north line of said 1/4 section; thence south 00 degrees 00'00''
west on a line parallel with the east line of said Northeast Quarter, to a
point on the northeasterly right of way line of Trunk Highway No. 22, thence
Northeasterly along the Highway 22 right-of-way to a point on the North line of
the Southeast quarter of said Section Five (5), thence easterly along said
quarter section line to the point of beginning.
Page 6 of 22
<PAGE> 166
Grandview
Yakima County, WA
PARCEL "A":
The East 50 feet of Lots 11 and 12, Block 29, of GRANDVIEW, Washington,
according to the official plat thereof, recorded in Volume "B" of Plats, Page
6, records of Yakima County, Washington.
PARCEL "B":
All that portion of Block 15, GRANDVIEW, Washington, according to the official
plat thereof recorded in Volume "B" of Plats, Page 6, records of Yakima County,
Washington, lying South of the Southerly right of way line of West 2nd Street,
as said street was conveyed to the City of Grandview, by instrument recorded
under Auditor's File Number 1452522.
TOGETHER WITH that portion of vacated Warehouse Street, which, upon vacation,
attached to said premises by operation of law.
PARCEL "C":
The North 16 feet of Lot 1 and Lot 2, 3, 4, 5, 6, 7 and 8 and Lot 9,
EXCEPT the North 5 feet thereof and Lots 13, 14, 15, 16 and 17, all in Block
29, of GRANDVIEW, Washington, according to the official plat thereof, recorded
in Volume "B" of Plats, Page 6, records of Yakima County, Washington.
TOGETHER WITH that portion of vacated West "A" Street accruing thereto;
AND TOGETHER WITH those portions of vacated alley accruing thereto.
PARCEL "D":
Lots 19, 20, 21, 22, 23 and 24, Block 28, of GRANDVIEW, Washington, according
to the official plat thereof, recorded in Volume "B" of Plats, Page 6, records
of Yakima County, Washington.
TOGETHER WITH that portion of vacated West "A" Street and that portion of
vacated West Third Street accruing thereto.
Situated in Yakima County, State of Washington.
Page 7 of 22
<PAGE> 167
Walla Walla
Walla Walla County, WA
WALLA WALLA COUNTY, STATE OF WASHINGTON
- --------------------------------------------------------------------------------
PARCEL A:
Block 1 of Bowman's Addition to the City of Walla Walla, according to
the official plat thereof recorded in volume C of plats at page 44, records of
Walla Walla County. ALSO,
Beginning at a point in the north line of Block 2 of said Bowman's
Addition to the City of Walla Walla, which point is 56 feet west, measured
along said north line, from the northeast corner of said Block 2, and running
thence south, parallel to the east line of said Block 2, a distance of 193.86
feet to a point in the south line of said Block 2; thence west, along the south
line of said Block 2, a distance of 168.7 feet to the southwest corner of said
Block 2; thence north, along the west line of said Block 2, a distance of
193.86 feet to the northwest corner of said Block 2; thence east, along
the north line of said Block 2, a distance of 168.7 feet to the point of
beginning.
PARCEL B:
A piece or parcel of land situate in the northwest quarter of Section
19, Township 7 north, Range 36 east of the Willamette Meridian, in Walla Walla
County, Washington, described as follows, to wit:
Beginning at a point on the north line of Dell Avenue in the City of
Walla Walla, that is 726 feet distant west of the point of intersection of said
north line with the west line of Thirteenth Avenue North in said city, said
point also being 30 feet north of the east and west center line of said Section
19; thence northerly and parallel with said west line of Thirteenth Avenue
North a distance of 650 feet; thence westerly and parallel with the east and
west center line of Section 19, a distance of 1000 feet; thence southerly,
parallel with the west line of Thirteenth Avenue North, a distance of 650 feet
to a point that is 30 feet distant north of said east and west center line of
Section 19; thence easterly, parallel with said east and west center line of
Section 19, a distance of 1000 feet to the point of beginning.
PARCEL C:
Beginning at the northeast corner of the U. S. Military Reserve in
Walla Walla, Washington, in Section 30 in Township 7 north, Range 36 east of
the Willamette Meridian, and running thence south 27 degrees 23' east 1685.78
feet, more or less, to a U. S. Corps of Engineers' bronze disk, which is the
TRUE POINT OF BEGINNING of this description; thence south 67 degrees 48' 10"
west a distance of 351.7 feet; thence north 29 degrees 50' west a distance of
352.2 feet; thence north 60 degrees 10' east a distance of 360 feet; thence
south 27 degrees 23' east a distance of 398.1 feet, more or less, to the said
true point of beginning.
EXCEPTING THEREFROM the northerly 35 feet in width conveyed to the City
of Walla Walla for street purposes.
Page 8 of 22
<PAGE> 168
Green Bay
Brown County, WI
Parcel I:
That part of the North 1/2 of the Southwest 1/4 of the Southeast 1/4, Section
32, Township 24 North, Range 21 East, in the City of Green Bay, East side of Fox
River, Brown County, Wisconsin described as:
Commencing at the Northwest corner of Lot 12, Block 3, of Smith Brothers Garden
Addition; thence North 89 degrees 59' 57" West along the South line of Brook
Street, 262.32 feet to the POINT OF BEGINNING; thence continuing North 89
degrees 59' 57" West, 253.2 feet to the East line of Henry Street; thence South
0 degrees 52' 24" West along the East line of Henry Street, 125.0 feet; thence
South 89 degrees 59' 57" East, 254.63 feet; thence North 0 degrees 03' 03" East,
125.0 feet to the point of beginning, EXCEPTING THEREFROM that part thereof
described in Volume 907 of Records, Page 535.
Tax Parcel Number: 21-1220-1
Street Address: 1804-1826 Brook Street
Parcel II:
Lots 99, 100, 101 and 102, EXCEPTING THEREFROM that part thereof described in
Volume 297 of Deeds, Page 348; and Lots 111, 112, 113 and 114, Oak Grove,
according to the recorded Plat thereof, in the City of Green Bay, East side of
Fox River, Brown County, Wisconsin.
Tax Parcel Number: 8-75
Street Address: 1425-1427 Main Street
Page 9 of 22
<PAGE> 169
Poynette
Columbia County, WI
LEGAL DESCRIPTION
Lots 1, 2, 3 and 4, Certified Survey Map No. 1288, recorded in Volume 6 of
Surveys, on page 50, as Document No. 471410, Village of Poynette and Town of
Dekorra, Columbia County, Wisconsin.
Lot 1, Certified Survey Map No. 1289, recorded in Volume 6 of Surveys, on page
51, as Document No. 471411, Village of Poynette and Town of Dekorra, Columbia
County, Wisconsin.
Lot 1, Certified Survey Map No. 1290, recorded in Volume 6 of Surveys, on page
52, as Document No. 471412, Village of Poynette and Town of Dekorra, Columbia
County, Wisconsin.
Lot 1, Certified Survey Map No. 1300, recorded in Volume 6 of Surveys, on page
62, as Document No. 472272, Village of Poynette, Columbia County, Wisconsin.
Page 10 of 22
<PAGE> 170
DeForest
Dane County, WI
The East 50 acres of the South 1/2 of the Southeast 1/4 of Section 8, Township
9 North, Range 10 East, in the Village of DeForest, Dane County, Wisconsin,
described as follows: Beginning at the Southeast corner of Section 8, Township
9 North, Range 10 East, which point is 57 feet East of a concrete highway
monument marking the West boundary of the State Highway; thence Westerly along
the South line of Section 8 at an angle of 89 degrees 20 minutes with the East
line of Section 8 for a distance of 1,651.8 feet to the Southwest corner of 50
acres tract; thence Northerly at an angle of 90 degrees 40 minutes with the
South line of said Section for a distance of 1,315 feet to the Northwest corner
of said tract; thence Easterly at an angle of 89 degrees 35 minutes with the
West line of said tract 1,651.83 feet to the Easterly line of Section 8, which
is 47 feet East of a highway concrete monument; thence Southerly along the East
line of Section 8 at an angle of 90 degrees 25 minutes with the above North
line for a distance of 1,322.3 feet to the place of beginning, EXCEPT that
portion conveyed in Vol. 744 of Deeds, page 51, Document No. 1053647; FURTHER
EXCEPT Certified Survey Map No. 5443, recorded in Vol. 24 of Certified Survey
Maps, page 408, Document No. 2060469; FURTHER EXCEPT land conveyed in Vol.
15285 of Records, page 17, Document No. 2241655.
TAX ROLL PARCEL NUMBER: 45-0910-084-9671-2
ADDRESS PER TAX ROLL: 101 Stokley Dr., DeForest, WI
Page 11 of 22
<PAGE> 171
Sun Prairie
Dane County, WI
PARCEL 1: Lots Thirteen (13) and Fourteen (14), PLAT OF A PART OF THE VILLAGE
OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the City of Sun
Prairie, Dane County, Wisconsin.
PARCEL 2: Lot Nineteen (19), SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK
17, in the City of Sun Prairie, Dane County, Wisconsin, EXCEPT: Beginning at
the most Northwesterly corner thereof; thence South 10 degrees 04 minutes West,
47.35 feet; thence North 61 degrees 17 minutes East, 95.13 feet; thence North
89 degrees 18 minutes West, 75.23 feet to the point of beginning of this
exception.
PARCEL 3: Lots Twenty (20), Twenty-one (21), Twenty-two (22), Twenty-three
(23), Twenty-four (24) and Twenty-five (25), SUN PRAIRIE PLAT OF SUBDIVISION OF
LOT 11, BLOCK 17, in the City of Sun Prairie, Dane County, Wisconsin.
PARCEL 4: That portion of Lots Twenty-six (26), Twenty-seven (27), and
Twenty-eight (28), lying South of relocated Lincoln Street, SUN PRAIRIE PLAT OF
SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie, Dane County,
Wisconsin.
PARCEL 5: That portion of Lot Five (5), lying South of relocated Lincoln
Street and North of the center line of vacated Lincoln Street, PLAT OF A PART OF
THE VILLAGE OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the
City of Sun Prairie, Dane County, Wisconsin.
PARCEL 6: That portion of vacated Lincoln Street lying East of the Easterly
line of Lot Five (5), and South of the South line of relocated Lincoln Street,
SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun
Prairie, Dane County, Wisconsin.
PARCEL 7: Part of Lot Five (5), PLAT OF A PART OF THE VILLAGE OF SUN PRAIRIE
as recorded in Volume B of Plats, page 3, in the City of Sun Prairie, Dane
County, Wisconsin, described as: Beginning at the intersection of the extended
East line of Market Street and the South line of Section 5, Township 8 North,
Range 11 East; thence East on said South line 99 feet; thence North parallel to
the East line of Market Street, 95.6 feet; thence at right angles to Market
Street 99 feet to said extended East line; thence South 102.6 feet to the point
of beginning.
PARCEL 8: That portion of Lincoln Street and relocated Lincoln Street, SUN
PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie,
Dane County, Wisconsin, described as: Beginning at the Southeast corner of
Lincoln Street on the West line of Lot 20, Block 17, Original Plat of Sun
Prairie, Dane County, Wisconsin; thence North along the East line of said
Lincoln Street 15 feet; thence Southwesterly to a point on the South line of
said Lincoln Street, 15 feet West of the point of beginning; thence East along
said South line of Lincoln Street, 15 feet to the point of beginning of this
description.
Page 12 of 22
<PAGE> 172
PARCEL 9: Outlot Two Hundred Eight (208), ASSESSOR'S PLAT OF THE VILLAGE OF
SUN PRAIRIE, in the City of Sun Prairie, Dane County, Wisconsin, EXCEPT that
part lying Easterly of the following described line: Beginning on the North
line of Park Street, 176.57 feet West of the Southeast corner thereof; thence
North 194.28 feet to the South corner of Outlot 202 of said Assessor's Plat.
PARCEL 10: Part of the Northeast 1/4 of the Northeast 1/4 of Section 8,
Township 8 North, Range 11 East, in the City of Sun Prairie, Dane County,
Wisconsin, described as follows: Beginning at the point where the East line of
Market Street produced Southerly from Main Street intersects the North line of
said Section 8; thence East along said North line of Section 8, a distance of
135 feet more or less to a point in a line parallel to and 8.5 feet
Northwesterly measured at right angles from the center line of the present most
Northwesterly Railroad track; thence Southwesterly parallel to said center
line, 170 feet more or less to a point in the aforesaid Southerly prolongation
of said East line of Market Street; thence North along said prolongation 103.3
feet more or less to the point of beginning.
TAX ROLL PARCEL NUMBERS: 55-0811-054-7155-7
55-0811-054-7175-3
55-0811-054-7263-6
55-0811-054-7325-1
55-0811-081-0088-0
ADDRESS PER TAX ROLL: 151 Market St., Sun Prairie, WI
Page 13 of 22
<PAGE> 173
Waunakee
Dane County, WI
PARCEL 1: Lots One (1), Two (2), and Three (3), WAUNAKEE CANNING CO. ADDITION,
in the Village of Waunakee, Dane County, Wisconsin.
PARCEL 2: Part of the Northeast 1/4 of the Northwest 1/4 of Section 8,
Township 8 North, Range 9 East, in the Village of Waunakee, Dane County,
Wisconsin, described as follows: Commencing at the Southeast corner of Lot 1,
Waunakee Canning Co. Addition, Village of Waunakee; thence South 89 degrees 00
minutes West, 166.75 feet; thence North 47 degrees 20 minutes West, 170.45 feet
to the point of beginning; thence continuing North 47 degrees 20 minutes
West, 44.90 feet; thence North 0 degrees 00 minutes 81.53 feet; thence
North 88 degrees 53 minutes East, 33.00 feet; thence South 0 degrees
00 minutes 112.55 feet to the point of beginning, being part of vacated
Madison Street, Village of Waunakee.
PARCEL 3: Part of the Northeast 1/4 of Section 8, Township 8 North, Range 9
East, in the Village of Waunakee, Dane County, Wisconsin, which is more
particularly described as follows: Beginning at the Southwest corner of
Outlot B of Waunakee Canning Co. Addition to the Village of Waunakee; thence
East along the South line of said Outlot B and on said South line produced for
a distance of 284.5 feet; thence South 7 degrees 40 minutes West, 233.5 feet to
the Easterly line of the Chicago Northwestern Railroad right-of-way; thence
Northwesterly along said Railroad right-of-way 342.5 feet to the point of
beginning.
PARCEL 4: Part of the West 1/2 of the Northeast 1/4 of Section 8, Township 8
North, Range 9 East, in the village of Waunakee, Dane County, Wisconsin, which
is described as follows: Beginning at the Southwest corner of Outlot B,
Waunakee Canning Co. Addition to the Village of Waunakee; thence West along the
Southerly line of said Outlot B produced 141.0 feet to the Westerly line of the
Chicago Northwestern Railroad right-of-way; thence South 47 degrees 48 minutes
East along the Westerly line of said right-of-way 140.5 feet to the point of
beginning of this description; thence continue South 47 degrees 48 minutes East
along said right-of-way 373.5 feet; thence South 20 degrees 15 minutes West
646.6 feet; thence North 60 degrees 25 minutes West, 397.2 feet; thence North 1
degree 26 minutes West 294.4 feet; thence North 62 degrees 56 minutes East,
339.9 feet; thence North 0 degrees 53 minutes West, 182.0 feet to the point of
beginning, EXCEPT that poriton conveyed in vol.664 of Deeds, page 403,
Document No. 939614.
PARCEL 5: All that part of the following described parcel lying West of the
center line of the Six Mile Creek running through said parcel: Part of the
West 1/2 of the Northeast 1/4 of Section 8, Township 8 North, Range 9 East, in
the Village of Waunakee, Dane County, Wisconsin, and described more fully as
follows: Commencing at a point on the Easterly extension of the South line of
Outlot B, Waunakee Canning Co. Addition (Also the South line of lands owned by
Village of Waunakee) distant thereon 284.5 feet East of the Southwest corner of
Outlot B; thence South 7 degrees 40 minutes West, 233.5 feet to the Northeast
right-of-way line of the Chicago Northwestern Railroad; thence Southeasterly
Page 14 of 22
<PAGE> 174
along said Northeasterly line of the center line of public highway; thence
Northerly along said center line to the Southeast corner of lands conveyed to
Village of Waunakee in Vol. 363 of Deeds, page 5, Document No. 553335; thence
West along South line of Village property to the point of beginning.
PARCEL 6: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8,
Township 8 North, Range 9 East, in the Village of Waunakee, Dane County,
Wisconsin, described as follows: Commencing on the Northeasterly line of the
land of the Chicago and Northwestern Railway Company and on a line running
North and South through center of said Section 8; thence North on said line
171.60 feet; thence East parallel with the North line of said Section, 99 feet;
thence South parallel with first line, 267.30 feet to the Northeasterly line of
the Chicago and Northwestern Railway Company; thence Northwesterly along said
line of the Chicago and Northwestern Railway Company, 137.28 feet to the place
of beginning.
PARCEL 7: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing at the Southeast corner of Lot 8, Block 2,
E. M. Cooper's Addition to the Village of Waunakee; thence running West 16-1/2
rods; thence South 13-4/5 rods; thence East 16-1/2 rods; thence North 13-4/5
rods to the point of beginning.
PARCEL 8: Outlots A and B, WAUNAKEE CANNING CO. ADDITION, in the Village of
Waunakee, Dane County, Wisconsin.
TAX ROLL PARCEL NUMBERS: 57-0809-081-3650-7
57-0809-081-3700-6
57-0809-081-9080-5
Page 15 of 22
<PAGE> 175
Cobb
Iowa County, WI
PARCEL I
Part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Commencing at the Northeast corner of the Southeast 1/4 of the Northeast 1/4 of
Section 26, thence West 1036 feet; thence South 525 feet; thence East 74 feet
to the Railroad right of way; thence North 120 feet; thence in a Northeasterly
direction along the North line of the Railroad right of way, 826 feet to a
point, 351 feet South of the North line of said Southeast 1/4 of the Northeast
1/4; thence North 224 feet; thence East 136 feet; thence North 127 feet to the
place of beginning.
PARCEL II
Part of the Southwest 1/4 of the Northwest 1/4 of Section 25, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Commencing at a point 60 feet South of the Northwest corner of the Southwest
1/4 of the Northwest 1/4 of Section 25, thence East, 242 feet; thence North 60
feet; thence East 744 3/4 feet, more or less, to a point that is 5 chains and 5
links West of the Northeast corner of said Southwest 1/4 of the Northwest 1/4;
thence South 402 1/2 feet to the North line of the C. & N.W.R.R. right of way;
thence West along said right of way, 486 3/4 feet; thence North along said
right of way, 125 feet; thence West along said right of way, 347 feet; thence
North, 60 feet; thence West 153 feet to the West line of said 40 acre tract;
thence North on the said West line, 215 feet more or less to the place of
beginning. Intending to include all that part of the Southwest 1/4 of the
Northwest 1/4 of Section 25, Township 6 North, Range 1 East, Village of Cobb,
Iowa County, Wisconsin, North of the railroad right of way as deeded in Volume
97 of Deeds, page 75, Document # 18876, in the Office of the Register of Deeds
for Iowa County, Wisconsin.
PARCEL III
A parcel of land lying and being in the Southeast 1/4 of the Northeast 1/4 of
Section 26, Township 6 North, Range 1 East, Village of Cobb, Iowa County,
Wisconsin, described as follows: Commencing 60 feet North of the Northeast
corner of that certain tract of land conveyed from Joseph Drury to the Chicago
& Tomah R.R. Co., and particularly described in Volume 35 of Deeds, page 542,
to which reference is had for said point of beginning; thence North on the East
line of said 40 acre tract, 150 feet; thence West, 140 feet; thence South 150
feet; thence East 140 feet to the place of beginning.
PARCEL IV
Part of the Southwest 1/4 of the Northwest 1/4 of Section 25, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Beginning at a point adjoining the North side of the Milwaukee and Madison
branch of the C. & N.W.R.R. Depot grounds as now located, 33 feet East of the
West line of the Southwest 1/4 of the Northwest 1/4 of Section 25, to run
thence North 60 feet; thence East 120 feet; thence South to said railroad
grounds; thence West along said railroad grounds to place of beginning.
PARCEL V
Part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6 North,
Range 1 East, in the Village of Cobb, Iowa County, Wisconsin, meted and bounded
as follows: Commencing at the Northeast corner of a tract of land last
conveyed by Joseph Drury to the Chicago and Tomah Railroad Company in a Deed
recorded in Volume 35, page 542 of Deeds in the Registers Office of said County;
thence North 60 feet, thence West 140 feet, thence South 60 feet, more or less,
to the Railroad land; thence with the line of said Railroad land, North 85
degrees East, 140 feet, more less, to the place of beginning.
Page 16 of 22
<PAGE> 176
PARCEL VI
That part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6
North, Range 1 East of the Fourth Principal Meridian, Village of Cobb, Iowa
County, Wisconsin, bounded and described as follows: Beginning at the point of
intersection of the West line of Division Street, a/k/a Commercial Street with
the northerly line of the 300 foot right of way of the Chicago and North
Western Railway Company; thence South along the West line of said Division
Street, a distance of 115 feet, more or less, to a point, 8.5 feet northerly
of, as measured at right angles from center line of Spur Track I.C.C. NO. 22 of
said Railway Company, as now located and established; thence Westerly along a
line parallel with the centerline of the tangent segment of said Spur Tract and
extension thereof to a point, 9 feet Northerly of, as measured radially from
the centerline of the curved segment of said Spur Tract; thence Westerly along
a line parallel with the centerline of the curved segment of said Spur Track to
a point, 50 feet Northerly of, as measured at right angles from the centerline
of the main track of said Railway Company, as now located and established;
thence Westerly along a line parallel with the centerline of said main track to
a point, 1000 feet Westerly of, as measured along a line parallel with the
Northerly line of said 300 foot right of way from the east line of said
Section; thence North along a line parallel with the East line of said Section
to the Northerly line of said 300 foot right of way; thence Easterly along the
Northerly line of said 300 foot right of way to the point of beginning.
EXCEPTING FROM PARCELS II THROUGH V, THE LANDS CONVEYED FOR HIGHWAY DESCRIBED
AS: A parcel of land located in the SW 1/4 of the NW 1/4 of Section 25, Town 6
North, Range 1 East, Village of Cobb, Iowa County, Wisconsin, and consist of
all the land therein lying between the west line of said Southwest 1/4 of
Northwest 1/4 of Section 25 and a new road right of way line 50 feet east of
and parallel to the centerline of new road as now laid out.
ALSO EXCEPTING lands located in the Southwest 1/4 of the Northwest 1/4 and in
the Northeast 1/4 of Section 25, Township 6 North, Range 1 East, Town of Eden,
and Village of Cobb, Iowa County, Wisconsin, and consists of all the land
therein which lies within 50 feet South of the centerline of new road from the
point of beginning to a point, 872 feet therefrom. Also all the land which
lies within 50 feet each side of centerline for the next 1239 feet, all the
land lying within 50 feet northerly of said centerline for the next 1325 feet
to the east line of grantor, the said centerline geing described as follows:
Commencing at a point 2111 feet west of the center of Section 25, Township 6
North, Range 1 East extending thence North 89 degrees 05' East, for 3436 feet
to the east property line of grantor.
FURTHER EXCEPTING lands located in the Southeast 1/4 of the Northeast 1/4 of
Section 26, Township 6 North, Range 1 East, Village of Cobb, Iowa County,
Wisconsin, and consists of all the land therein lying between the East line of
said Section 26 and a new right of way line 50 feet West of and parallel to the
centerline of the new road as now laid out. The centrerline is described as
follows: Beginning on the East line of said Section 26 at a point 1330 feet
South of the Northeast corner of said Section extending thence South
0 degrees 05' West for 130 feet to the south line of property.
TAX ROLL PARCEL NUMBER: 130, 131, 130.A and 130.B (Village of Cobb)
Page 17 of 22
<PAGE> 177
Jefferson
Jefferson County, WI
Lot 1 of Certified Survey Map No. 1890 recorded on November 8, 1985 in Volume 6
of Certified Surveys on Page 106, as Document Number 811709, being a part of
the Northwest Quarter of the Northwest Quarter of Section 14, Township 6 North,
Range 14 East, City of Jefferson, Jefferson County, Wisconsin.
COMPUTER NO.: 241-2082-02000
TAX KEY NO.: 06-14-14-22-003
Page 18 of 22
<PAGE> 178
Merrill
Lincoln County, WI
PARCEL 1
Lots Nine (9), Twenty-one (21) and Twenty-two (22), Block Two (2), in T. P.
Mathews Addition to the City of Merrill, Lincoln County, Wisconsin.
PARCEL 2
A portion of the Northeast 1/4 of the Northwest 1/4 of Section 15, Township 31
North, Range 6 East, City of Merrill, Lincoln County, Wisconsin, described by
metes and bounds as follows:
Commencing at the intersection of the South line of the Chicago, Milwaukee, St.
Paul & Pacific Railroad right-of-way and the West line of said 40, thence North
90 feet the place of beginning; thence East parallel with said Railroad
right-of-way, 500 feet, thence North parallel with the West line of said 40 to
the section line between Sections 10 and 15, thence West, 500 feet to the
Northwest corner of said 40, thence South to the place of beginning.
Also described as Lot 631 of the Assessor's Plat of the City of Merrill
recorded in Volume 3 of Plats, page 40, Lincoln County Records.
Page 19 of 22
<PAGE> 179
Oconomowoc
Waukesha County, WI
Parcel 1 of Certified Survey Map No. 6318, recorded on November 29, 1990 in
Volume 52 of Certified Survey Maps on Pages 131 to 133, inclusive, as Document
No. 1624207, being a part of the Southwest 1/4 of the Northwest 1/4 of Section
5, Town 7 North, Range 17 East, in the City of Oconomowoc, County of Waukesha,
State of Wisconsin.
Tax Key No. OCOC 0634.999.003
ADDRESS: 1055 Corporate Center
KR/WF/DD
Page 20 of 22
<PAGE> 180
Pickett
Winnebago County, WI
Parcel 1
A part of the Southwest Quarter (SW 1/4) of the Northwest Quarter (NW 1/4) of
Section 28, the Southeast Quarter (SE 1/4) of the Northeast Quarter (NE 1/4)
and the Northeast Quarter (NE 1/4) of the Southeast Quarter (SE 1/4) of Section
29, all in T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows:
Commencing at the Northwest Corner of said Section 28; thence south 0 degrees
47 minutes 54 seconds east, 1315.60 feet, along the West line of the North West
1/4 of said Section 28, to the Northwest Corner of the South West 1/4 of the
North West 1/4 of said Section 28, to the place of beginning; thence north 88
degrees 37 minutes 8 seconds east, 678.39 feet, along the North line of the
South West 1/4 of the North West 1/4 of said Section 28, to its intersection
with the Westerly right-of-way line of the Wisconsin and Southern Railroad
Company; thence south 38 degrees 6 minutes 6 seconds west, 2043.59 feet, along
the Westerly right-of-way line of the Wisconsin and Southern Railroad Company;
thence south 89 degrees 52 minutes 1 second west, 680.30 feet, to a point on
the Easterly right-of-way line of County Trunk Highway "M"; thence north 0
degrees 39 minutes 45 seconds west, 906.17 feet, along the Easterly
right-of-way line of County Trunk Highway "M"; thence north 88 degrees 46
minutes 50 seconds east, 291.16 feet; thence north 0 degrees 58 minutes 13
seconds west, 660.00 feet, to a point on the North line of the South East 1/4
of the North East 1/4 of said Section 29; thence north 88 degrees 46 minutes 50
seconds east, 993.90 feet, along the North line of the South East 1/4 of the
North East 1/4 of said Section 29, to the place of beginning.
Parcel 2
A part of the Northwest Quarter (NW 1/4) of the Southwest Quarter (SW 1/4) of
Section 28, the Northeast Quarter (NE 1/4) of the Southeast Quarter (SE 1/4)
and the Southeast Quarter (SE 1/4) of the Southeast Quarter (SE 1/4) of Section
29, all in T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows:
Commencing at the West Quarter Corner of said Section 28, the place of
beginning; thence north 88 degrees 42 mintues 40 seconds east, 397.10 feet,
along the North line of the North West 1/4 of the South West 1/4 of said
Section 28, to its intersection with the Westerly line of State Trunk Highway
No. 44; thence southwesterly along the Westerly line of said State Trunk
Highway No. 44 the following
Page 21 of 22
<PAGE> 181
courses: south 28 degrees 26 minutes 11 seconds west, 161.41 feet; thence
southwesterly, 786.96 feet, along the arc of a curve to the right having a
radius of 2804.93 feet and the chord of which bears south 36 degrees 29 minutes
23 seconds west, 784.38 feet; thence south 44 degrees 28 minutes 18 seconds
west, 547.27 feet; thence southwesterly, 694.74 feet, along the arc of a curve
to the right having a radius of 5669.65 feet and the chord of which bears south
48 degrees 2 minutes 32.5 seconds west, 694.31 feet; thence south 36 degrees 49
minutes 33 seconds west, 102.80 feet; thence southwesterly 74.40 feet, along
the arc of a curve to the right having a radius of 5696.65 feet and the chord
of which bears south 52 degrees 55 minutes 37 seconds west, 74.40 feet; thence
south 53 degrees 20 minutes 39 seconds west, 57.47 feet; thence north 63
degrees 46 minutes 36 seconds west, 56.80 feet, along the Westerly line of said
State Trunk Highway No. 44, to its intersection with the Easterly line of
County Trunk Highway "M"; thence north 5 degrees 10 mintues 26 seconds west,
69.34 feet, along the Easterly line of said County Trunk Highway "M"; thence
south 89 degrees 6 minutes 8 seconds west, 16.56 feet, to a point on the West
line of the East 1/2 of the South East 1/4 of said Section 29; thence north 1
degrees 7 minutes 59 seconds west, 417.70 feet, along the West line of the East
1/2 of the South East 1/4 of said Section 29, to its intersection with the
Easterly right-of-way line of the Wisconsin and Southern Railroad Company;
thence north 38 degrees 6 minutes 6 seconds east, 1603.15 feet, along the
Easterly right-of-way line of the Wisconsin and Southern Railroad Company to
its intersection with the North line of the North East 1/4 of the South East
1/4 of said Section 29; thence north 88 degrees 44 minutes 20 seconds east,
305.97 feet, along the North line of the North East 1/4 of the South East 1/4
of said Section 29, to the place of beginning.
Parcel 3
A part of the Southwest Quarter (SW 1/4) of the Southeast Quarter (SE 1/4) of
Section 29, T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows:
Commencing at a point on the South line of the Wisconsin and Southern Railroad
Company (formerly known as the Chicago, Milwaukee & St. Paul Railroad)
right-of-way in the center of County Trunk Highway "M" (formerly known as the
Waukau-Waupun Road); thence southwesterly, along the South line of said
Railroad right-of-way, 351 feet; thence southeasterly, at right angles to said
Railroad right-of-way, 41 feet and 10 inches; thence northeasterly, on a line
parallel to said Railroad right-of-way, to a point in the center of said County
Trunk Highway "M", about 300 feet; thence north, along the center of said
Highway, to the place of beginning.
Tax Key Number: Par. 1: 024-0594-01, 024-0594-03, 024-0609,
024-0609-01 & 024-0624; Par. 2: 024-0624-01, 024-0625-01
& 024-0599; Par. 3: 024-0637-01
Page 22 of 22
<PAGE> 182
ANNEX 3
Section 1(a)(ii)
Appleton, Wisconsin. Indemnifying Party removed a number of
underground storage tanks from this property during the 1980's and
early 1990's. All such tanks were used for storage of petroleum based
products. Leakage and soil contamination was detected in connection
with three tanks. The sites were over-excavated, and contaminated
soil was removed from site and disposed of in accordance with the
requirements of law.
However, because of unique soil conditions, small amounts of
contaminated soil may remain at the site in areas near where the tanks
were located. The WDNR allowed the site to be closed contingent upon
agreement by the Indemnifying Party to notify it in the event that
future excavation discloses contaminated soil that requires removal.
A deed restriction to that effect is in place.
Section 1(a)(iii)
None.
Section 1(a)(iv)
Sun Prairie and Waunakee, Wisconsin. Indemnifying Party has been
identified as a potentially responsible party in connection with the
clean-up of the Refuse Hideaway Landfill site in Middleton, Wisconsin.
Indemnifying Party contributed general refuse to that site from its
plants in Sun Prairie and Waunakee, Wisconsin. It did not contribute
hazardous materials to the site. Indemnifying Party is in the process
of negotiating a de-minimus settlement on the basis it contributed
insignificant volume to the site and no waste involved in the
contamination of the site.
<PAGE> 183
LITIGATION
1. Walter Reinholdt v. Stokely USA, Inc. (Law No. C2017 in the Iowa
District Court for Franklin County, Iowa)
This is an action brought by plaintiff for damages of
$56,633.43 plus interest and costs. The claim is based on the
Company's alleged negligence in connection with the storage of dark
red kidney beans at its plant in Ackley, Iowa. The Company denies
liability.
This case was tried to a jury in July of 1994, and a verdict
was returned which found no liability on the part of the Company.
Plaintiff has, however, appealed to the Court of Appeals of the State
of Iowa. A decision on that appeal is expected later this year.
Davis, Hockenberg, Wine, Brown, Koehn & Shors of Des Moines,
Iowa represents the Company in this matter.
2. Kurt Boehm v. Stokely USA, Inc., et al. (Case No. 93-L-003414 in the
Circuit Court of Cook County, Illinois)
This action was filed in April of 1993 and is for personal
injuries suffered by plaintiff in a boiler explosion that occurred at
the Company's plant in Hoopeston, Illinois while plaintiff was present
as a business invitee.
The Company has liability insurance in force for this claim
through Crum and Forster Commercial Insurance Co., and the Company's
defense has been undertaken by Crum and Forster Insurance Co. through
the law firm of Crystal, Heytow and Warnick, P.C. of Chicago, IL.
3. Robert Potratz and James Potratz v. Stokely USA, Inc. (Case No.
93-CV-811 in the Circuit Court of Winnebago County, Wisconsin.)
This action sought damages of $180,000 on a breach of contract
claim plus punitive damages of an unstated amount. The Company denied
liability, and the case was tried to a jury in April of 1995. The
jury found that the Company breached the contract and returned a
damage verdict of $73,283 against the Company.
The Company has filed motions after verdict to set aside or
reduce the damages to $34,788. These motions are scheduled to be
heard by the court on May 11, 1995. The Company plans to appeal if
the verdict as to damages is not set aside. Robert Brill, general
counsel of the Company,
<PAGE> 184
set aside. Robert Brill, general counsel of the Company, represents
the Company in this action.
4. Renee Estrada v. Arnold Bowman and Stokely USA, Inc. (Cause No.
C-1327-94-D, Hidalgo County, Texas District Court).
This action was filed on March 18, 1994 and is an action for
damages based on plaintiff's claim that he was wrongfully discharged
as an employee at the Company's plant in McAllen, Texas. There is no
substance to the plaintiff's claim. Damages sought include lost
earnings and punitive damages. The Complaint, however, fails to state
a specific damage amount. The exposure is minimal.
The Company is represented by the law firm of Adams and
Graham, L.L.P. of Harlingen, Texas in this action.
5. Baker's Best Frozen Commodities Co., v. Stokely USA, Inc. et al. (Case
No. BC102425 Los Angeles County Superior Court).
This action was filed on April 11, 1994 and seeks compensatory
and punitive damages arising from an alleged breach of contract. The
amount of damages is not stated in the Complaint but is generally
represented to be in excess of $500,000; of which sum the compensatory
damage claim comprises a small part. Stokely USA, Inc. denies
liability.
A tentative settlement has been reached which is in the
process of being reduced to writing. Pursuant to this settlement, the
Company will forgive outstanding invoices owed it by Plaintiff in the
amount of $16,700 and will provide $15,000 of trade discounts to
Plaintiff in each of the next 3 years.
The Company is represented in this action by Lane, Powell,
Spears and Lubersky of Los Angeles, California.
6. Duane C. Klingler v. Stokely USA, Inc. (Case No. CI-95-046 in the
Common Pleas Court of Paulding County, Ohio).
This action was filed in March of 1995 and claims that the
Company breached a warehouse lease agreement with Plaintiff. Damages
of $44,000 are claimed.
The Company has denied liability. Glenn Troth of Paulding,
Ohio represents the Company in this action.
7. Pedro Rodriguez v. Stokely USA, Inc. (Case No. C94-3057 in the United
States District Court for the Northern District of Iowa).
2
<PAGE> 185
This action was filed in August of 1994 and claims that the
Company breached an employment agreement with Plaintiff. Damages are
unstated in the complaint but are estimated by the Company to be less
than $5,000.
The Company has denied liability. No trial date has been set.
Robert Brill, general counsel of the Company, represents the Company
in this action.
8. Philip D. Freeman v. Stokely USA, Inc. (Case No. 95-C-003 in the
United States District Court for the Eastern District of Wisconsin).
This is a class action lawsuit which was filed on January 3,
1995, in the United States District Court for the Eastern District of
Wisconsin, by Philip D. Freeman, a Minnesota resident, against the
Company, all of the individual members of the Board of Directors of
the Company (in both their capacity as a member of the Board of
Directors and as an executive officer, as applicable), William Blair
& Company and Dain Bosworth, Inc. The plaintiff brought the action
pursuant to Sections 11, 12(2) and 15 of the Securities Act of 1934,
as amended, and Rule 10b-5 promulgated thereunder. The plaintiff
alleges that he sustained losses in connection with his purchase of
shares of Common Stock of the Company following a secondary offering
by the Company during the period from October 17, 1994 to December 19,
1994, as a result of defendants' alleged misleading statements and
omission to state material facts. The complaint seeks rescission
and/or compensatory damages, and costs and expenses related to the
bringing of the lawsuit. The Company believes that the allegations
are without merit or substance.
The Company retained the law firm of Gibbs, Roper, Loots and
Williams of Milwaukee, Wisconsin to represent the Company and its
officers. The Company has retained the law firm of Michael, Best &
Friedrich of Milwaukee, Wisconsin, to represent the Company's non-
employee directors. The Company has Directors and Officers Liability
Insurance coverage through two carriers with total coverage of
$10,000,000, less retention of $250,000. The Company has negotiated
allocation of defense costs with the primary carrier assuming 75% of
such costs and the Company 25% after the retention.
Motions for dismissal of the Complaint have been filed on
behalf of all defendants and remain pending.
9. Daniel J. Sweeney v. Stokely USA, Inc., et al. (Case No. 95-C-0501) in
the United States District Court for Eastern District of Wisconsin).
3
<PAGE> 186
This case was filed on 5/10/95 and served 5/17/95. It is a
class action suit arising from the same events as the Freeman case.
The Company has retained the law firm of Gibbs, Roper, Loots &
Williams of Milwaukee, Wisconsin to represent it and its employees
named as defendants.
ADMINISTRATIVE PROCEEDINGS PENDING
1. Cynthia A. Spencer v. Stokely USA, Inc. (Case No. CP 08-92-22838 Iowa
Civil Rights Commission)
Cynthia A. Spencer filed a complaint with the Iowa Civil
Rights Commission in August of 1992. She claims that she was not
hired in 1992 as a mechanic due to her gender. There is no substance
to her complaint which remains under investigation by the Iowa Civil
Rights Commission.
The Company is represented in this matter by its general
counsel, Robert Brill.
2. John Areklet v. Stokely USA, Inc. (PACA N-7964 in the United States
Department of Agriculture)
John Areklet filed a complaint with the United States
Department of Agriculture in February of 1995 which claims the Company
violated the Perishable Agricultural Commodities Act by rejecting a
quantity of green beans grown under contract with the Company by Mr.
Areklet in 1994. Mr. Areklet claims damages of $12,474.
Stokely has denied liability. An administrative decision on
the claim is forthcoming. The Company is represented in this matter
by its general counsel, Robert Brill.
3. Robert Van der Zanden v. Stokely USA, Inc. (PACA N-8003 in the United
States Department of Agriculture).
Robert Van der Zanden filed a complaint with the United States
Department of Agriculture in March of 1995 which claims the Company
violated the Perishable Agricultural Commodities Act by rejecting a
quantity of green beans grown under contract with the Company by Mr.
Van der Zanden in 1994. Mr. Van der Zanden claims damages of $5,770.
Stokely has denied liability. An administrative decision on
the claim is forthcoming. The Company is represented in this matter
by its general counsel, Robert Brill.
4
<PAGE> 187
THREATENED LITIGATION
1. Middleton Refuse Hideaway. The Company has been named as a
potentially responsible party with regard to the Middleton Refuse
Hideaway Landfill Site in Dane County, Wisconsin. The Company
believes its responsibility, if any, is de minimus on the basis that
it contributed no hazardous materials to the landfill site and an
insignificant volume of materials in a volumetric ranking scheme.
The Company joined with several other de minimus parties to
retain the law firm of Michael Best and Friedrich of Madison,
Wisconsin to represent it with regard to this matter; although there
is no legal action pending against the Company at this time. The
Company is currently negotiating a de minimus settlement.
5
<PAGE> 188
ENVIRONMENTAL INDEMNIFICATION AGREEMENT
THIS ENVIRONMENTAL INDEMNIFICATION AGREEMENT ("Agreement") is made as
of the 31st day of May, 1995, by STOKELY USA, INC., a Wisconsin corporation
(the "Indemnifying Party") to, and for the ratable benefit of, NATIONWIDE LIFE
INSURANCE COMPANY ("Nationwide"), EMPLOYERS LIFE INSURANCE COMPANY
("Employers"), WEST COAST LIFE INSURANCE COMPANY ("West Coast") and STATE OF
WISCONSIN INVESTMENT BOARD (Nationwide, Employers, West Coast and SWIB are
collectively referred to hereinafter as the "Lenders").
R E C I T A L S:
WHEREAS, Nationwide, Employers, West Coast and the Indemnifying Party
are parties to a Note Agreement, dated as of January 1, 1990, as amended by an
Amendment to Note Agreement dated August 18, 1992, a Second Amendment to Note
Agreement dated June 11, 1993, and a Third Amendment to Note Agreement dated
May 31, 1995 (said Note Agreement, as so amended, and as further amended,
modified or supplemented from time to time, is referred to hereinafter as the
"Nationwide Note Agreement"), pursuant to which the Indemnifying Party has
issued its 9.37% Senior Secured Notes due January 15, 2000 (collectively,
together with any other notes issued pursuant to the Nationwide Note Agreement,
the "Nationwide Notes"); and
WHEREAS, SWIB and the Indemnifying Party are parties to a Note
Agreement, dated as of December 1, 1991, as amended by a First Amendment to
Note Agreement dated as of August 18, 1992, a Second Amendment to Note
Agreement dated as of June 11, 1993, and a Third Amendment to Note Agreement
dated as of May 31,1995 (said Note Agreement, as so amended, and as further
amended, modified or supplemented from time to time, is referred to hereinafter
as the "SWIB Note Agreement"), pursuant to which the Indemnifying Party has
issued a certain 9.49% Senior Note due December 15, 2001 (collectively,
together with any other notes issued pursuant to the SWIB Note Agreement, the
"SWIB Notes"); and
WHEREAS, the Indemnifying Party has on this date entered into a
Security Agreement (as amended, modified or supplemented from time to time, the
"Security Agreement") with the Lenders, granting to, and for the ratable
benefit of, the Lenders a security interest in certain Collateral (as defined
in the Security Agreement) to secure the Nationwide Notes, the SWIB Notes and
the other Obligations (as defined in the Security Agreement); and
WHEREAS, as additional security for the Obligations, the Indemnifying
Party has granted to, and for the ratable benefit of, the Lenders certain real
estate mortgages/deeds of trust (as amended, modified or supplemented from time
to time, the "Mortgages"), encumbering certain real estate legally described on
Annex 1 hereto and the improvements and fixtures and other property described
in the Mortgages (said real estate, improvements, fixtures and other property,
the "Mortgaged Property"), together with certain other documents evidencing
and/or securing the Obligations (the Security Agreement, the Mortgages, this
Agreement and such other documents being described and defined in the Security
Agreement and collectively referred to hereinafter as the "Security
Documents"); and
<PAGE> 189
WHEREAS, as additional security for the Obligations, the Lenders have
required that the Indemnifying Party execute and deliver to the Lenders this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Indemnifying Party hereby agrees as
follows:
1. (a) The Indemnifying Party represents and warrants that:
(i) each of the Indemnifying Party, its
affiliates and the Mortgaged Property is in compliance in all
material respects with all Environmental Laws (defined below);
(ii) except as disclosed on Annex 2 hereto, there
are no environmental conditions with respect to the soil,
surface waters, groundwater, air or similar environmental
media, either on or off the Mortgaged Property, resulting from
any activity, inactivity or operations on or off the Mortgaged
Property, presently existing or likely to exist during the
term of the Obligations which would subject the Indemnifying
Party to damages, penalties, injunctive relief or cleanup
costs under any Environmental Law or any assertion thereof, or
which require or are likely to require cleanup, removal,
remedial action or other response by the Indemnifying Party
pursuant to any Environmental Law;
(iii) except as disclosed on Annex 2 hereto, the
Indemnifying Party is not a party to any litigation or
administrative proceeding, and, so far as is known by the
Indemnifying Party, no litigation or administrative proceeding
is threatened against it, which asserts or alleges that the
Indemnifying Party or any of its subsidiary companies has
violated or is violating any Environmental Law relative to the
Mortgaged Property or the activity or operations thereon, or
that the Indemnifying Party is required to clean up, remove or
take remedial or other responsive action pursuant to any
Environmental Law;
(iv) except as disclosed on Annex 2 hereto,
neither the Mortgaged Property nor the Indemnifying Party or
any of its affiliates is subject to any judgment, decree,
order or citation related to or arising out of any
Environmental Law relative to the Mortgaged Property or any
activity or operations thereon and neither the Indemnifying
Party nor any of its affiliates has been named or listed as a
potentially responsible party by any governmental body or
agency in a matter arising under any Environmental Law
relative to the Mortgaged Property;
(v) no permits, licenses, approvals,
certificates, plans, consent agreements or stipulations are
required under any Environmental Law relative to the Mortgaged
Property, or the activities and operations of the Indemnifying
Party on the Mortgaged Property or the activity or operations
thereon, that have not been obtained; and
(vi) there are not now, nor to the Indemnifying
Party's knowledge after reasonable investigation have there
ever been, Hazardous Materials generated,
2
<PAGE> 190
produced, stored, deposited, treated, handled, recycled,
spilled, discharged, leaked or disposed of on, under or at the
Mortgaged Property (or tanks or other facilities thereon
containing such Hazardous Materials) which require, or would
require, cleanup, removal or some other remedial action or
other response under any Environmental Law.
(b) As used herein, the following terms shall have the meanings
ascribed to them set forth below:
"Environmental Laws" shall mean all federal, state and local
laws, including statutes, regulations, ordinances, codes, rules and
other governmental restrictions and requirements, and all permits,
licenses, approvals, certificates, plans, consent agreements and
stipulations, relating to the discharge of air pollutants, water
pollutants or process waste water or otherwise relating to the
environment or hazardous or toxic wastes or substances including, but
not limited to, the Federal Solid Waste Disposal Act, the Federal
Clean Air Act, the Federal Clean Water Act, the Safe Drinking Water
Act, the Federal Resource Conservation and Recovery Act of 1976, the
Federal Comprehensive Environmental Responsibility Cleanup and
Liability Act of 1980, the Occupational Safety and Health Act, the
Toxic Substance Control Act, the Hazardous Materials Transportation
Act, the Federal Insecticide, Fungicide and Rodenticide Act,
regulations of the Environmental Protection Agency, regulations of the
Nuclear Regulatory Agency, and regulations of the State of Wisconsin
Department of Natural Resources now in effect or, for purposes of
Section 1(c) below, as amended, modified, supplemented or created
from time to time.
"Hazardous Materials" shall mean any petroleum, petroleum
products, fuel oil, derivatives of or additives to petroleum products
or fuel oil, explosives, reactive materials, ignitable materials,
corrosive materials, hazardous chemicals, hazardous wastes, hazardous
substances, hazardous air pollutants, air pollutants, extremely
hazardous substances, toxic substances, toxic chemicals, radioactive
materials, medical waste, biomedical waste, any mixture of sewage or
other waste material that passes through a sewer system to a treatment
facility, any industrial waste-water discharges subject to regulation
and any infectious materials, as such foregoing terms may be defined
in the Environmental Laws, and any other element, compound, mixture,
solution or substance which may pose a present or potential hazard to
human health or the environment.
(c) The Indemnifying Party shall comply in all material respects
with all applicable Environmental Laws relative to the Mortgaged Property and
shall provide to the Lenders, immediately upon receipt, copies of any
correspondence, notice, pleading, citation, indictment, complaint, order,
decree or other document from any source asserting or alleging a circumstance
or condition on the Mortgaged Property which requires or may require a
financial contribution by the Indemnifying Party or a cleanup, removal,
remedial action, or other response by or on the part of the Indemnifying Party
under any Environmental Law, or which seeks damages or civil, criminal or
punitive penalties from the Indemnifying Party for an alleged violation of any
Environmental Law relative to the Mortgaged Property. The Indemnifying Party
shall advise the Lenders in writing, as soon as the Indemnifying Party becomes
aware of any condition or circumstance on the Mortgaged Property which makes
the environmental warranties contained in this Agreement incomplete or
inaccurate. The Indemnifying Party shall, at its expense and at
3
<PAGE> 191
the request of the Lenders at any time having a reasonable basis for believing
that a condition or circumstance exists which causes the environmental
warranties contained in this Agreement to be inaccurate, and at any time
following an Event of Default hereunder, permit an environmental audit to be
conducted by the Lenders or an independent agent selected by the Lenders. This
provision shall not relieve the Indemnifying Party from conducting its own
environmental audits or taking any other steps necessary to comply with any
Environmental Law relative to the Mortgaged Property, it being understood that
the Indemnifying Party has and shall retain exclusive management control over
the management of Hazardous Materials on or about the Mortgaged Property and
responsibility for compliance with Environmental Laws. If, in the reasonable
belief of the Lenders based on any report prepared by one or more environmental
engineering/consulting firms, there exists any uncorrected violation of any
Environmental Law relative to the Mortgaged Property or any condition on the
Mortgaged Property which requires a cleanup, removal or other remedial action
under any Environmental Law, and such cleanup, removal or other remedial action
is not completed within one hundred twenty (120) days from the date of written
notice from the Lenders to the Indemnifying Party (or if such cleanup, removal
or other remedial action cannot reasonably be completed within said one hundred
twenty (120) day period, such longer period of time as may reasonably be
necessary for the Indemnifying Party to complete such cleanup, removal or other
remedial action, as long as the Indemnifying Party proceeds diligently to
complete the same), the same shall, at the option of the Lenders, constitute an
Event of Default hereunder.
2. The Indemnifying Party covenants that, except for claims,
losses, damages, response costs or expenses caused by or contributed (to the
extent of such contribution) to by the grossly negligent or intentional
misconduct of the Lenders, it will at all times, unconditionally, absolutely
and irrevocably, indemnify, hold harmless and defend the Lenders and their
respective successors and assigns from any and all claims, losses, damages,
response costs and expenses arising out of or in any way relating to a breach
and/or misrepresentation of any and/or all of the environmental
representations, warranties, certifications and/or covenants set forth above
and/or in any of the other Security Documents, or in any way relating to a
breach or violation, or alleged breach or violation, of any one or more of the
Environmental Laws, including, but not limited to: (a) claims of third parties
(including governmental agencies) for damages, penalties, response costs,
injunctive or other relief; (b) costs of removal, treatment, disposal and
restoration, including fees of attorneys and experts, costs of reporting the
existence of Hazardous Materials to any governmental agency and costs of
preparing and/or causing to be prepared any and all studies, tests, analyses
and/or reports in connection with any environmental matter; and (c) any and all
expenses or obligations, including attorneys' fees, incurred at, before and
after any trial or appeal therefrom, whether or not taxable as costs,
including, without limitation, attorneys' fees, witness fees, deposition costs,
copying and telephone charges and other expenses, all of which shall be paid by
the Indemnifying Party when incurred.
3. Except for claims, losses, damages, response costs or expenses
caused or contributed (to the extent of such contribution) by the grossly
negligent or intentional misconduct of the Lenders, the representations,
warranties, certifications and/or covenants contained herein and the
obligations of the Indemnifying Party to indemnify the Lenders as provided in
this Agreement, including, without limitation, indemnification for the
expenses, damages, losses, costs, damages and liabilities set forth in Section
2 above, shall survive the repayment of all amounts due under the Security
Documents and the release and/or cancellation of any and all of the Security
Documents, the foreclosure of any liens on the Mortgaged Property by the
4
<PAGE> 192
Lenders and/or a third party, or the conveyance thereof by deed in lieu of
foreclosure, and the relationship between the Indemnifying Party and the
Lenders shall not be limited to the amount of any deficiency in any foreclosure
sale of the Mortgaged Property.
4. The Indemnifying Party shall be fully, unconditionally,
irrevocably and personally liable for all of its respective obligations
hereunder, notwithstanding any exculpatory clauses of any kind contained, or
which may be contained, in any of the Security Documents or in any of the
underlying documents evidencing or otherwise securing the Obligations. The
Indemnifying Party hereby expressly acknowledges and agrees that the Lenders
may pursue any and/or all of their rights and remedies existing hereunder, or
otherwise existing at law and/or in equity, whether separately or concurrently,
and at the option of the Lenders, without seeking to enforce their rights under
any and/or all of the other Security Documents.
5. The Indemnifying Party agrees that at any time and from time
to time, upon the written request of any Lender, the Indemnifying Party will
promptly and duly execute and deliver any and all such further instruments and
documents as such Lender may reasonably request in obtaining the full benefits
of this Agreement and of the rights and powers herein granted. Upon the
Indemnifying Party's failure to so execute and deliver such further instruments
and documents, each Lender is authorized as agent of the Indemnifying Party to
sign any such instrument and document.
6. In the event that the Lenders shall incur any costs
(including, without limitation, attorneys' fees and court costs) to collect and
enforce the obligations of the Indemnifying Party hereunder, the Indemnifying
Party shall, upon demand by any Lender, immediately reimburse such Lender or
Lenders therefor, including, without limitation, for attorneys' fees incurred
in any litigation and bankruptcy and administrative proceedings, and appeals
therefrom.
7. This Agreement may not be changed or amended orally but only
by an instrument in writing signed by the Lenders and the Indemnifying Party.
8. Any notices to be delivered hereunder shall be delivered in
accordance with the terms of the Security Agreement.
9. This Agreement including, without limitation, the indemnities
contained herein, shall be binding upon the Indemnifying Party and its
successors and assigns. This Agreement shall inure to the benefit of and may
be enforceable by the Lenders, their affiliates, and their respective
successors and assigns.
10. In the event one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal or unenforceable
in any respect by a court of competent jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had not been contained herein.
11. This Agreement and all the terms hereof shall be governed by
and construed in accordance with the laws of the State of Wisconsin.
5
<PAGE> 193
12. THE INDEMNIFYING PARTY IRREVOCABLY AGREES THAT, SUBJECT TO THE
SOLE AND ABSOLUTE ELECTION OF THE LENDERS, ALL SUITS, ACTIONS OR OTHER
PROCEEDINGS IN ANY WAY, MANNER OR RESPECT ARISING OUT OF OR FROM OR RELATED TO
THIS AGREEMENT, OR ANY DOCUMENTS EXECUTED IN CONNECTION HEREWITH, SHALL BE
SUBJECT TO LITIGATION IN COURTS HAVING SITUS WITHIN MILWAUKEE, WISCONSIN. THE
INDEMNIFYING PARTY HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY
LOCAL, STATE OR FEDERAL COURT LOCATED WITHIN MILWAUKEE, WISCONSIN. THE
INDEMNIFYING PARTY HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE
THE VENUE OF ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT AGAINST THE
INDEMNIFYING PARTY BY THE LENDERS IN ACCORDANCE WITH THIS SECTION. THE
INDEMNIFYING PARTY AND THE LENDERS EACH HEREBY WAIVE, TO THE EXTENT PERMITTED
BY LAW, TRIAL BY JURY. THE INDEMNIFYING PARTY FURTHER WAIVES ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED
OF THE LENDERS.
[Remainder of page intentionally blank. Next page is signature page.]
6
<PAGE> 194
IN WITNESS WHEREOF, the undersigned have executed this Agreement in
one or more counterparts, which when combined shall constitute one agreement,
to take effect as of the date first above written.
INDEMNIFYING PARTY:
STOKELY USA, INC., a Wisconsin
corporation
By: /s/
-----------------------------
Name:
Its: Vice Chairman
Attest: /s/ Robert Brill
--------------------------
Name:
Its: Secretary
[Signature page to ENVIRONMENTAL INDEMNIFICATION AGREEMENT
of STOKELY USA, INC.]
<PAGE> 195
Scottville
Mason County
Michigan
Situated in the City of Scottville, Mason County, Michigan.
PARCEL 1: A tract of land described as Beginning at a point on the East and
West Quarter line 384.1 feet South 89 degrees West of the iron bar at the
center of Section 18, Township 18 North, Range 16 West, running thence South 80
degrees West along the East and West quarter line 548.8 feet to a three-quarter
inch gas pipe, thence South 105.4 feet to a five inch square cedar post set at
the forks of Foster Creek, thence South 28 degrees 10' West 197.7 feet to a
three-quarter inch gas pipe, thence south 17 degrees 15' East 191.5 feet to a
three-quarter inch gas pipe in the center of Foster Creek and 150 feet
North of the center of the Pere Marquette Railroad (now Chesapeake and Ohio
Railway) right of way, thence North 88 degrees 30' East along the North
boundary of the said right of way 596.4 feet to a two inch gas pipe, thence
North 1 degree 25' West 457.2 feet to the place of beginning.
PARCEL 2: All that part of the Northeast 1/4 of the Southwest 1/4 of Section
18, Township 18 North, Range 16 West, lying South of the right of way of the
Pere Marquette Railroad (now Chesapeake and Ohio Railway) and East of Foster
Creek.
PARCEL 3: The Southeast 1/4 of the Southwest 1/4 of Section 18, Township 18
North, Range 16 West, EXCEPTING THEREFROM the following described lands: a
piece of land beginning at a point 60 rods West of the Northeast corner of the
above described 40 acres of which this exception is a part, thence west to the
Northwest corner of the said SE 1/4 of SW 1/4 Section 18, thence South to the
Southwest corner of said SE 1/4 of SW 1/4 Section 18, thence East on the Section
line 14 and 1/2 rods, thence North 15 rods, thence East 3 rods, thence North 26
rods, thence East 2 and 1/2 rods, thence North about 39 rods to point of
beginning. AND ALSO EXCEPTING THEREFROM a parcel described as commencing at the
Northeast corner of said SE 1/4 of SW 1/4 of said Section 18, thence West a
distance of 173 feet (along a line that is parallel to the north boundary
thereof), thence South a distance of 520.5 feet, thence East a distance of 173
feet, thence North along the North and South quarter line a distance of 520.5
feet to said point of beginning; the East 33 feet of said exception being
reserved for right of way for a public road.
Situated in the Township of Custer, Mason County, Michigan.
PARCEL 4: All that part of the Northwest 1/4 of the Southeast 1/4 of Section
18, Township 18 North, Range 16 West, lying South of the Pere Marquette (now
Chesapeake and Ohio) Railway right of way.
Page 1 of 22
<PAGE> 196
Hoopeston
Vermilion County, IL
The Southwest Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated April 14, 1925 and recorded in Deed Record 352 Page 17 of the Records of
Vermilion County, Illinois, and EXCEPT that portion thereof conveyed unto the
State of Illinois by Deed dated January 2, 1959 and recorded in Deed Record 637
Page 522 of the records of Vermilion County, Illinois, situated in Vermilion
County, Illinois.
ALSO:
The Southeast Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records
of Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
That portion of the Northeast Quarter of Section 10 Township 23 North, Range 12
West of the 2nd P.M., lying South of the Lake Erie and Western (now Norfolk
and Western) Right-of-Way, ALSO all that part of the West Half of Section 11
Township 23 North, Range 12 West of the 2nd P. M., lying South of said Railroad
Right-of-Way and West of S.B.I. Route 1; EXCEPT from the last described tract
the following: (A) The South two acres thereof and (b) Beginning at the
intersection of the South line of said Railroad Right-of-Way with the West line
of S.B.I. Route No. 1; thence West 100 feet; thence South 405 feet; thence East
100 feet; thence North to the place of beginning; and (c) Right-of-Ways
conveyed to the State of Illinois by Deeds dated February 14, 1940 and recorded
respectively in Deed Record 463 Pages 431 and 432, and (D) Commencing at the
Northwest Corner of the Southwest Quarter of said Section 11; thence East along
the East and West center line of said Section 11, 185 feet to the true place of
beginning; thence South 2613 feet along a line 300 feet West of and parallel to
the West line of S.B.I Route No. 1 to a point 30 feet North of the center line
of S.B.I. Route No. 9; thence East 38 feet to
Page 2 of 22
<PAGE> 197
a point; thence North 1.67 feet to a point; thence East 262 feet to the
aforesaid West line of S.B.I Route No. 1; thence North along said West line
2331.33 feet to the North line of the said Southwest Quarter of said Section
11; thence West 300 feet to the place of beginning and (E) Beginning at a
point 238 feet East of and 146.67 feet North of the Southwest Corner of Section
11 Township 23 North, Range 12 West of the 2nd P. M.; thence North 165 feet;
thence East 262 feet to the West line of S.B.I. Route No. 1; thence South 165
feet; thence West 262 feet to the place of beginning, all situated in Vermilion
County, Illinois.
ALSO:
Part of the Southwest Quarter of the Southwest Quarter of Section 11 Township 23
North, Range 12 West of the 2nd P. M., described as: Beginning at the Southwest
Corner of said Section 11; thence North along the Section line 146.67 feet;
thence East 238 feet parallel to the South line of said Section; thence South
146.67 feet to the Section line; thence West to the place of beginning, EXCEPT
that portion thereof conveyed unto the State of Illinois by Deed dated
January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records of
Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
Beginning at the intersection of North side of the Right-of-Way of the Lake
Erie and Western (now Norfolk and Western) Railroad, and Sixth Avenue, in the
City of Hoopeston, as it existed on January 31, 1911; thence North 729.96 feet;
thence East 2593.80 feet to the West side of the Right-of-Way of the Chicago and
Eastern Illinois Railroad; thence South along the West side of the Right-of-Way
of the said Railroad to the North side of the Right-of-Way of the Lake Erie and
Western (now Norfolk and Western Railroad; thence West along the said North
line of said Right-of-Way to the place of beginning, EXCEPT the following: (a)
Beginning at the Northwest Corner of Lot 3 in the Clerk's Subdivision of the
North Half of Section 11 Township 23 North, Range 12 West of the 2nd P. M.;
thence Southerly along the West line of said Lot 3, 200 feet; thence
Northeasterly 360.55 feet to a point in the North line of said Lot 3; thence
Westerly 300 feet to the place of beginning, and (B) A strip of land 100 feet
in width across said Section 11, said land having been conveyed to the Chicago,
Danville and Vincennes Railway Company by Deed dated May 16, 1871 and recorded
in Deed Record 30 Page 291, and (C) All that portion of the described tract
conveyed to the Chicago and Eastern Illinois Railway Company by Deed dated
October 12, 1893 and recorded in Deed Record 127 Page 346, all as situated in
the Northeast Quarter and the Northwest Quarter of Section 11 Township 23
North, Range 12 West of the 2nd P. M., situated in Vermilion County, Illinois.
Page 3 of 22
<PAGE> 198
Ackley
Franklin County, IA
Parcel A:
The East 1/2 of the Southeast 1/4 of Section 34 and all that part of the West
1/2 of the Southwest 1/4 and all that part of the South 1/2 of the Southwest
1/4 of the Northwest 1/4 lying West of the rail road right-of-way Section 35,
all in Township 90 North, Range 19 West of the 5th P.M., Franklin County, Iowa.
Parcel B:
A tract of land in triangular form in the Southwest corner of the East 1/2 of
the Southwest 1/4 Section 35, Township-90 North, Range 19 West of the 5th P.M.,
Franklin County, Iowa, said land being all of the land in the East 1/2 of the
Southwest 1/4 of said Section 35 cut-off by the Minneapolis & St. Louis Railway
and lying West of said Railway, Franklin County, Iowa.
Parcel C:
Beginning at a point 1125.2 feet North and 65.5 feet East of the Southwest
corner of the Southeast 1/4 of the Southwest 1/4 of Section 35, Township 90
North, Range 19 West of the 5th P.M., Franklin County, Iowa, running thence
Easterly 306.2 feet, thence Northerly 560.0 feet to the center of Beaver Creek,
thence following the low water course of said Creek in the Northwesterly
direction 1520 feet to intersect with the North and South Quarter Section line,
thence Southerly 873.4 feet, Southeasterly on the East property line of the M.
& St. L. Railroad 152 feet to the place of beginning, Franklin County, Iowa.
Parcel D:
Beginning at point 1259.2 feet North of the Southeast corner of the Southwest
1/4 of the Southwest 1/4 of Section 35, Township 90 North, Range 19 West of the
5th P.M., Franklin County, Iowa, thence North 572 feet, thence West 274 feet,
thence in a Southeasterly direction 640 feet along the right-of-way of the
Minneapolis & St. Louis Railroad Company to the point of beginning, Franklin
County, Iowa.
Parcel E:
Lots 7, 8, 9, and 10, Block 3, Burns and Foster's Addition to the City of
Ackley, Hardin County, Iowa, and the East 1/2 of the vacated alley lying
between the extensions westerly of the northerly line of said Lot 7 and the
southerly line of said Lot 10.
Abstract.
Page 4 of 22
<PAGE> 199
Wells
Faribault County, MN
Wells, Minnesota
TRACT 1 - All that part of the Southeast Quarter (SE1/4) of Section Five (5),
Township One Hundred Three (103) North, Range Twenty-four (24) West, described
as follows:
Commencing at the northeast corner of the Southeast Quarter (SE1/4) of Section
Five (5), Township One Hundred Three (103) North, Range Twenty-four (24) West;
thence north 89 degrees 09'00'' west a distance of 748.5 feet on an assumed
bearing, on the north line of said 1/4 section; thence South 00 degrees 00'00''
West a distance of 1451.98 feet, on a line parallel with the east line of said
Northeast Quarter (NE1/4), to a point on the centerline of vacated Cleveland
Street, as shown on the plat of Garden Addition, as the same is platted and
recorded in the office of the County Recorder of Faribault County, Minnesota;
which point is the point of beginning of the tract to be described;
thence north 89 degrees 09'00'' west a distance of 406.35 feet, on the
centerline of said vacated Cleveland Street, parallel with the north line of
said 1/4 section, to a point 66 feet northeasterly, measured at a right angle
from the northeasterly right-of-way line of the Soo Line Railroad (formerly the
Chicago, Milwaukee, St. Paul & Pacific Railroad), said point being 16 feet
northeasterly, measured at a right angle, from the northeasterly line of
Thurman Street, as shown on said plat of Garden Addition;
thence north 41 degrees 09' 28'' west a distance of 238.31 feet, on a line
parallel with and 16 feet northeasterly, measured at a right angle, from the
northeasterly line of said Thurman Street;
thence northwesterly a distance of 226.98 feet, on a line parallel with and 16
feet northeasterly, measured at a right angle, from the northeasterly line of
said Thurman Street, on a non-tangential curve, concave to the northeast, with
a radius of 5613.50 feet, a central angle of 02 degrees 19'00'', and a chord
bearing of north 38 degrees 58'57'' west;
thence north 37 degrees 49'27'' west a distance of 1265.06 feet, on a line
parallel with and 16 feet northeasterly, measured at a right angle, from the
northeasterly line of said Thurman Street, to the point of intersection with a
line drawn perpendicular to the northeasterly line of said Thurman Street, from
a point thereon, which is 100 feet southeasterly from the point of
intersection of the northeasterly line of said Thurman Street, with the
southwesterly right-of-way line of Trunk Highway No. 22;
thence north 52 degrees 10'33'' east a distance of 23.42 feet, on a line
perpendicular to the northeasterly line of said Thurman Street, to a point on
the southwesterly right-of-way line of Trunk Highway No. 22;
Page 5 of 22
<PAGE> 200
thence south 51 degrees 46'10'' east a distance of 1862.72 feet, on the
southwesterly right-of-way line of said Trunk Highway No. 22, to the point of
intersection with a line parallel with and 748.5 feet west of the east line of
the Southeast Quarter of said Section Five (5), Township One Hundred Three (103)
North, Range Twenty-four (24) West;
thence south 00 degrees 00'00'' west a distance of 222.81 feet, on a line
parallel with and 748.5 feet west of the east line of said Southeast Quarter,
to the point of beginning;
TRACT 2 - The Northwest Quarter of Section Four (4), Township One Hundred Three
(103) North, Range Twenty-four (24) West of the Fifth Principal Meridian.
TRACT 3 - The South Twenty (20) rods of the West Half (W1/2) of the Northeast
Quarter (NE1/4) of Section Five (5) in Township One Hundred Three (103) North,
Range Twenty-four (24) West, excepting Railroad Right-of-Way of the Soo Line
Railroad (formerly the Chicago, Milwaukee, St. Paul and Pacific Railroad), and
subject to the easements for public highways now existing, and subject to the
agreement by second party that it will be permitted to drain only surface water
from above land into tile crossing the land of first parties to the north.
TRACT 4 - A tract commencing at a point 748.5 feet due west of the Southeast
corner of the Northeast Quarter of Section Five (5) Township One Hundred Three
(103) North of Range Twenty-four (24) West of the Fifth Principal Meridian in
the County of Faribault and State of Minnesota, thence running North 20 rods,
thence West to the West line of the East Half of the Northeast Quarter of said
Section Five (5) thence south 20 rods, thence East along the South line of said
East half of Northeast Quarter of said Section Five (5) to the place of
beginning.
TRACT 5 - All that part of the Southeast Quarter of Section Five (5), Township
One Hundred Three (103) North, Range Twenty-four (24) West; described as
follows: Commencing at the Northeast corner of the Southeast Quarter of Section
Five (5), Township One Hundred Three (103) North, Range Twenty-four (24) West;
thence north 89 degrees 09' 00'' west a distance of 748.5 feet on an assumed
bearing on the north line of said 1/4 section; thence south 00 degrees 00'00''
west on a line parallel with the east line of said Northeast Quarter, to a
point on the northeasterly right of way line of Trunk Highway No. 22, thence
Northwesterly along the Highway 22 right-of-way to a point on the North line of
the Southeast quarter of said Section Five (5), thence easterly along said
quarter section line to the point of beginning.
Page 6 of 22
<PAGE> 201
PARCEL "A":
The East 50 feet of Lots 11 and 12, Block 29, of GRANDVIEW, Washington,
according to the official plat thereof, recorded in Volume "B" of Plats, Page
6, records of Yakima County, Washington.
PARCEL "B":
All that portion of Block 15, GRANDVIEW, Washington, according to the official
plat thereof recorded in Volume "B" of Plats, Page 6, records of Yakima County,
Washington, lying South of the Southerly right of way line of West 2nd Street,
as said street was conveyed to the City of Grandview, by instrument recorded
under Auditor's File Number 1452522.
TOGETHER WITH that portion of vacated Warehouse Street, which, upon vacation,
attached to said premises by operation of law.
PARCEL "C":
The North 16 feet of Lot 1 and Lot 2, 3, 4, 5, 6, 7 and 8 and Lot 9,
EXCEPT the North 5 feet thereof and Lots 13, 14, 15, 16 and 17, all in Block
29, of GRANDVIEW, Washington, according to the official plat thereof, recorded
in Volume "B" Plats, Page 6, records of Yakima County, Washington.
TOGETHER WITH that portion of vacated West "A" Street accruing thereto;
AND TOGETHER WITH those portions of vacated alley accruing thereto.
PARCEL "D":
Lots 19, 20, 21, 22, 23 and 24, Block 28, of GRANDVIEW, Washington, according
to the official plat thereof, recorded in Volume "B" of Plats, Page 6, records
of Yakima County, Washington.
TOGETHER WITH that portion of vacated West "A" Street and that portion of
vacated West Third Street accruing thereto.
Situated in Yakima County, State of Washington.
Page 7 of 22
<PAGE> 202
Walla Walla
Walla Walla County, WA
WALLA WALLA COUNTY, STATE OF WASHINGTON
PARCEL A:
Block I of Bowman's Addition to the City of Walla Walla, according to
the official plat thereof recorded in volume C of plats at page 44, records of
Walla Walla County. ALSO,
Beginning at a point in the north line of Block 2 of said Bowman's
Addition to the City of Walla Walla, which point is 56 feet west, measured
along said north line, from the northeast corner of said Block 2, and running
thence south, parallel to the east line of said Block 2, a distance of 193.86
feet to a point in the south line of said Block 2; thence west, along the south
line of said Block 2, a distance of 168.7 feet to the southwest corner of said
Block 2; thence north, along the west line of said Block 2, a distance of
193.86 feet to the northwest corner of said Block 2; thence east, along the
north line of said Block 2, a distance of 168.7 feet to the point of beginning.
PARCEL B:
A piece or parcel of land situate in the northwest quarter of Section
19, Township 7 north, Range 36 east of the Willamette Meridian, in Walla Walla
County, Washington, described as follows, to wit:
Beginning at a point on the north line of Dell Avenue in the City of
Walla Walla, that is 726 feet distant west of the point of intersection of said
north line with the west line of Thirteenth Avenue North in said city, said
point also being 30 feet north of the east and west center line of said Section
19; thence northerly and parallel with said west line of Thirteenth Avenue
North a distance of 650 feet; thence westerly and parallel with the east and
west center line of Section 19, a distance of 1000 feet; thence southerly,
parallel with the west line of Thirteenth Avenue North, a distance of 650 feet
to a point that is 30 feet distant north of said east and west center line of
Section 19; thence easterly, parallel with said east and west center line of
Section 19, a distance of 1000 feet to the point of beginning.
PARCEL C:
Beginning at the northeast corner of the U. S. Military Reserve in
Walla Walla, Washington, in Section 30 in Township 7 north, Range 36 east of
the Willamette Meridian, and running thence south 27 degrees 23' east 1685.78
feet, more or less, to a U. S. Corps of Engineers, bronze disk, which is the
TRUE POINT OF BEGINNING of this description; thence south 67 degrees 48' 10"
west a distance of 351.7 feet; thence north 29 degrees 50' west a distance of
352.2 feet; thence north 60 degrees 10' east a distance of 360 feet; thence
south 27 degrees 23' east a distance of 398.1 feet, more or less, to the said
true point of beginning.
EXCEPTING THEREFROM the northerly 35 feet in width conveyed to the
City of Walla Walla for street purposes.
Page 8 of 22
<PAGE> 203
Brown County, WI
PARCEL I:
That part of the North 1/2 of the Southwest 1/4 of the Southeast 1/4, Section
32, Township 24 North, Range 21 East, in the City of Green Bay, East side of
Fox River, Brown County, Wisconsin described as:
Commencing at the Northwest corner of Lot 12, Block 3, of Smith Brothers
Garden Addition; thence North 89 degrees 59' 57" West along the South line
of Brook Street, 262.32 feet to the POINT OF BEGINNING; thence continuing
North 89 degrees 59' 57" West, 253.2 feet to the East line of Henry Street;
thence South 0 degrees 52' 24" West along the East line of Henry Street,
125.0 feet; thence South 89 degrees 59' 57" East, 254.63 feet; thence
North 0 degrees 03' 03" East, 125.0 feet to the point of beginning, EXCEPTING
THEREFROM that part thereof described in Volume 907 of Records, Page 535.
Tax Parcel Number: 21-1220-1
Street Address: 1804-1826 Brook Street
Parcel II:
Lots 99, 100, 101 and 102, EXCEPTING THEREFROM that part thereof described
in Volume 297 of Deeds, Page 348; and Lots 111, 112, 113 and 114, Oak Grove,
according to the recorded Plat thereof, in the City of Green Bay, East side of
Fox River, Brown County, Wisconsin.
Tax Parcel Number: 8-75
Street Address: 1425-1427 Main Street
Page 9 of 22
<PAGE> 204
Paynette
Columbia County, WI
LEGAL DESCRIPTION
Lots 1, 2, 3 and 4, Certified Survey Map No. 1288, recorded in Volume 6 of
Surveys. on page 50, as Document No. 471410, Village of Poynette and Town of
Dekorra, Columbia County, Wisconsin.
Lot 1, Certified Survey Map No. 1289, recorded in Volume 6 of Surveys, on page
51, as Document No. 471411, Village of Poynette and Town of Dekorra, Columbia
County, Wisconsin.
Lot 1, Certified Survey Map No. 1290, recorded in Volume 6 of Surveys, on page
52, as Document No. 471412, Village of Poynette and Town of Dekorra, Columbia
County, Wisconsin.
Lot 1, Certified Survey Map No. 1300, recorded in Volume 6 of Surveys. on page
62. as Document No. 472272, Village of Poynette, Columbia County, Wisconsin.
Page 10 of 22
<PAGE> 205
DeForest
Dane County, WI
The East 50 acres of the South 1/2 of the Southeast 1/4 of Section 8, Township
9 North, Range 10 East, in the Village of DeForest, Dane County, Wisconsin,
described as follows: Beginning at the Southeast corner of Section 8, Township
9 North, Range 10 East, which point is 57 feet East of a concrete highway
monument marking the West boundary of the State Highway; thence Westerly along
the South line of Section 8 at an angle of 89 degrees 20 minutes with the East
line of Section 8 for a distance of 1,651.8 feet to Southwest corner of 50
acres tract; thence Northerly at an angle of 90 degree 40 minutes with the
South line of said Section for a distance of 1,315 feet to the Northwest corner
of said tract; thence Easterly at an angle of 89 degrees 35 minutes with the
West line of said tract 1,651.83 feet to the Easterly line of Section 8, which
is 47 feet East of a highway concrete monument; thence Southerly along the East
line of Section 8 at an angle of 90 degrees 25 minutes with the above North
line for a distance of 1,322.3 feet to the place of beginning, EXCEPT that
portion conveyed in Vol. 744 of Deeds, page 51, Document No. 1053647; FURTHER
EXCEPT Certified Survey Map No. 543, recorded in Vol. 24 of Certified Survey
Maps, page 408, Document No. 2060469; FURTHER EXCEPT land conveyed in Vol.
15285 of Records, page 17, Document No. 2241655.
TAX ROLL PARCEL NUMBER: 45-0910-084-9671-2
ADDRESS PER TAX ROLL: 101 Stokley Dr., DeForest, WI
Page 12 of 22
<PAGE> 206
Sun Prairie
Dane County, WI
PARCEL 1: Lots Thirteen (13) and Fourteen (14), PLAT OF A PART OF THE
VILLAGE OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the City of
Sun Prairie, Dane County, Wisconsin.
PARCEL 2: Lot Nineteen (19), SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK
17, in the City of Sun Prairie, Dane County, Wisconsin, EXCEPT: Beginning at
the most Northwesterly corner thereof; thence South 10 degrees 04 minutes West,
47.35 feet; thence North 61 degrees 17 minutes East, 95.13 feet; thence North
89 degrees 18 minutes West, 75.23 feet to the point of beginning of this
exception.
PARCEL 3: Lots Twenty (20), Twenty-one (21), Twenty-two (22), Twenty-three
(23), Twenty-four (24) and Twenty-five (25), SUN PRAIRIE PLAT OF SUBDIVISION OF
LOT 11, BLOCK 17 in the City of Sun Prairie, Dane County, Wisconsin.
PARCEL 4: That portion of Lots Twenty-six (26), Twenty-seven (27), and
Twenty-eight (28), lying South of relocated Lincoln Street. SUN PRAIRIE PLAT
OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie, Dane County,
Wisconsin.
PARCEL 5: That portion of Lot Five (5), lying South of relocated Lincoln Street
and North of the center line of vacated Lincoln Street, PLAT OF A PART OF THE
VILLAGE OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the City of
Sun Prairie, Dane County, Wisconsin. PARCEL 6: That portion of vacated Lincoln
Street lying East of the Easterly line of Lot Five (5), and South of the South
line of relocated Lincoln Street, SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11,
BLOCK 17, in the City of Sun Prairie, Dane County, Wisconsin.
PARCEL 7: Part of Lot Five (5), PLAT OF A PART OF THE VILLAGE OF SUN PRAIRIE as
recorded in Volume B of Plats, page 3, in the City of Sun Prairie, Dane County,
Wisconsin, described as: Beginning at the intersection of the extended East
line of Market Street and the South line of Section 5, Township 8 North, Range
11 East; thence East on said South line 99 feet; thence North parallel to the
East line of Market Street, 95.6 feet; thence at right angles to Market Street
99 feet to said extended East line; thence South 102.6 feet to the point of
beginning
PARCEL 8: That portion of Lincoln Street and relocated Lincoln Street, SUN
PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie,
Dane County, Wisconsin, described as: Beginning at the Southeast corner
of Lincoln Street on the West line of Lot 20, Block 17, Original Plat of Sun
Prairie, Dane County, Wisconsin; thence North along the East line of said
Lincoln Street 15 feet; thence Southwesterly to a point on the South line of
said Lincoln Street, 15 feet West of the point of beginning; thence East along
said South line of Lincoln Street, 15 feet to the point of beginning of this
description.
Page 12 of 22
<PAGE> 207
PARCEL 9: Outlot Two Hundred Eight (208), ASSESSOR'S PLAT OF THE VILLAGE 0 SUN
PRAIRIE, in the City.of Sun Prairie, Dane County, Wisconsin, EXCEPT than part
lying Easterly of the following described line: Beginning on the North line of
Park Street, 176.57 feet West of the Southeast corner thereof; then North
194.28 feet to the South corner of Outlot 202 of said Assessor's Plat
PARCEL 10: Part of the Northeast 1/4 of the Northeast 1/4 of Section 8,
Township 8 North, Range 11 East, in the City of Sun Prairie, Dane County,
Wisconsin, described as follows: Beginning at the point where the East line of
Market Street produced Southerly from Main Street intersects the North line of
said Section 8; thence East along said North line of Section 8, a distance of
135 feet more or less to a point in a line parallel to and 8.5 feet
Northwesterly measured at right angles from the center line of the present most
Northwesterly Railroad track; thence Southwesterly parallel to said center
line, 170 feet more or less to a point in the aforesaid Southerly prolongation
of said East line of Market Street; thence North along said prolongation 103.3
feet more or less to the point of beginning.
TAX ROLL PARCEL NUMBERS: 55-0811-054-7155-7
55-0811-054-7175-3
55-0811-054-7263-6
55-0811-054-7325-1
55-0811-081-0088-0
ADDRESS PER TAX ROLL: 151 Market St., Sun Prairie, WI
Page 13 of 22
<PAGE> 208
Waunakee
Dane County, WI
PARCEL 1: Lots One (1), Two (2), and Three (3), WAUNAKEE CANNING CO.
ADDITION, in the Village of Waunakee, Dane County, Wisconsin.
PARCEL 2: Part of the Northeast 1/4 of the Northwest 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing at the Southeast corner of Lot 1, Waunakee
Canning Co. Addition, Village of Waunakee; thence South 89 degrees 00 minutes
West, 166.75 feet; thence North 47 degrees 20 minutes West, 170.45 feet to the
point of beginning; thence continuing North 47 degrees 20 minutes West, 44.90
feet; thence North 0 degrees 00 minutes 81.53 feet; thence North 88 degrees 53
minutes East, 33.00 feet; thence South 0 degrees 00 minutes 112.55 feet to the
point of beginning, being part of vacated Madison Street, Village of Waunakee.
PARCEL 3: Part of the Northeast 1/4 of Section 8, Township 8 North, Range 9
East, in the Village of Waunakee, Dane County, Wisconsin, which is more
particularly described as follows: Beginning at the Southwest corner of Outlot
B of Waunakee Canning Co. Addition to the Village of Waunakee; thence East
along the South line of said Outlot B and on said South line produced for a
distance of 284.5 feet; thence South 7 degrees 40 minutes West, 233.5 feet to
the Easterly line of the Chicago Northwestern Railroad right-of-way; thence
Northwesterly along said Railroad right-of-way 342.5 feet to the point of
beginning.
PARCEL 4: Part of the West 1/2 of the Northeast 1/4 of Section 8, Township
North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin, which
is described as follows: Beginning at the Southwest corner of Outlot B,
Waunakee Canning Co. Addition to the Village of Waunakee; thence West along the
Southerly line of said Outlot B produced 141.0 feet to the Westerly line of the
Chicago Northwestern Railroad right-of-way; thence South 47 degrees 4 minutes
East along the Westerly line of said right-of-way 140.5 feet to the point of
beginning of this description; thence continue South 47 degrees 48 minutes East
along said right-of-way 373.5 feet; thence South 20 degrees 15 minutes West
646.6 feet; thence North 60 degrees 25 minutes West, 397.2 feet; thence North 1
degree 26 minutes West 294.4 feet; thence North 62 degrees 56 minutes East,
339.9 feet; thence North 0 degrees 53 minutes West, 182.0 feet to the point of
beginning, EXCEPT that portion conveyed in Vol. 664 of Deeds, page 403,
Document No. 939614.
PARCEL 5: All that part of the following described parcel lying West of the
center line of the Six Mile Creek running through said parcel: Part of the
West 1/2 of the Northeast 1/4 of Section 8, Township 8 North, Range 9 East, in
the Village of Waunakee, Dane County, Wisconsin, and described more fully as
follows: Commencing at a point on the Easterly extension of the South line of
Outlot B, Waunakee Canning Co. Addition (Also the South line of lands owned by
Village of Waunakee) distant thereon 284.5 feet East of the Southwest corner of
Outlot B; thence South 7 degrees 40 minutes West, 233.5 feet to the Northeast
right-of-way line of the Chicago Northwestern Railroad; thence Southeasterly
Page 14 of 22
<PAGE> 209
along said Northeasterly line of the center line of public highway; thence
Northerly along said center line to the Southeast corner of lands conveyed
Village of Waunakee in Vol. 363 of Deeds, page 5, Document No. 553335; thence
West along South line of Village property to the point of beginning.
PARCEL 6: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8, Township
8 North, Range, 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing on the Northeasterly line of the land of the
Chicago and Northwestern Railway Company and on a line running North and South
through center of said Section 8; thence North on said line 171.60 feet; thence
East parallel with the North line of said Section, 99 feet; thence South
parallel with first line, 267.30 feet to the Northeasterly line of the Chicago
and Northwestern Railway Company; thence Northwesterly along said line of the
Chicago and Northwestern Railway Company 137.28 feet to the place of beginning.
PARCEL 7: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8,
Township 8 North, Range 9 East, in the Village of Waunakee, Dane County,
Wisconsin, described as follows: Commencing at the Southeast corner of Lot 8,
Block 2, E. M. Cooper's Addition to the Village of Waunakee; thence running
West 16-1/2 rods; thence South 13-4/5 rods; thence East 16-1/2 rods; thence
North 13-4/5 rods to the point of beginning.
PARCEL 8: Outlots A and B, WAUNAKEE CANNING CO. ADDITION, in the Village of
Waunakee, Dane County, Wisconsin.
TAX ROLL PARCEL NUMBERS: 57-0809-081-3650-7
57-0809-081-3700-6
57-0809-081-9080-5
Page 15 of 22
<PAGE> 210
Cobb
Iowa County, WI
PARCEL I
Part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Commencing at the Northeast corner of the Southeast 1/4 of the Northeast 1/4 of
Section 26, thence West 1036 feet; thence South 525 feet;
thence East 74 feet to the Railroad right of way; thence North 120 feet;
thence in a Northeasterly direction along the North line of the Railroad right
of way, 826 feet to a point, 351 feet South of the North line of said
Southeast 1/4 of the Northeast 1/4; thence North 224 feet; thence East
136 feet; thence North 127 feet to the place of beginning.
PARCEL II
Part of the Southwest 1/4 of the Northwest 1/4 of Section 25, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Commencing at a point 60 feet South of the Northwest corner of the Southwest
1/4 of the Northwest 1/4 of Section 25, thence East, 242 feet; thence North 60
feet; thence East 744 3/4 feet, more or less, to a point that is 5 chains and 5
links West of the Northeast corner of said Southwest 1/4 of the Northwest 1/4;
thence South 402 1/2 feet to the North line of the C.& N.W.R.R. right of way;
thence West along said right of way, 486 3/4 feet; thence North along said
right of way, 125 feet; thence West along said right of way, 347 feet; thence
North, 60 feet; thence West 153 feet to the West line of said 40 acre tract;
thence North on the said West line, 215 feet more or less to the place of
beginning. Intending to include all that part of the Southwest 1/4 of the
Northwest 1/4 of Section 25, Township 6 North, Range 1 East, Village of Cobb,
Iowa County, Wisconsin, North of the railroad right of way as deeded in Volume
97 of Deeds, page 75, Document # 18876, in the Office of the Register of Deeds
for Iowa County, Wisconsin.
PARCEL III
A parcel of land lying and being in the Southeast 1/4 of the Northeast 1/4 of
Section 26, Township 6 North, Range 1 East, Village of Cobb, Iowa County,
Wisconsin, described as follows: Commencing 60 feet North of the Northeast
corner of that certain tract of land conveyed from Joseph Drury to the Chicago
& Tomah R.R. Co., and particularly described in Volume 35 of Deeds, page 542,
to which reference is had for said point of beginning; thence North on the East
line of said 40 acre tract, 150 feet; thence West, 140 feet; thence South 150
feet; thence East 140 feet to the place of beginning.
PARCEL IV
Part of the Southwest 1/4 of the Northwest 1/4 of Section 25, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Beginning at a point adjoining the North side of the Milwaukee and Madison
branch of the C.& N.W.R.R. Depot grounds as now located, 33 feet East of the
West line of the Southwest 1/4 of the Northwest 1/4 of Section 25, to run
thence North 60 feet; thence East 120 feet; thence South to said railroad
grounds; thence West along said railroad grounds to place of beginning.
PARCEL V
Part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6 North,
Range 1 East, in the Village of Cobb, Iowa County, Wisconsin, meted and bounded
as follows: Commencing at the Northeast corner of a tract of land last
conveyed by Joseph Drury to the Chicago and Tomah Railroad Company in a Deed
recorded in Volume 35, page 542 of Deeds into he Registers Office of said
County; thence North 60 feet, thence West 140 feet, thence South 60 feet, more
or less, to the Railroad land; thence with the line of said Railroad land,
North 85 degrees East, 140 feet, more less, to the place of beginning.
Page 16 of 22
<PAGE> 211
PARCEL VI
That part of the Southeast 1/4 of the Northeast 1/4 of Section 26,
Township 6 North, Range 1 East of the Fourth Principal Meridian, Village of
Cobb, Iowa County, Wisconsin, bounded and described as follows: Beginning at
the point of intersection of the West line of Division Street, a/k/a/
Commercial Street with the northerly line of the 300 foot right of way of the
Chicago and North Western Railway Company; thence South along the West line of
said Division Street, a distance of 115 feet, more or less, to a point, 8.5
feet northerly of, as measured at right angles from center line of Spur Track
I.C.C. NO. 22 of said Railway Company, as now located and established; thence
Westerly along a line parallel with the centerline of the tangent segment of
said Spur Tract and extension thereof to a point, 9 feet Northerly of, as
measured radially from the centerline of the curved segment of said Spur Tract;
thence Westerly along a line parallel with the centerline of the curved
segment of said Spur Track to a point, 50 feet Northerly of, as measured at
right angles from the centerline of the main track of said Railway Company, as
now located and established; thence Westerly along a line parallel with the
centerline of said main track to a point, 1000 feet Westerly of, as measured
along a line parallel with the Northerly line of said 300 foot right of way
from the East line of said Section; thence North along a line parallel with
the East line of said Section to the Northerly line of said 300 foot right of
way; thence Easterly along the Northerly line of said 300 foot right of way to
the point of beginning.
EXCEPTING FROM PARCELS II THROUGH V, THE LANDS CONVEYED FOR HIGHWAY DESCRIBED
AS: A parcel of land located in the SW 1/4 of the NW 1/4 of Section 25, Town 6
North, Range 1 East, Village of Cobb, Iowa County, Wisconsin, and consist of
all the land therein lying between the west line of said Southwest 1/4 of
Northwest 1/4 of Secton 25 and a new road right of way line 50 feet east of and
parallel to the centerline of new road as now laid out.
ALSO EXCEPTING lands located in the Southwest 1/4 of the Northwest 1/4 and in
the Northeast 1/4 of Section 25, Township 6 North, Range 1 East, Town of Eden,
and Village of Cobb, Iowa County, Wisconsin, and consists of all the land
therein which lies within 50 feet South of the centerline of new road from the
point of beginning to a point, 872 feet therefrom. Also all the land which
lies within 50 feet each side of centerline for the next 1239 feet, all the
land lying within 50 feet northerly of said centerline for the next 1325 feet
to the east line of grantor. The said centerline being described as follows:
Commencing at a point 2111 feet west of the center of Section 25, Township 6
North, Range 1 East extending thence North 89 degrees 05' East, for 3436
feet to the east property line of grantor.
FURTHER EXCEPTING lands located in the Southeast 1/4 of the Northeast 1/4 of
Section 26, Township 6 North, Range 1 East, Village of Cobb, Iowa County,
Wisconsin, and consists of all the land therein lying between the East line of
said Section 26 and a new right of way line 50 feet West of and parallel to the
centerline of the new road as now laid out. The centerline is described as
follows: Beginning on the East line of said Section 26 at a point 1330 feet
South of the Northeast corner of said Section extending thence South 0 degrees
05' West for 130 feet to the south line of property.
TAX ROLL PARCEL NUMBER: 130, 131, 130.A and 130.B (Village of Cobb)
Page 17 of 22
<PAGE> 212
Jefferson
Jefferson County, WI
Lot 1 of Certified Survey Map No. 1890 recorded on November 8, 1985 in Volume 6
of Certified Surveys on Page 106, as Document Number 811709, being a part of
the Northwest Quarter of the Northwest Quarter of Section 14, Township 6 North,
Range 14 East, City of Jefferson, Jefferson County, Wisconsin.
COMPUTER NO.: 241-2082-02000
TAX KEY NO.: 06-14-14-22-003
Page 18 of 22
<PAGE> 213
Merrill
Lincoln County, WI
PARCEL 1
Lots Nine (9), Twenty-one (21) and Twenty-two (22), Block Two (2), in T. P.
Mathews Addition to the City of Merrill, Lincoln County, Wisconsin.
PARCEL 2
A portion of the Northeast 1/4 of the Northwest 1/4 of Section 15, Township 31
North, Range 6 East, City of Merrill, Lincoln County, Wisconsin, described by
metes and bounds as follows:
Commencing at the intersection of the South line of the Chicago, Milwaukee, St.
Paul & Pacific Railroad right-of-way and the West line of said 40, thence North
90 feet the place of beginning; thence East parallel with said Railroad
right-of-way, 500 feet, thence North parallel with the West line of said 40 to
the section line between Sections 10 and 15, thence West, 500 feet to the
Northwest corner of said 40, thence South to the place of beginning.
Also described as Lot 631 of the Assessor's Plat of the City of Merrill
recorded in Volume 3 of Plats, page 40, Lincoln County Records.
Page 19 of 22
<PAGE> 214
Oconomowoc
Waukesha County, WI
Parcel 1 of Certified Survey Map No. 6318, recorded on November 29, 1990 in
Volume 52 of Certified Survey Maps on Pages 131 to 133, inclusive, as Document
No. 1624207, being a part of the Southwest 1/4 of the Northwest 1/4 of Section
5, Town 7 North, Range 17 East, in the City of Oconomowoc, County of Waukesha,
State of Wisconsin.
Tax Key No. 0C0C 0634.999.003
ADDRESS: 1055 Corporate Center
KR/WF/DD
Page 20 of 22
<PAGE> 215
Pickett
Winnebago County, WI
Parcel 1
A part of the Southwest Quarter (SW 1/4) of the Northwest Quarter (NW 1/4) of
Section 28, the Southeast Quarter (SE 1/4) of the Northeast Quarter (NE 1/4)
and the Northeast Quarter (NE 1/4) of the Southeast Quarter (SE 1/4) of Section
29, all in T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows:
Commencing at the Northwest Corner of said Section 28; thence south 0 degrees
47 minutes 54 seconds east, 1315.60 feet, along the West line of the North West
1/4 of said Section 28, to the Northwest Corner of the South West 1/4 of the
North West 1/4 of said Section 28, to the place of beginning; thence north 88
degrees 37 minutes 8 seconds east, 678.39 feet, along the North line of the
South West 1/4 of the North West 1/4 of said Section 28, to its intersection
with the Westerly right-of-way line of the Wisconsin and Southern Railroad
Company; thence south 38 degrees 6 minutes 6 seconds west, 2043.59 feet, along
the Westerly right-of-way line of the Wisconsin and Southern Railroad Company;
thence south 89 degrees 52 minutes 1 second west, 680.30 feet, to a point on
the Easterly right-of-way line of County Trunk Highway "M"; thence north 0
degrees 39 minutes 45 seconds west, 906.17 feet, along the Easterly
right-of-way line of County Trunk Highway "M"; thence north 88 degrees 46
minutes 50 seconds east, 291.16 feet; thence north 0 degrees 58 minutes 13
seconds west, 660.00 feet, to a point on the North line of the South East 1/4
of the North East 1/4 of said Section 29; thence north 88 degrees 46 minutes 50
seconds east, 993.90 feet, along the North line of the South East 1/4 of the
North East 1/4 of said Section 29, to the place of beginning.
Parcel 2
A part of the Northwest Quarter (NW 1/4) of the Southwest Quarter (SW 1/4) of
Section 28, the Northeast Quarter (NE 1/4) of the Southeast Quarter (SE 1/4)
and the Southeast Quarter (SE 1/4) of the Southeast Quarter (SE 1/4) of Section
29, all in T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows:
Commencing at the West Quarter Corner of said Section 28, the place of
beginning; thence north 88 degrees 42 minutes 40 seconds east, 397.10 feet,
along the North line of the North West 1/4 of the South West 1/4 of said
Section 28, to its intersection with the Westerly line of State Trunk Highway
No. 44; then southwesterly along the Westerly line of said State Trunk Highway
No. 44 the following
Page 21 of 22
<PAGE> 216
courses: south 28 degrees 26 minutes 11 seconds west, 161.41 feet; thence
southwesterly, 786.96 feet, along the arc of a curve to the right having a
radius of 2804.93 feet and the chord of which bears south 36 degrees 29 minutes
23 seconds west, 784.38 feet; thence south 44 degrees 28 minutes 18 seconds
west, 547.27 feet; thence southwesterly, 694.74 feet, along the arc of a curve
to the right having a radius of 5669.65 feet and the chord of which bears south
48 degrees 2 minutes 32.5 seconds west, 694.31 feet; thence south 36 degrees 49
minutes 33 seconds west, 102.80 feet; thence southwesterly 74.40 feet, along
the arc of a curve to the right having a radius of 5696.65 feet and the chord
of which bears south 52 degrees 55 minutes 37 seconds west, 74.40 feet; thence
south 53 degrees 20 minutes 39 seconds west, 57.47 feet; thence north 63
degrees 46 minutes 36 seconds west, 56.80 feet, along the Westerly line of said
State Trunk Highway No. 44, to its intersection with the Easterly line of
County Trunk Highway "M"; thence north 5 degrees 10 minutes 26 seconds west,
69.34 feet, along the Easterly line of said County Trunk Highway "M"; thence
south 89 degrees 6 minutes 8 seconds west, 16.56 feet, to a point on the West
line of the East 1/2 of the South East 1/4 of said Section 29; thence north 1
degrees 7 minutes 59 seconds west, 417.70 feet, along the West line of the East
1/2 of the South East 1/4 of said Section 29, to its intersection with the
Easterly right-of-way line of the Wisconsin and Southern Railroad Company;
thence north 38 degrees 6 minutes 6 seconds east, 1603.15 feet, along the
Easterly right-of-way line of the Wisconsin and Southern Railroad Company to
its intersection with the North line of the North East 1/4 of the South East
1/4 of said Section 29; thence north 88 degrees 44 minutes 20 seconds east,
305.97 feet, along the North line of the North East 1/4 of the South East 1/4
of said Section 29, to the place of beginning.
Parcel 3
A part of the Southwest Quarter (SW 1/4) of the Southeast Quarter (SE 1/4) of
Section 29, T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows:
Commencing at a point on the South line of the Wisconsin and Southern Railroad
Company (formerly known as the Chicago, Milwaukee & St. Paul Railroad)
right-of-way in the center of County Trunk Highway "M" (formerly known as the
Waukau-Waupun Road); thence southwesterly, along the South line of said
Railroad right-of-way, 351 feet; thence southeasterly, at right angles to said
Railroad right-of-way, 41 feet and 10 inches; thence northeasterly, on a line
parallel to said Railroad right-of-way, to a point in the center of said County
Trunk Highway "M", about 300 feet; thence north, along the center of said
Highway, to the place of beginning.
Tax Key Number: Par. 1: 024-0594-01, 024-0594-03, 024-0609, 024-0609-01 &
024-0624; Par. 2: 024-0624-01, 024-0625-01 & 024-0599; Par. 3: 024-0637-01
Page 22 of 22
<PAGE> 217
ANNEX 2
Section 1(a)(ii)
Appleton, Wisconsin. Indemnifying Party removed a number of
underground storage tanks from this property during the 1980's and
early 1990's. All such tanks were used for storage of petroleum based
products. Leakage and soil contamination was detected in connection
with three tanks. The sites were over-excavated, and contaminated soil
was removed from site and disposed of in accordance with the
requirements of law.
However, because of unique soil conditions, small amounts of
contaminated soil may remain at the site in areas near where the tanks
were located. The WDNR allowed the site to be closed contingent upon
agreement by the Indemnifying Party to notify it in the event that
future excavation discloses contaminated soil that requires removal. A
deed restriction to that effect is in place.
Section 1(a)(iii)
None.
Section 1(a)(iv)
Sun Prairie and Waunakee, Wisconsin. Indemnifying Party has been
identified as a potentially responsible party in connection with the
clean-up of the Refuse Hideaway Landfill site in Middleton, Wisconsin.
Indemnifying Party contributed general refuse to that site from its
plants in Sun Prairie and Waunakee, Wisconsin. It did not contribute
hazardous materials to the site. Indemnifying Party is in the process
of negotiating a de-minimus settlement on the basis it contributed
insignificant volume to the site and no waste involved in the
contamination of the site.
<PAGE> 218
ASSIGNMENT OF CONTRACTS, WARRANTIES AND PERMITS
THIS ASSIGNMENT OF CONTRACTS, WARRANTIES AND PERMITS (this
"Assignment"), made as of May 31, 1995, by STOKELY USA, INC., a Wisconsin
corporation (the "Assignor").
WITNESSETH
WHEREAS, Nationwide Life Insurance Company, Employers Life Insurance
Company of Wausau and West Coast Life Insurance Company (collectively being
hereinafter called the "Insurance Companies") and the Assignor are parties to a
Note Agreement, dated as of January 1, 1990, as amended by an Amendment to Note
Agreement dated August 18, 1992, a Second Amendment to Note Agreement dated
June 11, 1993, and a Third Amendment to Note Agreement dated May 31,1995 (said
Note Agreement, as so amended, and as further amended, modified or supplemented
from time to time, is hereinafter referred to as the "Nationwide Note
Agreement"), pursuant to which the Assignor has issued its 9.37% Senior Secured
Notes due January 15, 2000 (collectively, together with any other notes issued
pursuant to the Nationwide Note Agreement, the "Nationwide Notes"); and
WHEREAS, State of Wisconsin Investment Board ("SWIB") and the Assignor
are parties to a Note Agreement, dated as of December 1, 1991, as amended by a
First Amendment to Note Agreement dated as of August 18, 1992, a Second
Amendment to Note Agreement dated as of June 11, 1993, and a Third Amendment to
Note Agreement dated as of May 31, 1995 (said Note Agreement, as so amended,
and as further amended, modified or supplemented from time to time, is
hereinafter referred to as the "SWIB Note Agreement"), pursuant to which the
Assignor has issued a certain 9.49% Senior Note due December 15, 2001
(collectively, together with any other notes issued pursuant to the SWIB Note
Agreement, the "SWIB Notes"); and
WHEREAS, the Insurance Companies and SWIB (collectively being
hereinafter called the "Assignees") have entered into an Intercreditor and
Collateral/Agency Agreement, dated as of even date herewith (the
"Intercreditor Agreement"); and
WHEREAS, in order to secure the prompt and complete payment,
observance and performance of the Nationwide Notes, the SWIB Notes, and all of
the other Obligations (as hereinafter defined), the Assignor has given to, and
for the ratable benefit of, the Assignees, certain Mortgages/Deeds of Trust,
each dated as of even date herewith (the "Mortgages"), encumbering certain land
described on Annex 1 attached hereto (such land, together with the buildings
and other improvements located or to be located thereon, collectively being
hereinafter called the "Properties"); and
WHEREAS, in order further to secure the prompt and complete payment,
observance and performance of the Obligations, the Assignees have required that
the Assignor execute and deliver this Assignment.
NOW, THEREFORE, FOR VALUE RECEIVED, the Assignor hereby absolutely and
unconditionally grants, transfers and assigns, to the extent transferable, to,
and for the ratable benefit of, the Assignees, their successors and assigns:
<PAGE> 219
(A) all issues and profits from the Properties; and
(B) all other right, title and interest of the Assignor in and to:
(i) any and all agreements and contracts, now in
existence or hereafter executed, for the operation, construction,
management, selling, leasing (to the extent not assigned under the
Mortgages from the Assignor to the Assignees) and maintenance of the
Properties; and
(ii) any leases of, or maintenance or service
agreements or contracts, now in existence or hereafter executed, with
respect to furniture, furnishings or equipment now owned or hereafter
acquired and located on and used in the operation, management, sale or
maintenance of the Properties or the operation or management of the
Assignor's business; and
(iii) all permits, licenses, governmental approvals
and authorizations, now owned or hereafter acquired, relating to the
operation or management of the Assignor's business, the construction
of any improvements on the Properties, or the operation thereof
(collectively, the "Permits"); and
(iv) any extensions, renewals or modifications of
collateral described in clauses (i), (ii) and (iii) above, and any
guarantees, now or hereafter owed the Assignor, relating to the
obligations described in clause (i) or clause (ii) above; and
(v) all warranties and guaranties now or
hereafter received by, or in favor of, the Assignor regarding
materials, equipment and other items of personal property supplied to,
and services performed in respect of, the Properties, or any portion
thereof, or any improvements thereto, or any portion thereof; and
(vi) all proceeds of any of the foregoing or substitutes
therefor.
Each and all of said agreements described in clauses (i), (ii), (iv)
and (v), together with the Permits, are hereinafter referred to singularly as
the "Contracts," the payments, if any, due the Assignor thereunder are
collectively hereinafter referred to as the "Proceeds" and the Contracts, the
Proceeds and the Permits are collectively hereinafter referred to as the
"Collateral." Notwithstanding the foregoing, the term "Contracts" shall not
include any agreement or contract the assignment or transfer of which, for
collateral purposes, would result in a default or require, or cause a
forfeiture, or permit a revocation, of rights under such contract or agreement.
All capitalized terms not otherwise defined herein (including, but not limited
to, the terms "Loan Documents" and "Obligations") have the meanings assigned to
such terms in the Security Agreement, dated as of even date herewith, by and
among the Assignor and the Assignees (the "Security Agreement").
FOR THE PURPOSES OF SECURING: payment, performance and discharge of
the Obligations.
2
<PAGE> 220
THE ASSIGNOR AGREES WITH RESPECT TO EACH CONTRACT THAT:
1. (a) The Assignor will give prompt written notice to the
Assignees of any notice received by the Assignor of a default by the Assignor
under any Contract, together with a complete copy of any such notice; and
(b) The Assignor will, to the fullest extent
commercially reasonable to do so:
(i) perform or observe each and every
material covenant and condition of the Assignor to be
performed or observed under each Contract;
(ii) at the cost and expense of the
Assignor, enforce, short of termination of any Contract, the
performance or observance of each and every material covenant
and condition of each Contract to be performed or observed by
the other parties thereto, to the fullest extent commercially
reasonable to do so;
(iii) not modify or in any way alter the
terms of any Contract, except to the extent permitted by the
terms of the Mortgages;
(iv) not terminate the term of any
Contract or accept a surrender thereof if such termination or
surrender, together with the termination or surrender of all
other Contracts terminated or surrendered at such time or
contemplated by the Assignor to be terminated or surrendered
in the future, could materially and adversely affect the
Properties, business or financial condition of the Assignor;
and
(v) not waive or release the other
parties thereto from any material obligations or conditions by
them to be performed under any Contract, if such waiver or
release, together with all other waivers and releases of any
parties under all other Contracts at such time or contemplated
by the Assignor to be waived or released in the future, could
materially and adversely affect the Properties, business or
financial condition of the Assignor.
2. The rights assigned hereunder include all of the Assignor's
right and power to modify or terminate the Contracts or to accept a surrender
or termination thereof, or to waive or release the other partes from the
performance or observance by them of any obligation or condition thereof;
provided, however, that the Assignees may not, and the Assignor may, to the
extent permitted by the terms of the Mortgages, exercise any such rights and
powers described in this Assignment so long as no Event of Default (as
hereinafter defined) shall have occurred and be continuing.
3. The Assignor, at its sole cost and expense, will appear in and
prosecute its claims and defend its rights in any action growing out of or in
any manner connected with the Contracts or the obligations or liabilities of
the Assignor, other parties or any guarantor thereunder, and any Assignee, if
made a party to any such action, may employ counsel and incur and pay
reasonable costs and expenses including, without limitation, reasonable
attorneys' fees, and all such sums, with interest at the annual rate of four
and one-quarter percent (4.25%) plus the Bank One
3
<PAGE> 221
reference rate as announced from time to time by Bank One, shall be due from
the Assignor upon demand and secured hereby and by the Mortgages.
4. If the Assignor shall fail to make any payment required to be
made, or to perform or observe any covenant or condition required to be
performed or observed, under any Contract as herein provided, then the
Assignees, but without obligation so to do and without notice to or demand on
the Assignor and without releasing the Assignor from any obligation herein, may
make, perform or observe the same, including specifically, without limiting
their general powers, appearing in and defending any action purporting to
affect the security hereof or the rights or powers of the Assignees, and
performing or observing any covenant or condition in such Contract contained,
and in exercising any such powers, paying reasonable costs and expenses,
employing counsel and incurring and paying reasonable attorneys' fees and
expenses; and the Assignor will pay immediately upon demand all sums expended
by the Assignees under the authority hereof, together with interest thereon at
the annual rate of four and one-quarter percent (4.25%) plus the Bank One
reference rate as announced from time to time by Bank One, and the same shall
be added to said Obligations and shall be secured hereby and by the Mortgages.
Notwithstanding anything contained herein to the contrary, if the Assignees
elect to exercise the rights granted hereunder, the Assignees shall endeavor to
notify the Assignor of the election to exercise such rights prior to the
exercise thereof; provided, however, the failure by the Assignees to so notify
the Assignor, or the Assignor's failure to receive such notice, shall not
affect the Assignees' rights under this Section 4.
5. Upon the occurrence of any Event of Default, the Assignees, at
their option, without notice and without regard to the adequacy of the security
for the Obligations, with or without bringing any action or proceeding, or by a
receiver to be appointed by a court, may:
(a) notify parties to the Contracts that such Contracts
have been assigned to the Assignees and that performance thereunder
shall be made on behalf of the Assignees;
(b) enter upon, take possession of, and operate the
Properties;
(c) make, enforce, modify, terminate and accept any
surrender of any Contract;
(d) perform any acts which the Assignees deem proper to
protect the security hereof until all Obligations are paid in full;
and
(e) either with or without taking possession of the
Properties, in the name of the Assignees, sue for or otherwise collect
and receive all Proceeds, and apply the same, less reasonable costs
and expenses of operation and collection including, without
limitation, reasonable attorneys' fees and expenses, to pay the
Obligations in such order as the Assignees may determine.
The entering upon and taking possession of the Properties, the collection of
such proceeds and the application thereof as aforesaid shall not cure or waive
any Event of Default under (and as defined in) any of the Loan Documents or
waive, modify or affect any notice of an Event of
4
<PAGE> 222
Default under (and as defined in) any of the Loan Documents or invalidate any
act performed pursuant to such notice.
6. The Assignees and the purchaser at any foreclosure sale shall
have the right, but not the obligation, to preserve any Contract and the rights
of the Assignor thereunder.
7. The Assignor warrants that as of the date hereof:
(a) each Contract (excluding the Permits) is a bona
fide, valid and legally enforceable obligation of the Assignor, and
all consents, licenses, approvals or authorizations of, or
declarations with any governmental authority required to be obtained,
effected or given in connection with the execution, delivery and
performance of any Contract by the Assignor have been duly obtained,
effected or given, are in full force and effect and do not subject the
scope of such Contract to any materially adverse limitation, either
specific or general in nature;
(b) the Permits are in full force and effect;
(c) the Assignor has not executed any prior assignment
of any of its rights under the Collateral;
(d) the Assignor has not done anything which might
prevent the Assignees from, or limit the Assignees in, operating under
any of the provisions hereof; and
(e) no defaults have occurred and are continuing under
the Contracts which, in the aggregate, could reasonably be expected to
have a material adverse effect upon the business, prospects, profits,
Properties or condition (financial or otherwise) of the Company.
8. The occurrence of any of the following shall be and constitute
an "Event of Default" hereunder:
(a) the Assignor shall fail to make, when due, the
payment of any amount due under this Assignment; or
(b) the Assignor shall fail to perform or observe, or
cause to be performed or observed, (i) any covenant or condition
contained in Section 1, Section 2, Section 3 or Section 9(c) of this
Agreement, and such failure shall continue for a period of five (5)
days, or (ii) any other covenant or condition contained in this
Agreement, and such failure shall continue for a period of twenty (20)
days, in either case after the earlier of (a) receipt of notice
thereof from any Assignee or (b) the date an officer of the Assignor
learns of such default; or
(c) the occurrence of an "Event of Default" as defined
in the Security Agreement; or
(d) any representation or warranty made by the Assignor
in this Assignment, or in any certificate furnished by or on behalf of
the Assignor in connection with the
5
<PAGE> 223
consummation of the transactions contemplated hereby, shall be untrue
in any material respect as of the date of the issuance or making
thereof.
9. The Assignor covenants and agrees with the Assignees that from
and after the date of this Assignment and until the termination of this
Assignment pursuant to Section 11:
(a) At any time and from time to time, upon written
request of the Assignees, and at the sole expense of the Assignor, the
Assignor shall promptly and duly execute and deliver any and all such
further instruments and documents and take such further action as the
Assignees may reasonably deem desirable in obtaining the full benefits
of this Assignment and of the rights and powers herein granted.
(b) The Assignor shall keep and maintain, at its own
cost and expense, satisfactory and complete records of all payments
made and received under the Contracts. For the Assignees' further
security, the Assignor agrees that the Assignees shall have a
special property interest in all of the Assignor's books and records
pertaining to the contract accounts and the Assignor shall make
available any books and records to the Assignees or to their
representatives, at any reasonable time on reasonable notice; provided
that after the occurrence of an Event of Default hereunder, no such
notice shall be required.
(c) In any suit, proceeding or action brought by the
Assignees under any Contract to enforce any provisions of such
Contract, the Assignor will save, indemnify and keep the Assignees
harmless from and against all reasonable expenses, losses or damages
suffered by reason of any defense, setoff, counterclaim, recoupment or
reduction of liability whatsoever of the obligee thereunder, except in
respect of any such matter arising out of the Assignees' bad faith,
gross negligence or wilful misconduct (provided that such bad faith,
gross negligence or wilful misconduct is determined to have occurred
by a final and nonappealable decision of a court of competent
jurisdiction) arising out of any other agreement, indebtedness or
liability at any time owing to or in favor of such obligee or its
successors from the Assignor, and all such obligations of the Assignor
shall be and remain enforceable against, and only against, the
Assignor, and shall not be enforceable against the Assignees.
(d) The Assignor shall, except to the extent otherwise
permitted under the terms of the Mortgages and except with respect to
claims that do not give rise to a statutory lien on the Properties and
for which the Assignor is disputing in a commercially reasonable
manner, pay promptly when due all claims of any kind under the
Contracts (including claims for labor, materials and supplies).
(e) The Assignor shall comply, in all material respects,
with all acts, rules, regulations, orders, decrees and directions of
any governmental authority applicable to the operation of the
Assignor's business.
10. If an Event of Default shall have occurred and be continuing,
the Assignees or their representatives may communicate at any time and from
time to time with parties to the Contracts in order to verify, to the
Assignees' satisfaction, the existence and terms of the Contracts.
6
<PAGE> 224
11. Upon the payment in full of all Obligations, as evidenced by
the recording of an instrument of reconveyance, satisfaction, release or
assignment of the Mortgages without the recording of another mortgage in favor
of, or for the benefit of, the Assignees encumbering the Properties, this
Assignment shall be released and terminated.
12. The Assignor hereby irrevocably constitutes and appoints each
Assignee, and any officer or agent thereof, with full power of substitution, as
its true and lawful attorneys-in-fact with full irrevocable power and authority
in the place and stead of the Assignor and in the name of the Assignor or in
such Assignee's own name, from time to time, after an Event of Default, at the
discretion of the Assignees, for the purpose of carrying out the terms of this
Assignment, to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Assignment. The Assignor hereby ratifies all that said
attorneys shall lawfully do or cause to be done by virtue hereof. This power
of attorney is a power coupled with an interest and shall be irrevocable.
13. Any notices to be delivered hereunder shall be delivered in
accordance with the terms of the Security Agreement.
14. The Assignees shall not by any act, delay, omission, or
otherwise, be deemed to have waived any of their rights or remedies hereunder
and no waiver shall be valid unless in writing, signed by the Required Lenders,
and then only to the extent therein set forth. A waiver by the Assignees of
any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Assignees would otherwise have had on any
future occasion. No failure to exercise, nor any delay in exercising, on the
part of Assignees, any right, power or privilege hereunder, shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or future exercise thereof or the
exercise or any other right, power or privilege. The rights and remedies
hereunder provided are cumulative and may be exercised singly or concurrently
at law.
15. This Assignment and all obligations of the Assignor hereunder
shall be binding upon the successors and assigns of the Assignor, and shall,
together with the rights and remedies of the Assignees hereunder, inure to the
benefit of the Assignees and their successors and assigns. This Assignment
shall be governed by, and be construed and interpreted in accordance with, the
laws of the State of Wisconsin.
16. Any provision of this Assignment which is prohibited or
unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.
17. The Assignor agrees to pay, and to save the Assignees harmless
from, any and all liabilities with respect to, or resulting from any delay in
paying, any and all excise, sales or other taxes which may be payable or
determined to be payable in connection with any of the transactions
contemplated by this Assignment.
18. THE ASSIGNOR IRREVOCABLY AGREES THAT, SUBJECT TO THE SOLE AND
ABSOLUTE ELECTION OF THE ASSIGNEES, ALL SUITS, ACTIONS OR OTHER PROCEEDINGS IN
ANY WAY, MANNER OR RESPECT ARISING OUT OF OR FROM OR RELATED TO THIS
ASSIGNMENT, OR ANY DOCUMENTS EXECUTED IN CONNECTION
7
<PAGE> 225
HEREWITH, SHALL BE SUBJECT TO LITIGATION IN COURTS HAVING SITUS WITHIN
MILWAUKEE, WISCONSIN. THE ASSIGNOR HEREBY CONSENTS AND SUBMITS TO THE
JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURT LOCATED WITHIN MILWAUKEE,
WISCONSIN. THE ASSIGNOR HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR
CHANGE THE VENUE OF ANY SUIT, ACTION OR OTHER PROCEEDING BROUGHT AGAINST THE
ASSIGNOR BY THE ASSIGNEES IN ACCORDANCE WITH THIS SECTION. THE ASSIGNOR AND
THE ASSIGNEES EACH HEREBY WAIVE, TO THE EXTENT PERMITTED BY LAW, TRIAL BY JURY.
THE ASSIGNOR FURTHER WAIVES ANY BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH
MIGHT, BUT FOR THIS WAIVER, BE REQUIRED OF THE ASSIGNEES.
[Remainder of page intentionally blank. Next page is signature page.]
8
<PAGE> 226
IN WITNESS WHEREOF, the Assignor has duly executed this Assignment the
day and year first above written.
STOKELY USA, INC.
By: ROBERT BRELL
--------------------------
Its Secretary
Address: 1055 Corporate Center Dr.
Oconomowoc, WI 53066
[Signature page for ASSIGNMENT OF CONTRACTS, WARRANTIES
AND PERMITS of STOKELY USA, INC.]
<PAGE> 227
ANNEX 1
Scottville
Mason County
Michigan
Situated in the City of Scottville, Mason County, Michigan.
PARCEL 1: A tract of land described as Beginning at a point on the East
and West Quarter line 384.1 feet South 89 degrees West of the iron bar at the
center of Section 18, Township 18 North, Range 16 West, running thence South 89
degrees West along the East and West quarter line 548.8 feet to a three-quarter
inch gas pipe, thence South 105.4 feet to a 5 inch square cedar post set at
the forks of Foster Creek, thence South 28 degrees 10' West 197.7 feet to a
three-quarter inch gas pipe, thence South 17 degrees 15' East 191.5 feet to a
three-quarter inch gas pipe in the center of Foster Creek and 150 feet North of
the center of the Pere Marquette Railroad (now Chesapeake and Ohio Railway)
right of way, thence North 88 degrees 30' East along the North boundary of the
said right of way 596.4 feet to a two inch gas pipe, thence North 1 degree 25'
West 457.2 feet to the place of beginning.
PARCEL 2: All that part of the Northeast 1/4 of the Southwest 1/4 of
Section 18, Township 18 North, Range 16 West, lying South of the right of way
of the Pere Marquette Railroad (now Chesapeake and Ohio Railway) and East of
Foster Creek.
PARCEL 3: The Southeast 1/4 of the Southwest 1/4 of Section 18,
Township 18 North, Range 16 West, EXCEPTING THEREFROM the following
described lands: a piece of land beginning at a point 60 rods West of the
Northeast corner of the above described 40 acres of which this exception is a
part, thence West to the Northwest corner of the said SE 1/4 of SW 1/4 Section
18, thence South to the Southwest corner of said SE 1/4 of SW 1/4 Section 18,
thence East on the Section line 14 and 1/2 rods, thence North 15 rods, thence
East 3 rods, thence North 26 rods, thence East 2 and 1/2 rods, thence North
about 39 rods to point of beginning. AND ALSO EXCEPTING THEREFROM a parcel
described as commencing at the Northeast corner of said SE 1/4 of SW 1/4 of said
Section 18, thence West a distance of 173 feet (along a line that is parallel to
the north boundary thereof), thence South a distance of 520.5 feet, thence East
a distance of 173 feet, thence North along the North and South quarter line a
distance of 520.5 feet to said point of beginning; the East 33 feet of said
exception being reserved for right of way for a public road.
Situated in the Township of Custer, Mason County, Michigan.
PARCEL 4: All that part of the Northwest 1/4 of the Southeast 1/4 of
Section 18, Township 18 North, Range 16 (West, lying South of the Pere
Marquette (now Chesapeake and Ohio) Railway right of way.
Page 1 of 22
<PAGE> 228
Hoopeston
Vermilion County, IL
The Southwest Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated April 14, 1925 and recorded in Deed Record 352 Page 17 of the Records of
Vermilion County, Illinois, and EXCEPT that portion thereof conveyed unto the
State of Illinois by Deed dated January 2, 1959 and recorded in Deed Record 637
page 522 of the records of Vermilion County, Illinois, situated in Vermilion
County, Illinois.
ALSO:
The Southeast Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records
of Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
That portion of the Northeast Quarter of Section 10 Township 23 North, Range 12
West of the 2nd P. M., lying South of the Lake Erie and Western (now Norfolk
and Western) Right-of-Way, ALSO all that part of the West Half of Section 11
Township 23 North, Range 12 West of the 2nd P. M., lying South of said Railroad
Right-of-Way and West of S.B.I. Route 1; EXCEPT from the last described tract
the following: (A) The South two acres thereof and (b) Beginning at the
intersection of the South line of said Railroad Right-of-Way with the West line
of S.B.I. Route No. 1; thence West 100 feet; thence South 405 feet; thence East
100 feet; thence North to the place of beginning; and (c) Right-of-Ways
conveyed to the State of Illinois by Deeds dated February 14, 1940 and recorded
respectively in Deed Record 463 Pages 431 and 432, and (D) Commencing at the
Northwest Corner of the Southwest Quarter of said Section 11; thence East along
the East and West center line of said Section 11, 185 feet to the true place of
beginning; thence South 2613 feet along a line 300 feet West of and parallel to
the West line of S.B.I. Route No. 1 to a point 30 feet North of the center line
of S.B.I. Route No. 9; thence East 38 feet to
Page 2 of 22
<PAGE> 229
a point; thence North 1.67 feet to a point; thence East 262 feet to the
aforesaid West line of S.B.I. Route No. 1; thence North along said West line
2331.33 feet to the North line of the said Southwest Quarter of said Section
11; thence West 300 feet to the place of beginning and (E) Beginning at a point
238 feet East of and 146.67 feet North of the Southwest Corner of Section 11
Township 23 North, Range 12 West of the 2nd P. M.; thence North 165 feet;
thence East 262 feet to the West line of S.B.I. Route No. 1; thence South 165
feet; thence West 262 feet to the place of beginning, all situated in Vermilion
County, Illinois.
ALSO:
Part of the Southwest Quarter of the Southwest Quarter of Section 11 Township
23 North, Range 12 West of the 2nd P. M., described as: Beginning at the
Southwest Corner of said Section 11; thence North along the Section line 146.67
feet; thence East 238 feet parallel to the South line of said Section; thence
South 146.67 feet to the Section line; thence West to the place of beginning,
EXCEPT that portion thereof conveyed unto the State of Illinois by Deed dated
January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records of
Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
Beginning at the intersection of North side of the Right-of-Way of the Lake
Erie and Western (now Norfolk and Western) Railroad, and Sixth Avenue, in the
City of Hoopeston, as it existed on January 31, 1911; thence North 729.96 feet;
thence East 2593.80 feet to the West side of the Right-of-Way of the Chicago
and Eastern Illinois Railroad; thence South along the West side of the Right-
of-Way of the said Railroad to the North side of the Right-of-Way of the Lake
Erie and Western (now Norfolk and Western Railroad; thence West along the said
North line of said Right-of-Way to the place of beginning, EXCEPT the
following: (a) Beginning at the Northwest Corner of Lot 3 in the Clerk's
Subdivision of the North Half of Section 11 Township 23 North, Range 12 West of
the 2nd P. M.; thence Southerly along the West line of said Lot 3, 200 feet;
thence Northeasterly 360.55 feet to a point in the North line of said Lot 3;
thence Westerly 300 feet to the place of beginning, and (B) A strip of land 100
feet in width across said Section 11, said land having been conveyed to the
Chicago, Danville and Vincennes Railway Company by Deed dated May 16, 1871 and
recorded in Deed Record 30 Page 291, and (C) All that portion of the described
tract conveyed to the Chicago and Eastern Illinois Railway Company by Deed
dated October 12, 1893 and recorded in Deed Record 127 Page 346, all as
situated in the Northeast Quarter and the Northwest Quarter of Section 11
Township 23 North, Range 12 West of the 2nd P. M., situated in Vermilion
County, Illinois.
Page 3 of 22
<PAGE> 230
Ackley
Franklin County I, A
Parcel A:
The East 1/2 of the Southeast 1/4 of Section 34 and all that part of the West
1/2 of the Southwest 1/4 and all that part of the South 1/2 of the Southwest
1/4 of the Northwest 1/4 lying West of the rail road right-of-way Section 35,
all in Township 90 North, Range 19 West of the 5th P.M., Franklin County, Iowa.
Parcel B:
A tract of land in triangular form in the Southwest corner of the East 1/2 of
the Southwest 1/4 Section 35, Township 90 North, Range 19 West of the 5th P.M.,
Franklin County, Iowa, said land being all of the land in the East 1/2 of the
Southwest 1/4 of said Section 35 cut-off by the Minneapolis & St. Louis Railway
and lying West of said Railway, Franklin County, Iowa.
Parcel C:
Beginning at a point 1125.2 feet North and 65.5 feet East of the Southwest
corner of the Southeast 1/4 of the Southwest 1/4 of Section 35, Township 90
North, Range 19 West of the 5th P.M., Franklin County, Iowa, running thence
Easterly 306.2 feet, thence Northerly 560.0 feet to the center of Beaver
Creek, thence following the low water course of said Creek in the Northwesterly
direction 1520 feet to intersect with the North and South Quarter section line,
thence Southerly 873.4 feet, Southeasterly on the East property line of the M.
& St. L. Railroad 152 feet to the place of beginning, Franklin County, Iowa.
Parcel D:
Beginning at at point 1259.2 feet North of the Southeast corner of the
Southwest 1/4 of the Southwest 1/4 of Section 35, Township 90 North, Range 19
West of the 5th P.M., Franklin County, Iowa, thence North 572 feet, thence West
274 feet, thence in a Southeasterly direction 640 feet along the right-of-way
of the Minneapolis & St. Louis Railroad Company to the point of beginning,
Franklin County, Iowa.
Parcel E:
Lots 7, 8, 9, and 10, Block 3, Burns and Foster's Addition to the City of
Ackley, Hardin County, Iowa, and the East 1/2 of the vacated alley lying
between the extensions westerly of the northerly line of said Lot 7 and the
southerly line of said Lot 10.
Abstract.
Page 4 of 22
<PAGE> 231
Wells
Faribault County, MN
Wells, Minnesota
TRACT 1 - All that part of the Southeast Quarter (SE1/4) of Section Five (5),
Township One Hundred Three (103) North, Range Twenty-four (24) West, described
as follows:
Commencing at the northeast corner of the Southeast Quarter (SE1/4) of Section
Five (5), Township One Hundred Three (103) North, Range Twenty-four (24) West;
thence north 89 degrees 09'00" west a distance of 748.5 feet on an assumed
bearing, on the north line of said 1/4 section; thence South 00 degrees 00'00"
West a distance of 1451.98 feet, on a line parallel with the east line of said
Northeast Quarter (NE1/4), to a point on the centerline of vacated Cleveland
Street, as shown on the plat of Garden Addition, as the same is platted and
recorded in the office of the County Recorder of Faribault County, Minnesota;
which point is the point of beginning of the tract to be described;
thence north 89 degrees 09'00" west a distance of 406.35 feet, on the
centerline of said vacated Cleveland Street, parallel with the north line of
said 1/4 section, to a point 66 feet northeasterly, measured at a right angle
from the northeasterly right-of-way line of the Soo Line Railroad (formerly the
Chicago, Milwaukee, St. Paul & Pacific Railroad), said point being 16 feet
northeasterly, measured at a right angle, from the northeasterly line of
Thurman Street, as shown on said plat of Garden Addition;
thence north 41 degrees 09' 28" west a distance of 238.31 feet, on a line
parallel with and 16 feet northeasterly, measured at a right angle, from the
northeasterly line of said Thurman Street;
thence northwesterly a distance of 226.98 feet, on a line parallel with and 16
feet northeasterly, measured at a right angle, from the northeasterly line of
said Thurman Street, on a non-tangential curve, concave to the northeast, with a
radius of 5613.50 feet, a central angle of 02 degrees 19'00", and a chord
bearing of north 38 degrees 58'57" west;
thence north 37 degrees 49'27" west a distance of 1265.06 feet, on a line
parallel with and 16 feet northeasterly, measured at a right angle, from the
northeasterly line of said Thurman Street, to the point of intersection with a
line drawn perpendicular to the northeasterly line of said Thurman Street, from
a point thereon, which is 100 feet southeasterly from the point of intersection
of the northeasterly line of said Thurman Street, with the southwesterly
right-of-way line of Trunk Highway No. 22;
thence north 52 degrees 10'33" east a distance of 23.42 feet, on a line
perpendicular to the northeasterly line of said Thurman Street, to a point on
the southwesterly right-of-way line of Trunk Highway No. 22;
Page 5 of 22
<PAGE> 232
thence south 51 degrees 46'10" east a distance of 1862.72 feet, on the
southwesterly right-of-way line of said Trunk Highway No. 22, to the point of
Intersection with a line parallel with and 748.5 feet west of the east line of
the Southeast Quarter of said Section Five (5), Township One Hundred Three
(103) North, Range Twenty-four (24) West;
thence south 00 degrees 00'00" west a distance of 222.81 feet, on a line
parallel with and 748.5 feet west of the east line of said Southeast Quarter,
to the point of beginning;
TRACT 2 - The Northwest Quarter of Section Four (4), Township One Hundred Three
(103) North, Range Twenty-four (24) West of the Fifth Principal Meridian.
TRACT 3 - The South Twenty (20) rods of the West Half (W1/2) of the Northeast
Quarter (NE1/4) of Section Five (5) in Township One Hundred Three (103) North,
Range Twenty-four (24) West, excepting Railroad Right-of-Way of the Soo Line
Railroad (formerly the Chicago, Milwaukee, St. Paul and Pacific Railroad), and
subject to the easements for public highways now existing, and subject to the
agreement by second party that it will be permitted to drain only surface water
from above land into tile crossing the land of first parties to the north.
TRACT 4 - A tract commencing at a point 748.5 feet due west of the Southeast
corner of the Northeast Quarter of Section Five (5) Township One Hundred Three
(103) North of Range Twenty-four (24) West of the Fifth Principal Meridian in
the County of Faribault and State of Minnesota, thence running North 20 rods,
thence West to the West line of the East Half of the Northeast Quarter of said
Section Five (5) thence south 20 rods, thence East along the South line of said
East half of Northeast Quarter of said Section Five (5) to the place of
beginning.
TRACT 5 - All that part of the Southeast Quarter of Section Five (5), Township
One Hundred Three (103) North, Range Twenty-four (24) West; described as
follows: Commencing at the Northeast corner of the Southeast Quarter of
Section Five (5), Township One Hundred Three (103) North, Range Twenty-four
(24) West; thence north 89 degrees 09' 00" west a distance of 748.5 feet on an
assumed bearing, on the north line of said 1/4 section; thence south 00 degrees
00'00" west on a line parallel with the east line of said Northeast Quarter, to
a point on the northeasterly right of way line of Trunk Highway No. 22, thence
Northwesterly along the Highway 22 right-of-way to a point on the North line of
the Southeast quarter of said Section Five (5), thence easterly along said
quarter section line to the point of beginning.
Page 6 of 22
<PAGE> 233
PARCEL "A":
The East 50 feet of Lots 11 and 12, Block 29, of GRANDVIEW, Washington,
according to the official plat thereof, recorded in Volume "B" of Plats, Page
6, records of Yakima County, Washington.
PARCEL "B":
All that portion of Block 15, GRANDVIEW, Washington, according to the official
plat thereof recorded in Volume "B" of Plats, Page 6, records of Yakima County,
Washington, lying South of the Southerly right of way line of West 2nd Street,
as said street was conveyed to the City of Grandview, by instrument recorded
under Auditor's File Number 1452522.
TOGETHER WITH that portion of vacated Warehouse Street, which, upon vacation,
attached to said premises by operation of law.
PARCEL "C":
The North 16 feet of Lot 1 and Lot 2, 3, 4, 5, 6, 7 and 8 and Lot 9,
EXCEPT the North 5 feet thereof and Lots 13, 14, 15, 16 and 17, all in Block
29, of GRANDVIEW, Washington, according to the official plat thereof, recorded
in Volume "B" of Plats, Page 6, records of Yakima County, Washington.
TOGETHER WITH that portion of vacated West "A" Street accruing thereto;
AND TOGETHER WITH those portions of vacated alley accruing thereto.
PARCEL "D":
Lots 19, 20, 21, 22, 23 and 24, Block 28, of GRANDVIEW, Washington, according
to the official plat thereof, recorded in Volume "B" of Plats, Page 6, records
of Yakima County, Washington.
TOGETHER WITH that portion of vacated West "A" Street and that portion of
vacated West Third Street accruing thereto.
Situated in Yakima County, State of Washington.
Page 7 of 22
<PAGE> 234
Walla Walla
Walla Walla County, WA
WALLA WALLA COUNTY, STATE OF WASHINGTON
PARCEL A:
Block 1 of Bowman's Addition to the City of Walla Walla, according to
the official plat thereof recorded in volume C of plats at page 44, records of
Walla Walla County. ALSO,
Beginning at a point in the north line of Block 2 of said Bowman's
Addition to the City of Walla Walla, which point is 56 feet west, measured
along said north line, from the northeast corner of said Block 2, and running
thence south, parallel to the east line of said Block 2, distance of 193.86
feet to a point in the south line of said Block 2; thence west, along the south
line of said Block 2, a distance of 168.7 feet to the southwest corner of said
Block 2; thence north, along the west line of said Block 2, a distance of
193.86 feet to the northwest corner of said Block 2; thence east, along the
north line of said Block 2, a distance of 168.7 feet to the point of beginning.
PARCEL B:
A piece or parcel of land situate in the northwest quarter of Section
19, Township 7 north, Range 36 east of the Willamette Meridian, in Walla Walla
County, Washington, described as follows, to wit:
Beginning at a point on the north line of Dell Avenue in the City of
Walla Walla, that is 726 feet distant west of the point of intersection of said
north line with the west line of Thirteenth Avenue North in said city, said
point also being 30 feet north of the east and west center line of said Section
19; thence northerly and parallel with said west line of Thirteenth Avenue
North a distance of 650 feet; thence westerly and parallel with the east and
west center line of Section 19, a distance of 1000 feet; thence southerly,
parallel with the west line of Thirteenth Avenue North, a distance of 650 feet
to a point that is 30 feet distant north of said east and west center line of
Section 19; thence easterly, parallel with said east and west center line of
Section 19, a distance of 1000 feet to the point of beginning.
PARCEL C:
Beginning at the northeast corner of the U.S. Military Reserve in Walla
Walla, Washington, in Section 30 in Township 7 north, Range 36 east of the
Willamette Meridian, and running thence south 27 degrees 23' east 1685.78 feet,
more or less, to a U.S. Corps of Engineers' bronze disk, which is the TRUE
POINT OF BEGINNING of this description; thence south 67 degrees 48' 10'' west a
distance of 351.7 feet; thence north 29 degrees 50' west a distance of 352.2
feet; thence north 60 degrees 10' east a distance of 360 feet; thence south 27
degrees 23' east a distance of 398.1 feet, more or less, to the said true point
of beginning.
EXCEPTING THEREFROM the northerly 35 feet in width conveyed to the City
of Walla Walla for street purposes.
Page 8 of 22
<PAGE> 235
Green Bay
Brown County, WI
Parcel I:
That part of the North 1/2 of the Southwest 1/4 of the Southeast 1/4, Section
32, Township 24 North, Range 21 East, in the City of Green Bay, East side of
Fox River, Brown County, Wisconsin described as:
Commencing at the Northwest corner of Lot 12, Block 3, of Smith Brothers Garden
Addition; thence North 89 degrees 59' 57'' West along the South line of Brook
Street, 262.32 feet to the POINT OF BEGINNING; thence continuing North 89
degrees 59' 57'' West, 253.2 feet to the East line of Henry Street; thence
South 0 degrees 52' 24'' West along the East line of Henry Street, 125.0 feet;
thence South 89 degrees 59' 57'' East, 254.63 feet; thence North 0 degrees 03'
03'' East, 125.0 feet to the point of beginning, EXCEPTING THEREFROM that part
thereof described in Volume 907 of Records, Page 535.
Tax Parcel Number: 21-1220-1
Street Address: 1804-1826 Brook Street
Parcel II:
Lots 99, 100, 101 and 102, EXCEPTING THEREFROM that part thereof described in
Volume 297 of Deeds, Page 348; and Lots 111, 112, 113 and 114, Oak Grove,
according to the recorded Plat thereof, in the City of Green Bay, East side of
Fox River, Brown County, Wisconsin.
Tax Parcel Number: 8-75
Street Address: 1425-1427 Main Street
Page 9 of 22
<PAGE> 236
Poynette
Columbia County, WI
LEGAL DESCRIPTION
Lots 1, 2, 3 and 4, Certified Survey Map No. 1288, recorded in Volume 6 of
Surveys, on page 50, as Document No. 471410, Village of Poynette and Town of
Dekorra, Columbia County, Wisconsin.
Lot 1, Certified Survey Map No. 1289, recorded in Volume 6 of Surveys, on page
51, as Document No. 471411, Village of Poynette and Town of Dekorra, Columbia
County, Wisconsin.
Lot 1, Certified Survey Map No. 1290, recorded in Volume 6 of Surveys, on page
52, as Document No. 471412, Village of Poynette and Town of Dekorra, Columbia
County, Wisconsin.
Lot 1, Certified Survey Map No. 1300, recorded in Volume 6 of Surveys, on page
62, as Document No. 472272, Village of Poynette, Columbia County, Wisconsin.
Page 10 of 22
<PAGE> 237
DeForest
Dane County, WI
The East 50 acres of the South 1/2 of the Southeast 1/4 of Section 8, Township
9 North, Range 10 East, in the Village of DeForest, Dane County, Wisconsin,
described as follows: Beginning at the Southeast corner of Section 8, Township
9 North, Range 10 East, which point is 57 feet East of a concrete highway
monument marking the West boundary of the State Highway; thence Westerly along
the South line of Section 8 at an angle of 89 degrees 20 minutes with the East
line of Section 8 for a distance of 1,651.8 feet to the Southwest corner of 50
acres tract; thence Northerly at an angle of 90 degrees 40 minutes with the
South line of said Section for a distance of 1,315 feet to the Northwest corner
of said tract; thence Easterly at an angle of 89 degrees 35 minutes with the
West line of said tract 1,651.83 feet to the Easterly line of Section 8, which
is 47 feet East of a highway concrete monument; thence Southerly along the East
line of Section 8 at an angle of 90 degrees 25 minutes with the above North
line for a distance of 1,322.3 feet to the place of beginning, EXCEPT that
portion conveyed in Vol. 744 of Deeds, page 51, Document No. 1053647; FURTHER
EXCEPT Certified Suervey Map No. 5443, recorded in Vol. 24 of Certified Survey
Maps, page 408, Document No. 2060469; FURTHER EXCEPT land conveyed in Vol.
15285 of Records, page 17, Document No. 2241655.
TAX ROLL PARCEL NUMBER: 45-0910-084-9671-2
ADDRESS PER TAX ROLL: 101 Stokley Dr., DeForest, WI
Page 11 of 22
<PAGE> 238
Sun Prairie
Dane County, WI
PARCEL 1: Lots Thirteen (13) and Fourteen (14), PLAT OF A PART OF THE
VILLAGE OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the City of
Sun Prairie, Dane County, Wisconsin.
PARCEL 2: Lot Nineteen (19), SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK
17, in the City of Sun Prairie, Dane County, Wisconsin, EXCEPT: Beginning at
the most Northwesterly corner thereof; thence South 10 degrees 04 minutes West,
47.35 feet; thence North 61 degrees 17 minutes East, 95.13 feet; thence North
89 degrees 18 minutes West, 75.23 feet to the point of beginning of this
exception.
PARCEL 3: Lots Twenty (20), Twenty-one (21), Twenty-two (22), Twenty-three
(23), Twenty-four (24) and Twenty-five (25), SUN PRAIRIE PLAT OF SUBDIVISION OF
LOT 11, BLOCK 17, in the City of Sun Prairie, Dane County, Wisconsin.
PARCEL 4: That portion of Lots Twenty-six (26), Twenty-seven (27), and
Twenty-eight (28), lying South of relocated Lincoln Street, SUN PRAIRIE PLAT OF
SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie, Dane County,
Wisconsin.
PARCEL 5: That portion of Lot Five (5), lying South of relocated Lincoln Street
and North of the center line of vacated Lincoln Street, PLAT OF A PART OF THE
VILLAGE OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the City of
Sun Prairie, Dane County, Wisconsin.
PARCEL 6: That portion of vacated Lincoln Street lying East of the Easterly
line of Lot Five (5), and South of the South line of relocated Lincoln Street,
SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun
Prairie, Dane County, Wisconsin.
PARCEL 7: Part of Lot Five (5), PLAT OF A PART OF THE VILLAGE OF SUN PRAIRIE as
recorded in Volume B of Plats, page 3, in the City of Sun Prairie, Dane County,
Wisconsin, described as: Beginning at the intersection of the extended East
line of Market Street and the South line of Section 5, Township 8 North, Range
11 East; thence East on said South line 99 feet; thence North parallel to the
East line of Market Street, 95.6 feet; thence at right angles to Market Street
99 feet to said extended East line; thence South 102.6 feet to the point of
beginning.
PARCEL 8: That portion of Lincoln Street and relocated Lincoln Street, SUN
PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie,
Dane County, Wisconsin, described as: Beginning at the Southeast corner
of Lincoln Street on the West line of Lot 20, Block 17, Original Plat of Sun
Prairie, Dane County, Wisconsin; thence North along the East line of said
Lincoln Street 15 feet; thence Southwesterly to a point on the South line of
said Lincoln Street, 15 feet West of the point of beginning; thence East along
said South line of Lincoln Street, 15 feet to the point of beginning of this
description.
Page 12 of 22
<PAGE> 239
PARCEL 9: Outlot Two Hundred Eight (208), ASSESSOR'S PLAT OF THE VILLAGE OF SUN
PRAIRIE, in the City of Sun Prairie, Dane County, Wisconsin, EXCEPT that part
lying Easterly of the following described line: Beginning on the North line of
Park Street, 176.57 feet West of the Southeast corner thereof; thence North
194.28 feet to the South corner of Outlot 202 of said Assessor's Plat.
PARCEL 10: Part of the Northeast 1/4 of the Northeast 1/4 of Section 8,
Township 8 North, Range 11 East, in the City of Sun Prairie, Dane County,
Wisconsin, described as follows: Beginning at the point where the East line of
Market Street produced Southerly from Main Street intersects the North line of
said Section 8; thence East along said North line of Section 8, a distance of
135 feet more or less to a point in a line parallel to and 8.5 feet
Northwesterly measured at right angles from the center line of the present
most Northwesterly Railroad track; thence Southwesterly parallel to said center
line, 170 feet more or less to a point in the aforesaid Southerly prolongation
of said East line of Market Street; thence North along said prolongation 103.3
feet more or less to the point of beginning.
TAX ROLL PARCEL NUMBERS: 55-0811-054-7155-7
55-0811-054-7175-3
55-0811-054-7263-6
55-0811-054-7325-1
55-0811-081-0088-0
ADDRESS PER TAX ROLL: 151 Market St., Sun Prairie, WI
Page 13 of 22
<PAGE> 240
Waunakee
Dane County, WI
PARCEL 1: Lots One (1), Two (2), and Three (3), WAUNAKEE CANNING CO. ADDITION,
in the Village of Waunakee, Dane County, Wisconsin.
PARCEL 2: Part of the Northeast 1/4 of the Northwest 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing at the Southeast corner of Lot 1, Waunakee
Canning Co. Addition, Village of Waunakee; thence South 89 degrees 00 minutes
West, 166.75 feet; thence North 47 degrees 20 minutes West, 170.45 feet to the
point of beginning; thence continuing North 47 degrees 20 minutes West, 44.90
feet; thence North 0 degrees 00 minutes 81.53 feet; thence North 88 degrees 53
minutes East, 33.00 feet; thence South 0 degrees 00 minutes 112.55 feet to the
point of beginning, being part of vacated Madison Street, Village of Waunakee.
PARCEL 3: Part of the Northeast 1/4 of Section 8, Township 8 North, Range 9
East, in the Village of Waunakee, Dane County, Wisconsin, which is more
particularly described as follows: Beginning at the Southwest corner of Outlot
B of Waunakee Canning Co. Addition to the Village of Waunakee; thence East
along the South line of said Outlot B and on said South line produced for a
distance of 284.5 feet; thence South 7 degrees 40 minutes West, 233.5 feet to
the Easterly line of the Chicago Northwestern Railroad right-of-way; thence
Northwesterly along said Railroad right-of-way 342.5 feet to the point of
beginning.
PARCEL 4: Part of the West 1/2 of the Northeast 1/4 of Section 8, Township 8
North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin, which
is described as follows: Beginning at the Southwest corner of Outlot B,
Waunakee Canning Co. Addition to the Village of Waunakee; thence West along the
Southerly line of said Outlot B produced 141.0 feet to the Westerly line of the
Chicago Northwestern Railroad right-of-way; thence South 47 degrees 48 minutes
East along the Westerly line of said right-of-way 140.5 feet to the point of
beginning of this description; thence continue South 47 degrees 48 minutes East
along said right-of-way 373.5 feet; thence South 20 degrees 15 minutes West
646.6 feet; thence North 60 degrees 25 minutes West, 397.2 feet; thence North 1
degree 26 minutes West 294.4 feet; thence North 62 degrees 56 minutes East,
339.9 feet; thence North 0 degrees 53 minutes West, 182.0 feet to the point of
beginning, EXCEPT that portion conveyed in Vol. 664 of Deeds, page 403,
Document No. 939614.
PARCEL 5: All that part of the following described parcel lying West of the
center line of the Six Mile Creek running through said parcel: Part of the West
1/2 of the Northeast 1/4 of Section 8, Township 8 North, Range 9 East, in the
Village of Waunakee, Dane County, Wisconsin, and described more fully as
follows: Commencing at a point on the Easterly extension of the South line of
Outlot B, Waunakee Canning Co. Addition (Also the South line of lands owned by
Village of Waunakee) distant thereon 284.5 feet East of the Southwest corner of
Outlot B; thence South 7 degrees 40 minutes West, 233.5 feet to the Northeast
right-of-way line of the Chicago Northwestern Railroad; thence Southeasterly
Page 14 of 22
<PAGE> 241
along said Northeasterly line of the center line of public highway; thence
Northerly along said center line to the Southeast corner of lands conveyed to
Village of Waunakee in Vol. 363 of Deeds, page 5, Document No. 553335; thence
West along South line of Village property to the point of beginning.
PARCEL 6: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing on the Northeasterly line of the land of the
Chicago and Northwestern Railway Company and on a line running North and South
through center of said Section 8; thence North on said line 171.60 feet; thence
East parallel with the North line of said Section, 99 feet; thence South
parallel with first line, 267.30 feet to the Northeasterly line of the Chicago
and Northwestern Railway Company; thence Northwesterly along said line of the
Chicago and Northwestern Railway Company, 137.28 feet to the place of beginning.
PARCEL 7: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing at the Southeast corner of Lot 8, Block 2,
E. M. Cooper's Addition to the Village of Waunakee; thence running West 16-1/2
rods; thence South 13-4/5 rods; thence East 16-1/2 rods; thence North 13-4/5
rods to the point of beginning.
PARCEL 8: Outlots A and B, WAUNAKEE CANNING CO. ADDITION, in the Village of
Waunakee, Dane County, Wisconsin.
TAX ROLL PARCEL NUMBERS: 57-0809-081-3650-7
57-0809-081-3700-6
57-0809-081-9080-5
Page 15 of 22
<PAGE> 242
Cobb
Iowa County, WI
PARCEL I
Part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Commencing at the Northeast corner of the Southeast 1/4 of the Northeast 1/4 of
Section 26, thence West 1036 feet; thence South 525 feet; thence East 74 feet
to the Railroad right of way; thence North 120 feet; thence in a Northeasterly
direction along the North line of the Railroad right of way, 826 feet to a
point, 351 feet South of the North line of said Southeast 1/4 of the Northeast
1/4; thence North 224 feet; thence East 136 feet; thence North 127 feet to the
place of beginning.
PARCEL II
Part of the Southwest 1/4 of the Northwest 1/4 of Section 25, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Commencing at a point 60 feet South of the Northwest corner of the Southwest
1/4 of the Northwest 1/4 of Section 25, thence East, 242 feet; thence North 60
feet; thence East 744 3/4 feet, more or less, to a point that is 5 chains and 5
links West of the Northeast corner of said Southwest 1/4 of the Northwest 1/4;
thence South 402 1/2 feet to the North line of the C.& N.W.R.R. right of way;
thence West along said right of way, 486 3/4 feet; thence North along said
right of way, 125 feet; thence West along said right of way, 347 feet; thence
North, 60 feet; thence West 153 feet to the West line of said 40 acre tract;
thence North on the said West line, 215 feet more or less to the place of
beginning. Intending to include all that part of the Southwest 1/4 of the North
west 1/4 of Section 25, Township 6 North, Range 1 East, Village of Cobb, Iowa
County, Wisconsin, North of the railroad right of way as deeded in Volume 97 of
Deeds, page 75, Document # 18876, in the Office of the Register of Deeds for
Iowa County, Wisconsin.
PARCEL III
A parcel of land lying and being in the Southeast 1/4 of the Northeast 1/4 of
Section 26, Township 6 North, Range 1 East, Village of Cobb, Iowa County,
Wisconsin, described as follows: Commencing 60 feet North of the Northeast
corner of that certain tract of land conveyed from Joseph Drury to the Chicago
& Tomah R.R. Co., and particularly described in Volume 35 of Deeds, page 542,
to which reference is had for said point of beginning; thence North on the East
line of said 40 acre tract, 150 feet; thence West, 140 feet; thence South 150
feet; thence East 140 feet to the place of beginning.
PARCEL IV
Part of the Southwest 1/4 of the Northwest 1/4 of Section 25, Township 6 North,
Range 1 East, Village of Cobb, Iowa County, Wisconsin, described as follows:
Beginning at a point adjoining the North side of the Milwaukee and Madison
branch of the C.& N.W.R.R. Depot grounds as now located, 33 feet East of the
West line of the Southwest 1/4 of the Northwest 1/4 of Section 25, to run
thence North 60 feet; thence East 120 feet; thence South to said railroad
grounds; thence West along said railroad grounds to place of beginning.
Parcel V
Part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6 North,
Range 1 East, in the Village of Cobb, Iowa County, Wisconsin, meted and bounded
as follows: Commencing at the Northeast corner of a tract of land last conveyed
by Joseph Drury to the Chicago and Tomah Railroad Company in a Deed recorded in
Volume 35, page 542 of Deeds in the Registers Office of said County; thence
North 60 feet, thence West 140 feet, thence South 60 feet, more or less, to the
Railroad land; thence with the line of said Railroad land, North 85 degrees
East, 140 feet, more less, to the place of beginning.
Page 16 of 22
<PAGE> 243
PARCEL VI
That part of the Southeast 1/4 of the Northeast 1/4 of Section 26, Township 6
North, Range 1 East of the Fourth Principal Meridian, Village of Cobb, Iowa
County, Wisconsin, bounded and described as follows: Beginning at the point of
intersection of the West line of Division Street, a/k/a Commercial Street with
the northerly line of the 300 foot right of way of the Chicago and North
Western Railway Company; thence South along the West line of said Division
Street, a distance of 115 feet, more or less, to a point, 8.5 feet northerly
of, as measured at right angles from center line of Spur Track I.C.C. NO. 22 of
said Railway Company, as now located and established; thence Westerly along a
line parallel with the centerline of the tangent segment of said Spur Tract and
extension thereof to a point, 9 feet Northerly of, as measured radially from
the centerline of the curved segment of said Spur Tract; thence Westerly along
a line parallel with the centerline of the curved segment of said Spur Track to
a point, 50 feet Northerly of, as measured at right angles from the centerline
of the main tract of said Railway Company, as now located and established;
thence Westerly along a line parallel with the centerline of said main track
to a point, 1000 feet Westerly of, as measured along a line parallel with the
Northerly line of said 300 foot right of way from the east line of said
Section; thence North along a line parallel with the East line of said Section
to the Northerly line of said 300 foot right of way; thence Easterly along the
Northerly line of said 300 foot right of way to the point of beginning.
EXCEPTING FROM PARCELS II THROUGH V, THE LANDS CONVEYED FOR HIGHWAY DESCRIBED
AS: A parcel of land located in the SW 1/4 of the NW 1/4 of Section 25, Town 6
North, Range 1 East, Village of Cobb, Iowa County, Wisconsin, and consist of
all the land therein lying between the west line of said Southwest 1/4 of
Northwest 1/4 of Section 25 and a new road right of way line 50 feet east of
and parallel to the centerline of new road as now laid out.
ALSO EXCEPTING lands located in the Southwest 1/4 of the Northwest 1/4 and in
the Northeast 1/4 of Section 25, Township 6 North, Range 1 East, Town of Eden,
and Village of Cobb, Iowa County, Wisconsin, and consists of all the land
therein which lies within 50 feet South of the centerline of new road from the
point of beginning to a point, 872 feet therefrom. Also all the land which lies
within 50 feet each side of centerline for the next 1239 feet, all the land
lying within 50 feet northerly of said centerline for the next 1325 feet to the
east line of grantor. The said centerline being described as follows:
Commencing at a point 2111 feet west of the center of Section 25, Township 6
North, Range 1 East extending thence North 89 degrees 05' East, for 3436
feet to the east property line of grantor.
FURTHER EXCEPTING lands located in the Southeast 1/4 of the Northeast 1/4 of
Section 26, Township 6 North, Range 1 East, Village of Cobb, Iowa County,
Wisconsin, and consists of all the land therein lying between the East line of
said Section 26 and a new right of way line 50 feet West of and parallel to the
centerline of the new road as now laid out. The centerline is described as
follows: Beginning on the East line of said Section 26 at a point 1330 feet
South of the Northeast corner of said Section extending thence South 0 degrees
05' West for 130 feet to the south line of property.
TAX ROLL PARCEL NUMBER: 130, 131, 130.A and 130.B (Village of Cobb)
Page 17 of 22
<PAGE> 244
Jefferson
Jefferson County, WI
Lot 1 of Certified Survey Map No. 1890 recorded on November 8, 1985 in Volume 6
of Certified Surveys on Page 106, as Document Number 811709, being a part of
the Northwest Quarter of the Northwest Quarter of Section 14, Township 6 North,
Range 14 East, City of Jefferson, Jefferson County, Wisconsin.
COMPUTER NO.: 241-2082-02000
TAX KEY NO.: 06-14-14-22-003
Page 18 of 22
<PAGE> 245
Merrill
Lincoln County, WI
PARCEL 1
Lots Nine (9), Twenty-one (21) and Twenty-two (22), Block Two (2), in T. P.
Mathews Addition to the City of Merrill, Lincoln County, Wisconsin.
PARCEL 2
A portion of the Northeast 1/4 of the Northwest 1/4 of Section 15, Township 31
North, Range 6 East, City of Merrill, Lincoln County, Wisconsin, described by
metes and bounds as follows: Commencing at the intersection of the South line
of the Chicago, Milwaukee, St. Paul & Pacific Railroad right-of-way and the
West line of said 40, thence North 90 feet the place of beginning; thence East
parallel with said Railroad right-of-way, 500 feet, thence North parallel with
the West line of said 40 to the section line between Sections 10 and 15, thence
West, 500 feet to the Northwest corner of said 40, thence South to the place
of beginning. Also described as Lot 631 of the Assessor's Plat of the City of
Merrill recorded in Volume 3 of Plats, page 40, Lincoln County Records.
Page 19 of 22
<PAGE> 246
Oconomowoc
Waukesha County, WI
Parcel 1 of Certified Survey Map No. 6318, recorded on November 29, 1990 in
Volume 52 of Certified Survey Maps on Pages 131 to 133, inclusive, as Document
No. 1624207, being a part of the Southwest 1/4 of the Northwest 1/4 of Section
5, Town 7 North, Range 17 East, in the City of Oconomowoc, County of Waukesha,
State of Wisconsin.
Tax Key No. OCOC 0634.999.003
ADDRESS: 1055 Corporate Center
KR/WF/DD
Page 20 of 22
<PAGE> 247
Pickett
Winnebago County, WI
Parcel 1
A part of the Southwest Quarter (SW 1/4) of the Northwest Quarter (NW 1/4) of
Section 28, the Southeast Quarter (SE 1/4) of the Northeast Quarter (NE 1/4)
and the Northeast Quarter (NE 1/4) of the Southeast Quarter (SE 1/4) of Section
29, all in T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows: Commencing at the Northwest Corner of said Section 28;
thence south 0 degrees 47 minutes 54 seconds east, 1315.6O feet, along the West
line of the North West 1/4 of said Section 28, to the Northwest Corner of the
South West 1/4 of the North West 1/4 of said Section 28, to the place of
beginning; thence north 88 degrees 37 minutes 8 seconds east, 678.39 feet,
along the North line of the South West 1/4 of the North West 1/4 of said
Section 28, to its intersection with the Westerly right-of-way line of the
Wisconsin and Southern Railroad Company; thence south 38 degrees 6 minutes 6
seconds west, 2043.59 feet, along the Westerly right-of-way line of the
Wisconsin and Southern Railroad Company; thence south 89 degrees 52 minutes 1
second west, 680.30 feet, to a point on the Easterly right-of-way line of
County Trunk Highway "M"; thence north 0 degrees 39 minutes 45 seconds west,
906.17 feet, along the Easterly right-of-way line of County Trunk Highway "M";
thence north 88 degrees 46 minutes 50 seconds east, 291.16 feet; thence north 0
degrees 58 minutes 13 seconds west, 660.00 feet, to a point on the North line
of the South East 1/4 of the North East 1/4 of said Section 29; thence north
88 degrees 46 minutes 50 seconds east, 993.90 feet, along the North line of
the South East 1/4 of the North East 1/4 of said Section 29, to the place of
beginning.
Parcel 2
A part of the Northwest Quarter (NW 1/4) of the Southwest Quarter (SW 1/4) of
Section 28, the Northeast Quarter (NE 1/4) of the Southeast Quarter (SE 1/4)
and the Southeast Quarter (SE 1/4) of the Southeast Quarter (SE 1/4) of Section
29, all in T17N, R15E, in the Town of Utica, Winnebago County, Wisconsin,
described as follows: Commencing at the West Quarter Corner of said Section 28,
the place of beginning; thence north 88 degrees 42 minutes 40 seconds east,
397.10 feet, along the North line of the North West 1/4 of the South West 1/4
of said Section 28, to its intersection with the Westerly line of State Trunk
Highway No. 44; thence southwesterly along the Westerly line of said State
Trunk Highway No. 44 the following
Page 21 of 22
<PAGE> 248
courses: south 28 degrees 26 minutes 11 seconds west, 161.41 feet; thence
southwesterly, 786.96 feet, along the arc of a curve to the right having a
radius of 2804.93 feet and the chord of which bears south 36 degrees 29 minutes
23 seconds west, 784.38 feet; thence south 44 degrees 28 minutes 18 seconds
west, 547.27 feet; thence southwesterly, 694.74 feet, along the arc of a curve
to the right having a radius of 5669.65 feet and the chord of which bears south
48 degrees 2 minutes 32.5 seconds west, 694.31 feet; thence south 36 degrees 49
minutes 33 seconds west, 102.80 feet; thence southwesterly 74.40 feet, along
the arc of a curve to the right having a radius of 5696.65 feet and the chord
of which bears south 52 degrees 55 minutes 37 seconds west, 74.40 feet; thence
south 53 degrees 20 minutes 39 seconds west, 57.47 feet; thence north 63
degrees 46 minutes 36 seconds west, 56.80 feet, along the Westerly line of said
State Trunk Highway No. 44, to its intersection with the Easterly line of
County Trunk Highway "M"; thence north 5 degrees 10 minutes 26 seconds west,
69.34 feet, along the Easterly line of said County Trunk Highway "M"; thence
south 89 degrees 6 minutes 8 seconds west, 16.56 feet, to a point on the West
line of the East 1/2 of the South East 1/4 of said Section 29; thence north 1
degrees 7 minutes 59 seconds west, 417.70 feet, along the West line of the East
1/2 of the South East 1/4 of said Section 29, to its intersection with the
Easterly right-of-way line of the Wisconsin and Southern Railroad Company;
thence north 38 degrees 6 minutes 6 seconds east, 1603.15 feet, along the
Easterly right-of-way line of the Wisconsin and Southern Railroad Company to
its intersection with the North line of the North East 1/4 of the South East
1/4 of said Section 29; thence north 88 degrees 44 minutes 20 seconds east,
305.97 feet, along the North line of the North East 1/4 of the South East 1/4
of said Section 29, to the place of beginning.
Parcel 3
A part of the Southwest Quarter (SW 1/4) of the Southeast Quarter (SE
1/4) of Section 29, T17N, R15E, in the Town of Utica, Winnebago County,
Wisconsin, described as follows: Commencing at a point on the South line of the
Wisconsin and Southern Railroad Company (formerly known as the Chicago,
Milwaukee & St. Paul Railroad) right-of-way in the center of County Trunk
Highway "M" (formerly known as the Waukau-Waupun Road); thence southwesterly,
along the South line of said Railroad right-of-way, 351 feet; thence
southeasterly, at right angles to said Railroad right-of-way, 41 feet and 10
inches; thence northeasterly, on a line parallel to said Railroad right-of-way,
to a point in the center of said County Trunk Highway "M", about 300 feet;
thence north, along the center of said Highway, to the place of beginning.
Tax Key Number: Par. 1: 024-0594-01, 024-0594-03, 024-0609, 024-0609-01 &
024-06241; Par. 2: 024-0624-01, 024-0625-01 & 024-0599; Par. 3: 024-0637-01
Page 22 of 22
<PAGE> 249
This instrument was prepared by State: Wisconsin
and upon recording should be (Sun Prairie, DeForest, Waunakee)
returned to: County: Dane
Attorney Thomas P. Solheim
Solheim Billing & Grimmer, S.C.
P.O. Box 1644
Madison, WI 53701-1644
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FINANCING STATEMENT
DATED AS OF MAY 31, 1995
STOKELY USA, INC.
(FORMERLY KNOWN AS OCONOMOWOC CANNING COMPANY),
MORTGAGOR
TO
STATE OF WISCONSIN INVESTMENT BOARD,
NATIONWIDE LIFE INSURANCE COMPANY,
WEST COAST LIFE INSURANCE COMPANY, AND
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU,
MORTGAGEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
This instrument secures future advances and obligations and contains an after-
acquired property provision.
May 23, 1995
<PAGE> 250
MORTGAGE, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FINANCING STATEMENT
THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND
FINANCING STATEMENT ("Mortgage"), made this 3lst day of May, 1995 by STOKELY
USA, INC., a Wisconsin corporation (formerly known as Oconomowoc Canning
Company), whose address is 1055 Corporate Center Drive, Oconomowoc, Wisconsin
53066, (herein called the "Mortgagor") to NATIONWIDE LIFE INSURANCE COMPANY
("Nationwide"), WEST COAST LIFE INSURANCE COMPANY ("West Coast"), EMPLOYERS
LIFE INSURANCE COMPANY OF WAUSAU ("Employers"), and STATE OF WISCONSIN
INVESTMENT BOARD ("SWIB"), as mortgagees (hereinafter referred to collectively
and individually as the "Mortgagee"), Nationwide, West Coast and Employers
having an office at One Nationwide Plaza, Columbus, Ohio 43216, Attention:
Corporate Fixed-Income Securities, and SWIB having an office at 121 East Wilson
Street, Madison, Wisconsin 53702, Attention: Private Placements. Capitalized
terms used herein, to the extent not otherwise defined herein, shall have the
meaning ascribed to such terms in the Security Agreement of same date hereof
(as may be amended from time to time, herein referred to as the "Security
Agreement") executed by and among Mortgagor, as debtor, and Mortgagees, as
secured parties.
W I T N E S S E T H:
WHEREAS, the Mortgagees are the lenders (the "Lenders") as described in
the Intercreditor Agreement and the Security Agreement and Mortgagor is
indebted to the Lenders pursuant to the Nationwide Note Agreement and
Nationwide Notes and the SWIB Note Agreement and SWIB Note; and
WHEREAS, Mortgagor desires that Lenders agree to certain amendments to the
Nationwide Note Agreement and the SWIB Note Agreement; and
WHEREAS, it is a condition precedent to the Lenders entering into
amendments of the Nationwide Note Agreement and the SWIB Note Agreement that
Mortgagor execute and deliver this Mortgage to Mortgagees;
WHEREAS, the Mortgagor desires to execute and deliver this Mortgage to
satisfy the condition described in the preceding paragraph;
WHEREAS, the Lenders were among the beneficiaries of certain prior
mortgages, deeds of trust, security agreements, and other documents (the "Prior
Security Documents") furnished by Mortgagor and others as security for the SWIB
Note Obligations and the Nationwide Note Obligations; and
May 23, 1995
<PAGE> 251
WHEREAS, this Mortgage secures the same SWIB Note Obligations and
Nationwide Note Obligations as were secured by the Prior Security Documents,
and covers property which was covered by the Prior Security Documents, and
accordingly replaces one or more of the Prior Security Documents.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby irrevocably acknowledged, and to secure the
prompt and complete payment and performance when due of the Nationwide Note
Obligations, the SWIB Note Obligations, and any obligations of Mortgagor to
Lenders arising under the Security Agreement or Loan Documents, as well as any
extensions or renewals of same, together with all other obligations and
liabilities of the Mortgagor due or to become due under any other documents
evidencing or securing the foregoing, together with all amounts, sums, and
expenses paid or incurred hereunder by any Mortgagee according to the terms
hereof and all other obligations and liabilities of the Mortgagor under this
Mortgage, or any additional sums which are in the future advanced or made by
Lenders or Mortgagee to or on behalf of Mortgagor as protective advances (all
of the foregoing hereafter collectively referenced as the "Indebtedness"), the
Mortgagor hereby MORTGAGES, GRANTS, BARGAINS, SELLS, WARRANTS, CONVEYS, ALIENS,
REMISES, RELEASES, ASSIGNS, SETS OVER AND CONFIRMS to the Mortgagee:
All that certain lot, piece or parcel of land more particularly
described in Exhibit A attached hereto and by this reference made a part
hereof;
TOGETHER with the buildings and improvements now or hereafter located
on said land and all right, title and interest, if any, of the Mortgagor
in and to the streets and roads abutting said land to the center lines
thereof, and strips and gores within or adjoining said land, the air space
and right to use said air space above said land, all rights of ingress and
egress by motor vehicles to parking facilities on or within said land, all
easements now or hereafter affecting said land, royalties and all rights
appertaining to the use and enjoyment of said land, including, without
limitation, alley, drainage, mineral, water, reservoir, oil and gas rights
(said land and/or leasehold estate, together with said building and
improvements, the property and other rights, privileges and interests
encumbered or conveyed hereby, are hereinafter collectively referred to as
the "Premises");
TOGETHER with all furnishings, fixtures and equipment and all
appurtenances and additions thereto and substitutions or replacements
thereof, which Mortgagor owns or in which Mortgagor has an interest and
which are now or hereafter permanently attached to the Premises (herein
called "Fixtures"), including, but not limited to, heating, cooling, fire
protection equipment and plumbing, electrical distribution and other
utility connections or equipment. Without limiting the foregoing, the
Mortgagor hereby grants to the Mortgagee a security interest in the above
described Fixtures and the Mortgagee shall have, in addition to all rights
and remedies provided herein, and in any other agreements, commitments and
undertakings made by the Mortgagor to the Mortgagee, all of the rights and
remedies of a "secured party" under the Uniform Commercial Code
2
May 23, 1995
<PAGE> 252
of the state in which the property described in Exhibit A is located (the
"Uniform Commercial Code"). To the extent permitted under applicable law,
this Mortgage shall be deemed to be a security agreement and financing
statement (as defined in the Uniform Commercial Code) with respect to the
Fixtures. Mortgagor hereby authorizes Mortgagee to execute and file
continuation statements without the signature of Mortgagor if Mortgagee
determines that such are necessary or advisable in order to perfect
Mortgagee's security interest in such Fixtures. Mortgagor shall promptly
execute financing and continuation statements in form satisfactory to
Mortgagee upon request to further evidence and secure Mortgagee's interest
in such Fixtures. Mortgagor shall pay to Mortgagee, on demand, any
expenses incurred by Mortgagee in connection with the preparation,
execution and filing of such statements and any continuation statements
that may be filed by Mortgagee. Upon the occurrence of an Event of
Default under this Mortgage, Mortgagee may, at its option, sell or
otherwise dispose of such Fixtures by public or private proceedings,
separate from or together with the sale of the Premises, in accordance
with the provisions of the Uniform Commercial Code. With respect to such
Fixtures, Mortgagee may exercise any other rights or remedies of a secured
party under the Uniform Commercial Code. Unless such Fixtures are
perishable or threaten to decline speedily in value or are of a type
customarily sold on a recognized market, Mortgagee shall give Mortgagor at
least ten (10) days prior written notice of the time and place of any
public sale of such Fixtures or intended disposition thereof. Upon the
occurrence of any Event of Default under this Mortgage, the Mortgagee
reserves the option to proceed with respect to such Fixtures as part of
the Premises in accordance with its rights and remedies with respect to
the Premises, in which event the default provisions of the Uniform
Commercial Code shall not apply;
TOGETHER with, to the extent of Mortgagor's interest therein, all
leases, lettings and licenses of the Premises or any part thereof now or
hereafter entered into and all right, title and interest of the Mortgagor
thereunder, including, without limitation, cash and securities deposited
thereunder and the right to receive and collect the rents, issues and
profits payable thereunder;
TOGETHER with all unearned premiums accrued, accruing or to accrue
under insurance policies now or hereafter obtained by the Mortgagor
relating to the Premises and/or Fixtures and all proceeds of the
conversion, voluntary or involuntary, of the Premises and/or Fixtures or
any part thereof into cash or liquidated claims, including, without
limitation, proceeds of hazard and title insurance and all awards and
compensation heretofore and hereafter made to the present and all
subsequent owners of the Premises and/or Fixtures by any governmental or
other lawful authorities for the taking by eminent domain, condemnation or
otherwise, of all or any part of the Premises and/or Fixtures or any
easement therein, including awards for any change of grade of streets;
TOGETHER with all right, title and interest of the Mortgagor in and
to all extensions, improvements, betterments, renewals, substitutions and
replacements of, and
3
May 23, 1995
<PAGE> 253
all additions and appurtenances (to the extent such additions and/or
appurtenances constitute real property and/or Fixtures) to, the Premises
and/or Fixtures hereafter acquired by, or released to, the Mortgagor or
constructed, assembled or placed by the Mortgagor on the Premises, and all
conversions of the security constituted thereby, immediately upon such
acquisition, release, construction, assembling, placement or conversion,
as the case may be, and in each such case, without any further mortgage,
conveyance, assignment or other act by the Mortgagor, shall become subject
to the lien of this Mortgage as fully and completely, and with the same
effect, as though now owned by the Mortgagor and specifically described
herein.
Any reference to the "Mortgaged Property" shall be deemed to apply to
the Premises, Fixtures and all the properties and rights expressed in the
foregoing five (5) paragraphs, unless the context shall require otherwise.
TO HAVE AND TO HOLD the Mortgaged Property unto the Mortgagee and its
successors and assigns forever, PROVIDED HOWEVER, that if the Indebtedness
is paid in full, and if the Mortgagor properly performs all of the
covenants herein contained, then this Mortgage shall be released,
otherwise this Mortgage will remain in full force and effect.
ARTICLE I
COVENANTS OF THE MORTGAGOR
AND the Mortgagor covenants and agrees with the Mortgagee as follows:
Section 1.1. Payment of Indebtedness. The Mortgagor will punctually pay
the Indebtedness including, without limitation, all sums and charges at any
time secured by or otherwise due under this Mortgage and all protective
advances made by the Mortgagee or Lenders to the Mortgagor and any other
advances made by the Mortgagee, all in immediately available funds in the
currency of the United States of America.
Section 1.2. Title to the Mortgaged Property. The Mortgagor warrants
that: (i) it has title to the Mortgaged Property subject only to those
exceptions to title set forth in Exhibit B attached hereto ("Permitted
Encumbrances"); (ii) it has full power and lawful authority to encumber the
Mortgaged Property in the manner and form herein set forth; (iii) it will own
all Fixtures now or hereafter affixed and/or used in connection with the
Premises, including any substitutions or replacements thereof, free and clear
of liens and claims except for Permitted Encumbrances; (iv) this Mortgage is
and will remain a valid and enforceable first lien on the Mortgaged Property
except for Permitted Encumbrances; and (v) it will preserve such title, and
will forever warrant and defend the same to the Mortgagee and will forever
warrant and defend the validity and priority of the lien hereof against the
claims of all persons and parties whomsoever except for Permitted Encumbrances.
4
May 23, 1995
<PAGE> 254
Section 1.3. Maintenance of the Mortgaged Property. The Mortgagor shall
maintain the Mortgaged Property in good repair, and shall comply with the
requirements of any governmental authority claiming jurisdiction over the
Mortgaged Property to the extent non-compliance would have a material adverse
effect on the Mortgaged Property or the business, assets, or financial
condition of the Mortgagor, within thirty (30) days after an order containing
such requirement has been issued by any such authority, provided that such
thirty (30) day period may be extended for such additional period of time as is
reasonably necessary or may be permitted under such order to so comply on the
condition that Mortgagor commences such compliance within such thirty (30) day
period and diligently prosecutes such compliance, but in any event Mortgagor
shall comply with such order not later than the earliest of: (a) one hundred
eighty (180) days after such order has been issued (unless a later date for
compliance is permitted under such order, in which case such later date shall
apply), or (b) such time as Mortgagee, in its sole discretion, notifies
Mortgagor in writing that the Mortgaged Property Mortgagee's security therein
is in jeopardy of being forfeited, foreclosed or otherwise adversely affected.
The Mortgagor shall permit the Mortgagee to enter upon the Premises and inspect
the Mortgaged Property at all reasonable hours and with prior reasonable
notice, provided that such inspection shall not interfere with Mortgagor's
business operations. The Mortgagor shall not, without the prior written
consent of the Mortgagee, commit, permit or suffer to occur any waste, material
alteration, demolition or removal of the Mortgaged Property or any part
thereof; provided however, that property or Fixtures may be removed from the
Premises and alterations may be made to the Premises if the Mortgagor
concurrently therewith replaces removed items with similar items of equal or
greater value, free of any lien, charge or claim of superior title, and
material alterations may be made to the Premises provided such material
alterations do not adversely affect the structure, utility or value of any
improvements or Fixtures located on the Premises.
Section 1.4. Insurance Restoration. The Mortgagor hereby agrees that:
(a) The Mortgagor shall keep the buildings and improvements now or
hereafter located within the Premises insured against damage by fire and
the other hazards covered by a standard extended coverage insurance policy
for the full insurable value thereof (which, unless the Mortgagee shall
otherwise agree in writing, shall mean the full repair and replacement
value thereof without reduction for depreciation or coinsurance). In
addition, the Mortgagee may require the Mortgagor to carry such other
insurance on the buildings and improvements now or hereafter located
within the Premises, in such amounts as may from time to time be
reasonably required by institutional lenders, against insurable casualties
which at the time are commonly insured against in the case of premises
similarly situated, due regard being given to the site and the type of the
building, the construction, location, utilities and occupancy or any
replacements or substitutions therefor; with respect to any portions of
the Premises or improvements thereon which do not conform to all laws and
regulations regarding such improvements, the Mortgagor shall provide a
"contingent operation of building laws" endorsement to such policy or
policies; the Mortgagor shall additionally keep the buildings,
improvements and Fixtures located therein and thereon now or hereafter
5
May 23, 1995
<PAGE> 255
located on the Premises insured against loss by flood if the Premises are
located in an area identified by the Secretary of Housing and Urban Development
as an area having special flood hazards and in which flood insurance has been
made available under the National Flood Insurance Act of 1968 (and any
successor act thereto) in an amount equal to the value of the Mortgaged
Property or the maximum limit of coverage available with respect to the
buildings under said Act, whichever is less, and will assign and deliver the
policy or policies of such insurance to the Mortgagee, which policy or policies
shall have endorsed thereon a standard mortgagee clause in the name of the
Mortgagee, so and in such manner and form that the Mortgagee and its successors
and assigns shall at all times have and hold the said policy or policies as
collateral and further security for any change in the use, operation or value
of the Premises, or in the availability of insurance in the area in which the
Premises are located. The Mortgagor shall, within five (5) days after demand
by the Mortgagee, take out such additional amounts and/or such other kinds of
insurance as the Mortgagee may reasonably require; otherwise, the Mortgagor
shall not take out any separate or additional insurance which is contributing
in the event of loss unless it is properly endorsed and otherwise,
satisfactory to the Mortgagee in all respects.
The proceeds of insurance paid on account of any damage or destruction to
the Premises or any part thereof shall be paid over to the Mortgagee to be
applied, in the absolute discretion of Mortgagee except as provided in the
following sentence, toward the payment of the Indebtedness secured by this
Mortgage or any portion thereof, whether nor not then due or payable and in
such order as Mortgagee shall determine. Notwithstanding the foregoing,
Mortgagee shall, at Mortgagor's direction, apply such proceeds of insurance or
any part thereof to the restoration of the Premises provided that (A) no Event
of Default hereunder or any event which, with the passage of time or the giving
of notice would constitute an Event of Default, or both, shall have occurred
and remain uncured, and (B) the insurance proceeds received pursuant to this
Section 1.4, together with such additional funds available to Mortgagor are
sufficient to restore the Premises to an architectural and economic unit of the
same character and not less valuable than the Premises immediately prior to
such damage or destruction; provided that insurance proceeds resulting from any
incident of damage or destruction where the amount of loss is $25,000 or less
shall be paid to, or may be retained by, Mortgagor, to be applied to the
Indebtedness or to restoration, as provided in this paragraph.
(b) In the event of damage or destruction to the Premises, for which
proceeds are to be applied to restoration of the Premises, the Mortgagor shall
promptly commence and diligently perform the repair, restoration and rebuilding
of the Premises so damaged or destroyed (hereinafter referred to as the
"work") to restore the Premises in full compliance with all legal requirements
and so that the Premises shall be at least equal in value and general utility
as they were prior to the damage or destruction. In such event, if the work
to be done is structural or if the cost of the work as estimated by the
Mortgagee shall exceed Two Hundred Fifty Thousand Dollars ($250,000)
(hereinafter referred to as "major work"), then the Mortgagor shall, prior to
the commencement of the work, furnish to the Mortgagee: (1) complete plans and
specifications for the work
6
May 24, 1995
<PAGE> 256
(approved by all governmental authorities whose approval is required), for the
Mortgagee's approval, which shall not be unreasonably withheld. Said plans and
specifications shall bear the signed approval thereof by an architect
satisfactory to the Mortgagee (hereinafter referred to as the "Architect") and
shall be accompanied by the Architect's signed estimate, bearing the
Architect's seal, of the entire cost of completing the work; (2) certified or
photostatic copies of all permits and approvals required by law in connection
with the commencement and conduct of the work; and (3) a surety bond for and/or
guaranty of the completion of the work, which bond or guaranty shall be in form
reasonably satisfactory to the Mortgagee and shall be signed by a surety or
sureties, or guarantor or guarantors, as the case may be, who are reasonably
acceptable to the Mortgagee.
If the proceeds of insurance are applied to restoration of the
Premises, any insurance proceeds recovered by the Mortgagee on account of
damage or destruction to the Premises less the cost, if any, to the Mortgagee
of such recovery and of paying out such proceeds (including attorneys' fees and
costs allocable to inspecting the work and the plans and specifications
therefor), shall, upon the written request of the Mortgagor, be applied by the
Mortgagee to the payment of the cost of the work or major work, as the case may
be, referred to above and shall be paid out from time to time to the Mortgagor
and/or, at the Mortgagee's option exercised from time to time, directly to the
contractor, subcontractors, materialmen, laborers, engineers, architects and
other persons rendering services or materials for the work, as said
work progresses except as otherwise hereinafter provided, but subject to the
following conditions, any of which the Mortgagee may waive:
1. If the work to be done is structural or if it is major work, as
determined by the Mortgagee, the Architect shall be in charge of the work;
2. Each request for payment shall be made on seven (7) days' prior
written notice to the Mortgagee and shall be accompanied by a certificate
of the Architect if one be required as provided above, otherwise by an
executive or fiscal officer of the Mortgagor, stating (i) that all of the
work completed has been done in compliance with the approved plans and
specifications, if any be required, as provided above and in accordance
with all provisions of law; (ii) the sum requested is required to
reimburse the Mortgagor for payments by the Mortgagor to, or is due to the
contractor, subcontractors, materialmen, laborers, engineers, architects
or other persons rendering services or materials for the work (giving a
brief description of such services and materials), and that when added to
all sums, if any, previously paid out by the Mortgagee does not exceed the
value of the work done to the date of such certificate; and (iii) that the
amount of such proceeds remaining in the hands of the Mortgagee will be
sufficient on completion of the work to pay for the same in full (giving
in such reasonable detail as the Mortgagee may reasonably require an
estimate of the cost of such completion);
7
May 23, 1995
<PAGE> 257
3. Each request shall be accompanied by waivers of liens
satisfactory to the Mortgagee covering that part of the work previously
paid for, if any, and by a search prepared by a title company or licensed
abstracter or by other evidence satisfactory to the Mortgagee, that there
has not been filed with respect to the Premises any mechanic's lien or
other lien or instrument for the retention of title in respect of any part
of the work not discharged of record and that there exist no encumbrances
on or affecting the Premises other than encumbrances, if any, which are
set forth in the title policy issued to the Mortgagee insuring the lien of
this Mortgage;
4. There shall be no uncured Event of Default on the part of the
Mortgagor under the Notes, the other Loan Documents, or this Mortgage; and
5. The request for any payment after the work has been completed
shall be accompanied by a copy of any certificate or certificates required
by law to render occupancy of the Premises legal.
(c) Except as otherwise agreed to by Mortgagor and Mortgagee, in the
event the work to be done to restore the Premises is not structural or it is
not major work as determined by the Mortgagee and Mortgagee has elected to
apply the proceeds of insurance to restoration, then the net insurance proceeds
held by the Mortgagee for application to restoration shall be paid to the
Mortgagor by the Mortgagee upon completion of the work, subject to the
provisions of the foregoing subsections, except to the extent those provisions
apply only to work to be done that is structural or major work as determined by
the Mortgagee.
(d) If the proceeds of insurance are applied toward restoration of
the Premises and, if, within one hundred twenty (120) days after the occurrence
of any damage or destruction to the Premises requiring structural work or major
work in order to restore the Premises, the Mortgagor shall not have submitted
to the Mortgagee and received the Mortgagee's approval of plans and
specifications for the repair, restoration and rebuilding of the Premises so
damaged or destroyed (approved by the Architect and by all governmental
authorities whose approval is required), or if, after such plans and
specifications are approved by all such governmental authorities and the
Mortgagee, the Mortgagor shall fail to commence promptly such repair,
restoration and rebuilding, or if thereafter the Mortgagor fails to continue
diligently such repair, restoration and rebuilding or is delinquent in the
payment to mechanics, materialmen or others of the costs incurred in connection
with such work required to be paid by Mortgagor, or, in the case of any damage
or destruction requiring neither structural work nor major work, as determined
by the Mortgagee in order to restore the Premises, if the Mortgagor shall fail
to diligently pursue such repair, restoration and rebuilding promptly the
Premises so damaged or destroyed then, in addition to all other rights herein
set forth, and after giving the Mortgagor fifteen (15) days' written notice of
the nonfulfillment of one or more of the foregoing conditions, the Mortgagee,
or any lawfully appointed receiver of
8
May 23, 1995
<PAGE> 258
the Premises, may at their respective options, upon forty-eight (48) hours'
prior notice, perform or cause to be performed such repair, restoration and
rebuilding, and may take such other steps as they deem advisable to perform
such repair, restoration and rebuilding, and the Mortgagor hereby waives, for
the Mortgagor and all others holding under the Mortgagor, any claim against the
Mortgagee and such receiver arising out of anything done by the Mortgagee or
such receiver pursuant hereto (except for their gross negligence, reckless
disregard or willful, malicious acts), and the Mortgagee may apply insurance
proceeds (without the need to fulfill any other requirements of this Section
1.4) to reimburse the Mortgagee, and/or such receiver, for all amounts expended
or incurred by them, respectively, in connection with the performance of such
work, and any excess costs shall be paid by the Mortgagor to the Mortgagee upon
demand.
(e) The Mortgagor shall (i) provide public liability insurance with
respect to the Premises providing for limits of liability of not less than
$5,000,000 for both injury to or death of a person and for property damage, and
(ii) provide rent insurance or business interruption insurance in an amount at
least equal at all times to the twelve months' anticipated gross rental income
or twelve months' gross business earnings of the Premises, whichever is
applicable.
(f) All insurance policies required pursuant to this Section 1.4 shall be
endorsed to name the Mortgagee as an insured thereunder, as its interest may
appear, with loss payable to the Mortgagee, without contribution, under a
standard mortgagee clause. All such insurance policies and endorsements shall
be fully paid for and contain such provisions and expiration dates and be in
such form and issued by such insurance companies licensed to do business in the
state where the Premises are located, with a rating of "A" or better and a size
classification of "X" or greater as established by Best's Rating Guide or an
equivalent rating with such other publication of a similar nature as shall be
in current use, as shall be approved by the Mortgagee. Without limiting the
foregoing, each policy shall provide that such policy may not be cancelled or
materially changed except upon thirty (30) days' prior written notice of
intention of non-renewal, cancellation or material change to the Mortgagee and
that no act or thing done by the Mortgagor shall invalidate the policy as
against the Mortgagee. In the event the Mortgagor fails to maintain insurance
in compliance with this Section 1.4, the Mortgagee may, but shall not be
obligated to, obtain such insurance and pay the premium therefor and the
Mortgagor shall, on demand, reimburse the Mortgagee for all sums, advances and
expenses incurred in connection therewith. The Mortgagor shall deliver copies
of all original policies, certified by the insurance company or authorized
agent as being true copies to the Mortgagee together with the endorsements
thereto required hereunder. Notwithstanding anything to the contrary contained
herein or any provision of applicable law of the state in which the Premises
are located, the proceeds of insurance policies coming into the possession of
the Mortgagee shall not be deemed trust funds and the Mortgagee shall be
entitled to dispose of such proceeds as herein provided.
9
May 23, 1995
<PAGE> 259
Section 1.5. Maintenance of Existence. The Mortgagor will, so
long as it is owner of the Mortgaged Property, do all things necessary to
preserve and keep in full force and effect its corporate existence, and will
comply with all regulations, rules, ordinances, statutes, orders and decrees of
any governmental authority or court applicable to the Mortgagor or to the
Mortgaged Property or any part thereof to the extent non-compliance would have
a material adverse effect on the Mortgaged Property or the business, assets or
financial condition of the Mortgagor.
Section 1.6. Taxes and Other Charges. The Mortgagor hereby
agrees that:
(a) The Mortgagor shall pay and discharge, when
due and before delinquent, all taxes of every kind and nature, water
rates, sewer rents and assessments, review, permits, inspection and
license fees and all other charges imposed upon or assessed against
the Mortgaged Property or any part thereof or upon the revenues,
rents, issues, income and profits of the Premises or arising in
respect of the occupancy, uses or possession thereof and, unless the
Mortgagor is making monthly deposits with the Mortgagee, in
accordance with Section 1.14 hereof, the Mortgagor shall exhibit to
the Mortgagee within thirty (30) days after the same shall have
become due, validated receipts showing the payment of such taxes,
assessments, water rates, sewer rents, levies, fees and other charges
which may be or become a prior lien on the Mortgaged Property.
Should the Mortgagor default in the payment of any of the foregoing
taxes, assessments, water rates, sewer rents, or other charges, the
Mortgagee may, but shall not be obligated to, pay the same or any
part thereof and the Mortgagor shall, on demand, reimburse the
Mortgagee for all amounts so paid.
(b) Nothing in this Section 1.6 shall require
the payment or discharge of any obligation imposed upon the Mortgagor by
subsection (a) of this Section 1.6 so long as the Mortgagor shall in
good faith and at its own expense contest the same or the validity
thereof by appropriate legal proceedings which proceedings must
operate to prevent the collection thereof or other realization
thereon and the sale or forfeiture of the Mortgaged Property or any
part thereof to satisfy the same; provided that during such contest
the Mortgagor shall, at the option of the Mortgagee, provide security
reasonably satisfactory to the Mortgagee, assuring the discharge of
the Mortgagor's obligation hereunder and of any additional interest
charge, penalty or expense arising from or incurred as a result of
such contest; and provided, further, that if at any time payment of
any obligation imposed upon the Mortgagor by subsection (a) of this
Section 1.6 shall become necessary to prevent the delivery of a tax
deed conveying the Mortgaged Property or any portion thereof because
of non-payment, then Mortgagor shall pay the same in sufficient time
to prevent the delivery of such tax deed.
10
May 23, 1995
<PAGE> 260
Section 1.7. Mechanics' and Other Liens. The Mortgagor hereby
agrees that:
(a) The Mortgagor shall pay, from time to time
when the same shall become due, all lawful claims and demands of
mechanics, materialmen, laborers, and others which, if unpaid, might
result in, or permit the creation of a lien on the Mortgaged
Property or any part thereof, or on the revenues, rents, issues,
income or profits arising therefrom and, in general, the Mortgagor
shall do, or cause to be done, at the cost of the Mortgagor and
without expense to the Mortgagee, everything necessary to fully
preserve the lien of this Mortgage. In the event the Mortgagor fails
to make payment of such claims and demands, the Mortgagee may, but
shall not be obligated to, make payment thereof, and the Mortgagor
shall, on demand, reimburse the Mortgagee for all sums so expended.
(b) Nothing in this Section 1.7 shall require the
payment or discharge of any claim or demand as set forth in subsection
(a) of this Section 1.7 so long as the Mortgagor shall, in good faith
and at its own expense, contest the same or the validity thereof by
appropriate legal proceedings which proceedings must operate to
prevent the collection thereof or other realization thereon and the
sale or forfeiture of the Mortgaged Property or any part thereof to
satisfy the same; provided that during such contest the Mortgagor has
posted security reasonably satisfactory to the Mortgagee, assuring the
discharge of the Mortgagor's obligation hereunder and of any additional
interest charge, penalty or expense arising from or incurred as a
result of such contest.
Section 1.8. Condemnation Awards. The Mortgagor,
immediately upon obtaining knowledge of the institution of any proceedings for
the condemnation of the Premises or any portion thereof, will notify the
Mortgagee of the pendency of such proceedings. The Mortgagee may participate
in any such proceedings and the Mortgagor from time to time will deliver to the
Mortgagee all instruments reasonably requested by it to permit such
participation. All awards and compensation or other taking or purchase in lieu
thereof, of the Premises or any part thereof, are hereby assigned to and shall
be paid to the Mortgagee. The Mortgagor hereby authorizes the Mortgagee to
collect and receive such awards and compensation, to give proper receipts and
acquittance therefor and in the Mortgagee's absolute discretion to apply the
same toward the payment of the Indebtedness, notwithstanding the fact that the
Indebtedness may not then be due and payable, or to apply the same toward the
restoration of the Premises. In the event that all or any portion of the
condemnation awards or compensation shall be used to reduce the Indebtedness,
such shall be applied in accordance with the provisions of the Intercreditor
Agreement. The Mortgagor, upon reasonable request by the Mortgagee, shall
make, execute and deliver any and all instruments requested for the purpose of
confirming the assignment of the aforesaid awards and compensation to the
Mortgagee free and clear of any liens, charges or encumbrances of any kind or
nature whatsoever.
Section 1.9. Mortgage Authorized. The Mortgagor hereby
warrants and represents that the execution and delivery of this Mortgage and
its acknowledgement of the
11
May 23, 1995
<PAGE> 261
Intercreditor Agreement has been duly authorized and that there is no provision
in its articles of incorporation or by-laws, as the same may have been amended,
requiring further consent for such action by any other entity or person; it is
duly organized, validly existing and in good standing under the laws of the
state of its incorporation or formation, as the case may be, and has (a) all
necessary licenses, authorizations, registrations and approvals (herein called
"Permits"), and (b) full power and authority to own its properties and carry on
its business as presently conducted; and (c) the execution and delivery by the
Mortgagor and performance of its obligations under this Mortgage and the
Intercreditor Agreement will not conflict with any provision of the articles of
incorporation or by-laws of the Mortgagor, as the same may have been amended,
or of any mortgage, credit or other agreement to which it is a party.
Section 1.10. Costs of Defending and Upholding the Lien.
If any action or proceeding is commenced to which action or proceeding the
Mortgagee or any of the Lenders is made a party or in which it becomes
necessary to defend or uphold the lien of this Mortgage, the Mortgagor shall,
on demand, reimburse the Mortgagee and/or the Lender(s) for all reasonable
expenses (including, without limitation, reasonable attorneys' fees and
expenses and appellate attorneys' fees and expenses) incurred by the Mortgagee
and/or the Lender(s) in any such action or proceeding.
Section 1.11. Additional Advances and Disbursements.
Subject to Mortgagor's right to contest the same in the same manner as set
forth in Sections 1.6(b) and 1.7(b) hereof, the Mortgagor shall pay when due
prior to the expiration of any applicable period of grace all payments and
charges on all liens, encumbrances, ground and other leases, and security
interests which may be or become superior to the lien of this Mortgage, and in
default thereof, the Mortgagee shall have the right, but shall not be
obligated, to pay, without notice to the Mortgagor, such payments and charges
and the Mortgagor shall, within ten (10) days after written demand, reimburse
the Mortgagee for amounts so paid. In addition, upon default of the Mortgagor
in the performance of any other terms, covenants, conditions or obligations by
it to be performed prior to the expiration of any applicable period of grace
under any such prior lien, encumbrance, lease or security interest, the
Mortgagee shall have the right, but shall not be obligated, to cure such
default in the name and on behalf of the Mortgagor. All sums advanced and
reasonable expenses incurred at any time by the Mortgagee pursuant to this
section or as otherwise provided under the terms and provisions of this
Mortgage shall bear interest from the date that such sum is advanced or expense
incurred, to and including the date of reimbursement.
Section 1.12. Costs of Enforcement/Waiver. The Mortgagor
agrees to bear and pay all reasonable expenses (including reasonable
attorneys' fees and appellate attorneys' fees) of or incidental to the
enforcement of any provision hereof, or the enforcement, compromise or
settlement of this Mortgage or the Indebtedness, and for the curing thereof, or
for defending or asserting the rights and claims of the Mortgagee in respect
thereof, by litigation or otherwise. All rights and remedies of the Mortgagee
shall be cumulative and may be exercised singly or concurrently.
Notwithstanding anything herein contained to the contrary, the Mortgagor, to
the extent permitted under applicable law: (a) will not (i) at any time insist
upon, or plead, or in any manner whatever claim or take any benefit or
advantage of any stay or extension or
12
May 23, 1995
<PAGE> 262
moratorium law, any exemption from execution or sale of the Mortgaged Property
or any part thereof, wherever enacted, now or at any time hereafter in force,
which may affect the covenants and terms of performance of this Mortgage, nor
(ii) claim, take or insist upon any benefit or advantage of any law now or
hereafter in force providing for the valuation or appraisal of the Mortgaged
Property, or any part thereof, prior to any sale or sales thereof which may be
made pursuant to any provision herein, or pursuant to the decree, judgment or
order of any court of competent jurisdiction, nor (iii) after any such sale or
sales, claim or exercise any right under any statute heretofore or hereafter
enacted to redeem the property so sold or any part thereof or claim any
homestead rights therein; (b) hereby expressly waives all benefit or advantage
of any such law or laws; (c) covenants not to hinder, delay or impede the
execution of any power herein granted or delegated to the Mortgagee, but to
suffer and permit the execution of every power as though no such law or laws
had been made or enacted; (d) ADDITIONALLY WAIVES TO THE EXTENT PERMITTED BY
LAW AND TO THE EXTENT MORTGAGOR MAY BE ENTITLED TO TRIAL BY JURY IN THE EVENT
ANY SUIT, ACTION, OR OTHER PROCEEDING IS INITIATED IN RESPECT OF MORTGAGOR'S
OBLIGATIONS HEREUNDER, MORTGAGOR WAIVES TRIAL BY JURY IN ANY SUCH ACTION OR
PROCEEDING; and (e) for itself and any other person who may claim under it,
waives, to the extent that it lawfully may, all right to have the Mortgaged
Property marshalled upon any foreclosure hereof.
Section 1.13. Mortgage Taxes. The Mortgagor shall pay
any and all taxes, charges, filing, registration and recording fees, excises
and levies imposed upon the Mortgagee by reason of the Indebtedness or this
Mortgage or any mortgage supplemental hereto, any security instrument with
respect to any Fixtures or personal property owned by the Mortgagor at the
Premises and any instrument of further assurance, other than income, franchise
and doing business taxes, and shall pay all stamp or mortgage taxes and other
taxes required to be paid on the Indebtedness and/or this Mortgage. In the
event the Mortgagor fails to make such payment within ten (10) days after
written notice thereof from the Mortgagee, then the Mortgagee shall have the
right, but shall not be obligated, to pay the amount due, and the Mortgagor
shall, on demand, reimburse the Mortgagee for said amount.
Section 1.14. Escrow Deposits. From and during the
occurrence of an Event of Default and continuing after any default by Mortgagor
to pay as and when due the amounts required to be paid under Section 1.6, the
Mortgagee, at its option, may require that the Mortgagor deposit with the
Mortgagee, monthly, one-twelfth (1/12th) of the annual charges for ground or
other rent, if any, insurance premiums and real estate taxes, assessments,
water, sewer, levies, fees and other charges which might become a lien upon the
Mortgaged Property and the Mortgagor shall, accordingly, make such deposits.
In addition, if required by the Mortgagee, the Mortgagor shall simultaneously
therewith deposit with the Mortgagee a sum of money which together with the
monthly installments aforementioned will be sufficient to make each of the
payments aforementioned at least thirty (30) days prior to the date such
payments are due. Should said charges not be ascertainable at the time any
deposit is required to be made with the Mortgagee, the deposit shall be made on
the basis of the charges for the prior year, and when the charges are fixed for
the then current year, the Mortgagor shall deposit any deficiency
13
May 23, 1995
<PAGE> 263
with the Mortgagee. All funds so deposited with the Mortgagee shall be held by
it in a separate interest bearing savings account and shall be applied in
payment of the charges aforementioned when and as payable, to the extent the
Mortgagee shall have such funds on hand or to the payment of the Indebtedness
or any other charges affecting the security of the Mortgagee, as the Mortgagee
sees fit, but no such application shall be deemed to have been made by
operation of law or otherwise until actually made by the Mortgagee as herein
provided. If deposits are being made with the Mortgagee, the Mortgagor shall
furnish the Mortgagee with bills for the charges for which such deposits are
required to be made hereunder and/or such other documents necessary for the
payment of same, at least fifteen (15) days prior to the date on which the
charges first become payable, and the Mortgagee shall, to the extent that
sufficient funds have been deposited with Mortgagee pursuant to this Section
1.14, make such sums available to Mortgagor for the purpose of payment such
charges. If any such bills or other documents are not reasonably available to
Mortgagor before such fifteen (15) days, then Mortgagor and Mortgagee shall
make reasonable efforts to cooperate in making the deposited funds available
for the timely payment of the charges. If permitted by applicable law,
Mortgagor may pay such charges upon an installment basis.
Section 1.15. Late Charges. Late charges shall be paid
as provided for in the respective Notes and Loan Documents and shall be deemed
to be a part of the Indebtedness secured by this Mortgage.
Section 1.16. Restrictive Covenants. Without the prior
written consent of the Mortgagee, which consent shall not be unreasonably
withheld or refused, the Mortgagor shall not: (a) execute or permit to exist
any lease of the Premises; (b) modify any lease affecting the Premises; (c)
discount any rents of the Premises or collect the same for a period of more
than one month in advance; (d) cancel any lease affecting the Premises except
upon the default of the tenant thereunder; (e) execute any conditional bill of
sale, chattel mortgage or other security instruments not subordinate to this
Mortgage which cover any Fixtures intended to be incorporated in the Premises
or the appurtenances thereto, excepting, however, the Permitted Encumbrances,
or purchase any of such Fixtures so that ownership of the same will not vest
unconditionally in the Mortgagor, free from encumbrances on delivery to the
Premises; (f) except for the Permitted Encumbrances, further assign the leases
and rents affecting the Premises; (g) sell, transfer, convey or assign any
interest in the Mortgaged Property or any part thereof or the beneficial
interest in Mortgagor or any part thereof; or (h) except for the Permitted
Encumbrances, further encumber, alienate, hypothecate, grant a security
interest in or grant any other interest whatsoever in the Mortgaged Property or
any part thereof.
Section 1.17. Estoppel Certificates. The Mortgagor
within ten (10) days upon request in person or within twenty (20) days upon
request by mail, shall furnish to the Mortgagee a written statement, duly
acknowledged, confirming the amount due on this Mortgage as of a recent date,
the terms of payment and maturity dates of the Notes, the dates to which
interest has been paid on the Notes, whether any offsets or defenses exist
against the Indebtedness and, if any are alleged to exist, the nature thereof
shall be set forth in detail.
14
May 23, 1995
<PAGE> 264
Section 1.18. Assignment of Rents. The Mortgagor hereby
assigns to the Mortgagee, as further security for the payment of the
Indebtedness, the rents, issues and profits of the Premises, together with all
leases and other documents evidencing such rents, issues and profits now or
hereafter in effect and any and all deposits held as security under said
leases, and shall, upon demand, deliver to the Mortgagee an executed
counterpart of each such lease or other document. Nothing contained in the
foregoing sentence shall be construed to bind the Mortgagee to the
performance of any of the covenants, conditions or provisions contained in any
such lease or other document or otherwise to impose any obligation on the
Mortgagee (including, without limitation, any liability under the covenant of
quiet enjoyment contained in any lease or in any law of any applicable state in
the event that any tenant shall have been joined as a party defendant in any
action to foreclose this Mortgage and shall have been barred and foreclosed
thereby of all right, title and interest and equity of redemption in the
Premises), except that the Mortgagee shall be accountable for any money
actually received pursuant to such assignment. The Mortgagor hereby further
grants to the Mortgagee the right (i) to enter upon and take possession of the
Premises for the purpose of collecting the said rents, issues and profits, (ii)
to dispossess by the usual summary proceedings any tenant defaulting in the
payment thereof to the Mortgagee, (iii) to let the Premises, or any part
thereof, and (iv) to apply said rents, issues and profits, after payment of
all necessary charges and expenses, on account of said Indebtedness. Such
assignment and grant shall continue in effect until the Indebtedness is paid,
the execution of this Mortgage constituting and evidencing the irrevocable
consent of the Mortgagor to the entry upon and taking possession of the
Premises by the Mortgagee pursuant to such grant, whether foreclosure has been
instituted or not and without applying for a receiver. Until the occurrence of
an Event of Default the Mortgagor shall have the revocable license to collect,
use and receive said rents, issues and profits. The Mortgagor agrees to use
said rents, issues and profits in payment of the Indebtedness and in payment of
taxes, assessments, water rates, sewer rents and carrying charges becoming due
against the Premises. Such revocable license of the Mortgagor to collect, use
and receive said rents, issues and profits may be revoked by the Mortgagee upon
the occurrence of any one or more of the following requisite discernable
events:
(a) Mortgagee's filing of a complaint to foreclose
the Mortgage and/or a motion for the appointment of a receiver; or
(b) notice and demand from Mortgagee to one or more
of the tenants under the leases stating that an Event of Default has
occurred and directing the tenants to pay to Mortgagee the rents and
other amounts due or to become due under the leases; or
(c) notice to Mortgagor stating that an Event of
Default has occurred and that Mortgagor's license to collect, use and
enjoy the rents, issues and profits has been revoked.
Section 1.19. Environmental Compliance; Liabilities. The
Mortgagor has, to the best of Mortgagor's knowledge, complied with and will
continue to comply with all applicable
15
May 23, 1995
<PAGE> 265
federal, state and local environmental laws, regulations and ordinances
(collectively, "Environmental Laws") governing the Mortgagor, its business and
the Mortgaged Property, with respect to all discharges into the ground and
surface water, emissions into the ambient air and generation, accumulation,
storage, treatment, transportation, labeling or disposal of waste materials or
process by-products, in all instances for which failure to comply would have a
material adverse effect on the Mortgagor and/or the Mortgaged Property. To the
extent any failure to comply would have a material adverse effect on the
Mortgagor and/or the Mortgaged Property, all licenses, permits or registrations
required for the Mortgaged Property and Mortgagor's business, as presently
conducted thereon, under any Environmental Laws have been and will at all times
continue to be secured and the Mortgagor is and will at all times continue to
be in full compliance therewith. The Mortgagor is in compliance with, and not
in breach of or default under any applicable Environmental Laws which would
adversely affect the Mortgaged Property and no event has occurred and is
continuing which, with the passage of time or the giving of notice, or both,
would constitute noncompliance, breach of, or default thereof which would have
a material adverse effect on the Mortgagor and/or the Mortgaged Property.
Section 1.20. Indemnity. The Mortgagor will indemnify
and hold the Mortgagee harmless against any loss or liability, cost or expense,
including, without limitation, any judgments, reasonable attorneys' fees or
costs of appeal bonds, arising out of or relating to any proceeding instituted
by any claimant alleging a violation by the Mortgagor, the Premises, the
Mortgagee, or one or more of the Lenders (except for the gross negligence of
Mortgagee or one or more of the Lenders) of any laws of the state in which the
Premises are located, or any Environmental Laws. This indemnity shall survive
the payment or other discharge of the Indebtedness and the satisfaction or
other termination of this Mortgage.
Section 1.21. After Acquired Property. All right, title
and interest of Mortgagor in and to all extensions, improvements, betterments,
renewals, substitutes and replacements of, and all additions and appurtenances
(to the extent such additions and/or appurtenances constitute real property
and/or Fixtures) to the Premises and/or Fixtures hereafter acquired by or
released to the Mortgagor or constructed, assembled, or placed by the Mortgagor
on the Premises, and all conversions of the security constituted thereby,
immediately upon such acquisition, release, construction, assembling, placement
or conversion, as the case may be, and in each case, without any further
mortgage, conveyance, assignment or other act by Mortgagor, shall become
subject to the lien of this Mortgage as fully and completely and with the same
effect as though now owned by the Mortgagor and specifically described herein;
but nevertheless, Mortgagor shall from time to time, if requested by Mortgagee,
execute and deliver any and all further assurances, conveyances or assignments
as Mortgagee may reasonably require for the purpose of expressly and
specifically subjecting all such property to the lien of this Mortgage.
16
May 23, 1995
<PAGE> 266
ARTICLE II
DEFAULT AND REMEDIES
Section 2.1. Events of Default. The following shall constitute
Events of Default under this Mortgage:
(a) If the Mortgagor shall fail to make the
payment of any amount due under this Mortgage within the time period
provided for herein, or if no time period is otherwise provided, within
5 days after the same becomes due; or
(b) [intentionally deleted];
(c) If the Mortgagor shall fail to perform or
observe, or cause to be performed or observed, (i) any covenant or
condition contained in Section 1.1, Section 1.14, Section 1.16 or
Section 1.20 of this Mortgage, and such failure shall continue for a
period of five (5) days, or (ii) any other covenant or condition
contained in this Mortgage, and such failure shall continue for a
period of twenty (20) days, in either case after the earlier of (a)
receipt of notice thereof by the Mortgagee or (b) the date an officer
of the Mortgagor learns of such default; or
(d) If any representation or warranty made by the
Mortgagor herein, or in any certificate furnished by or on behalf of
the Mortgagor in connection with the consummation of the transactions
contemplated hereby, shall be untrue in any material respect as of the
date of the issuance or making thereof; or
(e) If any Event of Default, as defined in the
Nationwide Note Agreement or the SWIB Note Agreement, shall occur.
Section 2.2. Remedies.
(a) During the continuance of any Event of
Default, the Mortgagee, at its option, may, in addition to exercising
any one or more of the rights and remedies provided by any of the
other Loan Documents, take such action, without notice or demand, as
it deems advisable to protect and enforce its rights against the
Mortgagor and to the Mortgaged Property, including, but not limited
to, the following actions, each of which may be pursued concurrently
or otherwise, at such time and in such order as the Mortgagee may
determine, in its sole discretion, without impairing or otherwise
affecting the other rights and remedies of the Mortgagee: (1) enter
into or upon the Premises, either personally or by its agents,
nominees or attorneys and dispossess the Mortgagor and its agents and
servants therefrom, and thereupon the Mortgagee may to the extent
permitted and pursuant to the procedures provided by applicable law:
(i) use, operate, manage, control, insure, maintain, repair, restore
and otherwise deal with all and every
17
May 23, 1995
<PAGE> 267
part of the Mortgaged Property and conduct the business thereon; (ii)
complete any construction on the Premises in such manner and form as
the Mortgagee deems advisable; (iii) make alterations, additions,
renewals, replacements and improvements to or on the Mortgaged
Property; (iv) exercise all rights and powers of the Mortgagor with
respect to the Mortgaged Property, whether in the name of the
Mortgagor or otherwise, including, without limitation, the right to
make, cancel, enforce or modify leases, obtain and evict tenants, and
demand, sue for, collect and receive all earnings, revenues, rents,
issues, profits and other income of the Premises and every part
thereof; and (v) apply the receipts from the Premises to the payment
of the Indebtedness, after deducting therefrom all expenses (including
reasonable attorneys' fees) incurred in connection with the aforesaid
operations and all amounts necessary to pay the taxes, assessments,
insurance and other charges in connection with the Mortgaged Property,
as well as reasonable compensation for the services of the Mortgagee's
outside counsel and agents; or (2) institute proceedings for the
complete foreclosure of this Mortgage in which the Mortgaged Property
may be sold for cash or upon credit in one or more parcels; or (3)
with or without entry, institute proceedings for the partial
foreclosure of this Mortgage for the portion of the Indebtedness then
due and payable, subject to the continuing lien of this Mortgage for
the balance of the Indebtedness not then due; or (4) sell for cash or
upon credit the Mortgaged Property or any party thereof and all
estate, claim, demand, right, title and interest of the Mortgagor
therein and rights of redemption thereof, pursuant to power of sale or
otherwise, at one or more sales, as an entity or in parcels, at such
time and place, upon such terms and after such notice thereof as may
be required or permitted by law, and in the event of a sale, by
foreclosure or otherwise, of less than all of the Mortgaged Property,
this Mortgage shall continue as a lien on the remaining portion of the
Mortgaged Property; or (5) institute an action, suit or proceedings in
equity for the specific performance of any covenant, condition or
agreement contained herein or in the Notes or other Loan Documents; or
(6) recover judgment on the Notes either before, during or after any
proceedings for the enforcement of this Mortgage; or (7) apply for the
appointment of a trustee, receiver, liquidator or conservator of the
Mortgaged Property, without regard for the adequacy of the security
for the Indebtedness and without regard for the solvency of the
Mortgagor or of any person, firm or other entity liable for the
payment of the Indebtedness; or (8) pursue such other remedies as the
Mortgagee may have under applicable law. Mortgagor acknowledges that
the remedies set forth in subsections (5), (6) and (8) may be pursued
by Mortgagee and/or by one or more of the Lenders exercising their
individual rights under the respective Notes and/or the other Loan
Documents, subject, however, to the terms and conditions of the
Intercreditor Agreement.
(b) The proceeds or avails of any sale made under
or by virtue of this Section 2.2, together with any other sums which
then may be held by the Mortgagee under this Mortgage, whether under
the provisions of this Section 2.2 or otherwise, shall be applied as
follows:
18
May 23, 1995
<PAGE> 268
First: To the payment of the costs and expenses of
any such sale, including reasonable legal fees and expenses of
Mortgagee's outside counsel and agents, and of any judicial
proceedings wherein the same may be made, and of all expenses,
liabilities and advances made or incurred by the Mortgagee
under this Mortgage, together with interest as provided in
Section 3.13 on all advances made by the Mortgagee and all
taxes and assessments, except any taxes, assessments or other
charges subject to which the Mortgaged Property shall have been
sold.
Second: To the payment of the Indebtedness, together
with any and all applicable interest and late charges, to be
allocated and disbursed in the manner provided in the
Intercreditor Agreement.
Third: To the payment of any other sums required to
be paid by the Mortgagor pursuant to any provisions of this
Mortgage or of the Intercreditor Agreement.
Fourth: To the payment of the surplus, if any, to
whosoever may be lawfully entitled to receive the same,
subject to the terms of the Intercreditor Agreement.
The Mortgagee and any receiver of the Mortgaged Property, or any part thereof,
shall be liable to account for only those rents, issues and profits actually
received by it.
(c) The Mortgagee may adjourn from time to time
any sale to be made by it under or by virtue of this Mortgage by
announcement at the time and place appointed for such sale or for such
adjourned sale or sales; and, except as otherwise provided by any
applicable provision of law, the Mortgagee, without further notice or
publication, may make such sale at the time and place to which the same
shall be so adjourned.
(d) Upon the completion of any sale or sales made
by the Mortgagee under or by virtue of this Section 2.2, the Mortgagee,
or an officer of any court empowered to do so, shall execute and
deliver to the accepted purchaser or purchasers a good and sufficient
instrument, or good and sufficient instruments, conveying, assigning
and transferring all estate, right, title and interest in and to the
property and rights sold. The Mortgagee is hereby irrevocably
appointed the true and lawful attorney of the Mortgagor, in its name
and stead, to make all necessary conveyances, assignments, transfers
and deliveries of the Mortgaged Property and rights so sold under this
Section 2.2 and for the purpose, the Mortgagee may execute all
necessary instruments of conveyance, assignment and transfer, and may
substitute one or more persons with like power, the Mortgagor hereby
ratifying and confirming all that its said attorney or such substitute
or substitutes shall lawfully do by virtue hereof. Any such sale or
sales made under or by virtue of this Section 2.2 whether made under
the power
19
May 23, 1995
<PAGE> 269
of sale herein granted or under or by virtue of judicial proceedings
or of a judgment or decree of foreclosure and sale, shall operate to
divest all of the estate, right, title, interest, claim and demand
whatsoever, whether at law or in equity, of the Mortgagor in and to
the properties and rights so sold, and shall be a perpetual bar both
at law and in equity against the Mortgagor and against any and all
persons claiming or who may claim the same, or any part thereof from,
through or under the Mortgagor for the benefit of purchaser.
(e) In the event of any sale of the Mortgaged
Property or any part thereof made under or by virtue of this Section
2.2 (whether made under the power of sale herein granted or under or
by virtue of judicial proceedings or of a judgment or decree of
foreclosure and sale) the entire Indebtedness, if not previously due
and payable, immediately thereupon shall, anything in the Notes, the
other Loan Documents, or in this Mortgage to the contrary
notwithstanding, become due and payable.
(f) Upon any sale of the Mortgaged Property or
any part thereof made under or by virtue of this Section 2.2 (whether
made under the power of sale herein granted or under or by virtue of
judicial proceedings or of a judgment or decree of foreclosure and
sale), the Mortgagee may bid for and acquire the Mortgaged Property or
any part thereof and in lieu of paying cash therefor may make
settlement for the purchase price by crediting upon the Indebtedness
the net sales price after deducting therefrom the expenses of the sale
and the costs of the action and any other sums which the Mortgagee is
authorized to deduct under this Mortgage.
(g) No recovery of any judgment by the Mortgagee
and no levy of an execution under any judgment upon the Mortgaged
Property or upon any other property of the Mortgagor shall affect in
any manner or to any extent, the lien of this Mortgage upon the
Mortgaged Property or any part thereof, or any liens, rights, powers
or remedies of the Mortgagee hereunder, but such liens, rights, powers
and remedies of the Mortgagee shall continue unimpaired as before
until all Indebtedness is fully paid.
Section 2.3. Payment of Indebtedness After Default. Upon the
occurrence of any Event of Default and the acceleration of the maturity hereof,
if, at any time prior to foreclosure sale, the Mortgagor or any other person
tenders payment of the amount necessary to satisfy the Indebtedness in full,
the same shall constitute an evasion of the payment terms of the Notes or the
other Loan Documents and shall be deemed to be voluntary prepayment thereunder,
in which case such payment must include the premium required under the
prepayment provision, if any, contained in the Notes or other Loan Documents.
Section 2.4. Possession of the Premises. Upon the occurrence
of any Event of Default hereunder, it is agreed that the then owner of the
Premises, if it is the occupant of the Premises or any part thereof, shall
immediately upon the request of Mortgagee surrender possession of the Premises
so occupied to the Mortgagee, and if such occupant is permitted to remain in
possession, the possession shall be as tenant of the Mortgagee and, on demand,
such
20
May 23, 1995
<PAGE> 270
occupant (a) shall pay to the Mortgagee monthly, in advance, as rental for the
space so occupied, the then reasonable market rental for the Premises and (b)
may be dispossessed by the usual summary proceedings. The covenants herein
contained may be enforced by a receiver of the Mortgaged Property or any part
thereof. Nothing in this Section 2.4 shall be deemed to be a waiver of the
provisions of this Mortgage prohibiting the sale or other disposition of the
Premises without the Mortgagee's consent.
Section 2.5. Mortgagor's Actions After Default. After the
happening of any Event of Default and immediately upon the commencement of any
action, suit or other legal proceedings by the Mortgagee to obtain judgment for
the Indebtedness, or of any other nature in aid of the enforcement of the Notes
or of this Mortgage, the Mortgagor hereby agrees, to the extent permitted by
law, and hereby does, if required by the Mortgagee, consent to the appointment
of a receiver or receivers of the Mortgaged Property and of all the earnings,
revenues, rents, issues, profits and income thereof.
Section 2.6. Control by Mortgagee After Default.
Notwithstanding the appointment of any receiver, liquidator or trustee of the
Mortgagor, or of any of its property, or of the Mortgaged Property or any part
thereof, the Mortgagee shall be entitled to retain possession and control of
all property now and hereafter covered by this Mortgage.
ARTICLE III
MISCELLANEOUS
Section 3.1. No Release. The Mortgagor agrees, that in the
event the Mortgaged Property is sold, the Mortgagor shall continue to be liable
to pay the Indebtedness unless expressly released and discharged in writing by
the Mortgagee.
Section 3.2. Notices. Any notice required to be given or
served hereunder shall be in writing and shall be delivered either in person or
sent to the parties at their respective addresses set forth below by (1) United
States certified or registered mail, postage prepaid, return receipt requested;
(ii) bonded courier service; or (iii) telecopy transmission to the telecopy
number designated beneath the address of the parties to receive such notice.
Any such notice, if mailed as provided herein, shall be deemed to have been
mailed, given or served on the date mailed and shall be deemed to have been
received on the expiration of two business days after mailing. Any notice or
communication personally delivered shall be deemed to have been given or served
upon the party to whom delivered upon delivery thereof in the manner above
provided.
If to Mortgagor: Stokely USA, Inc.
1055 Corporate Center Drive
Oconomowoc, Wisconsin 53066
Attention: Stephen W. Theobald
Facsimile: (414) 569-3761
21
May 23, 1995
<PAGE> 271
With a copy to: Michael, Best & Friedrich
100 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Attention: Peggy Brever
Facsimile: (414) 277-0656
If to Mortgagee: Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43216
Attention: Corporate Fixed-
Income Securities
Facsimile: (614) 249-4553
and
State of Wisconsin Investment Board
121 East Wilson Street
Madison, Wisconsin 53702
Attention: Private Placements
Facsimile: (608) 266-2436
With a copy to: Nationwide Life Insurance Company
One Nationwide Plaza
Floor 35
Columbus, OH 45216
Attention: Roger Craig, Esq.
Facsimile: (614) 249-2418
and
Solheim Billing & Grimmer, S.C.
2 East Gilman, Suite 402
P. 0. Box 1644
Madison, Wisconsin 53701-1644
Attention: Thomas P. Solheim
Facsimile: (608) 283-3079
Section 3.3. Binding Obligations. The provisions and
covenants of this Mortgage shall run with the land, shall be binding upon the
Mortgagor and shall inure to the benefit of the Mortgagee, subsequent holders
of this Mortgage and their respective successors and assigns. For the purpose
of this Mortgage, the term "Mortgagor" shall mean the Mortgagor named herein,
any subsequent owner of the Mortgaged Property, and their respective heirs,
22
May 23, 1995
<PAGE> 272
executors, legal representatives, successors and assigns. If there is more
than one Mortgagor, all their undertakings hereunder shall be deemed joint and
several.
Section 3.4. Captions. The captions of the sections of this
Mortgage are for the purpose of convenience only and are not intended to be a
part of this Mortgage and shall not be deemed to modify, explain, enlarge or
restrict any of the provisions hereof.
Section 3.5. Further Assurances. The Mortgagor shall do,
execute, acknowledge and deliver, at the sole cost and expense of the
Mortgagor, all and every such further acts, deeds, conveyances, mortgages,
assignments, estoppel certificates, notices of assignment, transfers and
assurances as the Mortgagee may reasonably require from time to time in order
to better assure, convey, assign, transfer and confirm unto the Mortgagee, the
rights granted to the Mortgagee under this Mortgage, together with protective
advances and/or advances pursuant to any other instrument executed in
connection with this Mortgage or any other instrument under which the Mortgagor
may be or may hereafter become bound to convey, mortgage or assign to the
Mortgagee for carrying out the intention of facilitating the performance of the
terms of this Mortgage.
Section 3.6. Severability. Any provision of this Mortgage
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provisions in any other
jurisdiction.
Section 3.7. General Conditions. The Mortgagor hereby agrees
that:
(a) All covenants hereof shall be construed as affording
to the Mortgagee rights additional to and not exclusive of the rights
conferred under the provisions of applicable law of the state in which
the Mortgaged Property is located.
(b) This Mortgage cannot be altered, amended, modified or
discharged orally and no executory agreement shall be effective to
modify or discharge it in whole or in part, unless it is in writing
and signed by the party against whom enforcement of the modification,
alteration, amendment or discharge is sought.
(c) No remedy herein conferred upon or reserved to the
Mortgagee is intended to be exclusive of any other remedy or remedies,
and each and every such remedy shall be cumulative, and shall be in
addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute. No delay or omission of
the Mortgagee in exercising any right or power accruing upon any Event
of Default shall impair any such right or power, or shall be construed
to be a waiver of any such Event of Default, or any acquiescence
therein. Acceptance of any payment after the occurrence of an Event of
Default shall not be deemed to waive or cure such Event of Default; and
every power and remedy given by this Mortgage to Mortgagee may be
exercised from time to time as often as may be deemed expedient by the
Mortgagee. Nothing in this
23
May 23, 1995
<PAGE> 273
Mortgage or in the Notes shall affect the obligation of the Mortgagor
to pay the Indebtedness in the manner and at the time and place
therein respectively expressed.
(d) No waiver by the Mortgagee will be effective unless
it is in writing and then only to the extent specifically stated.
Without limiting the generality of the foregoing, any payment made by
the Mortgagee for insurance premiums, taxes, assessments, water rates,
sewer rentals or any other charges affecting the Mortgaged Property,
shall not constitute a waiver of the Mortgagor's default in making
such payments and shall not obligate the Mortgagee to make any further
payments.
(e) The Mortgagee shall have the right to appear in and
defend any action or proceeding, in the name and on behalf of the
Mortgagor which the Mortgagee, in its reasonable discretion, feels may
adversely affect the Mortgaged Property or this Mortgage. The
Mortgagee shall also have the right to institute any action or
proceeding which the Mortgagee, in its reasonable discretion, feels
should be brought to protect its interest in the Mortgaged Property or
its rights hereunder. All costs and expenses incurred by the
Mortgagee in connection with such actions or proceedings, including,
without limitation, reasonable attorneys' fees and appellate
attorneys' fees, shall be paid by the Mortgagor, on demand.
(f) In the event of the passage after the date of this
Mortgage of any law of any governmental authority having jurisdiction,
deducting from the value of land for the purpose of taxation,
affecting any lien thereon or changing in any way the laws of the
taxation of mortgages or debts secured by mortgages for federal,
state or local purposes, or the manner of the collection of any such
taxes, so as to affect this Mortgage, the Mortgagor shall promptly pay
to the Mortgagee, on demand as and when due and payable, all taxes,
costs and charges for which the Mortgagee is or may be liable as a
result thereof.
(g) The information set forth on the cover page hereof is
hereby incorporated herein.
(h) The Mortgagor acknowledges that it has received a
true copy of this Mortgage.
(i) For the purposes of this Mortgage, all defined terms
contained herein shall be construed, whenever the context of this
Mortgage so requires, so that the singular shall be construed as the
plural and so that the masculine shall be construed as the feminine.
Section 3.8. Legal Construction. The terms of this Mortgage,
including the obligations of Mortgagor to pay any Indebtedness or additional
charges thereunder, shall be governed by and construed in accordance with the
laws of the State of Wisconsin; provided, however, the creation of this
Mortgage, the attachment and perfection of the lien or security
24
May 23, 1995
<PAGE> 274
interest in the Mortgaged Property, the rights and remedies of the Mortgagee
and the enforcement thereof with respect to the Mortgaged Property and
procedural matters as provided herein and by the laws of the state in which the
Premises are located, shall be governed by and construed in accordance with the
internal laws of the state in which the Premises are located. Nothing in this
Mortgage or in any other agreement between the Mortgagor and the Mortgagee
shall require the Mortgagor to pay, or the Mortgagee to accept, interest in an
amount which would subject the Mortgagee to any penalty under applicable law.
In the event that the payment of any interest due hereunder or under the Notes
or other Loan Documents or any such other agreement would subject the Mortgagee
to any penalty under applicable law, then ipso facto the obligations of the
Mortgagor to make such payment shall be reduced to the highest rate authorized
under applicable law.
Section 3.9. Brokerage Indemnification. Mortgagor hereby
indemnifies and holds harmless Mortgagee and the Lenders against, and agrees to
pay on demand, any brokerage commission or finder's fee claimed by any broker
or other party arising out of actions of or contacts with Mortgagor in
connection with the transactions contemplated by this Mortgage and the
Intercreditor Agreement.
Section 3.10. Subrogation. In the event that Mortgagee and/or
any of the Lenders, on or after the date hereof, pays any sum due under or
secured by any Senior Lien as hereinafter defined:
(a) To the extent not prohibited by loan documentation
evidencing the Senior Lien, Mortgagee shall have and be entitled to a
lien on the Mortgaged Property equal in priority to the Senior Lien
discharged, and Mortgagee shall be subrogated to, and receive and enjoy
all rights and liens possessed, held or enjoyed by, the holder of such
Senior Lien, which shall remain in existence and benefit Mortgagee in
securing the Indebtedness; and
(b) Notwithstanding the release of record of a Senior
Lien, and to the extent not prohibited by loan documentation
evidencing the Senior Lien, Mortgagee shall be subrogated to the
rights and liens of all mortgages, trust deeds, superior titles,
vendors' liens, mechanics' liens, or liens, charges, encumbrances,
rights and equities on the Mortgaged Property having priority to the
lien of this Mortgage (herein generally called "Senior Liens"), to the
extent that any obligation secured thereby is directly or indirectly
paid or discharged with disbursements or advances of the Indebtedness,
whether made pursuant to the provisions hereof or of the Note or any
document or instrument executed in connection with the Indebtedness.
Section 3.11. Additional Remedies. Without limiting the
provisions of Section 2.2 hereof but in addition thereto and in amplification
thereof, it is agreed as follows:
(a) When the Indebtedness, or any part thereof, shall
become due, whether by acceleration or otherwise, and shall not be
paid, the Mortgagee shall have the right
25
May 23, 1995
<PAGE> 275
to foreclose the lien hereof for such Indebtedness or part thereof.
In any suit or proceeding to foreclose the lien hereof there shall be
allowed and included as additional indebtedness in the decree for
sale, all expenditures and expenses which may be paid or incurred by
or on behalf of the Mortgagee for reasonable attorneys' fees,
appraisers' fees, outlays for documentary and expert evidence,
stenographers' charges, publication costs, and costs (which may be
estimated as to items to be expended after entry of a decree) of
procuring all such abstracts of title, title searches and
examinations, title insurance policies, and similar data and
assurances with respect to title, as the Mortgagee may deem reasonably
necessary either to prosecute such suit or to evidence to bidders at
sales which may be had pursuant to such decree, the true conditions of
the title to or the value of the Premises. All expenditures and
expenses of the nature in this subsection mentioned, and such expenses
and fees as may be incurred in the protection of the Mortgaged
Property and the maintenance of the lien of this Mortgage, including
the reasonable fees of any attorney employed by the Mortgagee in any
litigation or proceedings affecting this Mortgage or the Premises,
including probate and bankruptcy proceedings, or in the preparation
for the commencement or defense of any proceeding or threatened suit
or proceeding, shall be immediately due and payable by the Mortgagor,
with accrued interest thereon.
(b) Upon, or at any time after, the filing of a complaint
to foreclose this Mortgage, the court in which such complaint is filed
may appoint a receiver of the Premises. Such appointment may be made
either before or after sale, without notice, without regard to
solvency or insolvency of the Mortgagor at the time of application for
such receiver, without requirement for the posting of any bond or
security, and without regard to the then value of the Premises or
whether the same shall be then occupied as a homestead or not; and the
Mortgagee hereunder or any of the Lenders may be appointed as such
receiver. Such receiver shall have the power to collect the rents,
issues and profits of the Premises during the pendency of such
foreclosure suit and, in case of a sale and a deficiency, during the
full statutory period of redemption, if any, whether there be a
redemption or not, as well as during any further times when the
Mortgagor, except for the intervention of such receiver, would be
entitled to collection of such rents, issues and profits and all other
powers which may be necessary or are usual in such cases for the
protection, possession, control, management and operation of the
Premises during the whole of said period. The court may, from time to
time, authorize the receiver to apply the net income from the Premises
in his hands in payment in whole or in part of:
(i) The Indebtedness, or the indebtedness secured
by any decree foreclosing this Mortgage, or any tax, special
assessment or other lien which may be or become superior to
the lien hereof or of such decree, provided such application is
made prior to the foreclosure sale; or
(ii) The deficiency in case of a sale and deficiency.
26
May 23, 1995
<PAGE> 276
Section 3.12. Parity. This Mortgage secures the several
Notes, each of which is equally and ratably secured by this Mortgage and none
of which shall have any preference or priority over the other.
Section 3.13. Interest Rate. Excepting for any amount due
under the terms of any Notes and/or the other Loan Documents, the nonpayment of
which shall be governed by the default and interest rates respectively provided
therein, if any amount due Mortgagee under the terms and provisions of this
Mortgage or for which Mortgagor is liable hereunder is not paid when due,
interest shall accrue on such unpaid amount commencing on the date such payment
is due until payment has been made in full at the rate of four and one-quarter
percent (4-1/4%) per annum in excess of the Reference Rate announced by Bank
One, Milwaukee, National Association. For purposes of this section, the
"Reference Rate" shall mean the rate used by Bank One, Milwaukee, National
Association, for interest determinations, regardless of whether or not Bank
One, Milwaukee, National Association, makes loans at such rate. The Reference
Rate is not necessarily the lowest rate charged on loans at any given time.
Section 3.14. Releases. Mortgagee shall be entitled to have
released from the lien of this Mortgage any personal property or fixtures
included in the Mortgaged Property which, under section 3.D. of the Security
Agreement between Mortgagor and Mortgagee, dated the date hereof, may be
disposed of without the prior written consent of the Required Lenders, as
defined therein.
[End of Page]
27
May 23, 1995
<PAGE> 277
IN WITNESS WHEREOF, Mortgagor has caused these presents to be
duly executed and attested by its duly authorized officers and its corporate
seal, if any, to be hereunto affixed, all as of the day, month and year first
above written.
STOKELY USA, INC.
(formerly known as Oconomowoc Canning Company
a Wisconsin corporation
By: STEPHEN W. THEOBALD
------------------------------------------
Stephen W. Theobald, Vice Chairman
Attest:
ROBERT M. BRILL
---------------------------------------------
Robert M. Brill, Secretary
STATE OF WISCONSIN )
) SS
COUNTY OF WAUKESHA )
I, LINDA KUKLINSKI, a Notary Public in and for the County and State
aforesaid, do hereby certify that Stephen W. Theobald and Robert M. Brill,
respectively, the Vice Chairman and Secretary of Stokely USA, Inc., a Wisconsin
corporation, who are personally known to me to be the same persons whose names
are subscribed to the foregoing instrument as such officers of said
corporation, respectively, appeared before me in person and acknowledged that
they signed and delivered the said instrument as their own free and voluntary
act and as the free and voluntary act of said corporation for the uses and
purposes therein set forth, and the said Secretary of said corporation then and
there acknowledged that he, as custodian of the corporate seal of said
instrument as his own free and voluntary act and as the free and voluntary act
of said corporation for the uses and purposes therein set forth.
Given under my hand and notarial seal this 25 day of May, 1995.
LINDA M. KUKLINSKI
--------------------------------------
Notary Public
My commission expires:
3/15/98
- ----------------------
28
May 23, 1995
<PAGE> 278
"EXHIBIT A"
Sun Prairie
Dane County, WI
PARCEL 1: Lots Thirteen (13) and Fourteen (14), PLAT OF A PART OF THE VILLAGE
OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the City of Sun
Prairie, Dane County, Wisconsin.
PARCEL 2: Lot Nineteen (19), SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK
17, in the City of Sun Prairie, Dane County, Wisconsin, EXCEPT: Beginning at
the most Northwesterly corner thereof; thence South 10 degrees 04 minutes West,
47.35 feet; thence North 61 degrees 17 minutes East, 95.13 feet; thence North
89 degrees 18 minutes West, 75.23 feet to the point of beginning of this
exception.
PARCEL 3: Lots Twenty (20), Twenty-one (21), Twenty-two (22), Twenty-three
(23), Twenty-four (24) and Twenty-five (25), SUN PRAIRIE PLAT OF SUBDIVISION
OF LOT 11, BLOCK 17, in the City of Sun Prairie, Dane County, Wisconsin.
PARCEL 4: That portion of Lots Twenty-six (26), Twenty-seven (27), and
Twenty-eight (28), lying South of relocated, Lincoln Street, SUN PRAIRIE PLAT OF
SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie, Dane County,
Wisconsin.
PARCEL 5: That portion of Lot Five (5), lying South of relocated Lincoln Street
and North of the center line of vacated Lincoln Street, PLAT OF A PART OF THE
VILLAGE OF SUN PRAIRIE as recorded in Volume B of Plats, page 3, in the City of
Sun Prairie, Dane County, Wisconsin.
PARCEL 6: That portion of vacated Lincoln Street lying East of the Easterly
line of Lot Five (5), and south of the South line of relocated Lincoln Street,
SUN PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun
Prairie, Dane County, Wisconsin.
PARCEL 7: Part of Lot Five (5), PLAT OF A PART OF THE VILLAGE OF SUN PRAIRIE as
recorded in Volume B of Plats, page 3, in the City of Sun Prairie, Dane
County, Wisconsin, described as: Beginning at the intersection of the extended
East line of Market Street and the South line of Section 5, Township 8 North,
Range 11 East; thence East on said South line 99 feet; thence North parallel to
the East line of Market Street, 95.6 feet; thence at right angles to Market
Street 99 feet to said extended East line; thence South 102.6 feet to the point
of beginning.
PARCEL 8: That portion of Lincoln Street and relocated Lincoln Street, SUN
PRAIRIE PLAT OF SUBDIVISION OF LOT 11, BLOCK 17, in the City of Sun Prairie,
Dane County, Wisconsin, described as: Beginning at the Southeast corner of
Lincoln Street on the West line of Lot 20, Block 17, Original Plat of Sun
Prairie, Dane County, Wisconsin; thence North along the East line of said
Lincoln Street 15 feet; thence Southwesterly to a point on the South line of
said Lincoln Street, 15 feet West of the point of beginning; thence East along
said South line of Lincoln Street, 15 feet to the point of beginning of this
description.
(See continuation attached hereto.)
EXHIBIT A
<PAGE> 279
"EXHIBIT A"
Exhibit A - Continued
PARCEL 9: Outlot Two Hundred Eight (208), ASSESSOR'S PLAT OF THE VILLAGE OF SUN
PRAIRIE, in the City of Sun Prairie, Dane County, Wisconsin, EXCEPT that part
lying Easterly of the following described line: Beginning on the North line of
Park Street, 176.57 feet West of the Southeast corner thereof; thence North
194.28 feet to the South corner of Outlot 202 of said Assessor's Plat.
PARCEL 10: Part of the Northeast 1/4 of the Northeast 1/4 of Section 8,
Township 8 North, Range 11 East, in the City of Sun Prairie, Dane County,
Wisconsin, described as follows: Beginning at the point where the East line of
Market Street produced Southerly from Main Street intersects the North line of
said Section 8; thence East along said North line of Section 8, a distance of
135 feet more or less to a point in a line parallel to and 8.5 feet
Northwesterly measured at right angles from the center line of the present most
Northwesterly Railroad track; thence Southwesterly parallel to said center
line, 170 feet more or less to a point in the aforesaid Southerly prolongation
of said East line of Market Street; thence North along said prolongation 103.3
feet more or less to the point of beginning.
TAX ROLL PARCEL NUMBERS: 55-0811-054-7155-7
55-0811-054-7175-3
55-0811-054-7263-6
55-0811-054-7325-1
55-0811-081-0088-0
ADDRESS PER TAX ROLL: 151 Market St., Sun Prairie, WI
EXHIBIT A
<PAGE> 280
"EXHIBIT A"
DeForest
Dane County, WI
The East 50 acres of the South 1/2 of the Southeast 1/4 of Section 8, Township
9 North, Range 10 East, in the Village of DeForest, Dane County, Wisconsin,
described as follows: Beginning at the Southeast corner of Section 8, Township
9 North, Range 10 East, which point is 57 feet East of a concrete highway
monument marking the West boundary of the State Highway; thence Westerly along
the South line of Section 8 at an angle of 89 degrees 20 minutes with the East
line of Section 8 for a distance of 1,651.8 feet to the Southwest corner of 50
acres tract; thence Northerly at an angle of 90 degrees 40 minutes with the
South line of said Section for a distance of 1,315 feet to the Northwest corner
of said tract; thence Easterly at an angle of 89 degrees 35 minutes with the
West line of said tract 1,651.83 feet to the Easterly line of Section 8, which
is 47 feet East of a highway concrete monument; thence Southerly along the East
line of Section 8 at an angle of 90 degrees 25 minutes with the above North
line for a distance of 1,322.3 feet to the place of beginning, EXCEPT that
portion conveyed in Vol. 744 of Deeds, page 51, Document No. 1053647; FURTHER
EXCEPT Certified Survey Map No. 5443, recorded in Vol. 24 of Certified Survey
Maps, page 408, Document No. 2060469; FURTHER EXCEPT land conveyed in Vol.
15285 of Records, page 17, Document No. 2241655.
TAX ROLL PARCEL NUMBER: 45-0910-084-9671-2
ADDRESS PER TAX ROLL: 101 Stokley Dr., DeForest, WI
EXHIBIT A
<PAGE> 281
"EXHIBIT A"
Waunakee
Dane County, WI
PARCEL 1: Lots One (1), Two (2), and Three (3), WAUNAKEE CANNING CO.
ADDITION, in the Village of Waunakee, Dane County, Wisconsin.
PARCEL 2: Part of the Northeast 1/4 of the Northwest 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing at the Southeast corner of Lot 1, Waunakee
Canning Co. Addition, Village of Waunakee; thence South 89 degrees 00 minutes
West, 166.75 feet; thence North 47 degrees 20 minutes West, 170.45 feet to the
point of beginning; thence continuing North 47 degrees 20 minutes West, 44.90
feet; thence North 0 degrees 00 minutes 81.53 feet; thence North 88 degrees 53
minutes East, 33.00 feet; thence South 0 degrees 00 minutes 112.55 feet to the
point of beginning, being part of vacated Madison Street, Village of Waunakee.
PARCEL 3: Part of the Northeast 1/4 of Section 8, Township 8 North, Range 9
East, in the Village of Waunakee, Dane County, Wisconsin, which is more
particularly described as follows: Beginning at the Southwest corner of Outlot
B of Waunakee Canning Co. Addition to the Village of Waunakee; thence East
along the South line of said Outlot B and on said South line produced for a
distance of 284.5 feet; thence South 7 degrees 40 minutes West, 233.5 feet to
the Easterly line of the Chicago Northwestern Railroad right-of-way; thence
Northwesterly along said Railroad right-of-way 342.5 feet to the point of
beginning.
PARCEL 4: Part of the West 1/2 of the Northeast 1/4 of Section 8, Township 8
North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin, which
is described as follows: Beginning at the Southwest corner of Outlot B,
Waunakee Canning Co. Addition to the Village of Waunakee; thence West along the
Southerly line of said Outlot B produced 141.0 feet to the Westerly line of the
Chicago Northwestern Railroad right-of-way; thence South 47 degrees 48 minutes
East along the Westerly line of said right-of-way 140.5 feet to the point of
beginning of this description; thence continue South 47 degrees 48 minutes East
along said right-of-way 373.5 feet; thence South 20 degrees 15 minutes West
646.6 feet; thence North 60 degrees 25 minutes West, 397.2 feet; thence North 1
degree 26 minutes West 294.4 feet; thence North 62 degrees 56 minutes East,
339.9 feet; thence North 0 degrees 53 minutes West, 182.0 feet to the point of
beginning, EXCEPT that portion conveyed in Vol. 664 of Deeds, page 403,
Document No. 939614.
PARCEL 5: All that part of the following described parcel lying West of the
center line of the Six Mile Creek running through said parcel: Part of the West
1/2 of the Northeast 1/4 of Section 8, Township 8 North, Range 9 East, in the
Village of Waunakee, Dane County, Wisconsin, and described more fully as
follows: Commencing at a point on the Easterly extension of the South line of
Outlot B, Waunakee Canning Co. Addition (Also the South line of lands owned by
Village of Waunakee) distant thereon 284.5 feet East of the Southwest corner of
Outlot B; thence South 7 degrees 40 minutes West, 233.5 feet to the Northeast
right-of-way line of the Chicago Northwestern Railroad; thence Southeasterly
(See continuation attached hereto.)
EXHIBIT A
<PAGE> 282
"EXHIBIT A"
Exhibit A - Continued
along said Northeasterly line of the center line of public highway; thence
Northerly along said center line to the Southeast corner of lands conveyed to
Village of Waunakee in Vol. 363 of Deeds, page 5, Document No. 553335; thence
West along South line of Village property to the point of beginning.
PARCEL 6: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing on the Northeasterly line of the land of the
Chicago and Northwestern Railway Company and on a line running North and South
through center of said Section 8; thence North on said line 171.60 feet; thence
East parallel with the North line of said Section, 99 feet; thence South
parallel with first line, 267.30 feet, to the Northeasterly line of the Chicago
and Northwestern Railway Company; thence Northwesterly along said line of the
Chicago and Northwestern Railway Company, 137.28 feet to the place of
beginning.
PARCEL 7: Part of the Northwest 1/4 of the Northeast 1/4 of Section 8, Township
8 North, Range 9 East, in the Village of Waunakee, Dane County, Wisconsin,
described as follows: Commencing at the Southeast corner of Lot 8, Block 2, E.
M. Cooper's Addition to the Village of Waunakee; thence running West 16-1/2
rods; thence South 13-4/5 rods; thence East 16-1/2 rods; thence North 13-4/5
rods to the point of beginning.
PARCEL 8: Outlots A and B, WAUNAKEE CANNING CO. ADDITION, in the Village of
Waunakee, Dane County, Wisconsin.
TAX ROLL PARCEL NUMBERS: 57-0809-081-3650-7
57-0809-081-3700-6
57-0809-081-9080-5
EXHIBIT A
<PAGE> 283
EXHIBIT B
PERMITTED LIENS & ENCUMBRANCES
STOKELY USA, INC.
I. Properties
Ackley, Iowa Appleton, Wisconsin
Cobb, Wisconsin DeForest, Wisconsin
Grandview, Washington Green Bay, Wisconsin
Hoopeston, Illinois Jefferson, Wisconsin
Merrill, Wisconsin Oconomowoc, Wisconsin
Pickett, Wisconsin Poynette, Wisconsin
Scottville, Michigan Sun Prairie, Wisconsin
Walla Walla, Washington Waunakee, Wisconsin
Wells, Minnesota
II. Liens and Encumbrances Affecting All Properties
A. Building and zoning laws, ordinances, State and Federal
Regulations.
B. General and special taxes for the year 1995 and subsequent
years.
C. Deferred 1994 real estate taxes.
D. Restrictions relating to use or improvement of the Properties.
E. Utility and drainage easements and all other easements,
covenants and restrictions on title of record on May 24, 1995.
III. Liens and Encumbrances Affecting Specific Properties as
Follows:
<PAGE> 284
ACKLEY, IOWA
<PAGE> 285
- - Mortgage dated July 1, 1989, filed November 20, 1989 as File No. 892118,
executed by Stokley USA, Inc. to First Bank (N.A.) to secure
$3,000,000.00. (Parcels A-D)
- - Easement to the State of Iowa dated July 29, 1930, filed November 6, 1930 in
Book 59, Page 106 over the North 17 feet of the South 50 feet of the
East 1292 feet of the West 1325 feet of the Southwest Quarter of Section 35,
Township 90 North, Range 19 West.
- - Easement to the State of Iowa dated July 29, 1930, filed November 6, 1930 in
Book 59, Page 107 over the North 17 feet of the South 50 feet of the
West 1291 feet of the East 1324 feet of the Southeast Quarter of Section 34,
Township 90 North, Range 19 West.
- - Right-of-way Agreement to the Iowa Public Service Company dated May 4, 1954,
filed March 4, 1955 in Book 76, Page 28, for electric transmission line
and access thereto.
- - Rights of the Iowa State Highway Commission to control access to Primary
Roads in Franklin County, Iowa.
- - Easement to the Town of Ackley, Iowa for the use, drilling and maintenance
of a well in the Southwest corner of the East Half of the Southwest
Quarter of Section 35, Township 90, Range 19.
- - Consequence of any change in the location of streams which may form
boundaries of the parcels.
- - Easement for road and public highway purposes granted to Franklin County,
Iowa, dated May 18, 1984, filed May 21, 1984 in File No. 840905 over
the West 40 feet of Southwest Quarter of Section 35, Township 90 North,
Range 19 West of the 5th P.M. and the West 40 feet of the South Half of the
Southwest Quarter of the Northwest Quarter of Section 35, Township 90 North,
Range 19 West of the 5th P.M. (Parcel A)
- - Easement for road and public highway purposes granted to Franklin County,
Iowa dated May 18, 1984, filed May 21, 1984 in File No. 840906. (Parcel A)
- - Unrecorded agreements providing for easements, leasehold rights, restrictions
or reservations regarding the relationship between the land owned by
the titleholder and the railroad.
- - Possible lack of access to premises from an existing public road.
- - Rights of other riparian owners to the uninterrupted flow of the creek.
- - Entrance permit dated June 15, 1990, filed July 30, 1990 in File No. 901240.
- - Reservation of utilities easements by the Town of Ackley, Iowa in Quit Claim
Deed dated September 23, 1963, filed June 17, 1983 in Book 583, Page
144 as to that part of subject premises comprising vacated alley. (Parcel E)
- - Urban Renewal Plan for the City of Ackley, Iowa dated November 17, 1994,
filed May 3, 1995 as File No. 950815.
<PAGE> 286
APPLETON
<PAGE> 287
- - Easement contained in Instrument executed by Fuhremann Canning Company, a
Wisconsin Corporation to City of Appleton, a Municipal Corporation dated May
10, 1945 and recorded in the Office of the Register of Deeds for Outagamie
County, Wisconsin on May 19, 1945 in Volume 296 on Page 519 as Document No.
383005.
- - Easements, if any, of the public or any school district, utility,
municipality or person, as provided in Section 80.32(4) of the Statutes, for
the continued use and right of entrance, maintenance, construction and repair
of underground or overground structures, improvements or service in that
portion of the subject premises which were formerly a part of West Eighth
Street now vacated.
- - Rights and easements (if any) in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to the
subject premises.
- - Declaration of Restrictions contained in Instrument by Stokely USA, Inc., a
Wisconsin corporation, dated May 5, 1992 and recorded in the office of the
Register of Deeds for Outagamie County, Wisconsin on June 17, 1992, Jacket
12569, Images 22-28, as Document No. 1042209.
- - Revenue Agreement contained in Instrument by and between the City of
Appleton, Wisconsin, a municipal corporation and Stokely USA, Inc., a
Wisconsin corporation dated December 1, 1985 and recorded in the office of
the Register of Deeds for Outagamie County, Wisconsin on May 1, 1986 in
Jacket 6267 Image 32 through Jacket 6269 Image 6, as Document No. 883907.
- - Indenture of Trust by and between the City of Appleton, Wisconsin, a
municipal corporation and First Bank, Milwaukee, Wisconsin, dated December 1,
1985 and recorded in the office of the Register of Deeds for Outagamie
County, Wisconsin on May 1, 1986 in Jacket 6269 Image 7 through Jacket
6270 Image 19, as Document No. 883908.
<PAGE> 288
COBB, WISCONSIN
<PAGE> 289
- - Restrictions and the terms thereof, contained in Deed executed by Chicago
and North Western Railway Company to Cobb Canning Co., dated December 16,
1964 and recorded in said Register's Office on December 30, 1964 in Volume
219 of Records, page 533 as Document No. 97146, providing as follows: The
East 50 feet of the lands hereby conveyed shall be left free from all
buildings, structures, trees, shrubbery or other obstructions which will
obstruct the view over and across said East 50 foot strip.
- - Electric Line Easement and the terms thereof, dated May 23, 1984 and
recorded June 15, 1994 in Volume 465 of Records, page 870, document # 197303,
Iowa County Registry.
- - Rights and easement and the terms thereof, if any, in and to any land all
railroad switches, sidetracks, spur tracks, and rights of way located upon or
appurtenant to the above-described premises.
- - Rights and priviledges and the terms thereof, of Chicago, Milwaukee, and
Northwestern Railway Co. as shown in Deed recorded in Volume 36 of Deeds,
page 399.
- - Rights, if any, of Lawrence Warehouse Company under lease entered into by
and between Cobb Canning Company, as lessor and Lawrence Warehouse Company,
as lessee, dated March 27, 1939, recorded in the office of the Register of
Deeds for Iowa County, Wisconsin on May 6, 1939 in Volume 132 of Deeds, at
page 443-448, wherein a 2 story brick and concrete building is leased to said
lessee.
<PAGE> 290
DEFOREST, WISCONSIN
<PAGE> 291
- - Rights of the public in that portion of the premises lying within the
limits of C.T.H. "V" and U.S. Highway 51.
- - Electric Line Easement to Wisconsin Power and Light Company recorded on
September 12, 1962, in Volume 381 of Misc., page 156, as Document No.
1056831.
- - Underground Electric Easement to Wisconsin Power and Light Company recorded
on October 2, 1989, in Volume 13375 of Records, page 64, as Document No.
2164887.
- - Right of Way Grant -- Gas Main to Madison Gas and Electric Company recorded
on August 17, 1990, in Volume 14594 of Records, page 86, as Document No.
2217417.
- - Electric Line Easement to Wisconsin Power and Light Company recorded on June
6, 1991, in Volume 16042 of Records, page 7, as Document No. 2267064.
- - Easement and Right of Way to Village of DeForest recorded on January 12,
1995, in Volume 29197 of Records, page 26, as Document No. 2655506.
<PAGE> 292
GRANDVIEW, WASHINGTON
<PAGE> 293
- - Easement and rights of way over the lands herein described as may be
necessary for canals, tunnels, or other conduits and for telephone and
transmission lines, required in connection with the irrigation works
constructed, disclosed by deeds or water contracts appearing in the record
executed in favor of: Sunnyside Valley Irrigation District.
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for sewer line, in favor of
Russell E. Holmes, et ux, as recorded August 14, 1961, in Volume 619 of
Deeds, under Auditor's File Number 1875286. Said easement affects the South
10 feet of Parcel "A".
- - Requirement to relocate existing sewer line and provide necessary easements
and allow access to said premises for garbage collection as disclosed by
instrument recorded under Auditor's File Number 2828565. Affects portion of
vacated street adjoining Parcel "B".
- - Matters disclosed on Survey map prepared by Jaussaud, Seward & Associates,
and filed on October 18, 1988 in Book 45 of Surveys, at Page 66, records of
Yakima County, Washington. Among other items, the map discloses usage line
extends to the fence located North of the North line of Parcel "D".
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for existing water, sewer and storm
drains, in favor of City of Grandview, Washington, as recorded November 22,
1991, in Volume 1341 of Official Records, under Auditor's File Number
2942460. Said easement affects Parcels "C" and "D".
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for ingress and egress, in favor of
Gary Christensen and Annette Christensen, husband and wife, as recorded
December 11, 1991, in Volume 1343 of Official Records, under Auditor's File
Number 2943976. Said easement affects Parcels "C" and "D".
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for installation and maintenance of
a guy wire and guy pole, in favor of City of Grandview, a municipal
corporation, as recorded March 22, 1990, in Volume 1290 of Official Records,
under Auditor's File Number 2886078. Said easement affects Parcel "B".
- - All existing utility easements located within vacated West "A" Street and
vacated West Third Street, as reserved by the City of Grandview in
unrecorded Ordinance No. 1296, as passed by the City Council on August 19,
1991.
- - Matters disclosed on survey map prepared by Worley Surveying Service, Inc.
and filed on March 19, 1993 in Book 55 of surveys, at Page 79, records of
Yakima County, Washington. Among other items, the map discloses overlap of
building across the North line of Parcel "B", and overlap of building across
the South line of Parcel "C".
<PAGE> 294
GREEN BAY, WISCONSIN
<PAGE> 295
HOOPESTON, ILLINOIS
<PAGE> 296
Easement dated March 11, 1993 and recorded June 2, 1993 as Document 93-5396 to
City of Hoopeston, to erect, construct, install or lay, use, operate and
inspect, repair, maintain and use for a drainage ditch.
Premises are located within the Hoopeston Drainage District and are subject to
assessments thereunder.
Premises are located within the Vermilion County Soil and Water Conservation
District.
Terms, covenants and provisions of a certain Agreement by and between Thomas
Hoopes and Lafayette, Bloomington and Mississippi Railway Company, dated June
3, 1870 and recorded February 5, 1926 in Deed Record 350 Page 210.
Easement of City of Hoopeston, Illinois, a Municipal Corporation, its
successors and assigns, for storm sewer and appurtenances as contained in the
Storm Sewer Easement made by Stokley Van-Camp, Inc., a Corporation, dated April
18, 1968 and recorded May 22, 1968 in Book 765 Page 38 as Document 798206.
Easement of Central Illinois Public Service Company, its successors and assigns
for transmission lines and appurtenances, as contained in Right of Way Grant
made by Stokley Van Camp, Inc., dated February 6, 1974 and recorded June 4,
1974 in Book 863 Page 403 as Document No. 870722.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant, dated July 26, 1950 as to the following: Lot 3 of the Clerk's
Subdivision of the North Half of Section 11 in Township 23 North, Range 12 West
of the 2nd P. M., Vermilion County, Illinois. This Grant is made to grant the
right to place 1 Guy Stub 478 feet North of the South line of the above
described property and 15 feet East of the West line of the said property. One
anchor to be placed 10 feet East of the said Guy Stub, as disclosed in Warranty
Deed dated June 10, 1983 and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company, under Right of Way and
Easement Grant dated November 19, 1953, as to the following: The South Half of
Section 10 in Township 23 North, Range 12 West of the 2nd P.M., Vermilion
County, Illinois, and that part of the Northeast Quarter of the said Section 10
which lies South of the South line of the Right of Way of the New York, Chicago
and St. Louis Railroad Company; also that part of the West Half of Section 11
in the said Township and Range which lies South of the Right of Way of the said
Railroad Company and West of the Westerly line of the Right of Way of State
Bond Issue Highway Route Number One, Except the South 2 acres thereof,
<PAGE> 297
and also Except the East 100 feet of the North 405 feet of the last above
mentioned tract. The said transmission line shall be located on a line which
extends Northwardly from a point on the South line of the above described land
which is 3991 feet East of the Southwest Corner of the said Section 10 to a
point on the North line of the said land which is 3991 feet East of the West
line of the said Section 10, as disclosed in Warranty Deed dated June 10, 1983
and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated November 15, 1957, as to the following: The North 400 feet
of the West 400 feet of that part of the Northeast Quarter of Section 11
Township 23 North, Range 12 West of the 2nd P. M., Vermilion County, Illinois,
lying South of the Chicago and Eastern Illinois Railroad spur, excepting a
triangular tract in the Northwest Corner thereof heretofore deeded to Chicago &
Eastern Railroad Company. This Grant is made to grant the right to place one
pole with necessary wires and fixtures attached thereto 262 feet East of the
East line of Sixth Street and 50 feet, more or less, South of the North line of
the above described property. Anchors to be placed not more than 60 feet
Southeastwardly from said pole, as disclosed in Warranty Deed dated June 10,
1983 and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated April 28, 1966, as to the following: The East 310 feet of
all that part of the Northwest Quarter of Section 11 Township 23 North, Range
12 West of the 2nd P. M. Vermilion County, Illinois, lying South of the Right
of Way of the New York, Chicago and Saint Louis Railroad Company and West of
the Right of Way of State Bond Issue Highway Route #1. The said line to be
located approximately 300 feet of the West line of the Right of Way of State
Bond Issue Highway Route #1, as disclosed in Warranty Deed dated June 10,
1983 and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated January 10, 1973, as to the following: The East 20 feet of
the following described property: Beginning at a point which is 241 feet South
of the center line of Penn Street extended West and 383 feet West of the center
line of S.B.I. Highway Route #1; thence South 580 feet; thence West 20
feet; thence North 580 feet; thence East 20 feet to the place of beginning and
being a part of the West Half of Section 11 in
<PAGE> 298
Township 23 North, Range 12 West of the 2nd P. M., Vermilion County, Illinois.
The said Penn Street being located in the City of Hoopeston, Vermilion County,
Illinois. Place overhead wires, not including poles and fixtures, over, across
and along the East 10 feet of the above described property, as disclosed in
Warranty Deed dated June 10, 1983 and recorded September 22, 1983 as Document
83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated August 20, 1973 as to the West Half of Section 11 Township
23 North, Range 12 West of the 2nd P. M., as disclosed in Warranty Deed dated
June 10, 1983 and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated April 27, 1976 as to the following: Commencing on the
North side of the Right of Way of the Lake Erie and Western Railroad and 6th
Avenue running North 1106 links; thence East 3930 links to the West side of the
Right of Way of the Chicago and Eastern Illinois Railroad; thence South along
the West side of the Right of Way of the Chicago and Eastern Illinois Railroad
to the North side of the Right of Way of the Lake Erie and Western Railroad;
thence West along the North side of the said Right of Way of the Lake Erie and
Western Railroad to the place of beginning (Except that portion of said tract
deeded to the Chicago and Eastern Illinois Railroad) in the City of Hoopeston,
Excepting therefrom that land conveyed to the Chicago and Eastern Illinois
Railroad Company by Deed dated August 5, 1907 and recorded in Deed Record 211
Page 168 of the Vermilion County records, and being a part of the Northeast
Quarter of Section 11 Township 23 North, Range 12 West of the 2nd P. M.,
Vermilion County, Illinois. The pole in the said transmission line is to be
located on or within 3 feet more or less, of the South property line of the
above described land and approximately 44 feet West of the centerline of 4th
Avenue in the Town of Hoopeston of said 4th Avenue were to extend Northward of
said Railroad. Overhang with wires and conductors to extend Eastward of said
pole approximately 85 feet to an existing pole. Anchors to extend approximately
14 feet Northward and approximately 22 feet Westward of said pole, as disclosed
in Warranty Deed dated June 10, 1983 and recorded August 22, 1983 as Document
83-6530.
That portion of the above described premises falling within the boundaries of
certain Railroad right of ways.
Easement dated February 20, 1986 and recorded February 17, 1987 as Document
87-1280 to City of Hoopeston, to erect, construct, operate, lay, maintain,
repair, replace and remove, a sanitary sewer, etc.
Easement dated October 6, 1992 and recorded April 5, 1993 as Document 93-3193
to City of Hoopeston, to construct and operate a combined sewer, etc., and See
Temporary Easement dated October 6, 1992 and recorded April 5, 1993 as Document
93-3194.
<PAGE> 299
JEFFERSON, WISCONSIN
<PAGE> 300
- Easement and Common Wall Agreement by and between Jefferson Cold
Storage Corporation and Stokely USA, Inc. dated November 20, 1985 and recorded
on January 27, 1986 in Volume 670 of Records on Page 892, as Document Number
813510. (See attachment.)
- Memorandum of Option to Purchase and First Refusal Rights to Purchase
by and between Jefferson Cold Storage Corporation and Stokely USA, Inc. dated
November 20, 1985 and recorded on January 27, 1986 in Volume 670 of
Records on Page 900, as Document Number 813511. (See attachment.)
- Easement and Common Wall Agreement by and between Jefferson Cold Storage
Corporation and Stokely USA, Inc. dated October 19, 1990 and recorded on
October 22, 1990 in Volume 762 of Records on Page 75, as Document Number
867246. (See attachment.)
- Mortgage from Stokely USA, Inc. to First Bank (N.A.) as Trustee, dated
December 15, 1985 and recorded on December 27, 1985 in Volume 669 of Records on
Page 659, as Document Number 812800, in the originally stated amount of
$6,500,000.00.
<PAGE> 301
MERRILL, WISCONSIN
<PAGE> 302
- - Easement from Lincoln Canning Company to the City of Merrill, dated
Dec. 6, 1956, recorded Dec. 10, 1956, in Volume 191 of Misc., page 2 204, as
Document No. 175462.
<PAGE> 303
OCONOMOWOC, WISCONSIN
<PAGE> 304
- - Limitations imposed upon access set forth in Award of Damages by State
Highway Commission of Wisconsin pursuant to a relocation order of the State
Highway Commission of Wisconsin dated November 29, 1961 for the improvement
of Interstate Highway 94 recorded May 21, 1962 in Volume 915 of Deeds on
Page 533, as Document No. 565390.
- - Public or private rights, if any, in such portion of the subject premises
as may be presently used, laid out or dedicated in any manner whatsoever,
for road purposes.
- - 15 Foot Utility Easement along the South property line of the land as
depicted on the plat of Certified Survey Map No. 6318, recorded on November
29, 1990 in Volume 52 of Certified Survey Maps on Pages 131 to 133
inclusive, as Document No. 1624207.
- - 25 Foot Drainage Easement along the two Northwesterly curved property
lines of the land as depicted on the plat of Certified Survey Map No. 6318,
recorded on November 29, 1990 in Volume 52 of Certified Survey Maps on Pages
131 to 133 inclusive, as Document No. 1624207.
- - Wetlands and environmental corridor to as depicted on the plat of
Certified Survey Map No. 6318, recorded on November 29, 1990 in Volume 52 of
Certified Survey Maps on Pages 131 to 133 inclusive, as Document No.
1624207.
- - Notice of Location of Cataloged Buriel Site recorded on November 12, 1990
on Reel 1253, Image 533 as Document No. 1621812.
- - Notice of Location of Cataloged Burial Site, recorded on November 12, 1990
on Reel 1253, Image 535 as Document No. 1621813.
- - Tax Incremental District Development Agreement entered into by and
between the City of Development and Valley Road Limited Partnership, dated
November 9, 1990 and recorded on November 29, 1990 on Reel 1257, Image 879
as Document No. 1624246.
- - Charges and assessments according to the terms of the Tax Incremental
District Development Agreement entered into by and between the City of
Oconomowoc and Valley Road Limited Partnership, dated November 9, 1990 and
recorded November 29, 1990 on Reel 1257, Image 879 as Document No. 1624246.
- - Covenants, conditions and restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status, or national origin, unless and only to the extent that said
covenant (a) is exempt under Chapter 42, Section 3607 of the United States
Code, or (b) relates to handicap but does not discriminate against
handicapped persons) set forth in Covenants, conditions and restrictions
set forth in a Declaration of Protective Covenants for Oconomowoc
Corporate Center, dated November 27, 1990 and recorded on November 29, 1990
Reel 1257, Image 977 as Document No. 1624247. See copy enclosed with
commitment.
- - Charges and assessments according to the terms of the Declaration of
Protective Covenants for Oconomowoc Corporation Center, dated November 27,
1990 and recorded on November 29, 1990 on Reel 1257, Image 977 as Document
No. 1624247.
- - Rights of the public in so much of the subject premises as are affected
by ordinance adopted by the Board of Supervisors of Waukesha County June 18,
1954 and approved by the various towns in said County, establishing the
width of C.T.H. "B" at 100 feet, and ordaining that said highway be widened
to the width so established; together with rights of the public in that
portion of said premises lying within the limits of said road and not
affected by said ordinance. A notice and plat etc. in said matter was filed
April 18, 1957, as No. 1.
<PAGE> 305
PICKETT, WISCONSIN
<PAGE> 306
Indenture of Trust by and between the Town of Utica, a municipal corporation
and existing under the laws of the State of Wisconsin and The Peoples Bank, a
banking corporation with trust powers duly organized and existing under
and by virtue of the laws of the State of Indiana, dated July 1, 1977 and
recorded in the Office of the Register of Deeds for Winnebago County, Wisconsin
on July 28, 1977 as Document No. 499665.
Mortgage, according to the terms and provisions thereof, from Naas Foods of
Wisconsin, Inc., a corporation to Town of Utica, Wisconsin, a Wisconsin
municipal corporation, its successors and assigns in the originally stated
indebtedness of $1,000,000 and assignment from Town of Utica, Wisconsin to The
Peoples Bank, Portland, Indiana, as Trustee, or to its successor or successors
as Trustee, under that certain Indenture of Trust, dated as of July 1, 1977,
dated July 1, 1977 and recorded in the Office of the Register of Deeds for
Winnebago County, Wisconsin on July 28, 1977 as Document No. 499666.
Covenants, Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status or national origin, unless and only to the extent that said
covenant (a) is exempt under Chapter 42, Section 3607 of the United States
Code, or (b) relates to handicap but does not discriminate against handicapped
persons) set forth in Quit Claim Deed executed by Jasper G. Pickett, a single
man to Wisconsin State Canners Company, a Wisconsin corporation of Pickett
dated June 26, 1947 and recorded in the office of the Register of Deeds for
Winnebago County, Wisconsin on July 18, 1947 in Volume 560 on Page 229 as
Document No. 147323.
Covenants, Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap, familial
status or national origin, unless and only to the extent that said covenant (a)
is exempt under Chapter 42, Section 3607 of the United States Code, or (b)
relates to handicap but does not discriminate against handicapped persons) set
forth in Instrument dated October 31, 1994 and recorded in the office of the
Register of Deeds for Winnebago County, Wisconsin on November 4, 1994 as
Document No. 890931.
Covenants, Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status or national origin, unless and only to the extent that said
covenant (a) is exempt under Chapter 42, Section 3607 of the United States
Code, or (b) relates to handicap but does not discriminate against handicapped
persons) set forth in Instrument dated November 14, 1994 and recorded in the
office of the Register of Deeds for Winnebago County, Wisconsin on November 16,
1994 as Document No. 891668.
<PAGE> 307
- - Possible assessments, if any, as disclosed by the Order Creating a
Sanitary District, if the subject premises is located within a sanitary
district.
- - Drainage rights and rights of way by reason of any drainage ditches,
feeders, laterals and underground drain tile or pipes that may be located on
the subject premises.
- - Rights of the public in that portion of the premises lying within the
limits of County Trunk Highway "M".
- - Rights and easements (if any) in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to the
subject premises.
- - Covenants, Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status or national origin, unless and only to the extent that said
covenant (a) is exempt under Chapter 42, Section 3607 of the United States
Code, or (b) relates to handicap but does not discriminate against
handicapped persons) set forth in Warranty Deed executed by Standard Hemp
and Fibre Company, a corporation of Pickett to Wisconsin State Canners Co.,
a Wisconsin Corporation dated March 23, 1923 and recorded in the office of
the Register of Deeds for Winnebago County, Wisconsin on April 7, 1923 in
Volume 351 on Page 82.
- - Holding Tank Agreement contained in Instrument dated March 29, 1990 and
recorded in the office of the Register of Deeds for Winnebago County,
Wisconsin on April 12, 1990 as Document No. 741485.
- - Holding Tank Servicing Contract contained in Instrument dated April 18,
1990 and recorded in the office of the Register of Deeds for Winnebago
County, Wisconsin on April 19, 1990 as Document No. 741895.
- - Apparent interest of David Hielke and Joan Hielke in the subject
premises, as indicated by the fact that they are named as debtors in the
Financing Statement shown below.
- - Security interest of Valley First National Bank of Ripon secured party,
as disclosed by Financing Statement filed on April 4, 1989 as No. 968356
executed by David Hielke and Joan Hielke, debtor in certain chattels on the
subject premises described in Schedule A hereof.
<PAGE> 308
POYNETTE, WISCONSIN
<PAGE> 309
- - Easements and rights incidental thereto in connection [ copy cut off] of
entrance, maintenance construction and repair of municipal or utility
facilities as may exist underground or overground in or on that portion of
the above-described premises which were formerly a part of Old Hwy. "10"
and C.T.H. "S" now vacated.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded
August 1, 1929 in Volume 171 of Deeds, on page 104, as Document No. 196491.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded
August 21, 1929 in Volume 171 of Deeds, on page 109, as Document No. 196610.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded
March 4, 1930 in Volume 171 of Deeds, on page 122, as Document No. 197846.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded June
10, 1930 in Volume 171 of Deeds, on page 156, as Document No. 198571.
- - EASEMENT and conditions as contained in instrument recorded February 11,
1957 in Volume 34 of Misc., on page 342, as Document No. 287483.
- - EASEMENT and conditions as contained in instrument recorded April 3, 1954 in
Volume 31 of Misc., on page 311, as Document No. 277048.
- - EASEMENT and conditions as contained in instrument recorded February 19,
1957 in Volume 34 of Misc., on page 351, as Document No. 287545.
- - EASEMENT and conditions as contained in instrument recorded February 2,
1960 in Volume 37 of Misc., on page 562, as Document No. 298052.
- - OFFICIAL PUBLICATION, FINDING, DETERMINATION AND DECLARATION BY THE STATE
HIGHWAY COMMISSION OF WISCONSIN ESTABLISHING A CERTAIN CONTROLLED-ACCESS
HIGHWAY IN COLUMBIA COUNTY, WISCONSIN WITH REFERENCE TO RURAL PORTIONS ON A
CERTAIN STATE TRUNK HIGHWAY IN THE TOWNS OF LEEDS, DEKORRA, ARLINGTON, AND
PACIFIC, VILLAGE OF POYNETTE AND CITY OF PORTAGE as contained in instrument
recorded March 17, 1956 in Volume 33 of Misc., on pages 445-449, as Document
No. 284176.
- - HIGHWAY DEEDS and conditions as contained in instrument recorded June 26,
1967 in Volume 42 of Records, on pages 428-429, as Document No. 329788:
recorded January 16 1968 in Volume 49 of Records, on page 603, as Document
No. 332601: recorded January 16, 1968 in Volume 49 of Records, on pages
604-605, as Document No. 332602 and recorded October 20, 1971 in Volume 97
of Records, on pages 543-544, as Document No. 351132.
- - EASEMENT and conditions as contained in instrument recorded October 18,
1974 in Volume 143 of Records, on page 168, as Document No. 370030.
- - ON SITE WASTE DISPOSAL OPERATION & MAINTENANCE AGREEMENT and conditions as
contained in instrument to Columbia County, Wisconsin recorded March 15,
1985 in Volume 281 of Records, on page 109, as Document No. 440623.
- - EASEMENT and conditions as contained in instrument recorded November 2,
1987 in Volume 326 of Records, on page 455, as Document No. 462497.
<PAGE> 310
- - Rights of the public in that portion of the premises lying within the
limits of Kent Road. Old "S", U.S.H. 51, Old Hwy. "10" and C.T.H. "S".
- - Rights and easements, if any, in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to the
captioned premises.
- - WELL AND PUMPHOUSE AGREEMENT and conditions as contained in instrument
recorded March 22, 1989 in Volume 349 of Records, on pages 611-618, as
Document No. 473082.
- - RIGHT OF WAY EASEMENT and conditions as contained in instrument recorded
November 30, 1992 in Volume 431 of Records, on pages 168-170, as Document
No. 510190.
- - Vision Corner as shown on Certified Survey Map No. 1288, as Document No.
471410 and Certified Survey Map No. 1289, as Document No. 471411.
- - Lack of access to public streets from any parcel which does not abut public
streets.
- - MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS from Stokely
USA. Inc., a Wisconsin Corporation to the Village of Poynette, Wisconsin and
ASSIGNED to Firstar Bank, N.A. for $6,000,000 dated August 1, 1988 and
recorded August 18, 1988 in Volume 340 of Records, on pages 1-31, as
Document No. 468538.
<PAGE> 311
SCOTTVILLE, MICHIGAN
<PAGE> 312
- The Mortgage and Security Agreement to Michigan Job Development
Authority dated October 1, 1984 and recorded on October 16, 1984 in Liber 319
on Pages 544-557; and assigned to First Bank, N.A., as Trustee and Tracy E.
Little, an individual, as co-trustee, dated October 1, 1984 and recorded on
October 16, 1984 in Liber 319 on Pages 558-562; and see Subordination Agreement
recorded on February 18, 1995 in Liber 437 on Pages 981-985.
- Financing Statement between Oconomowoc Canning Company as Debtor and
Michigan Job Develpment Authority as Secured Party, recorded on October 16,
1984 in Liber 319 on Page 563; and as renewed by instrument recorded May 4,
1989 in Liber 380 on Page 176.
- The rights of the public and of any Governmental unit in any part
thereof taken, used or deeded for street, road or highway purposes.
- Rights of the United States, State of Michigan, and the public for
commerce, navigation, recreation and fishery in any portion of the land
comprising the bed or waters of Foster Creek.
- The nature, extent or lack of riparian rights or the riparian rights of
riparian owners and the public in and to the use of waters of Foster Creek.
- Lease contiguous and appurtenant to Parcel 1 and access along the
Easterly line of said Parcel 1 granted by the City of Scottville to W.R. Roach
Company for 99 years from June 15, 1936 or until such time as grantee shall
cease to use said property for canning and manufacturing purposes as set forth
in Liber 13 of Misc. Records on Page 51.
- The easement and right of way recorded November 26, 1975 in Liber 90 of
Misc. Records on Pages 198-199, to City of Scottville for drains, sewers,
waterlines, or other public service facilities over the South 15 feet of Parcel
1.
- The easement and right of way recorded June 15, 1976 in Liber 91 of
Misc. Records on Pages 146-147 to City of Scottville for drains, sewers,
waterlines, or other public service facilities over the South 15 feet of the
North 48 feet of the East 160 feet of Parcel 1.
- The right of way easement recorded December 8, 1931 in Liber 11 of
Misc. Records on Pages 209-210 to Michigan Bell Telephone Company for
telephone and telegraph poles, wires, cables, conduits etc. over and across
Parcel 4.
- The easement for electric line recorded November 6, 1990 in Liber 398
on Page 158 from Stokely USA, Inc., a Wisconsin corporation, to Consumers Power
Company over and across a part of Parcel 1.
<PAGE> 313
SUN PRAIRIE, WISCONSIN
<PAGE> 314
- - Rights and easements, if any, in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to the
subject premises.
- - Highway Conveyance, Limited Highway Easements and Restrictions contained in
instrument recorded on June 1, 1976, in Volume 684 of Records, page 651, as
Document No. 1471081.
- - Easement to General Telephone Company of Wisconsin recorded on September 20,
1976, in Volume 727 of Records, page 259, as Document No. 1487896.
- - Easement to Wisconsin Gas Company recorded on August 2, 1976, in Volume 708
of Records, page 445, as Document No. 1480592.
- - Encroachment, if any, of the building located on Parcel 7 of the captioned
premises into the railroad right of way, as disclosed in instrument recorded
on March 15, 1934, in Volume 363 of Deeds, page 177, as Document No. 554178.
- - Utility easement reserved in instrument recorded on June 22, 1964, in Volume
780 of Deeds, page 51, as Document No. 1104670.
- - Easements and rights incidental thereto in connection with the continued use
and right of entrance, maintenance, construction and repair of municipal or
utility facilities as may exist underground or overground in or on that
portion of the above-described premises which were formerly a part of
Lincoln Street now vacated.
- - Easement to Wisconsin Telephone Company recorded on June 26, 1920, in Volume
48 of Misc., page 215, as Document No. 392723.
- - Easement to City of Sun Prairie recorded on March 29, 1985, in Volume 6636
of Records, page 74, as Document No. 1873497.
<PAGE> 315
WALLA WALLA, WASHINGTON
<PAGE> 316
- - Assessment of [ #'s Missing ] for Poplar Street Extension, under Local
Improvement District No. 762, No. 5, payable in 20 annual installments plus
interest at #(8 1/2%) per annum from April 1, 1991. The first three
installments are paid. The fourth installment was delinquent May 1, 1955.
- - Deed of Trust to Secure an indebtedness of the amount herein stated and any
amounts payable under the terms thereof.
- - Amount : $2,124,000.00
Dated : March 28, 1978
Recorded : March 31, 1978
Volume/Page : 79/389
Auditor's No. : 7802826
Grantor : D & K Frozen Foods, Inc.
Trustee : Pioneer National Title Insurance Company
Beneficiary : Economic Development Administration
U.S. Department of Commerce
- - A security interest in goods under the provisions of the Uniform Commercial
Code, RCW 62A, disclosed by financing statement filed in the office of the
County Auditor.
Debtor : D & K Frozen Foods, Inc.
Secured Party: United States Department of Commerce
Economic Development Administration
Filed : July 29, 1993
Auditor's No.: 9307730
Collateral : All machinery and equipment, etc.
- - A security interest in goods under the provisions of the Uniform Commercial
Code, RCW 62A, disclosed by financing statement filed in the office of the
County Auditor.
Debtor : D & K Frozen Foods, Inc.
Secured Party: Independent Finance, Inc.
Filed : May 17, 1985
Auditor's No.: 8503186
Collateral : One (1) Flofreeze Model 10 MA freezer-Frigoscandia
Contracting, Inc.
Affects : Parcel B
- - A security interest in goods under the provisions of the Uniform Commercial
Code, RCW 62A, disclosed by financing statement filed in the office of the
County Auditor.
Debtor : D & K Frozen Foods, Inc.
Secured Party: Independent Finance, Inc.
Filed : May 17, 1985
Auditor's No.: 8503187
Collateral : One (1) Flofreeze Model 10 MA Freezer-Frigoscandia
Contracting, Inc.
Affects : Parcel B
- - A security interest in goods under the provisions of the Uniform Commercial
Code, RCW 62A, disclosed by financing statement filed in the office of the
County Auditor.
Debtor : D & K/Frozen Foods, Inc.
Secured Party: Rainier Bank
Filed : May 12, 1986
Auditor's No.: 8603286
Collateral : All equipment but not limited to food processing equipment,
freezing tunnels, conveyors, compressors, and hoppers and
including all parts, accessories and accessions
<PAGE> 317
- - Reservations contained in Deed.
Executed By : Jones-Scott Company, a corporation
Recorded : October 8, 1945
Auditor's No. : 287054
Volume/Page : 221/40
As Follows : Jones-Scott Company reserves to itself and its assigns
the right to install a switch and other appurtenances
necessary for building a railway side track on the
Jones-Scott Company's remaining property, said switch
to be installed as near to the north and east boundaries
of the property herein conveyed as may be practical.
Affects : PARCEL B
- - Reservation contained in Deed
Executed by : United States of America
Recorded : February 14, 1956
Auditor's No. : 385018
Volume/Page : 276/280
As follows :
Subject to the following restrictions and conditions (which shall be
covenants running with the land) for breach of any of which restrictions and
conditions the property herein conveyed shall revert to the grantor or its
transferee at its election:
1. Noise shall not exceed 70 decibles at the border of the industrial zones
for all operations. The noise shall be muffled so as not to become
objectionable due to intermittence, heat frequency or shrillness;
2. Smoke, dust, dirt and fly ash shall not exceed 0.3 grains per cubic foot
of flue gas at stack temperatures of 500 degrees Fahrenheit and not to
exceed 50 per cent excess air and shall in no manner be unclean, destructive,
hazardous, nor shall visibility be impaired by the emission of a haze which
unduly impedes vision within apparent opaqueness equivalent to No. 1 of the
Ringleman Chart. Smoke, as measured by the Ringleman Chart, equivalent to
No. 2 on the chart, may be allowed for periods aggregating 4 minutes in any
30 minutes;
3. The emission of obnoxious odors of any kind shall not be permitted;
4. No gas shall be permitted which is deleterious to the public health,
safety or general welfare as determined by the Sanitarian of the County-
City Health Department, when requested by the Building Inspector;
5. Are welding, acetylene torch cutting or similar processes shall be
performed so that glare shall not be seen and heat shall not be noticeable
from any point beyond the outside of the property on which the process is
conducted;
<PAGE> 318
6. Fire and safety precautions, including those pertaining to the
storage and handling of flammable liquids, liquefied petroleum and gases,
shall comply with the rules and regulations of the State of Washington and
the City of Walla Walla;
7. Bulk storage of flammable liquids below ground shall comply with
the fire code of Walla Walla, Washington, bulk storage of flammable liquids,
liquified petroleum, gases and explosives, above ground shall not be
permitted;
8. Storage, such as raw materials, fuel, etc., shall be within an entire
closed building;
9. Prohibited uses. In the Industrial Park area no building shall be
erected or altered and no land shall be used for the carrying on of
manufacturing activities of the character of or similar to junk and wrecking
yards, tanneries, stock yards, glue factories, soap factories, oil refineries
or other similar factories;
10. The area is designated as a park area and shall not be used for
residential purposes or permanent habitation, except for such needs as
caretaker and watchman;
11. Vacant property may not be used for commercial gardening, fruit
raising, and general agricultural purposes that require tilling of the soil
or any use that creates dust, noise, gases, noxious odors or fire and safety
hazards;
12. Mining or extracting operations shall be prohibited;
13. Well drilling, filling, and soil stripping must be done in such manner
as to leave no unsightly or dangerous excavations or spoilbanks and in such
a manner as to prevent increased erosion;
14. Provisions for sewage and waste disposal shall conform to all local and
state ordinances and further shall be such that no condition tending to
pollute the Veterans Administration Hospital water supply shall exist.
Affects : PARCEL C
- - An easement affecting a portion of said premises and for the purpose
stated herein, and incidental purposes.
In favor of : City of Walla Walla, a municipal corporation, its
successors and assigns
Recorded : January 28, 1960
Volume/Page : 292/742
Auditor's no. : 417992
As follows :
Easement and right of way for the operation, maintenance and repair of
a trunk sewer of 24" I.D. dimensions, now located on the following described
property, together with all necessary and usual appurtenances therefor:
Beginning at a point on the original easterly boundary line of the
Veterans Administration Reservation in Sec. 30, Tp. 7 N., R. 36 E.W.M., said
point being 1685.78 feet and bearing south 27 degrees 23' east of the
northeast corner of said Veterans Administration boundary line, said point
being identified by a U.S.C.E. bronze disk, and running thence south 67
degrees 48' 10" west 30.12 feet for the true point of beginning; thence
south 67 degrees 48' 10" west 20.09 feet; thence north 27 degrees 23' west,
parallel to said easterly boundary line, 1525.73 feet more or less to the
south line of Rose Street; said south line being formerly the south right of
way line of the Washington State Primary Highway No. 3; thence easterly
along said south line 20.09 feet; thence south 27 degrees 23' east 1525.73
feet more or less to the true point of beginning.
Affects : PARCEL C.
<PAGE> 319
- - An easement affecting a portion of said premises and for the purposes stated
herein, and incidental purposes.
For : Easement for a pipeline or pipelines for transportation of
oil, gas and the products thereof, and related rights
In Favor of : Cascade Natural Gas Corporation
Recorded : September 8, 1969
Volume/Page : 332/590
Auditor's No. : 503727
Affects : South 10 feet of Parcel C
- - Reservations Contained in Deed
Executed by : Union Pacific Railroad Company, a Utah corporation, and
Walla Walla Valley Railway Company, an Oregon corporation
Recorded : June 22, 1962
Volume/Page : 302/221
Auditor's no. : 439803
As follows :
Reserving unto the grantors, their successors and assigns forever, all
minerals and all mineral rights of every kind and character now known to
exist or hereafter discovered including, without limiting the generality of
the foregoing, oil and gas and rights thereto, together with the sole,
exclusive and perpetual right to explore for, remove and dispose of said
minerals by any means or methods suitable to the grantors, their
successors and assigns, but without entering upon or using the surface of
the lands hereby conveyed, and in such manner as not to damage the surface
of said lands or to interfere with the use thereof by the grantee, its
successors or assigns.
Also, excepting and reserving unto the grantors, their successors and
assigns forever, a perpetual easement and right of way for the purpose of
operating and maintaining railroad facilities upon, along, over and across
the following described portion of the real estate hereby conveyed, to wit:
A strip of land 392 feet more or less in length and 17 feet wide, being
8.5 feet in width on each side of the center line of the joint Walla Walla
Valley Railway Company - Union Pacific Railroad Company switching track
#205, situate in the NW1/4 of Section 19, Township 7 north, Range 36
E.W.M., described as follows, to wit:
Beginning at a point on the north line of Dell Avenue in the City of
Walla Walla that is 726 feet distance west of the point of intersection of
said north line of Dell Avenue with the west line of Thirteenth Avenue
north, said point also being 30 feet northerly of the east and west center
line of said Section 19 which is common to the center line of Dell Avenue;
thence northerly and parallel with said west line of Thirteenth Avenue North
a distance of 607.3 feet to a point which is the TRUE POINT OF BEGINNING of
this description; thence westerly and parallel with and 8.5 feet distant
southerly measured at right angles to the center line of said track #205 a
distance of 392.0 feet more or less; thence northerly and parallel with said
west line of Thirteenth Avenue North a distance of 17.0 feet; thence
easterly and parallel with and 8.5 feet distant northerly measured at right
angles to the center line of said spur track #205 a distance of 392 feet
more or less; thence southerly and parallel with said west line of
Thirteenth Avenue north a distance of 17 feet to the true point of beginning
of this description.
<PAGE> 320
Also, excepting all right, title and interest in and to those certain
railroad tracks, facilities and appurtenances situated upon the property
described in the foregoing paragraph, and reserving unto Walla Walla Valley
Railway Company, its successors and assigns forever, all its right, title and
interest therein and thereto. It is understood and agreed between the
grantors that the railroad tracks, facilities and appurtenances are owned
equally and in common by Walla Walla Valley Railway Company and
Oregon-Washington Railroad & Navigation Company, a corporation.
Affects : Parcel B
- - An easement affecting a portion of said premises and for the purposes stated
herein, and incidental purposes.
For : a perpetual easement with the right to place, construct,
operate and maintain, inspect, reconstruct, repair,
replace and keep clear Underground Communication Lines
with wires, cables, fixtures and appurtenances and
related rights
In Favor of : Pacific Northwest Bell Telephone Company, a Washington
Corporation
Recorded : May 26, 1981
Volume/Page : 128/295
Auditor's No. : 8103831
Affects : east 10 feet of Parcel C
<PAGE> 321
WAUNAKEE, WISCONSIN
<PAGE> 322
- - Rights and easements, if any, in and to any and all railroad switches,
sidetracks, spur tracts and rights of way located upon or appurtenant to the
subject premises.
- - Rights of the public in any portion of the subject premises lying below the
ordinary highwater mark of Six Mile Creek.
- - Easement recorded on June 14, 1944, in Volume 448 of Deeds, page 211, as
Document No. 688528.
- - Easement recorded on July 19, 1949, in Volume 222 of Misc., page 590, as
Document No. 783363.
- - Easement recorded on October 30, 1956, in Volume 297 of Misc., page 249, as
Document No. 928401.
- - Easement to the Village of Waunakee over the Northeasterly 16.5 feet of
Parcel 4 of the captioned premises, said 16.5 feet being parallel and
adjacent to the Westerly line of the Railway right-of-way.
sewer trunk line over a strip of lanced one rode wide running from the
South side of Outlet 3, Waunakee Canning Co. Addition to the Village of
Waunakee, in a Southerly direction to the right of way of the Chicago
Northwestern Railway and having for a center line the center line of the
sewer trunk line now installed on these premises.
- Easements and rights incidental thereto in connection with the continued
use and right of entrance, maintenance, construction and repair of
municipal or utility facilities as may exist underground or overground in
or on that portion of the above-described premises which were formerly a
part of Madison Street, now partially vacated.
- Easement recorded on March 1, 1994, in Volume 26700 of Records, page 40,
as Document No. 2579154.
<PAGE> 323
WELLS, MINNESOTA
<PAGE> 324
- - THERE IS AN EASEMENT FOR HIGHWAY PURPOSES TO COUNTY OF FARIBAULT,
MINNESOTA, BY VIRTUE OF AN EASEMENT AGREEMENT DATED OCTOBER 4, 1940,
RECORDED DECEMBER 7, 1948, AT 17 MISCELLANEOUS, PAGE 160, OVER THE WEST
49 1/2 FEET OF THE CAPTIONED PROPERTY. TRACT 2.
- - THERE IS A TILE AGREEMENT DATED APRIL 22, 1913, FILED AT BOOK 5 OF
MISCELLANEOUS, PAGE 453, GRANTING THE RIGHT TO THE PROPERTY ADJOINING THE
CAPTIONED LAND ON THE EAST TO ENTER AND USE A CERTAIN STRING OF TILE
DRAINAGE TERMINATING AT THE EAST LINE ABOUT 1600 FEET NORTH OF THE
SOUTHEAST CORNER THEREOF FOR THE PURPOSE OF CONNECTING WITH AND FURNISHING
AN OUTLET FOR OTHER STRINGS OF TILE TO BE LAID BY THE OWNER OF THE PROPERTY
TO THE EAST BUT NOT TO EXCEED THE CAPACITY OF AS 12 INCH TILE. TRACT 2.
- - THERE IS A TRANSMISSION LINE EASEMENT TO INTERSTATE POWER COMPANY DATED
APRIL 20, 1964, FILED IN BOOK 23 OF MISCELLANEOUS, PAGE 486, TO INTERSTATE
POWER COMPANY. THE EASEMENT IS LISTED OVER THE CAPTIONED PROPERTY BUT
FURTHER PROVIDES THAT THE ELECTRIC TRANSMISSION LINE IS TO RUN IN AN
EASTERLY AND WESTERLY DIRECTION ALONG THE SOUTH LINE OF THE ABOVE DESCRIBED
PROPERTY. ALSO SAID LINE IS TO RUN IN A NORTHERLY AND SOUTHERLY DIRECTION
ALONG THE WEST LINE OF THE ABOVE DESCRIBED PROPERTY AND BE LOCATED
APPROXIMATELY 2 FEET EAST OF THE EAST BOUNDARY LOCATED ALONG THE WEST LINE
OF THE CAPTIONED PROPERTY. TRACT 1.
- - THERE IS A RIGHT OF WAY DEED TO THE CHICAGO, MILWAUKEE AND ST. PAUL
RAILWAY COMPANY DATED APRIL 23, 1891, FILED APRIL 29, 1891, AT BOOK 20,
PAGE 599. THE RIGHT OF WAY IS OVER A STRIP OF LAND LYING SOUTHWESTERLY OF A
LINE DRAWN TO AND 50 FEET NORTHEASTERLY FROM THE CENTERLINE OF THE
MAIN TRACK OF THE MANKATO BRANCH OF THE RAILWAY AS IT CROSSES THE SOUTHWEST
QUARTER OF THE NORTHEAST QUARTER OF SECTION 5, TOWNSHIP 103, RANGE 24. SAID
DEED ALSO GRANTS THE RIGHT TO ERECT WITHIN 150 FEET FROM THE CENTERLINE
PORTABLE SNOW FENCES ARE NOT ERECTED BEFORE THE 15TH DAY OF OCTOBER EACH
YEAR AND REMOVED ON OR BEFORE THE 1ST DAY OF APRIL. TRACTS 3 & 4.
- - THERE IS A FINAL CERTIFICATE TO THE STATE OF MINNESOTA FOR HIGHWAY
PURPOSES DATED MARCH 8, 1937, FILED MARCH 30, 1937, RECORDED AT 96 OF
DEEDS, PAGE 51. THE HIGHWAY RIGHT OF WAY IS OVER A TRACT OF LAND IN
THE SOUTHWEST QUARTER OF THE NORTHEAST QUARTER OF SECTION 5, TOWNSHIP 103
NORTH, RANGE 24 WEST LYING NORTHEASTERLY OF THE RAILWAY AND LYING
SOUTHWESTERLY OF A LINE PARALLEL WITH AND DISTANT 50 FEET NORTHEASTERLY
AND CONTAINING 0.86 ACRES MORE OR LESS. TRACTS 3 & 4.
- - THERE IS A FINAL CERTIFICATE TO THE STATE OF MINNESOTA DATED DECEMBER 14,
1954, FILED FEBRUARY 26, 1955, AT 119 OF DEEDS, PAGE 76, FOR HIGHWAY RIGHT
OF WAY PURPOSES AS FOLLOWS: THAT PART OF THE SOUTH 20 RODS OF THE SOUTHWEST
QUARTER OF THE SOUTHEAST QUARTER OF SECTION 4, TOWNSHIP 103 NORTH, RANGE 24
WEST LYING NORTHEASTERLY OF THE RAILROAD WHICH LIES SOUTHWESTERLY OF A LINE
PARALLEL WITH AND DISTANT 75 FEET NORTHEASTERLY OF A DESCRIBED LINE
CONTAINING 0.2 ACRES MORE OR LESS. TRACTS 3 & 4.
- - EASEMENT DATED MAY 13, 1991, FILED MAY 20, 1991, AS DOCUMENT NO. 275606.
SEE ATTACHED.
- - EASEMENT AGREEMENT DATED MAY 15, 1992, FILED JUNE 3, 1992, AS DOCUMENT
NO. 279540 BETWEEN THOMAS KUECHENMEISTER AND MAXINE KUECHENMEISTER, HUSBAND
AND WIFE, AND STOKELY USA, INC. SEE ATTACHED.
<PAGE> 325
146092-B
This instrument was prepared by State: Illinois (Hoopeston)
and upon recording should be
returned to: County: Vermilion
Attorney Thomas P. Solheim
Solheim Billing & Grimmer, S.C.
P.O. Box 1644
Madison, WI 53701-1644
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FINANCING STATEMENT
DATED AS OF MAY 25, 1995
STOKELY USA, INC., GRANTOR
TO
STATE OF WISCONSIN INVESTMENT BOARD,
NATIONWIDE LIFE INSURANCE COMPANY,
WEST COAST LIFE INSURANCE COMPANY, AND
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU,
BENEFICIARY
CHICAGO TITLE INSURANCE COMPANY, AS TRUSTEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
This instrument secures future advances and obligations and contains an
after-acquired property provision.
May 23, 1995
<PAGE> 326
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS,
SECURITY AGREEMENT AND FINANCING STATEMENT
THIS DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT AND FINANCING STATEMENT ("Deed of Trust"), made this 25th day of May,
1995 by STOKELY USA, INC., a Wisconsin corporation, whose address is 1055
Corporate Center Drive, Oconomowoc, Wisconsin 53066, (herein called the
"Grantor") to CHICAGO TITLE INSURANCE COMPANY, Chicago, Illinois, (herein
called the "Trustee"), and NATIONWIDE LIFE INSURANCE COMPANY ("Nationwide"),
WEST COAST LIFE INSURANCE COMPANY ("West Coast"), EMPLOYERS LIFE INSURANCE
COMPANY OF WAUSAU ("Employers"), and STATE OF WISCONSIN INVESTMENT BOARD
("SWIIB"), as beneficiaries (hereinafter referred to collectively and
individually as the "Beneficiary"), Nationwide, West Coast and Employers having
an office at One Nationwide Plaza, Columbus, Ohio 43216, Attention: Corporate
Fixed-Income Securities, and SWIB having an office at 121 East Wilson
Street, Madison, Wisconsin 53702, Attention: Private Placements. Capitalized
terms used herein, to the extent not otherwise defined herein, shall have the
meaning ascribed to such terms in the Security Agreement of same date hereof
(as may be amended from time to time, herein referred to as the "Security
Agreement") executed by and among Grantor, as debtor, and Beneficiaries, as
secured parties.
W I T N E S S E T H:
WHEREAS, the Beneficiaries are the lenders (the "Lenders") as
described in the Intercreditor Agreement and the Security Agreement and Grantor
is indebted to the Lenders pursuant to the Nationwide Note Agreement and
Nationwide Notes and the SWIB Note Agreement and SWIB Note; and
WHEREAS, Grantor desires that Lenders agree to certain
amendments to the Nationwide Note Agreement and the SWIB Note Agreement; and
WHEREAS, it is a condition precedent to the Lenders entering
into the Nationwide Note Agreement and the SWIB Note Agreement that Grantor
execute and deliver this Deed of Trust;
WHEREAS, the Grantor desires to execute and deliver this Deed
of Trust to satisfy the condition described in the preceding paragraph;
WHEREAS, the Lenders were among the beneficiaries of a certain
prior mortgages, deeds of trust, security agreements, and other documents (the
"Prior Security Documents") furnished by Grantor and others as security for the
SWIB Note Obligations and the Nationwide Note Obligations; and
May 23, 1995
<PAGE> 327
WHEREAS, this Deed of Trust secures the same SWIB Note
Obligations and Nationwide Note Obligations as were secured by the Prior
Security Documents, and covers property which was covered by the Prior Security
Documents, and accordingly replaces one or more of the Prior Security
Documents.
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby irrevocably acknowledged, and to
secure the prompt and complete payment and performance when due of the
Nationwide Note Obligations, the SWIB Note Obligations, and any obligations of
Grantor to Lenders arising under the Security Agreement or Loan Documents, as
well as any extensions or renewals of same, together with all other obligations
and liabilities of the Grantor due or to become due under any other documents
evidencing or securing the foregoing, together with all amounts, sums, and
expenses paid or incurred hereunder by any Beneficiary according to the terms
hereof and all other obligations and liabilities of the Grantor under this Deed
of Trust, or any additional sums which are in the future advanced or made by
Lenders or Beneficiary to or on behalf of Grantor as protective advances (all
of the foregoing hereafter collectively referenced as the "Indebtedness"), the
Grantor hereby GRANTS, BARGAINS, SELLS, WARRANTS, CONVEYS, ALIENS, REMISES,
RELEASES, ASSIGNS, SETS OVER AND CONFIRMS to the Trustee, in trust with power
of sale.:
All that certain lot, piece or parcel of land more particularly
described in Exhibit A attached hereto and by this reference made a
part hereof;
TOGETHER with the buildings and improvements now or hereafter
located on said land and all right, title and interest, if any, of the
Grantor in and to the streets and roads abutting said land to the
center lines thereof, and strips and gores within or adjoining said
land, the air space and right to use said air space above said land,
all rights of ingress and egress by motor vehicles to parking
facilities on or within said land, all easements now or hereafter
affecting said land, royalties and all rights appertaining to the use
and enjoyment of said land, including, without limitation, alley,
drainage, mineral, water, reservoir, oil and gas rights (said land
and/or leasehold estate, together with said building and improvements,
the property and other rights, privileges and interests encumbered or
conveyed hereby, are hereinafter collectively referred to as the
"Premises");
TOGETHER with all furnishings, fixtures and equipment and all
appurtenances and additions thereto and substitutions or replacements
thereof, which Grantor owns or in which Grantor has an interest and
which are now or hereafter permanently attached to the Premises (herein
called "Fixtures"), including, but not limited to, heating, cooling,
fire protection equipment and plumbing, electrical distribution and
other utility connections or equipment. Without limiting the
foregoing, the Grantor hereby grants to the Beneficiary a security
interest in the above described Fixtures and the Beneficiary shall
have, in addition to all rights and remedies provided herein, and in
any other agreements, commitments and undertakings made by the Grantor
to the Beneficiary, all
2
May 23, 1995
<PAGE> 328
of the rights and remedies of a "secured party" under the Uniform
Commercial Code of the state in which the property described in Exhibit
A is located (the "Uniform Commercial Code"). To the extent permitted
under applicable law, this Deed of Trust shall be deemed to be a
security agreement and financing statement (as defined in the Uniform
Commercial Code) with respect to the Fixtures. Grantor hereby
authorizes Beneficiary to execute and file continuation statements
without the signature of Grantor if Beneficiary determines that such
are necessary or advisable in order to perfect Beneficiary's security
interest in such Fixtures. Grantor shall promptly execute financing
and continuation statements in form satisfactory to Beneficiary upon
request to further evidence and secure Beneficiary's interest in such
Fixtures. Grantor shall pay to Beneficiary, on demand, any expenses
incurred by Beneficiary in connection with the preparation, execution
and filing of such statements and any continuation statements that may
be filed by Beneficiary. Upon the occurrence of an Event of Default
under this Deed of Trust, Beneficiary may, at its option, sell or
otherwise dispose of such Fixtures by public or private proceedings,
separate from or together with the sale of the Premises, in accordance
with the provisions of the Uniform Commercial Code. With respect to
such Fixtures, Beneficiary may exercise any other rights or remedies of
a secured party under the Uniform Commercial Code. Unless such
Fixtures are perishable or threaten to decline speedily in value or are
of a type customarily sold on a recognized market, Beneficiary shall
give Grantor at least ten (10) days prior written notice of the time
and place of any public sale of such Fixtures or intended disposition
thereof. Upon the occurrence of any Event of Default under this Deed of
Trust, the Beneficiary reserves the option to proceed with respect to
such Fixtures as part of the Premises in accordance with its rights and
remedies with respect to the Premises, in which event the default
provisions of the Uniform Commercial Code shall not apply;
TOGETHER with, to the extent of Grantor's interest therein, all
leases, lettings and licenses of the Premises or any part thereof now or
hereafter entered into and all, right, title and interest of the Grantor
thereunder, including, without limitation, cash and securities deposited
thereunder and the right to receive and collect the rents, issues and
profits payable thereunder;
TOGETHER with all unearned premiums accrued, accruing or to
accrue under insurance policies now or hereafter obtained by the
Grantor relating to the Premises and/or Fixtures and all proceeds of
the conversion, voluntary or involuntary, of the Premises and/or
Fixtures or any part thereof into cash or liquidated claims, including,
without limitation, proceeds of hazard and title insurance and all
awards and compensation heretofore and hereafter made to the present
and all subsequent owners of the Premises and/or Fixtures by any
governmental or other lawful authorities for the taking by eminent
domain, condemnation or otherwise, of all or any part of the Premises
and/or Fixtures or any easement therein, including awards for any
change of grade of streets;
3
May 23, 1995
<PAGE> 329
TOGETHER with all right, title and interest of the Grantor in
and to all extensions, improvements, betterments, renewals, substitutes
and replacements of, and all additions and appurtenances (to the extent
such additions and/or appurtenances constitute real property and/or
Fixtures) to, the Premises and/or Fixtures hereafter acquired by, or
released to, the Grantor or constructed, assembled or placed by the
Grantor on the Premises, and all conversions of the security
constituted thereby, immediately upon such acquisition, release,
construction, assembling, placement or conversion, as the case may be,
and in each such case, without any further mortgages, conveyance,
assignment or other act by the Grantor, shall become subject to the
lien of this Deed of Trust as fully and completely, and with the same
effect, as though now owned by the Grantor and specifically described
herein.
Any reference to the "Property" shall be deemed to apply to the
Premises, Fixtures and all the properties and rights expressed in the
foregoing five (5) paragraphs, unless the context shall require
otherwise.
TO HAVE AND TO HOLD the Property unto the Beneficiary and its
successors and assigns forever, PROVIDED HOWEVER, that if the
Indebtedness is paid in full, and if the Grantor properly performs all
of the covenants herein contained, then this Deed of Trust shall be
released, otherwise this Deed of Trust will remain in full force and
effect.
ARTICLE I
COVENANTS OF THE GRANTOR
AND the Grantor covenants and agrees with the Beneficiary as
follows:
Section 1.1. Payment of Indebtedness. The Grantor will
punctually pay the Indebtedness including, without limitation, all sums and
charges at any time secured by or otherwise due under this Deed of Trust and
all protective advances made by the Beneficiary or Lenders to the Grantor and
any other advances made by the Beneficiary, all in immediately available funds
in the currency of the United States of America.
Section 1.2. Title to the Property. The Grantor warrants that:
(i) it has title to the Property subject only to those exceptions to title set
forth in Exhibit B attached hereto ("Permitted Encumbrances"); (ii) it has
full power and lawful authority to encumber the Property in the manner and form
herein set forth; (iii) it will own all Fixtures now or hereafter affixed
and/or used in connection with the Premises, including any substitutions or
replacements thereof, free and clear of liens and claims except for Permitted
Encumbrances; (iv) this Deed of Trust is and will remain a valid and
enforceable first lien on the Property except for Permitted Encumbrances; and
(v) it will preserve such title, and will forever warrant and defend the same
to the Beneficiary and will forever warrant and defend the validity and
priority of the lien hereof against the claims of all persons and parties
whomsoever except for Permitted Encumbrances.
4
May 23, 1995
<PAGE> 330
Section 1.3. Maintenance of the Property. The Grantor shall
maintain the Property in good repair, and shall comply with the requirements of
any governmental authority claiming jurisdiction over the Property to the
extent non-compliance would have a material adverse effect on the Property or
the business, assets, or financial condition of the Grantor, within thirty (30)
days after an order containing such requirement has been issued by any such
authority, provided that such thirty (30) day period may be extended for such
additional period of time as is reasonably necessary or may be permitted under
such order to so comply on the condition that Grantor commences such compliance
within such thirty (30) day period and diligently prosecutes such compliance,
but in any event Grantor shall comply with such order not later than the
earliest of: (a) one hundred eighty (180) days after such order has been issued
(unless a later date for compliance is permitted under such order, in which
case such later date shall apply), or (b) such time as Beneficiary, in its sole
discretion, notifies Grantor in writing that the Property or Beneficiary's
security therein is in jeopardy of being forfeited, foreclosed or otherwise
adversely affected. The Grantor shall permit the Beneficiary to enter upon the
Premises and inspect the Property at all reasonable hours and with prior
reasonable notice, provided that such inspection shall not interfere with
Grantor's business operations. The Grantor shall not, without the prior written
consent of the Beneficiary, commit, permit or suffer to occur any waste,
material alteration, demolition or removal of the Property or any part thereof;
provided however, that property or Fixtures may be removed from the Premises
and alterations may be made to the Premises if the Grantor concurrently
therewith replaces removed items with similar items of equal or greater value,
free of any lien, charge or claim of superior title, and material alterations
may be made to the Premises provided such material alterations do not adversely
affect the structure, utility or value of any improvements or Fixtures located
on the Premises.
Section 1.4. Insurance Restoration. The Grantor hereby agrees
that:
(a) The Grantor shall keep the buildings and
improvements now or hereafter located within the Premises insured
against damage by fire and the other hazards covered by a standard
extended coverage insurance policy for the full insurable value thereof
(which, unless the Beneficiary shall otherwise agree in writing, shall
mean the full repair and replacement value thereof without reduction
for depreciation or coinsurance). In addition, the Beneficiary may
require the Grantor to carry such other insurance on the buildings and
improvements now or hereafter located within the Premises, in such
amounts as may from time to time be reasonably required by
institutional lenders, against insurable casualties which at the time
are commonly insured against in the case of premises similarly
situated, due regard being given to the site and the type of the
building, the construction, location, utilities and occupancy or any
replacements or substitutions therefor; with respect to any portions
of the Premises or improvements thereon which do not conform to all
laws and regulations regarding such improvements, the Grantor shall
provide a "contingent operation of building laws" endorsement to such
policy or policies; the Grantor shall additionally keep the buildings,
improvements and Fixtures located therein and thereon now or hereafter
located on the Premises insured against loss by flood if the Premises
are located in an area identified
5
May 23, 1995
<PAGE> 331
by the Secretary of Housing and Urban Development as an area
having special flood hazards and in which flood insurance has been made
available under the National Flood Insurance Act of 1968 (and any
successor act thereto) in an amount equal to the value of the Property
or the maximum limit of coverage available with respect to the
buildings under said Act, whichever is less, and will assign and
deliver the policy or policies of such insurance to the Beneficiary,
which policy or policies shall have endorsed thereon a standard
mortgagee clause in the name of the Beneficiary, so and in such manner
and form that the Beneficiary and its successors and assigns shall at
all times have and hold the said policy or policies as collateral and
further security for any change in the use, operation or value of the
Premises, or in the availability of insurance in the area in which the
Premises are located. The Grantor shall, within five (5) days after
demand by the Beneficiary, take out such additional amounts and/or such
other kinds of insurance as the Beneficiary may reasonably require;
otherwise, the Grantor shall not take out any separate or additional
insurance which is contributing in the event of loss unless it is
properly endorsed and otherwise satisfactory to the Beneficiary in all
respects.
The proceeds of insurance paid on account of any damage
or destruction to the Premises or any part thereof shall be paid over
to the Beneficiary to be applied, in the absolute discretion of
Beneficiary except as provided in the following sentence, toward
the payment of the Indebtedness secured by this Deed of Trust or any
portion thereof, whether nor not then due or payable and in such order
as Beneficiary shall determine. Notwithstanding the foregoing,
Beneficiary shall, at Grantor's direction, apply such proceeds of
insurance or any part thereof to the restoration of the Premises
provided that (A) no Event of Default hereunder or any event which,
with the passage of time or the giving of notice would constitute an
Event of Default, or both, shall have occurred and remain uncured, and
(B) the insurance proceeds received pursuant to this Section 1.4,
together with such additional funds available to Grantor are sufficient
to restore the Premises to an architectural and economic unit of the
same character and not less valuable than the Premises immediately
prior to such damage or destruction; provided that insurance proceeds
resulting from any incident of damage or destruction where the amount
of loss is $25,000 or less shall be paid to, or may be retained by,
Grantor, to be applied to the Indebtedness or to restoration, as
provided in this paragraph.
(b) In the event of damage or destruction to the
Premises, for which proceeds are to be applied to restoration of the
Premises, the Grantor shall promptly commence and diligently perform
the repair, restoration and rebuilding of the Premises so damaged
or destroyed (hereinafter referred to as the "work") to restore the
Premises in full compliance with all legal requirements and so that the
Premises shall be at least equal in value and general utility as they
were prior to the damage or destruction. In such event, if the work to
be done is structural or if the cost of the work as estimated by the
Beneficiary shall exceed Two Hundred Fifty Thousand Dollars ($250,000)
(hereinafter referred to as "major work"), then the Grantor shall,
prior to the commencement of the work, furnish to the Beneficiary: (1)
complete plans and specifications for the work (approved by all
governmental authorities whose approval is
6
May 23, 1995
<PAGE> 332
required), for the Beneficiary's approval, which shall not be
unreasonably withheld. Said plans and specifications shall bear the
signed approval thereof by an architect satisfactory to the Beneficiary
(hereinafter referred to as the "Architect") and shall be accompanied
by the Architect's signed estimate, bearing the Architect's seal, of
the entire cost of completing the work; (2) certified or photostatic
copies of all permits and approvals required by law in connection with
the commencement and conduct of the work; and (3) a surety bond for
and/or guaranty of the completion of the work, which bond or guaranty
shall be in form reasonably satisfactory to the Beneficiary and shall
be signed by a surety or sureties, or guarantor or guarantors, as the
case may be, who are reasonably acceptable to the Beneficiary.
If the proceeds of insurance are applied to restoration
of the Premises, any insurance proceeds recovered by the
Beneficiary on account of damage or destruction to the Premises less
the cost, if any, to the Beneficiary of such recovery and of paying out
such proceeds (including attorneys' fees and costs allocable to
inspecting the work and the plans and specifications therefor), shall,
upon the written request of the Grantor, be applied by the Beneficiary
to the payment of the cost of the work or major work, as the case may
be, referred to above and shall be paid out from time to time to the
Grantor and/or, at the Beneficiary's option exercised from time to
time, directly to the contractor, subcontractors, materialmen,
laborers, engineers, architects and other persons rendering services or
materials for the work, as said work progresses except as otherwise
hereinafter provided, but subject to the following conditions, any of
which the Beneficiary may waive:
1. If the work to be done is structural or if
it is major work, as determined by the Beneficiary, the
Architect shall be in charge of the work;
2. Each request for payment shall be made on
seven (7) days' prior written notice to the Beneficiary and
shall be accompanied by a certificate of the Architect if one
be required as provided above, otherwise by an executive or
fiscal officer of the Grantor, stating (i) that all of the work
completed has been done in compliance with the approved plans
and specifications, if any be required, as provided above and
in accordance with all provisions of law; (ii) the sum
requested is required to reimburse the Grantor for payments by
the Grantor to, or is due to the contractor, subcontractors,
materialmen, laborers, engineers, architects or other persons
rendering services or materials for the work (giving a brief
description of such services and materials), and that when
added to all sums, if any, previously paid out by the
Beneficiary does not exceed the value of the work done to the
date of such certificate; and (iii) that the amount of such
proceeds remaining in the hands of the Beneficiary will be
sufficient on completion of the work to pay for the same in
full (giving in such reasonable detail as the Beneficiary may
reasonably require an estimate of the cost of such completion);
7
May 23, 1995
<PAGE> 333
3. Each request shall be accompanied by waivers
of liens satisfactory to the Beneficiary covering that part of
the work previously paid for, if any, and by a search prepared
by a title company or licensed abstracter or by other evidence
satisfactory to the Beneficiary, that there has not been filed
with respect to the Premises any mechanic's lien or other lien
or instrument for the retention of title in respect of any part
of the work not discharged of record and that there exist no
encumbrances on or affecting the Premises other than
encumbrances, if any, which are set forth in the title policy
issued to the Beneficiary insuring the lien of this Deed of
Trust;
4. There shall be no uncured Event of Default
on the part of the Grantor under the Notes, the other Loan
Documents, or this Deed of Trust; and
5. The request for any payment after the work
has been completed shall be accompanied by a copy of any
certificate or certificates required by law to render occupancy
of the Premises legal.
(c) Except as otherwise agreed to by Grantor and
Beneficiary, in event the work to be done to restore the Premises is
not structural or it is not major work as determined by the Beneficiary
and Beneficiary has elected to apply the proceeds of insurance to
restoration, then the net insurance proceeds held by the Beneficiary
for application to restoration shall be paid to the Grantor by the
Beneficiary upon completion of the work, subject to the provisions of
the foregoing subsections, except to the extent those provisions apply
only to work to be done that is structural or major work as determined
by the Beneficiary.
(d) If the proceeds of insurance are applied toward
restoration of the Premises and, if, within one hundred twenty (120)
days after the occurrence of any damage or destruction to the Premises
requiring structural work or major work in order to restore the
Premises, the Grantor shall not have submitted to the Beneficiary and
received the Beneficiary's approval of plans and specifications for the
repair, restoration and rebuilding of the Premises so damaged or
destroyed (approved by the Architect and by all governmental
authorities whose approval is required), or if, after such plans and
specifications are approved by all such governmental authorities and
the Beneficiary, the Grantor shall fail to commence promptly such
repair, restoration and rebuilding, or if thereafter the Grantor fails
to continue diligently such repair, restoration and rebuilding or is
delinquent in the payment to mechanics, materialmen or others of the
costs incurred in connection with such work required to be paid by
Grantor, or, in the case of any damage or destruction requiring neither
structural work nor major work, as determined by the Beneficiary in
order to restore the Premises, if the Grantor shall fail to diligently
pursue such repair, restoration and rebuilding promptly the Premises so
damaged or destroyed then, in addition to all other rights herein set
forth, and after giving the Grantor fifteen (15) days' written notice
of the nonfulfillment of one or more of the foregoing conditions, the
Beneficiary, or any lawfully appointed receiver of the Premises,
8
May 23, 1995
<PAGE> 334
may at their respective options, upon forty-eight (48) hours'
prior notice, perform or cause to be performed such repair, restoration
and rebuilding, and may take such other steps as they deem advisable to
perform such repair, restoration and rebuilding, and the Grantor hereby
waives, for the Grantor and all others holding under the Grantor, any
claim against the Beneficiary and such receiver arising out of anything
done by the Beneficiary or such receiver pursuant hereto (except for
their gross negligence, reckless disregard or willful, malicious acts),
and the Beneficiary may apply insurance proceeds (without the need to
fulfill any other requirements of this Section 1.4) to reimburse the
Beneficiary, and/or such receiver, for all amounts expended or incurred
by them, respectively, in connection with the performance of such work,
and any excess costs shall be paid by the Grantor to the Beneficiary
upon demand.
(e) The Grantor shall (i) provide public liability
insurance with respect to the Premises providing for limits of
liability of not less than $5,000,000 for both injury to or death
of a person and for property damage, and (ii) provide rent insurance or
business interruption insurance in an amount at least equal at all
times to the twelve months' anticipated gross rental income or twelve
months' gross business earnings of the Premises, whichever is
applicable.
(f) All insurance policies required pursuant
to this Section 1.4 shall be endorsed to name the Beneficiary as an
insured thereunder, as its interest may appear, with loss payable to
the Beneficiary, without contribution, under a standard mortgagee
clause. All such insurance policies and endorsements shall be fully
paid for and contain such provisions and expiration dates and be in
such form and issued by such insurance companies licensed to do
business in the state where the Premises are located, with a rating of
"A" or better and a size classification of "X" or greater as
established by Best's Rating Guide or an equivalent rating with such
other publication of a similar nature as shall be in current use, as
shall be approved by the Beneficiary. Without limiting the foregoing,
each policy shall provide that such policy may not be cancelled or
materially changed except upon thirty (30) days' prior written
notice of intention of non-renewal, cancellation or material change to
the Beneficiary and that no act or thing done by the Grantor shall
invalidate the policy as against the Beneficiary. In the event the
Grantor fails to maintain insurance in compliance with this Section
1.4, the Beneficiary may, but shall not be obligated to, obtain such
insurance and pay the premium therefor and the Grantor shall, on
demand, reimburse the Beneficiary for all sums, advances and expenses
incurred in connection therewith. The Grantor shall deliver copies of
all original policies, certified by the insurance company or authorized
agent as being true copies to the Beneficiary together with the
endorsements thereto required hereunder. Notwithstanding anything to
the contrary contained herein or any provision of applicable law of the
state in which the Premises are located, the proceeds of insurance
policies coming into the possession of the Beneficiary shall not be
deemed trust funds and the Beneficiary shall be entitled to dispose of
such proceeds as herein provided
9
May 23, 1995
<PAGE> 335
Section 1.5. Maintenance of Existence. The Grantor will, so
long as it is owner of the Property, do all things necessary to preserve and
keep in full force and effect its corporate existence, and will comply with all
regulations, rules, ordinances, statutes, orders and decrees of any governmental
authority or court applicable to the Grantor or to the Property or any part
thereof to the extent non-compliance would have a material adverse effect on the
Property or business, assets or financial condition of the Grantor.
Section 1.6. Taxes and Other Charges. The Grantor hereby
agrees that:
(a) The Grantor shall pay and discharge when due
and before delinquent all taxes of every kind and nature, water rates,
sewer rents and assessments, review, permits, inspection and license
fees and all other charges imposed upon or assessed against the
Property or any part thereof or upon the revenues, rents, issues,
income and profits of the Premises or arising in respect of the
occupancy, uses or possession therefore and, unless the Grantor is
making monthly deposits with the Beneficiary in accordance with Section
1.14 hereof, the Grantor shall exhibit to the Beneficiary within thirty
(30) days after the same shall have become due, validated receipts
showing the payment of such taxes, assessments, water rates, sewer
rents, levies, fees and other charges which may be or become a prior
lien on the Property. Should the Grantor default in the payment of any
of the foregoing taxes, assessments, water rates, sewer rents, or other
charges, the Beneficiary may, but shall not be obligated to, pay the
same or any part thereof and the Grantor shall, on demand, reimburse
the Beneficiary for all amounts so paid.
(b) Nothing in this Section 1.6 shall require the
payment or discharge of any obligation imposed upon the Grantor by
subsection (a) of this Section 1.6 so long as the Grantor shall in good
faith and at its own expense contest the same or the validity thereof
by appropriate legal proceedings which proceedings must operate to
prevent the collection thereof or other realization thereon and the
sale or forfeiture of the Property or any part thereof to satisfy the
same; provided that during such contest the Grantor shall, at the
option of the Beneficiary, provide security reasonably satisfactory to
the Beneficiary, assuring the discharge of the Grantor's obligation
hereunder and of any additional interest charge, penalty or expense
arising from or incurred as a result of such contest; and provided,
further, that if at any time payment of any obligation imposed upon the
Grantor by subsection (a) of this Section 1.6 shall become necessary to
prevent the delivery of a tax deed conveying the Property or any
portion thereof because of non-payment, then Grantor shall pay the same
in sufficient time to prevent the delivery of such tax deed.
Section 1.7. Mechanics' and Other Liens. The Grantor
hereby agrees that:
(a) The Grantor shall pay, from time to time when the
same shall become due, all lawful claims and demands of mechanics,
materialmen, laborers, and others
10
May 23, 1995
<PAGE> 336
which, if unpaid, might result in, or permit the creation of a lien on
the Property or any part thereof, or on the revenues, rents, issues,
income or profits arising therefrom and, in general, the Grantor shall
do, or cause to be done, at the cost of the Grantor and without expense
to the Beneficiary, everything necessary to fully preserve the lien of
this Deed of Trust. In the event the Grantor fails to make payment of
such claims and demands, the Beneficiary may, but shall not be
obligated to, make payment thereof, and the Grantor shall, on demand,
reimburse the Beneficiary for all sums so expended.
(b) Nothing in this Section 1.7 shall require the
payment or discharge of any claim or demand as set forth in subsection
(a) of this Section 1.7 so long as the Grantor shall, in good faith and
at its own expense, contest the same or the validity thereof by
appropriate legal proceedings which proceedings must operate to
prevent the collection thereof or other realization thereon and the
sale or forfeiture of the Property or any part thereof to satisfy the
same; provided that during such contest the Grantor has posted security
reasonably satisfactory to the Beneficiary, assuring the discharge of
the Grantor's obligation hereunder and of any additional interest
charge, penalty or expense arising from or incurred as a result of such
contest.
Section 1.8. Condemnation Awards. The Grantor, immediately
upon obtaining knowledge of the institution of any proceedings for the
condemnation of the Premises or any portion thereof, will notify the
Beneficiary of the pendency of such proceedings. The Beneficiary may
participate in any such proceedings and the Grantor from time to time will
deliver to the Beneficiary all instruments reasonably requested by it to permit
such participation. All awards and compensation or other taking or purchase in
lieu thereof, of the Premises or any part thereof, are hereby assigned to and
shall be paid to the Beneficiary. The Grantor hereby authorizes the Beneficiary
to collect and receive such awards and compensation, to give proper receipts
and acquittance therefor and in the Beneficiary's absolute discretion to apply
the same toward the payment of the Indebtedness, notwithstanding the fact that
the Indebtedness may not then be due and payable, or to apply the same toward
the restoration of the Premises. In the event that all or any portion of the
condemnation awards or compensation shall be used to reduce the Indebtedness,
such shall be applied in accordance with the provisions of the Intercreditor
Agreement. The Grantor, upon reasonable request by the Beneficiary, shall make,
execute and deliver any and all instruments requested for the purpose of
confirming the assignment of the aforesaid awards and compensation to the
Beneficiary free and clear of any liens, charges or encumbrances of any kind or
nature whatsoever.
Section 1.9. Deed of Trust Authorized. The Grantor hereby
warrants and represents that the execution and delivery of this Deed of Trust
and its acknowledgement of the Intercreditor Agreement has been duly authorized
and that there is no provision in its articles of incorporation or by-laws, as
the same may have been amended, requiring further consent for such action by
any other entity or person; it is duly organized, validly existing and in good
standing under the laws of the state of its incorporation or formation, as the
case may be, and has (a) all necessary licenses, authorizations, registrations
and approvals (herein called "Permits"), and (b) full power and authority to own
its properties and carry on its business as
11
May 23, 1995
<PAGE> 337
presently conducted; and (c) the execution and delivery by the Grantor and
performance of its obligations under this Deed of Trust and the Intercreditor
Agreement will not conflict with any provision of the articles of incorporation
or by-laws of the Grantor, as the same may have been amended, or of any
mortgage, credit or other agreement to which it is a party.
Section 1.10. Costs of Defending and Upholding the Lien. If
any action or proceeding is commenced to which action or proceeding the
Beneficiary or any of the Lenders is made a party or in which it becomes
necessary to defend or uphold the lien of this Deed of Trust, the Grantor shall,
on demand, reimburse the Beneficiary and/or the Lender(s) for all reasonable
expenses (including, without limitation, reasonable attorneys' fees and
expenses and appellate attorneys' fees and expenses) incurred by the Beneficiary
and/or the Lender(s) in any such action or proceeding.
Section 1.11. Additional Advances and Disbursements. Subject
to Grantor's right to contest the same in the same manner as set forth in
Sections 1.6(b) and 1.7(b) hereof, the Grantor shall pay when due prior to the
expiration of any applicable period of grace all payments and charges on all
liens, encumbrances, ground and other leases, and security interests which may
be or become superior to the lien of this Deed of Trust, and in default
thereof, the Beneficiary shall have the right, but shall not be obligated, to
pay, without notice to the Grantor, such payments and charges and the Grantor
shall, within ten (10) days after written demand, reimburse the Beneficiary for
amounts so paid. In addition, upon default of the Grantor in the performance
of any other terms, covenants, conditions or obligations by it to be performed
prior to the expiration of any applicable period of grace under any such prior
lien, encumbrance, lease or security interest, the Beneficiary shall have the
right, but shall not be obligated, to cure such default in the name and on
behalf of the Grantor. All sum advanced and reasonable expenses incurred at
any time by the Beneficiary pursuant to this section or as otherwise provided
under the terms and provisions of this Deed of Trust shall bear interest from
the date that such sum is advanced or expense incurred, to and including the
date of reimbursement.
Section 1.12. Costs of Enforcement/Waiver. The Grantor
agrees to bear and pay all reasonable expenses (including reasonable attorneys'
fees and appellate attorneys' fees) of or incidental to the enforcement of any
provision hereof, or the enforcement, compromise or settlement of this Deed of
Trust or the Indebtedness, and for the curing thereof, or for defending or
asserting the rights and claims of the Beneficiary in respect thereof, by
litigation or otherwise. All rights and remedies of the Beneficiary shall be
cumulative and may be exercised singly or concurrently. Notwithstanding
anything herein contained to the contrary, the Grantor, to the extent permitted
under applicable law: (a) will not (i) at any time insist upon, or plead, or in
any manner whatever claim or take any benefit or advantage of any stay or
extension or moratorium law, any exemption from execution or sale of the
Property or any part thereof, wherever enacted, now or at any time hereafter in
force, which may affect the covenants and terms of performance of this Deed of
Trust, nor (ii) claim, take or insist upon any benefit or advantage of any law
now or hereafter in force providing for the valuation or appraisal of the
Property, or any part thereof, prior to any sale or sales thereof which may be
made pursuant to any provision herein, or pursuant to the decree, judgment or
order of any court of competent
12
May 23, 1995
<PAGE> 338
jurisdiction, nor (iii) after any such sale or sales, claim or exercise any
right under any statute heretofore or hereafter enacted to redeem the property
so sold or any part thereof or claim any homestead rights therein; (b) hereby
expressly waives all benefit or advantage of any such law or laws; (c)
covenants not to hinder, delay or impede the execution of any power herein
granted or delegated to the Beneficiary, but to suffer and permit the execution
of every power as though no such law or laws had been made or enacted; (d)
ADDITIONALLY WAIVES TO THE EXTENT PERMITTED BY LAW AND TO THE EXTENT GRANTOR
MAY BE ENTITLED TO TRIAL BY JURY IN THE EVENT ANY SUIT, ACTION, OR OTHER
PROCEEDING IS INITIATED IN RESPECT OF GRANTOR'S OBLIGATIONS HEREUNDER, GRANTOR
WAIVES TRIAL BY JURY IN ANY SUCH ACTION OR PROCEEDING; and (e) for itself and
any other person who may claim under it, waives, to the extent that it lawfully
may, all right to have the Property marshalled upon any foreclosure hereof.
Section 1.13. Deed of Trust Taxes. The Grantor shall pay any
and all taxes, charges, filing, registration and recording fees, excises and
levies imposed upon the Beneficiary by reason of the Indebtedness or this Deed
of Trust or any mortgage supplemental hereto, any security instrument with
respect to any Fixtures or personal property owned by the Grantor at the
Premises and any instrument of further assurance, other than income, franchise
and doing business taxes, and shall pay all stamp or mortgage taxes and other
taxes required to be paid on the Indebtedness and/or this Deed of Trust. In the
event the Grantor fails to make such payment within ten (10) days after written
notice thereof from the Beneficiary, then the Beneficiary shall have the right,
but shall not be obligated, to pay the amount due, and the Grantor shall, on
demand, reimburse the Beneficiary for said amount.
Section 1.14. Escrow Deposits. From and during the occurrence
of an Event of Default and continuing after any default by Grantor to
pay as and when due the amounts required to be paid under Section 1.6, the
Beneficiary, at its option, may require that the Grantor deposit with the
Beneficiary, monthly, one-twelfth (1/12th) of the annual charges for ground or
other rent, if any, insurance premiums and real estate taxes, assessments,
water, sewer, levies, fees and other charges which might become a lien upon the
Property and the Grantor shall, accordingly, make such deposits. In addition,
if required by the Beneficiary, the Grantor shall simultaneously therewith
deposit with the Beneficiary a sum of money which together with the monthly
installments aforementioned will be sufficient to make each of the payments
aforementioned at least thirty (30) days prior to the date such payments are
due. Should said charges not be ascertainable at the time any deposit is
required to be made with the Beneficiary, the deposit shall be made on the
basis of the charges for the prior year, and when the charges are fixed for the
then current year, the Grantor shall deposit any deficiency with the
Beneficiary. All funds so deposited with the Beneficiary shall be held by it in
a separate interest bearing savings account and shall be applied in payment of
the charges aforementioned when and as payable, to the extent the Beneficiary
shall have such funds on hand or to the payment of the Indebtedness or any
other charges affecting the security of the Beneficiary, as the Beneficiary
sees fit, but no such application shall be deemed to have been made by
operation of law or otherwise until actually made by the Beneficiary as herein
provided. If deposits are being made with the Beneficiary, the Grantor shall
furnish the Beneficiary with bills for the charges for
13
May 23, 1995
<PAGE> 339
which such deposits are required to be made hereunder and/or such other
documents necessary for the payment of same, at least fifteen (15) days prior
to the date on which the charges first become payable and the Beneficiary
shall, to the extent that sufficient funds have been deposited with Beneficiary
pursuant to this Section 1.14, make such sums available to Grantor for the
purpose of payment such charges. If any such bills or other documents are not
reasonably available to Grantor before such fifteen (15) days, then Grantor and
Beneficiary shall make reasonable efforts to cooperate in making the deposited
funds available for the timely payment of the charges. If permitted by
applicable law, Grantor may pay such charges upon an installment basis.
Section 1.15. Late Charges. Late charges shall be paid as
provided for in the respective Notes and Loan Documents and shall be deemed to
be a part of the Indebtedness secured by this Deed of Trust.
Section 1.16. Restrictive Covenants. Without the prior
written consent of the Beneficiary, which consent shall not be unreasonably
withheld or refused, the Grantor shall not: (a) execute or permit to exist any
lease of the Premises; (b) modify any lease affecting the Premises; (c)
discount any rents of the Premises or collect the same for a period of more
than one month in advance; (d) cancel any lease affecting the Premises except
upon the default of the tenant thereunder; (e) execute any conditional bill of
sale, chattel mortgage or other security instruments not subordinate to this
Deed of Trust which cover any Fixtures intended to be incorporated in the
Premises or the appurtenances thereto, excepting, however, the Permitted
Encumbrances, or purchase any of such Fixtures so that ownership of the same
will not vest unconditionally in the Grantor, free from encumbrances on
delivery to the Premises; (f) except for the Permitted Encumbrances, further
assign the leases and rents affecting the Premises; (g) sell, transfer, convey
or assign any interest in the Property or any part thereof or the beneficial
interest in Grantor or any part thereof; or (h) except for the Permitted
Encumbrances, further encumber, alienate, hypothecate, grant a security
interest in or grant any other interest whatsoever in the Property or any part
thereof.
Section 1.17. Estoppel Certificates. The Grantor within ten
(10) days upon request in person or within twenty (20) days upon request by
mail, shall furnish to the Beneficiary a written statement, duly acknowledged,
confirming the amount due on this Deed of Trust as of a recent date, the terms
of payment and maturity dates of the Notes, the dates to which interest has been
paid on the Notes, whether any offsets or defenses exist against the
Indebtedness and, if any are alleged to exist, the nature thereof shall be set
forth in detail.
Section 1.18. Assignment of Rents. The Grantor hereby
assigns to the Beneficiary, as further security for the payment of the
Indebtedness, the rents, issues and profits of the Premises, together with all
leases and other documents evidencing such rents, issues and profits now or
hereafter in effect and any and all deposits held as security under said
leases, and shall, upon demand, deliver to the Beneficiary an executed
counterpart of each such lease or other document. Nothing contained in the
foregoing sentence shall be construed to bind the Beneficiary to the
performance of any of the covenants, conditions or provisions contained in
14
May 23, 1995
<PAGE> 340
any such lease or other document or otherwise to impose any obligation on the
Beneficiary (including, without limitation, any liability under the covenant of
quiet enjoyment contained in any lease or in any law of any applicable state in
the event that any tenant shall have been joined as a party defendant in any
action to foreclose this Deed of Trust and shall have been barred and
foreclosed thereby of all right, title and interest and equity of
redemption in the Premises), except that the Beneficiary shall be accountable
for any money actually received pursuant to such assignment. The Grantor
hereby further grants to the Beneficiary the right (i) to enter upon and take
possession of the Premises for the purpose of collecting the said rents, issues
and profits, (ii) to dispossess by the usual summary proceedings any tenant
defaulting in the payment thereof to the Beneficiary, (iii) to let the
Premises, or any part thereof, and (iv) to apply said rents, issues and
profits, after payment of all necessary charges and expenses, on account of
said Indebtedness. Such assignment and grant shall continue in effect until the
Indebtedness is paid, the execution of this Deed of Trust constituting and
evidencing the irrevocable consent of the Grantor to the entry upon and taking
possession of the Premises by the Beneficiary pursuant to such grant, whether
foreclosure has been instituted or not and without applying for a receiver.
Until the occurrence of an Event of Default the Grantor shall have the
revocable license to collect, use and receive said rents, issues and profits.
The Grantor agrees to use said rents, issues and profits in payment of the
Indebtedness and in payment of taxes, assessments, water rates, sewer rents and
carrying charges becoming due against the Premises. Such revocable license of
the Grantor to collect, use and receive said rents, issues and profits may be
revoked by the Beneficiary upon the occurrence of any one or more of the
following requisite discernable events:
(a) Beneficiary's filing of a complaint to foreclose
the Deed of Trust and/or a motion for the appointment of a receiver; or
(b) notice and demand from Beneficiary to one or more
of the tenants under the leases stating that an Event of Default has
occurred and directing the tenants to pay to Beneficiary the rents and
other amounts due or to become due under the leases; or
(c) notice to Grantor stating that an Event of
Default has occurred and that Grantor's license to collect, use and
enjoy the rents, issues and profits has been revoked.
Section 1.19. Environmental Compliance; Liabilities. The
Grantor has, to the best of Grantor's knowledge, complied with and will
continue to comply with all applicable federal, state and local environmental
laws, regulations and ordinances (collectively, "Environmental Laws") governing
the Grantor, its business and the Property, with respect to all discharges into
the ground and surface water, emissions into the ambient air and generation,
accumulation, storage, treatment, transportation, labeling or disposal of waste
materials or process by-products, in all instances for which failure to comply
would have a material adverse effect on the Grantor and/or the Property. To the
extent any failure to comply would have a material adverse effect on the Grantor
and/or the Property, all licenses, permits or registrations
15
May 23, 1995
<PAGE> 341
required for the Property and Grantor's business, as presently conducted
thereon, under any Environmental Laws have been and will at all times continue
to be secured and the Grantor is and will at all times continue to be in full
compliance therewith. The Grantor is in compliance with, and not in breach of
or default under any applicable Environmental Laws which would adversely affect
the Property and no event has occurred and is continuing which, with the
passage of time or the giving of notice, or both, would constitute
noncompliance, breach of, or default thereof which would have a material
adverse effect on the Grantor and/or the Property.
Section 1.20. Indemnity. The Grantor will indemnify and hold
the Beneficiary harmless against any loss or liability, cost or expense,
including, without limitation, any judgments, reasonable attorneys' fees or
costs of appeal bonds, arising out of or relating to any proceeding instituted
by any claimant alleging a violation by the Grantor, the Premises, the
Beneficiary, or one or more of the Lenders (except for the gross negligence of
Beneficiary or one or more of the Lenders) of any laws of the state in which
the Premises are located, or any Environmental Laws. This indemnity shall
survive the payment or other discharge of the Indebtedness and the satisfaction
or other termination of this Deed of Trust.
Section 1.21. After Acquired Property. All right, title and
interest of Grantor in and to all extensions, improvements, betterments,
renewals, substitutes and replacements of, and all additions and appurtenances
(to the extent such additions and/or appurtenances constitute real property
and/or Fixtures) to the Premises and/or Fixtures hereafter acquired by or
released to the Grantor or constructed, assembled, or placed by the Grantor
on the Premises, and all conversions of the security constituted thereby,
immediately upon such acquisition, release, construction, assembling,
placement or conversion, as the case may be, and in each case, without any
further mortgage, conveyance, assignment or other act by Grantor, shall become
subject to the lien of this Deed of Trust as fully and completely and with the
same effect as though now owned by the Grantor and specifically described
herein; but nevertheless, Grantor shall from time to time, if requested by
Beneficiary, execute and deliver any and all further assurances, conveyances
or assignments as Beneficiary may reasonably require for the purpose of
expressly and specifically subjecting all such property to the lien of this
Deed of Trust.
ARTICLE II
DEFAULT AND REMEDIES
Section 2.1. Events of Default. The following shall constitute
Events of Default under this Deed of Trust:
(a) If the Grantor shall fail to make the payment of
any amount due under this Deed of Trust within the time period
provided, or if no time period is otherwise provided, within 5 days
after the same becomes due; or
(b) [intentionally deleted];
16
May 23, 1995
<PAGE> 342
(c) If the Grantor shall fail to perform or observe,
or cause to be performed or observed, (i) any covenant or condition
contained in [Section 11, Section 1.14, Section 1.16 or Section 1.20
of this Deed of Trust], and such failure shall continue for a
period of five (5) days, or (ii) any other covenant or condition
contained in this Deed of Trust, and such failure shall continue for a
period of twenty (20) days, in either case after the earlier of (a)
receipt of notice thereof by the Beneficiary or (b) the date an
officer of the Grantor learns of such default; or
(d) If any representation or warranty made by the
Grantor herein, or in any certificate furnished by or on behalf of the
Grantor in connection with the consummation of the transactions
contemplated hereby, shall be untrue in any material respect as of the
date of the issuance or making thereof; or
(e) If any Event of Default, as defined in the
Nationwide Note Agreement or the SWIB Note Agreement, shall occur.
Section 2.2. Remedies. Upon the occurrence of any Event of
Default under this Deed of Trust and at any time thereafter, Trustee or
Beneficiary may, in addition to exercising any one or more of the rights and
remedies provided by any of the other Loan Documents, exercise any one or more
of the following rights and remedies:
(a) Non-Judicial Foreclosure. Upon written request of
Beneficiary, Trustee shall sell the Property, in accordance with the
Deed of Trust Act, or similarly applicable law of the state in which
the Premises are located (as existing now, or thereafter amended)
and the Uniform Commercial Code of the state in which the Premises
are located where applicable, at public auction to the highest bidder
for cash at such place as are statutorily prescribed. Grantor
acknowledges that there is no right to an extension of the trustee's
sale on "equitable" or other grounds, and that Beneficiary's remedies
under this Deed of Trust shall not be affected or impaired by the
exercise of any right of set off or to collect and apply rents,
profits, insurance proceeds or condemnation awards. Any person except
Trustee may bid at a Trustee's sale. Subject to applicable law,
Trustee shall apply the proceeds of sale in the following order: (1) to
the expense of sale, including a reasonable Trustee's fee and
attorneys' fees; (2) to the Indebtedness secured by this Deed of Trust;
(3) the surplus, if any, shall be distributed in accordance with said
Deed of Trust Act. Trustee shall deliver to the purchaser at the sale
its deed without warranty, which shall convey to the purchaser the
interest in the Property which Grantor had or had the power to convey
at the time of Grantor's execution of this Deed of Trust, and such as
Grantor may have acquired thereafter. Trustee's deed shall recite the
facts showing that the sale was conducted in compliance with all the
requirements of law and of this Deed of Trust, which recital shall be
prima facie evidence of such compliance and conclusive evidence thereof
in favor of bona fide purchasers and encumbrancers for value. The
Trustee is not obligated to notify any party hereto of pending sale
under any other Deed of Trust or of any action or proceeding in
17
May 23, 1995
<PAGE> 343
which Grantor, Trustee or Beneficiary shall be a party, unless such
action or proceeding is brought by the Trustee.
(b) Judicial Foreclosure. Beneficiary shall have the
right to judicially foreclose this Deed of Trust as a mortgage. If
this Deed of Trust is foreclosed by judicial procedure, Beneficiary
will be entitled to a judgment which will provide that if the
foreclosure sale proceeds are insufficient to satisfy the judgment,
execution may issue for any amount by which the unpaid balance of the
obligations secured by this Deed of Trust exceeds the net sale proceeds
payable to Beneficiary. In the event Grantor remains in possession of
the Property after the Property is sold as provided above or
Beneficiary otherwise becomes entitled to possession of the Property
upon default of Grantor, Grantor shall become a tenant at will of
Beneficiary or the purchaser of the Property and shall pay a reasonable
rental for use of the Property while in Grantor's possession. The
purchaser at any foreclosure sale may (but shall be under no obligation
to), during any redemption period, make such repairs and alterations to
the improvements as may be appropriate for the proper operation, care,
preservation, and protection thereof; pay any taxes and assessments due
during such period; insure the improvements on the Property against
loss by casualty and itself against liability arising from its
ownership and use of the Property; and pay liens not extinguished by
the foreclosure and any other amounts relating to the Property to the
extent due during such redemption period, and all of such expenses and
payments, together with interest thereon from the date so paid to
reimbursement at the rate provided for any other redemption amounts,
shall be included in the amount required to be paid by any person to
redeem the Property.
(c) UCC Remedies. With respect to all or any part of the
Property that is personal or intangible, Beneficiary shall have all the
rights and remedies of a secured party under the Uniform Commercial
Code. Upon request, Grantor shall assemble and make such Property
available to Beneficiary at a place to be designated by Beneficiary
which is reasonably convenient to both parties. Upon repossession,
Beneficiary may propose to retain the Property in partial satisfaction
of the Indebtedness or sell same at public or private sale in
accordance with the Uniform Commercial Code as adopted in the state
where the Property is situated or any other applicable statute. Such
sale may be held as a part of, distinctive from or without a Trustee's
sale or foreclosure of the real property secured by this Deed of Trust.
If any notification of disposition of all or any portion of the
Property is required by law, such notification shall be deemed
reasonably and properly given if mailed at least ten (10) days prior to
such disposition. If Beneficiary disposes of all or any part of the
Property after default, the proceeds of disposition shall be applied in
the following order:
(i) to the reasonable expenses of retaining,
holding, preparing for sale, and selling of, the Property, and
the like;
(ii) to the reasonable attorneys' fees and legal
expenses incurred by Beneficiary; and
18
May 23, 1995
<PAGE> 344
(iii) to the satisfaction of the Indebtedness
secured by this Deed of Trust.
(d) Remedial Advances. Should Grantor fail to make any
payment or to do any act as herein provided, then Beneficiary or
Trustee, without the obligation to do so and without demand upon
Grantor and without releasing Grantor from any obligation hereof,
may (i) make or do the same in such manner and to such extent as either
may deem necessary to protect the security hereof, Beneficiary or
Trustee being authorized to enter upon the Property for such purposes;
(ii) commence, appear in and defend any action or proceeding purporting
to affect the security hereof or the rights or powers of Beneficiary or
Trustee; and (iii) pay, purchase, contest, or compromise any amounts
due under any lease, contract, encumbrance, charge, lien, tax or
assessment, or the premium for any policy of insurance required herein;
and in exercising any such power, incur any liability, expend whatever
amounts in its absolute discretion it may deem necessary therefor,
including cost of evidence of title, employ counsel and pay such
counsels' fees. Beneficiary shall be subrogated to the rights and lien
interests of any person who is paid by Beneficiary pursuant to the
terms of this subsection. Grantor shall repay immediately on written
notice to Grantor all sums expended or advanced hereunder by or on
behalf of Beneficiary, with interest from the date of such advance or
expenditure at the rate provided for in Section 3.14, and the repayment
thereof shall be secured hereby.
(e) Summary Possession. Beneficiary may, at its
option, and in person or by agent, employee or court-appointed
receiver, enter upon and take possession of the Property and continue
any improvement, repair or renovation thereof at Grantor's expense and
lease the same or any part thereof, making such alterations as it
find necessary, and may terminate in any lawful manner any lease of the
Property, exercising with respect thereto any right or option available
to Grantor. The entering upon and taking possession of the Property,
the collection of rents, issues and profits, or the proceeds of fire
and other insurance policies or compensation or awards for any taking
or damage of the Property, and the application or release thereof
shall not cure or waive any Event of Default or notice thereof or
invalidate any act done pursuant to such notice.
(f) Collection of Rents. Beneficiary may require any
tenant or other user to make payments of rent or use fees directly to
Beneficiary regardless of whether Beneficiary has taken possession of
the Property. If any rents are collected by Beneficiary, the Grantor
irrevocably designates Beneficiary as Grantor's attorney-in-fact to
endorse instruments received in payment thereof in the name of Grantor
and to negotiate the same and collect the proceeds. Payments by
tenants or other users to Beneficiary in response to Beneficiary's
demand shall satisfy the obligation for which the payments are made,
whether or not any proper grounds for the demand existed. Beneficiary
may exercise its rights under this subsection either in person, by
agent or through a receiver.
19
May 23, 1995
<PAGE> 345
(g) Beneficiary's Enforcement of Leases. Beneficiary is
hereby vested with full power to use all measures, legal and equitable,
deemed by it necessary or proper to collect rents assigned in this Deed
of Trust, including the right, in person or by agent, employee and
court-appointed receiver, to enter upon the Property, or any part
thereof, and take possession thereof forthwith to the extent necessary
to effect the cure of any default on the part of Grantor as lessor in
any leases or upon an Event of Default as set forth hereunder. Grantor
hereby grants to Beneficiary full power and authority to exercise all
rights, privileges and powers herein granted at any and all times
hereafter, without notice to Grantor, including the right to operate
and manage the Property, make and amend the leases and perform any
other acts which are reasonably necessary to protect the value,
priority or enforceability of any security for the Guaranty and use
and apply all of the rents and other income herein assigned to the
payment of the costs of exercising such remedies, of managing and
operating the Property, and of any Indebtedness or liability of
Grantor to Beneficiary, including, but not limited to, the payment of
taxes, special assessments, insurance premiums, damage claims, the
costs of maintaining, repairing, rebuilding and restoring the
improvements on the Property or of making same rentable, attorneys'
fees incurred in connection with the enforcement of this Deed of
Trust, and any obligations pursuant to this Deed of Trust and the
Guaranty, all in such order as Beneficiary may determine. Beneficiary
shall be under no obligation to enforce any of the rights or claims
assigned to it hereunder or to perform or carry out any of the
obligations of the lessor under any leases does not assume any of the
liabilities in connection with or arising or growing out of the
covenants and agreements of Grantor in any leases. It is further
understood that this Deed of Trust shall not operate to place
responsibility for the control, care, management or repair of the
Property, or parts thereof, upon Beneficiary nor shall it operate to
make Beneficiary liable for the carrying out of any of the terms and
conditions of any leases, or for any waste of the Property by the
lessee under any leases or by any other party, or for any dangerous or
defective condition of the Property or for any negligence in the
management, upkeep, repair or control of the Property resulting in loss
or injury or death to any lessee, invitee, licensee, employee or
stranger, except as may result from the gross negligence or willful
misconduct of Beneficiary after taking possession of the Property
hereunder.
(h) Beneficiary's Enforcement of Contracts. Beneficiary
shall have the right to enforce Grantor's rights under all
architect contracts and construction contracts and to bring an action
for the breach thereof in the name of Beneficiary or, at Beneficiary's
option, in the name of Grantor, in the event any architect or
contractor breaches their respective contracts, regardless of whether
Beneficiary has acquired or retained any interest in the Property.
Grantor hereby irrevocably appoints Beneficiary as its attorney-in-fact
for the purposes of the foregoing, which power shall be durable and
coupled with an interest. Beneficiary does not assume and shall not be
obligated to perform any of Grantor's obligations under said contracts
nor shall Beneficiary be required to enforce such contracts or bring
action for the breach thereof, provided, however any performance of the
respective contract specifically in writing by
20
May 23, 1995
<PAGE> 346
Beneficiary following an Event of Default and which is properly and
timely undertaken by the contractor or architect, shall be paid for by
Beneficiary in accordance with the terms and conditions of the
contracts. Such payments shall be deemed additions to the Indebtedness
and shall bear interest at the rate provided in Section 3.14 from the
date of advance to and including the date of full payment, and shall be
secured by the Deed of Trust.
(i) Appointment of Receiver. Beneficiary shall have
the right to have a receiver appointed to take possession of any or all
of the Property, with the power to protect and preserve the Property,
to operate the Property preceding foreclosure or sale, to collect the
income from the Property and apply the proceeds, over and above cost
of the receivership, against the Indebtedness. The receiver may serve
without bond if permitted by law. Beneficiary's right to the
appointment of a receiver shall exist whether or not apparent value of
the Property exceeds the Indebtedness secured hereby by a substantial
amount. Employment by Beneficiary shall not disqualify a person from
serving as a receiver. Upon taking possession of all or any part
of the Property, the receiver or Beneficiary may: (1) use, operate,
manage, control and conduct business on the Property and make
expenditures for all maintenance and improvements as in its judgment
are necessary and proper; (ii) collect the income from the Property and
apply such sums to the expenses of use, operation and management; and
(iii) at Beneficiary's option, complete any construction in progress on
the Property, and in that connection pay bills, borrow funds, employ
contractors and make any changes in plans or specifications as
Beneficiary deems reasonably necessary or appropriate. If the revenues
produced by the Property are insufficient to pay expenses, the receiver
may borrow, from Beneficiary or otherwise, or Beneficiary may borrow or
advance, such sums as the receiver or Beneficiary may deem reasonably
necessary for the purposes stated in this paragraph. The amounts
borrowed or advanced shall be payable on demand and bear interest from
the date of expenditure until repaid at the interest rate provided in
Section 3.14. Such sums shall become a part of the Indebtedness secured
by this Deed of Trust.
(j) Specific Enforcement. Beneficiary may specifically
enforce any covenant in this Deed of Trust or Grantor's compliance
with its warranties herein and may restrain and enjoin the breach or
prospective breach of any such covenant or the noncompliance with any
condition, and Grantor waives any requirement of the posting of any
bond in connection therewith.
(k) General Creditors' Remedies. Beneficiary shall
have such other rights and remedies as are available under any
statute or at law or in equity generally, and the delineation
of certain remedies in this Deed of Trust shall not be deemed in
limitation thereof.
(l) Application of Sale Proceeds. After deducting all
costs and expenses of Trustee and of this Deed of Trust, including
cost of evidence of title and reasonable attorneys' fees in connection
with sale, as above set forth, Trustee shall apply
21
May 23, 1995
<PAGE> 347
the proceeds of sale to payment of all sums expended under the terms
hereof, not then repaid; all other sums then secured hereby; and the
remainder, if any, to the person or persons legally entitled thereto.
(m) Remedies Cumulative. All rights and remedies of
Beneficiary herein specified are cumulative and are in addition to, not
in limitation of, any rights and remedies Beneficiary may have at law.
(n) No Waiver. No waiver of any default or failure or
delay to exercise any right or remedy by Beneficiary shall operate as
a waiver of any other default or of the same default in the future or a
preclusion of any right or remedy with respect to the same or any other
occurrence.
(o) Marshalling. In case of a sale under this Deed of
Trust, the said Property, real, personal and mixed, may be sold in one
or more parcels. Neither Trustee nor Beneficiary shall be required to
marshal Grantor's assets.
Section 2.3. Payment of Indebtedness After Default. Upon the
occurrence of any Event of Default and the acceleration of the maturity hereof,
if, at any time prior to foreclosure sale, the Grantor or any other person
tenders payment of the amount necessary to satisfy the Indebtedness in full,
the same shall constitute an evasion of the payment terms of the Notes and
shall be deemed to be a voluntary prepayment thereunder, in which case such
payment must include the premium required under the prepayment provision, if
any, contained in the Notes.
Section 2.4. Possession of the Premises. Upon the occurrence
of any Event of Default hereunder, it is agreed that the then owner of the
Premises, if it is the occupant of the Premises or any part thereof, shall
immediately upon the request of Beneficiary surrender possession of the
Premises so occupied to the Beneficiary, and if such occupant is permitted to
remain in possession, the possession shall be as tenant of the Beneficiary and,
on demand, such occupant (a) shall pay to the Beneficiary monthly, in advance,
as rental for the space so occupied, the then reasonable market rental for the
Premises and (b) may be dispossessed by the usual summary proceedings. The
covenants herein contained may be enforced by a receiver of the Property or any
part thereof. Nothing in this Section 2.4 shall be deemed to be a waiver of the
provisions of this Deed of Trust prohibiting the sale or other disposition of
the Premises without the Beneficiary's consent.
Section 2.5. Grantor's Actions After Default. After the
happening of any Event of Default and immediately upon the commencement of any
action, suit or other legal proceedings by the Beneficiary to obtain
judgment for the Indebtedness, or of any other nature in aid of the enforcement
of the Guaranty or this Deed of Trust, the Grantor hereby agrees, to the extent
permitted by applicable law, and hereby does, if required by the Beneficiary,
consent to the appointment of a receiver or receivers of the Property and of
all the earnings, revenues, rents, issues, profits and income thereof.
22
May 23, 1995
<PAGE> 348
Section 2.6. Control by Beneficiary After Default.
Notwithstanding the appointment of any receiver, liquidator or trustee of the
Grantor, or of any of its property, or of the Property or any part thereof, the
Beneficiary shall be entitled to retain possession and control of all property
now and hereafter covered by this Deed of Trust.
Section 2.7. Payment of Indebtedness After Default. Upon the
occurrence of any Event of Default and the acceleration of the maturity hereof,
if, at any time prior to foreclosure sale, the Grantor or any other person
tenders payment of the amount necessary to satisfy the Indebtedness, the same
shall constitute an evasion of the payment terms of the Notes or the other Loan
Documents and shall be deemed to be voluntary prepayment thereunder, in which
case such payment must include the premium required under the prepayment
provision, if any, contained in the Notes or other Loan Documents.
Section 2.8. Possession of the Premises. Upon the occurrence
of any Event of Default hereunder, it is agreed that the then owner of the
Premises, if it is the occupant of the Premises or any part thereof, shall
immediately upon the request of Beneficiary surrender possession of the
Premises so occupied to the Beneficiary, and if such occupant is permitted to
remain in possession, the possession shall be as tenant of the Beneficiary and,
on demand, such occupant (a) shall pay to the Beneficiary monthly, in advance,
as rental for the space so occupied, (i) the then reasonable market rental for
the Premises and (b) may be dispossessed by the usual summary proceedings. The
covenants herein contained may be enforced by a receiver of the Property or any
part thereof. Nothing in this Section 2.4 shall be deemed to be waiver of the
provisions of this Deed of Trust prohibiting the sale or other disposition of
the Premises without the Beneficiary's consent.
Section 2.9. Grantor's Actions After Default. After the
happening of any Event of Default and immediately upon the commencement of any
action, suit or other legal proceedings by the Beneficiary to obtain judgment
for the Indebtedness, or of any other nature in aid of the enforcement of the
Notes or of this Deed of Trust, the Grantor hereby agrees, to the extent
permitted by law, and hereby does, if required by the Beneficiary, consent to
the appointment of a receiver or receivers of the Property and of all the
earnings, revenues, rents, issues, profits and income thereof.
Section 2.10. Control by Beneficiary After Default.
Notwithstanding the appointment of any receiver, liquidator or trustee of the
Grantor, or of any of its property, or of the Property or any part thereof, the
Beneficiary shall be entitled to retain possession and control of all property
now and hereafter covered by this Deed of Trust.
23
May 23, 1995
<PAGE> 349
ARTICLE III
MISCELLANEOUS
Section 3.1. No Release. The Grantor agrees, that in the
event the Property is sold, the Grantor shall continue to be liable to pay the
Indebtedness unless expressly released and discharged in writing by the
Beneficiary.
Section 3.2. Notices. Any notice required to be given or
served hereunder shall be in writing and shall be delivered either in person or
sent to the parties at their respective addresses set forth below by (i) United
States certified or registered mail, postage prepaid, return receipt requested;
(ii) bonded courier service; or (iii) telecopy transmission to the telecopy
number designated beneath the address of the parties to receive such notice.
Any such notice, if mailed as provided herein, shall be deemed to have been
mailed, given or served on the date mailed and shall be deemed to have been
received on the expiration of two business days after mailing. Any notice or
communication personally delivered shall be deemed to have been given or served
upon the party to whom delivered upon delivery thereof in the manner above
provided.
If to Grantor: Stokely USA, Inc.
1055 Corporate Center Drive
Oconomowoc, Wisconsin 53066
Attention: Stephen W. Theobald
Facsimile: (414) 569-3761
With a copy to: Michael, Best & Friedrich
100 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Attention: Peggy Brever
Facsimile: (414) 277-0656
If to Trustee: Chicago Title Insurance Company
171 North Clark Street
Chicago, Illinois
Facsimile: 312-223-2110
If to Beneficiary: Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43216
Attention: Corporate Fixed-
Income Securities
Facsimile: (614) 249-4553
24
May 23, 1995
<PAGE> 350
and
State of Wisconsin Investment Board
121 East Wilson Street
Madison, Wisconsin 53702
Attention: Private Placements
Facsimile: (608) 266-2436
With a copy to: Nationwide Life Insurance Company
One Nationwide Plaza
Floor 35
Columbus, Ohio 43216
Attention: Roger Craig, Esq.
Facsimile: (614) 249-2418
and
Solheim Billing & Grimmer, S.C.
2 East Gilman Street, Suite 402
P. 0. Box 1644
Madison, Wisconsin 53701-1644
Attention: Thomas P. Solheim
Facsimile: (608) 283-3079
Section 3.3. Binding Obligations. The provisions and covenants
of this Deed of Trust shall run with the land, shall be binding upon the
Grantor and shall inure to the benefit of the Beneficiary, subsequent holders
of this Deed of Trust and their respective successors and assigns. For the
purpose of this Deed of Trust, the term "Grantor" shall mean the Grantor named
herein, any subsequent owner of the Property, and their respective heirs,
executors, legal representatives, successors and assigns. If there is more than
one Grantor, all their undertakings hereunder shall be deemed joint and
several.
Section 3.4. Captions. The captions of the sections of this
Deed of Trust are for the purpose of convenience only and are not intended to
be a part of this Deed of Trust and shall not be deemed to modify, explain,
enlarge or restrict any of the provisions hereof.
Section 3.5 Further Assurances. The Grantor shall do,
execute, acknowledge and deliver, at the sole cost and expense of the Grantor,
all and every such further acts, deeds, is conveyances, mortgages, assignments,
estoppel certificates, notices of assignment, transfers and assurances as the
Beneficiary may reasonably require from time to time in order to better assure,
convey, assign, transfer and confirm unto the Beneficiary, the rights granted
to the Beneficiary under this Deed of Trust, together with protective advances
and/or advances pursuant to any other instrument executed in connection with
this Deed of Trust or any other instrument under which the Grantor may be or
may hereafter become bound to convey, mortgage or assign to the
25
May 23, 1995
<PAGE> 351
Beneficiary for carrying out the intention of facilitating the performance of
the terms of this Deed of Trust.
Section 3.6. Severability. Any provision of this Deed of Trust
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provisions in any other
jurisdiction.
Section 3.7. General Conditions. The Grantor hereby agrees
that:
(a) All covenants hereof shall be construed as
affording to the Beneficiary rights additional to and not exclusive of
the rights conferred under the provisions of applicable law of the
state in which the Property is located.
(b) This Deed of Trust cannot be altered, amended,
modified or discharged orally and no executory agreement shall be
effective to modify or discharge it in whole or in part, unless it is
in writing and signed by the party against whom enforcement of the
modification, alteration, amendment or discharge is sought.
(c) No remedy herein conferred upon or reserved to the
Beneficiary is intended to be exclusive of any other remedy or remedies,
and each and every such remedy shall be cumulative, and shall be in
addition to every other remedy given hereunder or now or hereafter
existing at law or in equity or by statute. No delay or omission of the
Beneficiary in exercising any right or power accruing upon any Event of
Default shall impair any such right or power, or shall be construed to
be a waiver of any such Event of Default, or any acquiescence therein.
Acceptance of any payment after the occurrence of an Event of Default
shall not be deemed to waive or cure such Event of Default; and every
power and remedy given by this Deed of Trust to Beneficiary may be
exercised from time to time as often as may be deemed expedient by the
Beneficiary. Nothing in this Deed of Trust or in the Notes shall
affect the obligation of the Grantor to pay the Indebtedness in the
manner and at the time and place therein respectively expressed.
(d) No waiver by the Beneficiary will be effective
unless it is in writing and then only to the extent specifically
stated. Without limiting the generality of the foregoing, any
payment made by the Beneficiary for insurance premiums, taxes,
assessments, water rates, sewer rentals or any other charges affecting
the Property, shall not constitute a waiver of the Grantor's default in
making such payments and shall not obligate the Beneficiary to make any
further payments.
(e) The Beneficiary shall have the right to appear in
and defend any action or proceeding, in the name and on behalf of the
Grantor which the Beneficiary, in its reasonable discretion, feels may
adversely affect the Property or this Deed of Trust. The Beneficiary
shall also have the right to institute any action or proceeding which
the
26
May 23, 1995
<PAGE> 352
Beneficiary, in its reasonable discretion, feels should be brought to
protect its interest in the Property or its rights hereunder. All
costs and expenses incurred by the Beneficiary in connection with such
actions or proceedings, including, without limitation, reasonable
attorneys' fees and appellate attorneys' fees, shall be paid by the
Grantor, on demand.
(f) In the event of the passage after the date of this
Deed of Trust of any law of any governmental authority having
jurisdiction, deducting from the value of land for the purpose of
taxation, affecting any lien thereon or changing in any way the laws of
the taxation of mortgages or debts secured by mortgages for federal,
state or local purposes, or the manner of the collection of any such
taxes, so as to affect this Deed of Trust, the Grantor shall promptly
pay to the Beneficiary, on demand as and when due and payable, all
taxes, costs and charges for which the Beneficiary is or may be liable
as a result thereof.
(g) The information set forth on the cover page hereof is
hereby incorporated herein.
(h) The Grantor acknowledges that it has received a true
copy of this Deed of Trust.
(i) For the purposes of this Deed of Trust, all defined
terms contained herein shall be construed, whenever the context of
this Deed of Trust so requires, so that the singular shall be
construed as the plural and so that the masculine shall be construed as
the feminine.
Section 3.8. Legal Construction. The terms of this Deed of
Trust, including the obligations of Grantor to pay any Indebtedness or
additional charges thereunder, shall be governed by and construed in accordance
with the laws of the State of Wisconsin; provided, however, the creation of
this Deed of Trust, the attachment and perfection of the lien or security
interest in the Property, the rights and remedies of the Beneficiary and the
enforcement thereof with respect to the Property and procedural matters as
provided herein and by the laws of the state in which the Premises are located,
shall be governed by and construed in accordance with the internal laws of the
state in which the Premises are located. Nothing in this Deed of Trust or in
any other agreement between the Grantor and the Beneficiary shall require the
Grantor to pay, or the Beneficiary to accept, interest in an amount which
would subject the Beneficiary to any penalty under applicable law. In the
event that the payment of any interest due hereunder or under the Notes or
other Loan Documents or any such other agreement would subject the Beneficiary
to any penalty under applicable law, then ipso facto the obligations of the
Grantor to make such payment shall be reduced to the highest rate authorized
under applicable law.
Section 3.9. Brokerage Indemnification. Grantor hereby
indemnifies and holds harmless Beneficiary and the Lenders against, and agrees
to pay on demand, any brokerage commission or finder's fee claimed by any
broker or other party arising out of actions of or
27
May 23, 1995
<PAGE> 353
contacts with Grantor in connection with the transactions contemplated by this
Deed of Trust and the Intercreditor Agreement.
Section 3.10. Subrogation. In the event that Beneficiary
and/or any of Lenders, on or after the date hereof, pays any sum due under or
secured by any Senior Lien as hereinafter defined:
(a) To the extent not prohibited by loan documentation
evidencing the Senior Lien, Beneficiary shall have and be entitled to
a lien on the Property equal in priority to the Senior Lien discharged,
and Beneficiary shall be subrogated to, and receive and enjoy all
rights and liens possessed, held or enjoyed by, the holder of such
Senior Lien, which shall remain in existence and benefit Beneficiary in
securing the Indebtedness; and
(b) Notwithstanding the release of record of a Senior Lien,
and to the extent not prohibited by loan documentation evidencing
the Senior Lien, Beneficiary shall be subrogated to the rights and
liens of all mortgages, trust deeds, superior titles, vendors' liens,
mechanics' liens, or liens, charges, encumbrances, rights and equities
on the Property having priority to the lien of this Deed of Trust
(herein generally called "Senior Liens"), to the extent that any
obligation secured thereby is directly or indirectly paid or discharged
with disbursements or advances of the Indebtedness, whether made
pursuant to the provisions hereof or of the Note or any document or
instrument executed in connection with the Indebtedness.
Section 3.11. Additional Remedies. Without limiting the
provisions of Section 2.2 hereof but in addition thereto and in amplification
thereof, it is agreed as follows:
(a) When the Indebtedness, or any part thereof, shall
become due, whether by acceleration or otherwise, and shall not be
paid, the Beneficiary shall have the right to foreclose the lien hereof
for such Indebtedness or part thereof. In any suit or proceeding to
foreclose the lien hereof there shall be allowed and included as
additional indebtedness in the decree for sale, all expenditures and
expenses which may be paid or incurred by or on behalf of the
Beneficiary for reasonable attorneys' fees, appraisers' fees, outlays
for documentary and expert evidence, stenographers' charges,
publication costs, and costs (which may be estimated as to items to be
expended after entry of a decree) of procuring all such abstracts of
title, title searches and examinations, title insurance policies, and
similar data and assurances with respect to title, as the Beneficiary
may deem reasonably necessary either to prosecute such suit or to
evidence to bidders at sales which may be had pursuant to such decree,
the true conditions of the title to or the value of the Premises. All
expenditures and expenses of the nature in this subsection mentioned,
and such expenses and fees as may be incurred in the protection of the
Property and the maintenance of the lien of this Deed of Trust,
including the reasonable fees of any attorney employed by the
Beneficiary in any litigation or proceedings affecting this Deed of
Trust or the Premises, including probate and bankruptcy proceedings, or
in the preparation for the commencement or defense of any
28
May 23, 1995
<PAGE> 354
proceeding or threatened suit or proceeding, shall be immediately due
and payable by the Grantor, with accrued interest thereon.
(b) Upon, or at any time after, the filing of a complaint
to foreclose this Deed of Trust, the court in which such complaint is
filed may appoint a receiver of the Premises. Such appointment may be
made either before or after sale, without notice, without regard to
solvency or insolvency of the Grantor at the time of application for
such receiver, without requirement for the posting of any bond or
security, and without regard to the then value of the Premises or
whether the same shall be then occupied as a homestead or not; and the
Beneficiary hereunder or any of the Lenders may be appointed as such
receiver. Such receiver shall have the power to collect the rents,
issues and profits of the Premises during the pendency of such
foreclosure suit and, in case of a sale and a deficiency, during the
full statutory period of redemption, if any, whether there be a
redemption or not, as well as during any further times when the
Grantor, except for the intervention of such receiver, would be
entitled to collection of such rents, issues and profits and all other
powers which may be necessary or are usual in such cases for the
protection, possession, control, management and operation of the
Premises during the whole of said period. The court may, from time to
time, authorize the receiver to apply the net income from the Premises
in his hands in payment in whole or in part of:
(i) The Indebtedness, or the indebtedness secured
by any decree foreclosing this Deed of Trust, or any tax,
special assessment or other lien which may be or become
superior to the lien hereof or of such decree, provided such
application is made prior to the foreclosure sale; or
(ii) The deficiency in case of a sale and
deficiency.
Section 3.12. Parity. This Deed of Trust secures the several
Notes, each of which is equally and ratably secured by this Deed of Trust and
none of which shall have any preference or priority over the other.
Section 3.13. Interest Rate. If any amount due Beneficiary
under the terms and provisions of this Deed of Trust or for which Grantor is
liable hereunder is not paid when due, interest shall accrue on such unpaid
amount commencing on the date such payment is due until payment has been made
in full at the rate of four and one-quarter percent (4-1/4%) per annum in
excess of the Reference Rate announced by Bank One, Milwaukee, National
Association. For purposes of this section, the "Reference Rate" shall mean the
rate used by Bank One, Milwaukee, National Association, for interest
determinations, regardless of whether or not Bank One, Milwaukee, National
Association, makes loans at such rate. The Reference Rate is not necessarily
the lowest rate charged on loans at any given time.
Section 3.14. Grantor's Indemnification. Grantor agrees to
indemnify and hold harmless Trustee and Beneficiary from and against any and
all losses, liabilities, suits,
29
May 23, 1995
<PAGE> 355
obligations, fines, damages, judgments, penalties, claims, charges, costs and
expenses (including attorneys' fees and disbursements) which may be imposed on,
incurred or paid by, or asserted against, Trustee and/or Beneficiary by reason
or on account of, or in connection with; (a) any willful misconduct of Grantor
or any default by Grantor hereunder or under the other documents relating to or
securing the Indebtedness or the Guaranty; (b) Trustee's and/or Beneficiary's
good faith and commercially reasonable exercise of any of their rights and
remedies or the performance of any of their duties hereunder or under the other
documents to which Grantor is a party; (c) the construction, reconstruction or
alteration of the Property; (d) any negligence of Grantor, or any negligence or
willful misconduct of any lessee of the Property, or any of their respective
agents, contractors, subcontractors, servants, employees, licensees or
invitees; or; (e) any accident, injury, death or damage of any person or
property occurring in, on or about the Property or any street, drive, sidewalk,
curb or passageway adjacent thereto, except for the willful misconduct or gross
negligence of the indemnified person; or (f) any failure of Grantor to file any
tax reports or returns referred to in this Deed of Trust. The indemnity
provided under subsection (f) of this section shall also extend to counsel for
Beneficiary. Any amount payable to Trustee, Beneficiary or counsel for
Beneficiary under this section shall be due and payable within ten (10) days
after demand therefor and receipt by Grantor of a statement from Trustee,
Beneficiary and/or counsel for Beneficiary setting forth in reasonable detail
the amount claimed and the basis therefor, and such amounts shall bear interest
at the rate provided in Section 3.14 from and after the date such amounts are
paid by Beneficiary, Trustee or counsel for Beneficiary until paid in full by
Grantor. Grantor's obligations under this section shall not be affected by the
absence or unavailability of insurance covering the same or by the failure or
refusal by an insurance carrier to perform any obligation on its part under any
such policy of insurance. If any claim, action or proceeding is made or
brought against Grantor and/or Beneficiary which is subject to the indemnity
set forth in this section, Grantor shall resist or defend against the same, if
necessary, in the name of Trustee and/or Beneficiary, by attorneys for
Grantor's insurance carrier (if the same is covered by insurance) or otherwise
by attorneys approved by Beneficiary. Notwithstanding the foregoing, Trustee
and Beneficiary, in their reasonable discretion, may engage their own attorneys
to resist or defend, or assist therein, and Grantor shall pay, or, on demand,
shall reimburse Trustee and Beneficiary for the payment of the reasonable fees
and disbursements of said attorneys.
Section 3.15. Nonagricultural Property. Grantor covenants and
warrants that the Property is not used principally or primarily for
agricultural or farming purposes.
Section 3.16. Acceptance by Trustee. Trustee accepts this
Trust when this Deed, duly executed and acknowledged, is made a public record
as provided by law.
Section 3.17. Successor Trustee. Trustee may resign by an
instrument in writing addressed to Beneficiary, or Trustee may be removed at
any time with or without cause by an instrument in writing executed by
Beneficiary and duly recorded. In case of the death, resignation, removal or
disqualification of Trustee or if for any reason Beneficiary shall deem it
desirable to appoint a substitute or successor trustee to act instead of
Trustee herein named or any substitute or successor trustee, then Beneficiary
shall have the right and is hereby authorized
30
May 23, 1995
<PAGE> 356
and empowered to appoint a successor trustee, or a substitute trustee, without
other formality than appointment and designation in writing executed and
acknowledged by Beneficiary and the recordation of such writing in the office
where this Deed of Trust is recorded, and the authority hereby conferred shall
extend to the appointment of other successor and substitute trustees
successively. Such appointment and designation by Beneficiary shall be full
evidence of the right and authority to make the same and of all facts therein
recited. If such appointment is executed on behalf of Beneficiary by an
officer of Beneficiary, such appointment shall be conclusively presumed to be
executed with authority and shall be valid and sufficient without proof of any
action by Trustee or any officer of Beneficiary. Upon the making of such
appointment and designation, all of the estate and title of Trustee in the
Property shall vest in the named successor or substitute trustee and it shall
thereupon succeed to and shall hold, possess and execute all the rights,
powers, privileges, immunities and duties herein conferred upon Trustee; but,
nevertheless, upon the written request of Beneficiary or of the successor or
substitute trustee, Trustee shall execute and deliver an instrument
transferring to such successor or substitute trustee all of the estate and
title in the Property of the trustee so ceasing to act, together with all the
rights, powers, privileges, immunities an duties herein conferred upon Trustee,
and shall duly assign, transfer and deliver any of the properties and moneys
held by Trustee hereunder to said successor or substitute trustee. All
references herein to Trustee shall be deemed to refer to any trustee
(including any successor or substitute, appointed and designated, as herein
provided) from time to time acting hereunder. Grantor hereby ratifies and
confirms any and all acts which Trustee herein named or its successor or
successors, substitute or substitutes, in this Deed of Trust, shall do lawfully
by virtue hereof.
Section 3.18. Reconveyance. Upon written request of
Beneficiary, stating that the Guaranty secured hereby has been discharged, and
upon surrender of this Deed of Trust for cancellation and retention, and upon
payment of its fees, Trustee shall reconvey, without warranty, the Property
then held thereunder. The recitals in any reconveyance executed under this
Deed of Trust of any matters or facts shall be conclusive proof of the
truthfulness thereof. The grantee in such reconveyance may be described as "the
person or persons legally entitled thereto." By executing this Deed of Trust,
Grantor specifically acknowledges that Beneficiary shall be under no obligation
to provide a request for reconveyance until such time as both (a) the
Indebtedness and all obligations, and duties of Grantor pursuant to this Deed
of Trust and the Guaranty have been paid and discharged, and (b) Grantor has
provided Beneficiary with a written release of the governmental agency of any
commitment of Beneficiary to provide additional funds to or for the benefit of
such agency in connection with any improvements, landscaping or other amenities
on or related to the Property and, to the extent not otherwise secured by a
separate deed of trust on the Property granted to Beneficiary, and funds so
advanced by Beneficiary and all interest thereon have been repaid.
Section 3.19. Beneficiary's Consent. At any time, upon written
request of Grantor, payment of Beneficiary's fees and presentation of this Deed
of Trust and the Guaranty (in case of full reconveyance, for cancellation and
retention), without affecting the liability of any person for the payment of
the Indebtedness, Beneficiary may: (a) consent to the making of any map or plat
of said Property; (b) join in granting any easement or creating any restriction
31
May 23, 1995
<PAGE> 357
thereon; or (c) join in any subordination or other agreement affecting this
Deed of Trust or the lien or charge thereof.
Section 3.20. Purpose of Obligations Secured. The
Indebtedness and other obligations secured by this Deed of Trust were incurred
for business and commercial purposes, and not for personal, family, or
household purposes.
Section 3.21. Releases. Grantor shall be entitled to have
released from the lien of this Deed of Trust any personal property or fixtures
included in the Property which, under section 3.D. of the Security Agreement
between Grantor and Beneficiary, dated the date hereof, may be disposed of
without the prior written consent of the Required Lenders, as defined therein.
[ Section 3.22. Prior Deed of Trust. Grantor, Trustee, and
Beneficiary herein acknowledge that the Deed of Trust granted herein is subject
to a prior lien on the Property ("Prior Lien") listed on Exhibit B. Grantor
agrees and covenants that it will promptly and faithfully abide by, discharge
and perform all terms, obligations and covenants of Grantor set forth in the
Prior Lien or as set forth in any documents evidencing the indebtedness which
the Prior Lien secures. The Grantor additionally agrees and covenants that it
will give Beneficiary prompt written notice of any notice of default under the
Prior Lien or any documents evidencing the indebtedness secured by the Prior
Lien served upon Grantor by the party whose interest has been secured by the
Prior Lien. To the extent the obligations of Grantor under the Prior Lien and
the obligations of Grantor under this Deed of Trust conflict, the obligations
of Grantor under the Prior Lien shall govern so long as the Prior Lien remains
a lien on the Property.]
[End of page]
32
May 23, 1995
<PAGE> 358
IN WITNESS WHEREOF, Grantor has caused these presents to be duly
executed and attested by its duly authorized officers and its corporate seal,
if any, to be hereunto affixed, all as of the day, month and year first above
written.
STOKELY USA, INC.
a Wisconsin corporation
By: Stephen W. Theobald
----------------------------------
Stephen W. Theobald, Vice Chairman
Attest:
Robert M. Brill
--------------------------------------
Robert M. Brill, Secretary
STATE OF WISCONSIN )
) SS
COUNTY OF WAUKESHA )
I, LINDA KUKLINSKI, a Notary Public in and for the County and State
aforesaid, do hereby certify that Stephen W. Theobald and Robert M. Brill,
respectively, the Vice Chairman and Secretary of Stokely USA, Inc., a Wisconsin
corporation, who are personally known to me to be the same persons whose names
are subscribed to the foregoing instrument as such officers of said
corporation, respectively, appeared before me in person and acknowledged that
they signed and delivered the said instrument as their own free and voluntary
act and as the free and voluntary act of said corporation for the uses and
purposes therein set forth, and the said Secretary of said corporation then and
there acknowledged that he, as custodian of the corporate seal of said
instrument as his own free and voluntary act and as the free and voluntary act
of said corporation for the uses and purposes therein set forth.
Given under my hand and notarial seal this 25 day of May, 1995.
Linda M. Kuklinski
----------------------------------------
Notary Public
My commission expires:
3/15/98
- ----------------------
33
May 23, 1995
<PAGE> 359
EXHIBIT A
Hoopeston
Vermilion County, IL
The Southwest Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated April 14, 1925 and recorded in Deed Record 352 Page 17 of the Records of
Vermilion County, Illinois, and EXCEPT that portion thereof conveyed unto the
State of Illinois by Deed dated January 2, 1959 and recorded in Deed Record 637
Page 522 of the records of Vermilion County, Illinois, situated in Vermilion
County, Illinois.
ALSO:
The Southeast Quarter of Section 10 Township 23 North, Range 12 West of the 2nd
P. M., EXCEPT that portion thereof conveyed unto the State of Illinois by Deed
dated January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records
of Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
That portion of the Northeast Quarter of Section 10 Township 23 North, Range 12
West of the 2nd P. M., lying South of the Lake Erie and Western (now Norfolk
and Western) Right-of-Way, ALSO all that part of the West Half of Section 11
Township 23 North, Range 12 West of the 2nd P. M., lying South of said Railroad
Right-of-Way and West of S.B.I. Route 1; EXCEPT from the last described tract
the following: (A) The South two acres thereof and (b) Beginning at the
intersection of the South line of said Railroad Right-of-Way with the West line
of S.B.I. Route No. 1; thence West 100 feet; thence South 405 feet; thence East
100 feet; thence North to the place of beginning; and (c) Right-of-Ways
conveyed to the State of Illinois by Deeds dated February 14, 1940 and recorded
respectively in Deed Record 463 Pages 431 and 432, and (D) Commencing at the
Northwest Corner of the Southwest Quarter of said Section 11; thence East along
the East and West center line of said Section 11, 185 feet to the true place of
beginning; thence South 2613 feet along a line 300 feet West of and parallel to
the West line of S.B.I. Route No. 1 to a point 30 feet North of the center line
of S.B.I. Route No. 9; thence East 38 feet to
Page 1 of 2
<PAGE> 360
Continued...
a point; thence North 281.67 feet to a point; thence East 262 feet to the
aforesaid West line of S.B.I. Route No. 1; thence North along said West line
2331.33 feet to the North line of the said Southwest Quarter of said Section
11; thence West 300 feet to the place of beginning and (E) Beginning at a point
238 feet East of and 146.67 feet North of the Southwest Corner of Section 11
Township 23 North, Range 12 West of the 2nd P. M.; thence North 165 feet;
thence East 262 feet to the West line of S.B.I. Route No. 1; thence South 165
feet; thence West 262 feet to the place of beginning, all situated in Vermilion
County, Illinois.
ALSO:
Part of the Southwest Quarter of the Southwest Quarter of Section 11 Township
23 North, Range 12 West of the 2nd P. M., described as: Beginning at the
Southwest Corner of said Section 11; thence North along the Section line 146.67
feet; thence East 238 feet parallel to the South line of said Section; thence
South 146.67 feet to the Section line; thence West to the place of beginning,
EXCEPT that portion thereof conveyed unto the State of Illinois by Deed dated
January 2, 1959 and recorded in Deed Record 637 Page 522 of the Records of
Vermilion County, Illinois, situated in Vermilion County, Illinois.
ALSO:
Beginning at the intersection of North side of the Right-of-Way of the Lake
Erie and Western (now Norfolk and Western) Railroad, and Sixth Avenue, in the
City of Hoopeston, as it existed on January 31, 1911; thence North 729.96 feet;
thence East 2593.80 feet to the West side of the Right-of-Way of the Chicago
and Eastern Illinois Railroad; thence South along the West side of the
Right-of-Way of the said Railroad to the North side of the Right-of-Way of the
Lake Erie and Western (now Norfolk and Western Railroad; thence West along the
said North line of said Right-of-Way to the place of beginning, EXCEPT the
following: (a) Beginning at the Northwest Corner of Lot 3 in the Clerk's
Subdivision of the North Half of Section 11 Township 23 North, Range 12 West of
the 2nd P. M.; thence Southerly along the West line of said Lot 3, 200 feet;
thence Northeasterly 360.55 feet to a point in the North line of said Lot 3;
thence Westerly 300 feet to the place of beginning, and (B) A strip of land 100
feet in width across said Section 11, said land having been conveyed to the
Chicago, Danville and Vincennes Railway Company by Deed dated May 16, 1871 and
recorded in Deed Record 30 Page 291, and (C) All that portion of the described
tract conveyed to the Chicago and Eastern Illinois Railway Company by Deed
dated October 12, 1893 and recorded in Deed Record 127 Page 346, all as
situated in the Northeast Quarter and the Northwest Quarter of Section 11
Township 23 North, Range 12 West of the 2nd P. M., situated in Vermilion
County, Illinois.
Page 2 of 2
<PAGE> 361
EXHIBIT B
PERMITTED LIENS & ENCUMBRANCES
STOKELY USA, INC,
I. Properties
Ackley, Iowa Appleton, Wisconsin
Cobb, Wisconsin DeForest, Wisconsin
Grandview, Washington Green Bay, Wisconsin
Hoopeston, Illinois Jefferson, Wisconsin
Merrill, Wisconsin Oconomowoc, Wisconsin
Pickett, Wisconsin Poynette, Wisconsin
Scottville, Michigan Sun Prairie, Wisconsin
Walla Walla, Washington Waunakee, Wisconsin
Wells, Minnesota
II. Liens and Encumbrances Affecting All Properties
A. Building and zoning laws, ordinances, State and Federal
Regulations.
B. General and special taxes for the year 1995 and subsequent
years.
C. Deferred 1994 real estate taxes.
D. Restrictions relating to use or improvement of the Properties.
E. Utility and drainage easements and all other easements,
covenants and restrictions on title of record on May 24, 1995.
III. Liens and Encumbrances Affecting Specific Properties as Follows:
<PAGE> 362
ACKLEY, IOWA
<PAGE> 363
- - Mortgage dated July 1, 1989, filed November 20, 1989 as File No. 892118,
executed by Stokley USA, Inc. to First Bank (N.A.) to secure $3,000,000.00.
(Parcels A-D)
- - Easement to the State of Iowa dated July 29, 1930, filed November 6, 1930 in
Book 59, Page 106 over the North 17 feet of the South 50 feet of the East
1292 feet of the West 1325 feet of the Southwest Quarter of Section 35,
Township 90 North, Range 19 West.
- - Easement to the State of Iowa dated July 29, 1930, filed November 6, 1930 in
Book 59, Page 107 over the North 17 feet of the South 50 feet of the West
1291 feet of the East 1324 feet of the Southeast Quarter of Section 34,
Township 90 North, Range 19 West.
- - Right-of-way Agreement to the Iowa Public Service Company dated May 4, 1954,
filed March 4, 1955 in Book 76, Page 28, for electric transmission line and
access thereto.
- - Rights of the Iowa State Highway Commission to control access to Primary
Roads in Franklin County, Iowa.
- - Easement to the Town of Ackley, Iowa for the use, drilling and maintenance
of a well in the Southwest corner of the East Half of the Southwest Quarter
of Section 35, Township 90, Range 19.
- - Consequence of any change in the location of streams which may form
boundaries of the parcels.
- - Easement for road and public highway purposes granted to Franklin County,
Iowa, dated May 18, 1984, filed May 21, 1984 in File No. 840905 over the
West 40 feet of Southwest Quarter of Section 35, Township 90 North, Range 19
West of the 5th P.M. and the West 40 feet of the South Half of the Southwest
Quarter of the Northwest Quarter of Section 35, Township 90 North, Range 19
West of the 5th P.M. (Parcel A).
- - Easement for road and public highway purposes granted to Franklin County,
Iowa dated May 18, 1984, filed May 21, 1984 in File No. 840906. (Parcel A)
- - Unrecorded agreements providing for easements, leasehold rights,
restrictions or reservations regarding the relationship between the land
owned by the titleholder and the railroad.
- - Possible lack of access to premises from an existing public road.
- - Rights of other riparian owners to the uninterrupted flow of the creek.
- - Entrance permit dated June 15, 1990, filed July 30, 1990 in File No. 901240.
- - Reservation of utilities easements by the Town of Ackley, Iowa in Quit Claim
Deed dated September 23, 1963, filed June 17, 1983 in Book 583, Page 144 as
to that part of subject premises comprising vacated alley. (Parcel E)
- - Urban Renewal Plan for the City of Ackley, Iowa dated November 17, 1994,
filed May 3, 1995 as File No. 950815.
<PAGE> 364
APPLETON
<PAGE> 365
- - Easement contained in Instrument executed by Fuhremann Canning Company, a
Wisconsin Corporation to City of Appleton, a Municipal Corporation dated May
10, 1945 and recorded in the Office of the Register of Deeds for Outagamie
County, Wisconsin on May 19, 1945 in Volume 296 on Page 519 as Document No.
383005.
Easements, if any, of the public or any school district, utility,
municipality or person, as provided in Section 80.32(4) of the Statutes, for
the continued use and right of entrance, maintenance, construction and
repair of underground or overground structures, improvements or service in
that portion of the subject premises which were formerly a part of West
Eighth Street now vacated.
Rights and easements (if any) in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to the
subject premises.
Declaration of Restrictions contained in Instrument by Stokely USA, Inc., a
Wisconsin corporation, dated May 5, 1992 and recorded in the office of the
Register of Deeds for Outagamie County, Wisconsin on June 17, 1992, Jacket
12569, Images 22-28, as Document No. 1042209.
- - Revenue Agreement contained in Instrument by and between the City of
Appleton, Wisconsin, a municipal corporation and Stokely USA, Inc., a
Wisconsin corporation dated December 1, 1985 and recorded in the office of
the Register of Deeds for Outagamie County, Wisconsin on May 1, 1986 in
Jacket 6267 Image 32 through Jacket 6269 Image 6, as Document No. 883907.
- - Indenture of Trust by and between the City of Appleton, Wisconsin, a
municipal corporation and First Bank, Milwaukee, Wisconsin, dated December
1, 1985 and recorded in the office of the Register of Deeds for Outagamie
County, Wisconsin on May 1, 1986 in Jacket 6269 Image 7 through Jacket 6270
Image 19, as Document No. 883908.
<PAGE> 366
COBB, WISCONSIN
<PAGE> 367
- - Restrictions and the terms thereof, contained in Deed executed by
Chicago and North Western Railway Company to Cobb Canning Co., dated
December 16, 1964 and recorded in said Register's Office on December 30,
1964 in Volume 219 of Records, page 533 as Document No. 97146, providing as
follows: The East 50 feet of the lands hereby conveyed shall be left free
from all buildings, structures, trees, shrubbery or other obstructions which
will obstruct the view over and across said East 50 foot strip.
- - Electric Line Easement and the terms thereof, dated May 23, 1984 and
recorded June 15, 1994 in Volume 465 of Records, page 870, document
number 197303, Iowa County Registry.
- - Rights and easement and the terms thereof, if any, in and to any land
all railroad switches, sidetracks, spur tracks, and rights of way located
upon or appurtenant to the above-described premises.
- - Rights and privileges and the terms thereof, of Chicago, Milwaukee, and
Northwestern Railway Co. as shown in Deed recorded in Volume 36 of Deeds,
page 399.
- - Rights, if any, of Lawrence Warehouse Company under lease entered into
by and between Cobb Canning Company, as lessor and Lawrence Warehouse
Company, as lessee, dated March 27, 1939, recorded in the office of the
Register of Deeds for Iowa County, Wisconsin on May 6, 1939 in Volume 132 of
Deeds, at page 443-448, wherein a 2 story brick and concrete building is
leased to said lessee.
<PAGE> 368
DEFOREST, WISCONSIN
<PAGE> 369
- - Rights of the public in that portion of the premises lying within the
limits of C.T.H. "V" and U.S. Highway 51.
- - Electric Line Easement to Wisconsin Power and Light Company recorded on
September 12, 1962, in Volume 381 of Misc., page 156, as Document No.
1056831.
- - Underground Electric Easement to Wisconsin Power and Light Company
recorded on October 2, 1989, in Volume 13375 of Records, page 64, as
Document No. 2164887.
- - Right of Way Grant - Gas Main to Madison Gas and Electric Company
recorded on August 17, 1990, in Volume 14594 of Records, page 86, as
Document No. 2217417.
- - Electric Line Easement to Wisconsin Power and Light Company recorded on
June 6, 1991, in Volume 16042 of Records, page 7, as Document No. 2267064.
- - Easement and Right of Way to Village of DeForest recorded on January
12, 1995, in Volume 29197 of Records, page 26, as Document No. 2655506.
<PAGE> 370
GRANDVIEW, WASHINGTON
<PAGE> 371
- - Easement and rights of way over the lands herein described as may be
necessary for canals, tunnels, or other conduits and for telephone and
transmission lines, required in connection with the irrigation works
constructed, disclosed by deeds or water contracts appearing in the record
executed in favor of: Sunnyside Valley Irrigation District.
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for sewer line, in favor of Russell
E. Holmes, et ux, as recorded August 14, 1961, in Volume 619 of Deeds, under
Auditor's File Number 1875286. Said easement affects the South 10 feet of
Parcel "A".
- - Requirement to relocate existing sewer line and provide necessary
easements and allow access to said premises for garbage collection as
disclosed by instrument recorded under Auditor's File Number 2828565.
Affects portion of vacated street adjoining Parcel "B".
- - Matters disclosed on Survey map prepared by Jaussaud, Seward &
Associates, and filed on October 18, 1988 in Book 45 of Surveys, at Page 66,
records of Yakima County, Washington. Among other items, the map discloses
usage line extends to the fence located North of the North line of Parcel
"D".
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for existing water, sewer and storm
drains, in favor of City of Grandview, Washington, as recorded November 22,
1991, in Volume 1341 of Official Records, under Auditor's File Number
2942460. Said easement affects Parcels "C" and "D".
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for ingress and egress, in favor of
Gary Christensen and Annette Christensen, husband and wife, as recorded
December 11, 1991, in Volume 1343 of Official Records, under Auditor's File
Number 2943976. Said easement affects Parcels "C" and "D".
- - An easement affecting the portion of said premises and for the purposes
stated herein, and incidental purposes, for installation and maintenance of
a guy wire and guy pole, in favor of City of Grandview, a municipal
corporation, as recorded March 22, 1990, in Volume 1290 of Official Records,
under Auditor's File Number 2886078. Said easement affects Parcel "B".
- - All existing utility easements located within vacated West "A" Street
and vacated West Third Street, as reserved by the City of Grandview in
unrecorded Ordinance No. 1296, as passed by the City Council on August 19,
1991.
- - Matters disclosed on Survey map prepared by Worley Surveying Service,
Inc. and filed on March 19, 1993 in Book 55 of Surveys, at Page 79, records
of Yakima County, Washington. Among other items, the map discloses overlap
of building across the North line of Parcel "B", and overlap of building
across the South line of Parcel "C".
<PAGE> 372
GREEN BAY, WISCONSIN
<PAGE> 373
HOOPESTON, ILLINOIS
<PAGE> 374
Easement dated March 11, 1993 and recorded June 2, 1993 as Document 93-5396 to
City of Hoopeston, to erect, construct, install or lay, use, operate and
inspect, repair, maintain and use for a drainage ditch.
Premises are located within the Hoopeston Drainage District and are subject to
assessments thereunder.
Premises are located within the Vermilion County Soil and Water Conservation
District.
Terms, covenants and provisions of a certain Agreement by and between Thomas
Hoopes and Lafayette, Bloomington and Mississippi Railway Company, dated June
3, 1870 and recorded February 5, 1926 in Deed Record 350 Page 210.
Easement of City of Hoopeston, Illinois, a Municipal Corporation, its
successors and assigns, for storm sewer and appurtenances as contained in the
Storm Sewer Easement made by Stokley Van-Camp, Inc., a Corporation, dated April
18, 1968 and recorded May 22, 1968 in Book 765 Page 38 as Document 798206.
Easement of Central Illinois Public Service Company, its successors and assigns
for transmission lines and appurtenances, as contained in Right of Way Grant
made by Stokley Van Camp, Inc., dated February 6, 1974 and recorded June 4,
1974 in Book 863 Page 403 as Document No. 870722.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant, dated July 26, 1950 as to the following: Lot 3 of the Clerk's
Subdivision of the North Half of Section 11 in Township 23 North, Range 12 West
of the 2nd P. M., Vermilion County, Illinois. This Grant is made to grant the
right to place 1 Guy Stub 478 feet North of the South line of the above
described property and 15 feet East of the West line of the said property. One
anchor to be placed 10 feet East of the said Guy Stub, as disclosed in Warranty
Deed dated June 10, 1983 and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company, under Right of Way and
Easement Grant dated November 19, 1953, as to the following: The South Half of
Section 10 in Township 23 North, Range 12 West of the 2nd P. M., Vermilion
County, Illinois, and that part of the Northeast Quarter of the said Section 10
which lies South of the South line of the Right of Way of the New York, Chicago
and St. Louis Railroad Company; also that part of the West Half of Section 11
in the said Township and Range which lies South of the Right of Way of the said
Railroad Company and West of the Westerly line of the Right of Way of State
Bond Issue Highway Route Number One, Except the South 2 acres thereof,
<PAGE> 375
and also Except the East 100 feet of the North 405 feet of the last above
mentioned tract. The said transmission line shall be located on a line which
extends Northwardly from a point on the South line of the above described land
which is 3991 feet East of the Southwest Corner of the said Section 10 to a
point on the North line of the said land which is 3991 feet East of the West
line of the said Section 10, as disclosed in Warranty Deed dated June 10, 1983
and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated November 15, 1957, as to the following: The North 400 feet
of the West 400 feet of that part of the Northeast Quarter of Section 11
Township 23 North, Range 12 West of the 2nd P. M., Vermilion County, Illinois,
lying South of the Chicago and Eastern Illinois Railroad spur, excepting a
triangular tract in the Northwest Corner thereof heretofore deeded to Chicago &
Eastern Railroad Company. This Grant is made to grant the right to place one
pole with necessary wires and fixtures attached thereto 262 feet East of the
East line of Sixth Street and 50 feet, more or less, South of the North line of
the above described property. Anchors to be placed not more than 60 feet
Southeastwardly from said pole, as disclosed in Warranty Deed dated June 10,
1983 and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated April 28, 1966, as to the following: The East 310 feet of
all that part of the Northwest Quarter of Section 11 Township 23 North, Range
12 West of the 2nd P. M. Vermilion County, Illinois, lying South of the Right
of Way of the New York, Chicago and Saint Louis Railroad Company and West of
the Right of Way of State Bond Issue Highway Route #1. The said line to be
located approximately 300 feet of the West line of the Right of Way of State
Bond Issue Highway Route #1, as disclosed in Warranty Deed dated June 10, 1983
and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated January 10, 1973, as to the following: The East 20 feet
of the following described property: Beginning at a point which is 241 feet
South of the center line of Penn Street extended West and 383 feet West of the
center line of S.B.I. Highway Route #1; thence South 580 feet; thence West 20
feet; thence North 580 feet; thence East 20 feet to the place of beginning and
being a part of the West Half of Section 11 in
<PAGE> 376
Township 23 North Range 12 West of the 2nd P. M., Vermilion County, Illinois.
The said Penn Street being located in the City of Hoopeston, Vermilion County,
Illinois. Place overhead wires, not including poles and fixtures, over, across
and along the East 10 feet of the above described property, as disclosed in
Warranty Deed dated June 10, 1983 and recorded September 22, 1983 as Document
83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated August 20, 1973 as to the West Half of Section 11 Township
23 North, Range 12 West of the 2nd P. M., as disclosed in Warranty Deed dated
June 10, 1983 and recorded September 22, 1983 as Document 83-6530.
Rights of Central Illinois Public Service Company under Right of Way and
Easement Grant dated April 27, 1976 as to the following: Commencing on the
North side of the Right of Way of the Lake Erie and Western Railroad and 6th
Avenue running North 1106 links; thence East 3930 links to the West side of the
Right of Way of the Chicago and Eastern Illinois Railroad; thence South along
the West side of the Right of Way of the Chicago and Eastern Illinois Railroad
to the North side of the Right of Way of the Lake Erie and Western Railroad;
thence West along the North side of the said Right of Way of the Lake Erie and
Western Railroad to the place of beginning (Except that portion of said tract
deeded to the Chicago and Eastern Illinois Railroad) in the City of Hoopeston,
Excepting therefrom that land conveyed to the Chicago and Eastern Illinois
Railroad Company by Deed dated August 5, 1907 and recorded in Deed Record 211
Page 168 of the Vermilion County records, and being a part of the Northeast
Quarter of Section 11 Township 23 North, Range 12 West of the 2nd P. M.,
Vermilion County, Illinois. The pole in the said transmission line is to be
located on or within 3 feet more or less, of the South property line of the
above described land and approximately 44 feet West of the centerline of 4th
Avenue in the Town of Hoopeston of said 4th Avenue were to extend Northward of
said Railroad. Overhang with wires and conductors to extend Eastward of said
pole approximately 85 feet to an existing pole. Anchors to extend
approximately 14 feet Northward and approximately 22 feet Westward of said
pole, as disclosed in Warranty Deed dated June 10, 1983 and recorded August 22,
1983 as Document 83-6530.
That portion of the above described premises falling within the boundaries of
certain Railroad right of ways.
Easement dated February 20, 1986 and recorded February 17, 1987 as Document
87-1280 to City of Hoopeston, to erect, construct, operate, lay, maintain,
repair, replace and remove, a sanitary sewer, etc.
Easement dated October 6, 1992 and recorded April 5, 1993 as Document 93-3193
to City of Hoopeston, to construct and operate a combined sewer, etc., and See
Temporary Easement dated October 6, 1992 and recorded April 5, 1993 as Document
93-3194.
<PAGE> 377
JEFFERSON, WISCONSIN
<PAGE> 378
- - Easement and Common Wall Agreement by and between Jefferson Cold
Storage Corporation and Stokely USA, Inc. dated November 20, 1985 and recorded
on January 27, 1986 in Volume 670 of Records on Page 892, as Document Number
813510. (See attachment.)
- - Memorandum of Option to Purchase and First Refusal Rights to Purchase
by and between Jefferson Cold Storage Corporation and Stokely USA, Inc. dated
November 20, 1985 and recorded on January 27, 1986 in Volume 670 of Records on
Page 900, as Document Number 813511. (See attachment.)
- - Easement and Common Wall Agreement by and between Jefferson Cold
Storage Corporation and Stokely USA, Inc. dated October 19, 1990 and recorded
on October 22, 1990 in Volume 762 of Records on Page 75, as Document Number
867246. (See attachment.)
- - Mortgage from Stokely USA, Inc. to First Bank (N.A.) as Trustee, dated
December 15, 1985 and recorded on December 27, 1985 in Volume 669 of Records on
Page 659, as Document Number 812800, in the originally stated amount of
$6,500,000.00.
<PAGE> 379
MERRILL, WISCONSIN
<PAGE> 380
- - Easement from Lincoln Canning Company to the City of Merrill, dated
Dec. 6, 1956, recorded Dec. 10, 1956, in Volume 191 of Misc., page 2
204, as Document No. 175462.
<PAGE> 381
OCONOMOWOC, WISCONSIN
<PAGE> 382
- - Limitations imposed upon access set forth in Award of Damages by State
Highway Commission of Wisconsin pursuant to a relocation order of the
State Highway Commission of Wisconsin dated November 29, 1961 for the
improvement of Interstate Highway 94 recorded May 21, 1962 in Volume 915
of Deeds on Page 533, as Document No. 565390.
- - Public or private rights, if any, in such portion of the subject premises as
may be presently used, laid out or dedicated in any manner whatsoever, for
road purposes.
- - 15 Foot Utility Easement along the South property line of the land as
depicted on the plat of Certified Survey Map No. 6318, recorded on
November 29, 1990 in Volume 52 of Certified Survey Maps on Pages 131 to 133
inclusive, as Document No. 1624207.
- - 25 Foot Drainage Easement along the two Northwesterly curved property lines
of the land as depicted on the plat of Certified Survey Map No. 6318,
recorded on November 29, 1990 in Volume 52 of Certified Survey Maps on Pages
131 to 133 inclusive, as Document No. 1624207.
- - Wetlands and environmental corridor to as depicted on the plat of Certified
Survey Map No. 6318, recorded on November 29, 1990 in Volume 52 of Certified
Survey Maps on Pages 131 to 133 inclusive, as Document No. 1624207.
- - Notice of Location of Cataloged Burial Site recorded on November 12, 1990
on Reel 1253, Image 533 as Document No. 1621812.
- - Notice of Location of Cataloged Burial Site, recorded on November 12, 1990
on Reel 1253, Image 535 as Document No. 1621813.
- - Tax Incremental District Development Agreement entered into by and between
the City of Development and Valley Road Limited Partnership, dated
November 9, 1990 and recorded on November 29, 1990 on Reel 1257, Image 879
as Document No. 1624246.
- - Charges and assessments according to the terms of the Tax Incremental
District Development Agreement entered into by and between the City of
Oconomowoc and Valley Road Limited Partnership, dated November 9, 1990
and recorded November 29, 1990 on Reel 1257, Image 879 as Document No.
1624246.
- - Covenants, conditions and restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status, or national origin, unless and only to the extent that
said covenant (a) is exempt under Chapter 42, Section 3607 of the United
States Code, or (b) relates to handicap but does not discriminate against
handicapped persons) set forth in Covenants, conditions and restrictions
set forth in a Declaration of Protective Covenants for Oconomowoc Corporate
Center, dated November 27, 1990 and recorded on November 29, 1990 Reel 1257,
Image 977 as Document No. 1624247. See copy enclosed with commitment.
- - Charges and assessments according to the terms of the Declaration of
Protective Covenants for Oconomowoc Corporation Center, dated November 27,
1990 and recorded on November 29, 1990 on Reel 1257, Image 977 as Document
No. 1624247.
- - Rights of the public in so much of the subject premises as are affected by
ordinance adopted by the Board of Supervisors of Waukesha County June 18,
1954 and approved by the various towns in said County, establishing the
width of C.T.H. "B" at 100 feet, and ordaining that said highway be
widened to the width so established; together with rights of the public
in that portion of said premises lying within the limits of said road and
not affected by said ordinance. A notice and plat etc. in said matter was
filed April 18, 1957, as No. 1.
<PAGE> 383
PICKETT, WISCONSIN
<PAGE> 384
Indenture of Trust by and between the Town of Utica, a municipal
corporation and existing under the laws of the State of Wisconsin and The
Peoples Bank, a banking corporation with trust powers duly organized and
existing under and by virtue of the laws of the State of Indiana, dated
July 1, 1977 and recorded in the Office of the Register of Deeds for
Winnebago County, Wisconsin on July 28, 1977 as Document No. 499665.
Mortgage, according to the terms and provisions thereof, from Naas Foods
of Wisconsin, Inc., a corporation to Town of Utica, Wisconsin, a Wisconsin
municipal corporation, its successors and assigns in the originally stated
indebtedness of $1,000,000 and assignment from Town of Utica, Wisconsin to
The Peoples Bank, Portland, Indiana, as Trustee, or to its successor or
successors as Trustee, under that certain Indenture of Trust, dated as of
July 1, 1977, dated July 1, 1977 and recorded in the Office of the
Register of Deeds for Winnebago County, Wisconsin on July 28, 1977 as
Document No. 499666.
Covenants, Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status or national origin, unless and only to the extent that
said covenant (a) is exempt under Chapter 42, Section 3607 of the United
States Code, or (b) relates to handicap but does not discriminate against
handicapped persons) set forth in Quit Claim Deed executed by Jasper G.
Pickett, a single man to Wisconsin State Canners Company, a Wisconsin
corporation of Pickett dated June 26, 1947 and recorded in the office of
the Register of Deeds for Winnebago County, Wisconsin on July 18, 1947 in
Volume 560 on Page 229 as Document No. 147323.
Covenants, Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status or national origin, unless and only to the extent that
said covenant (a) is exempt under Chapter 42, Section 3607 of the United
States Code, or (b) relates to handicap but does not discriminate against
handicapped persons) set forth in Instrument dated October 31, 1994 and
recorded in the office of the Register of Deeds for Winnebago County,
Wisconsin on November 4, 1994 as Document No. 890931.
Covenants Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status or national origin, unless and only to the extent that
said covenant (a) is exempt under Chapter 42, Section 3607 of the United
States Code, or (b) relates to handicap but does not discriminate against
handicapped persons) set forth in Instrument dated November 14, 1994 and
recorded in the office of the Register of Deeds for Winnebago County,
Wisconsin on November 16, 1994 as Document No. 891668.
<PAGE> 385
- - Possible assessments, if any, as disclosed by the Order Creating a
Sanitary District, if the subject premises is located within a sanitary
district.
- - Drainage rights and rights of way by reason of any drainage ditches,
feeders, laterals and underground drain tile or pipes that may be located
on the subject premises.
- - Rights of the public in that portion of the premises lying within the
limits of County Trunk Highway "M".
- - Rights and easements (if any) in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to
the subject premises.
- - Covenants, Conditions and Restrictions (but omitting any such covenant,
condition or restriction based on race, color, religion, sex, handicap,
familial status or national origin, unless and only to the extent that
said covenant (a) is exempt under Chapter 42, Section 3607 of the United
States Code, or (b) relates to handicap but does not discriminate against
handicapped persons) set forth in Warranty Deed executed by Standard Hemp
and Fibre Company, a corporation of Pickett to Wisconsin State Canners
Co., a Wisconsin Corporation dated March 23, 1923 and recorded in the
office of the Register of Deeds for Winnebago County, Wisconsin on April
7, 1923 in Volume 351 on Page 82.
Holding Tank Agreement contained in Instrument dated March 29, 1990 and
recorded in the office of the Register of Deeds for Winnebago County,
Wisconsin on April 12, 1990 as Document No. 741485.
Holding Tank Servicing Contract contained in Instrument dated April 18,
1990 and recorded in the office of the Register of Deeds for Winnebago
County, Wisconsin on April 19, 1990 as Document No. 741895.
- - Apparent interest of David Hielke and Joan Hielke in the subject premises,
as indicated by the fact that they are named as debtors in the Financing
Statement shown below.
Security interest of Valley First National Bank of Ripon, secured party,
as disclosed by Financing Statement filed on April 4, 1989 as No. 968356
executed by David Hielke and Joan Hielke, debtor in certain chattels on
the subject premises described in Schedule A hereof.
<PAGE> 386
POYNETTE, WISCONSIN
<PAGE> 387
- - Easements and rights incidental thereto in connection with the continued
use and right of entrance, maintenance, construction and repair of
municipal or utility facilities as may exist underground or overground in
or on that portion of the above-described premises which were formerly a
part of Old Hwy. "10" and C.T.H. "S" now vacated.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded
August 1, 1929 in Volume 171 of Deeds, on page 104, as Document No.
196491.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded
August 21, 1929 in Volume 171 of Deeds, on page 109, as Document No.
196610.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded
March 4, 1930 in Volume 171 of Deeds, on page 122, as Document No.
197846.
- - POLE AND LINE GRANT and conditions as contained in instrument recorded
June 10, 1930 in Volume 171 of Deeds, on page 156, as Document No.
198571.
- - EASEMENT and conditions as contained in instrument recorded February 11,
1957 in Volume 34 of Misc., on page 342, as Document No. 287483.
- - EASEMENT and conditions as contained in instrument recorded April 3, 1954
in Volume 31 of Misc., on page 311, as Document No. 277048.
- - EASEMENT and conditions as contained in instrument recorded February 19,
1957 in Volume 34 of Misc., on page 351, as Document No. 287545.
- - EASEMENT and conditions as contained in instrument recorded February 2,
1960 in Volume 37 of Misc., on page 562, as Document No. 298052.
- - OFFICIAL PUBLICATION, FINDING, DETERMINATION AND DECLARATION BY THE STATE
HIGHWAY COMMISSION OF WISCONSIN ESTABLISHING A CERTAIN CONTROLLED-ACCESS
HIGHWAY IN COLUMBIA COUNTY, WISCONSIN WITH REFERENCE TO RURAL PORTIONS ON A
CERTAIN STATE TRUNK HIGHWAY IN THE TOWNS OF LEEDS, DEKORRA, ARLINGTON,
AND PACIFIC, VILLAGE OF POYNETTE AND CITY OF PORTAGE as contained in
instrument recorded March 17, 1956 in Volume 33 of Misc., on pages 445-449,
as Document No. 284176.
- - HIGHWAY DEEDS and conditions as contained in instrument recorded June 26,
1967 in Volume 42 of Records, on pages 428-429, as Document No. 329788:
recorded January 16, 1968 in Volume 49 of Records, on page 603, as Document
No. 332601: recorded January 16, 1968 in Volume 49 of Records, on pages
604-605, as Document No. 332602 and recorded October 20, 1971 in Volume 97
of Records, on pages 543-544, as Document No. 351132.
- - EASEMENT and conditions as contained in instrument recorded October 18,
1974 in Volume 143 of Records, on page 168, as Document No. 370030.
- - ON SITE WASTE DISPOSAL OPERATION & MAINTENANCE AGREEMENT and conditions as
contained in instrument to Columbia County, Wisconsin recorded March 15,
1985 in Volume 281 of Records, on page 109, as Document No. 440623.
- - EASEMENT and conditions as contained in instrument recorded November 2,
1987 in Volume 326 of Records, on page 455, as Document No. 462497.
<PAGE> 388
- - Rights of the public in that portion of the premises lying within the
limits of Kent Road, Old "S", U.S.H. 51. Old Hwy. "10" and C.T.H. "S".
- - Rights and easements, if any, in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to
the captioned premises.
- - WELL AND PUMPHOUSE AGREEMENT and conditions as contained in instrument
recorded March 22, 1989 in Volume 349 of Records, on pages 611-618, as
Document No. 473082.
- - RIGHT OF WAY EASEMENT and conditions as contained in instrument recorded
November 30, 1992 in Volume 431 of Records, on pages 168-170, as Document
No. 510190.
- - Vision Corner as shcron on Certified Survey Map No. 1288, as Document No.
471410 and Certified Survey Map No. 1289, as Document No. 471411.
- - Lack of access to public streets from any parcel which does not abut
public streets.
- - MORTGAGE, SECURITY AGREEMENT AND ASSIGNMENT OF LEASES AND RENTS from
Stokely USA, Inc., a Wisconsin Corporation to the Village of Poynette,
Wisconsin and ASSIGNED to Firstar Bank, N.A. for $6,000,000 dated August
1, 1988 and recorded August 18, 1988 in Volume 340 of Records, on pages
1-31, as Document No. 468538.
<PAGE> 389
SCOTTVILLE, MICHIGAN
<PAGE> 390
- The Mortgage and Security Agreement to Michigan Job Development
Authority dated October 1,1984 and recorded on October 16, 1984 in Liber 319 on
Pages 544-557; and assigned to First Bank, N.A., as Trustee and Tracy E.
Little, an individual, as co-trustee, dated October 1, 1984 and recorded on
October 16, 1984 in Liber 319 on Pages 558-562; and see Subordination Agreement
recorded on February 18, 1995 in Liber 437 on Pages 981-985.
- Financing Statement between Oconomowoc Canning Company as Debtor
and Michigan Job Development Authority as Secured Party, recorded on October
16, 1984 in Liber 319 on Page 563; and as renewed by instrument recorded May 4,
1989 in Liber 380 on Page 176.
- The rights of the public and of any Governmental unit in any part
thereof taken, used or deeded for street, road or highway purposes.
- Rights of the United States, State of Michigan, and the public for
commerce, navigation, recreation and fishery in any portion of the land
comprising the bed of waters of Foster Creek.
- The nature, extent or lack of riparian rights or the riparian
rights of riparian owners and the public in and to the use of waters of Foster
Creek.
- Lease contiguous and appurtenant to Parcel 1 and access along the
Easterly line of said Parcel 1 granted by the City of Scottville to W.R. Roach
Company for 99 years from June 15, 1936 or until such time as grantee shall
cease to use said property for canning and manufacturing purposes as set forth
in Liber 13 of Misc. Records on Page 51.
- The easement and right of way recorded November 26, 1975 in Liber
90 of Misc. Records on Pages 198-199, to City of Scottville for drains, sewers,
waterlines, or other public service facilities over the South 15 feet of
Parcel 1.
- The easement and right of way recorded June 15, 1976 in Liber 91 of
Misc. Records on Pages 146-147 to City of Scottville for drains, sewers,
waterlines, or other public service facilities over the South 15 feet of the
North 48 feet of the East 160 feet of Parcel 1.
- The right of way easement recorded December 8, 1931 in Liber 11 of
Misc. Records on Pages 209-210 to Michigan Bell Telephone Company for telephone
and telegraph poles, wires, cables, conduits etc. over and across Parcel 4.
- The easement for electric line recorded November 6, 1990 in Liber
398 on Page 158 from Stokely USA, Inc., a Wisconsin corporation, to Consumers
Power Company over and across a part of Parcel 1.
<PAGE> 391
SUN PRAIRIE, WISCONSIN
<PAGE> 392
- - Rights and easements, if any, in and to any and all railroad
switches, sidetracks, spur tracks and rights of way located upon or
appurtenant to the subject premises.
- - Highway Conveyance, Limited Highway Easements and Restrictions
contained in instrument recorded on June 1, 1976, in Volume 684 of Records,
page 651, as Document No. 1471081.
- - Easement to General Telephone Company of Wisconsin recorded on
September 20, 1976, in Volume 727 of Records, page 259, as Document No.
1487896.
- - Easement to Wisconsin Gas Company recorded on August 2, 1976, in
Volume 708 of Records, page 445, as Document No. 1480592.
- - Encroachment, if any, of the building located on Parcel 7 of the
captioned premises into the railroad right of way, as disclosed in
instrument recorded on March 15, 1934, in Volume 363 of Deeds, page 177, as
Document No. 554178.
- - Utility easement reserved in instrument recorded on June 22, 1964,
in Volume 780 of Deeds, page 51, as Document No. 1104670.
- - Easements and rights incidental thereto in connection with the
continued use and right of entrance, maintenance, construction and repair of
municipal or utility facilities as may exist underground or overground in or
on that portion of the above-described premises which were formerly a part
of Lincoln Street now vacated.
- - Easement to Wisconsin Telephone Company recorded on June 26, 1920,
in Volume 48 of Misc., page 215, as Document No. 392723.
- - Easement to City of Sun Prairie recorded on March 29, 1985, in
Volume 6636 of Records, page 74, as Document No. 1873497.
<PAGE> 393
WALLA WALLA, WASHINGTON
<PAGE> 394
- - Assessment of $22,469.41 for Poplar Street Extension, under Local
Improvement District No. 762, No. 5, payable in 20 annual installments plus
interest at 8 1/2% per annum from April 1, 1991. The first three
installments are paid. The fourth installment was delinquent May 1, 1955.
- - Deed of Trust to Secure an indebtedness of the amount herein stated
and any amounts payable under the terms thereof.
Amount : $2,124,000.00
Dated : March 28, 1978
Recorded : March 31, 1978
Volume/Page : 79/389
Auditor's No. : 7802826
Grantor : D & K Frozen Foods, Inc.
Trustee : Pioneer National Title Insurance Company
Beneficiary : Economic Development Administration
U.S. Department of Commerce
- - A security interest in goods under the provisions of the Uniform
Commercial Code, RCW 62A, disclosed by financing statement filed in the
office of the County Auditor.
Debtor : D & K Frozen Foods, Inc.
Secured Party : United States Department of Commerce
Economic Development Administration
Filed : July 29, 1993
Auditor's No. : 9307730
Collateral : All machinery and equipment, etc.
- - A security interest in goods under the provisions of the Uniform
Commercial Code, RCW 62A, disclosed by financing statement filed in the
office of the County Auditor.
Debtor : D & K Frozen Foods, Inc.
Secured Party : Independent Finance, Inc.
Filed : May 17, 1985
Auditor's No. : 8503186
Collateral : One (1) Flofreeze Model 10 MA
freezer-Frigoscandia Contracting, Inc.
Affects : Parcel B
- - A security interest in goods under the provisions of the Uniform
Commercial Code, RCW 62A, disclosed by financing statement filed in the
office of the County Auditor.
Debtor : D & K/Frozen Foods, Inc.
Secured Party : Independent Finance, Inc.
Filed : May 17, 1985
Auditor's No. : 8503187
Collateral : One (1) Flofreeze Model 10 MA
Freeze--Frigoscandia Contracting, Inc.
Affects : Parcel B
- - A security interest in goods under the provisions of the Uniform
Commercial Code, RCW 62A, disclosed by financing statement filed in the
office of the County Auditor.
Debtor : D & K Frozen Foods, Inc.
Secured Party : Rainier Bank
Filed : May 12, 1986
Auditor's No. : 8603286
Collateral : All equipment but not limited to food
processing equipment, freezing tunnels,
conveyors, compressors, and hoppers and
including all parts, accessories and accessions
<PAGE> 395
- - Reservations contained in Deed.
Executed by : Jones-Scott Company, a corporation
Recorded : October 8, 1945
Auditor's No. : 287054
Volume/Page : 221/40
As Follows : Jones-Scott Company reserves to itself and its assigns
the right to install a switch and other appurtenances
necessary for building a railway side track on the
Jones-Scott Company's remaining property, said switch to be
installed as near to the north and east boundaries of the
property herein conveyed as may be practical.
Affects : PARCEL B
- - Reservation contained in Deed
Executed by : United States of America
Recorded : February 14, 1956
Auditor's No. : 385018
Volume/Page : 276/280
As Follows :
Subject to the following restrictions and conditions (which shall be
covenants running with the land) for breach of any of which restrictions and
conditions the property herein conveyed shall revert to the grantor or its
transferee at its election:
1. Noise shall not exceed 70 decibels at the border of the industrial
zones for all operations. The noise shall be muffled so as not to become
objectionable due to intermittence, heat frequency or shrillness;
2. Smoke, dust, dirt and fly ash shall not exceed 0.3 grains per cubic
foot of flue gas at stack temperatures of 500 degrees Fahrenheit and not to
exceed 50 per cent excess air and shall in no manner be unclean,
destructive, hazardous, nor shall visibility be impaired by the emission of
a haze which unduly impedes vision within apparent opaqueness equivalent to
No. 1 of the Ringleman Chart. Smoke, as measured by the Ringleman Chart,
equivalent to No. 2 on the chart, may be allowed for periods aggregating 4
minutes in any 30 minutes;
3. The emission of obnoxious odors of any kind shall not be permitted;
4. No gas shall be permitted which is deleterious to the public
health, safety or general welfare as determined by the Sanitarian of the
County-City Health Department, when requested by the Building Inspector;
5. Arc welding, acetylene torch cutting or similar processes shall be
performed so that glare shall not be seen and heat shall not be noticeable
from any point beyond the outside of the property on which the process is
conducted;
<PAGE> 396
6. Fire and safety precautions, including those pertaining to the storage
and handling of flammable liquids, liquefied petroleum and gases, shall
comply with the rules and regulations of the State of Washington and the
City of Walla Walla;
7. Bulk storage of flammable liquids below ground shall comply with the
fire code of Walla Walla, Washington, bulk storage of flammable liquids,
liquified petroleum, gases and explosives, above ground shall not be
permitted;
8. Storage, such as raw materials, fuel, etc., shall be within an entire
closed building;
9. Prohibited uses. In the Industrial Park area no building shall be
erected or altered and no land shall be used for the carrying on of
manufacturing activities of the character of or similar to junk and wrecking
yards, tanneries, stock yards, glue factories, soap factories, oil
refineries or other similar factories;
10. The area is designated as a park area and shall not be used for
residential purposes or permanent habitation, except for such needs as
caretaker and watchman;
11. Vacant property may not be used for commercial gardening, fruit
raising, and general agricultural purposes that require tilling of the
soil or any use that creates dust, noise, gases, noxious odors or fire and
safety hazards;
12. Mining or extracting operations shall be prohibited;
13. Well drilling, filling, and soil stripping must be done in such manner
as to leave no unsightly or dangerous excavations or spoilbanks and in
such a manner as to prevent increased erosion;
14. Provisions for sewage and waste disposal shall conform to all local and
state ordinances and further shall be such that no condition tending to
pollute the Veterans Administration Hospital water supply shall exist.
Affects : PARCEL C
- - An easement affecting a portion of said premises and for the purposes tated
herein, and incidental purposes.
In favor of : City of Walla Walla, a municipal corporation,
its successors and assigns
Recorded : January 28, 1960
Volume/Page : 292/742
Auditor's no. : 417992
As follows :
Easement and right of way for the operation, maintenance and repair of
a trunk sewer of 24" I.D. dimensions, now located on the following described
property, together with all necesary and usual appurtenances therefor:
Beginning at a point on the original easterly boundary line of the
Veterans Administration Reservation in Sec. 30, Tp. 7 N., R. 36 E.W.M., said
point being 1685.78 feet and bearing south 27 degrees 23' east of the
northeast corner of said Veterans Administration boundary line, said point
being identified by a U.S.C.E. bronze disk, and running thence south 67
degrees 48' 10" west 30.12 feet for the true point of beginning; thence
south 67 degrees 48' 10" west 20.09 feet; thence north 27 degrees 23' west,
parallel to said easterly boundary line, 1525.73 feet more or less to the
south line of Rose Street; said south line being formerly the south right of
way line of the Washington State Primary Highway No. 3; thence easterly
along said south line 20.09 feet; thence south 27 degrees 23' east 1525.73
feet more or less to the true point of beginning.
Affects : PARCEL C.
<PAGE> 397
- - An easement affecting a portion of said premises and for the purposes stated
herein, and incidental purposes.
For : Easement for a pipeline or pipelines for transportation of
oil, gas and the products thereof, and related rights
In Favor of : Cascade Natural Gas Corporation
Recorded : September 8, 1969
Volume/Page : 332/590
Auditor's No. : 503727
Affects : South 10 feet of Parcel C
- - Reservations Contained in Deed
Executed by : Union Pacific Railroad Company, a Utah corporation, and
Walla Walla Valley Railway Company, an Oregon corporation
Recorded : June 22, 1962
Volume/Page : 302/221
Auditor's No. : 439803
As follows :
Reserving unto the grantors, their successors and assigns forever, all
minerals and all mineral rights of every kind and character now known to
exist or hereafter discovered including, without limiting the generality of
the foregoing, oil and gas and rights thereto, together with the sole,
exclusive and perpetual right to explore for, remove and dispose of said
minerals by any means or methods suitable to the grantors, their successors
and assigns, but without entering upon or using the surface of the lands
hereby conveyed, and in such manner as not to damage the surface of said
lands or to interfere with the use thereof by the grantee, its successors or
assigns.
Also, excepting and reserving unto the grantors, their successors and
assigns forever, a perpetual easement and right of way for the purpose of
operating and maintaining railroad facilities upon, along, over and across
the following described portion of the real estate hereby conveyed, to wit:
A strip of land 392 feet more or less in length and 17 feet wide, being
8.5 feet in width on each side of the center line of the joint Walla Walla
Valley Railway Company - Union Pacific Railroad Company switching track
#205, situate in the NW1/4 of Section 19, Township 7 north, Range 36 E.W.M.,
described as follows, to wit:
Beginning at a point on the north line of Dell Avenue in the City of
Walla Walla that is 726 feet distance west of the point of intersection of
said north line of Dell Avenue with the west line of Thirteenth Avenue
north, said point also being 30 feet northerly of the east and west center
line of said Section 19 which is common to the center line of Dell Avenue;
thence northerly and parallel with said west line of Thirteenth Avenue North
a distance of 607.3 feet to a point which is the TRUE POINT OF BEGINNING of
this description; thence westerly and parallel with and 8.5 feet distant
southerly measured at right angles to the center line of said track #205 a
distance of 392.0 feet more or less; thence northerly and parallel with said
west line of Thirteenth Avenue North a distance of 17.0 feet; thence
easterly and parallel with and 8.5 feet distant northerly measured at right
angles to the center line of said spur track #205 a distance of 392 feet
more or less; thence southerly and parallel with said west line of
Thirteenth Avenue north a distance of 17 feet to the true point of beginning
of this description.
<PAGE> 398
cepting all right, title and interest in and to those
certain railroad tracks, facilities and appurtenances situated upon the
property described in the foregoing paragraph, and reserving unto Walla
Walla Valley Railway Company, its successors and assigns forever, all
its right, title and interest therein and thereto. It is understood and
agreed between the grantors that the railroad tracks, facilities and
appurtenances are owned equally and in common by Walla Walla Valley
Railway Company and Oregon-Washington Railroad & Navigation Company, a
corporation.
Affects : Parcel B
- - An easement affecting a portion of said premises and for the purposes
stated herein, and incidental purposes.
For : a perpetual easement with the right to place,
construct, operate and maintain, inspect,
reconstruct, repair, replace and keep clear
Underground Communication Lines with wires, cables,
fixtures and appurtenances and related rights
In Favor of : Pacific Northwest Bell Telephone Company,
a Washington corporation
Recorded : May 26, 1981
Volume/Page : 128/295
Auditor's No. : 8103831
Affects : east 10 feet of Parcel C
<PAGE> 399
WAUNAKEE, WISCONSIN
<PAGE> 400
- - Rights and easements, if any, in and to any and all railroad switches,
sidetracks, spur tracks and rights of way located upon or appurtenant to the
subject premises.
- - Rights of the public in any portion of the subject premises lying below the
ordinary highwater mark of Six Mile Creek.
- - Easement recorded on June 14, 1944, in Volume 448 of Deeds, page 211, as
Document No. 688528.
- - Easement recorded on July 19, 1949, in Volume 222 of Misc., page 590, as
Document No. 783363.
- - Easement recorded on October 30, 1956, in Volume 297 of Misc., page 249, as
Document No. 928401.
- - Easement to the Village of Waunakee over the Northeasterly 16.5 feet of
Parcel 4 of the captioned premises, said 16.5 feet being parallel and
adjacent to the Westerly line of the Railway right-of-way.
sewer trunk line over a strip of land one rode wide running from the
South side of Outlot B, Waunakee Canning Co. Addition to the Village of
Waunakee, in a Southerly direction to the right of way of the Chicago
Northwestern Railway and having for a center line the center line of the
sewer trunk line now installed on these premises.
- Easements and rights incidental thereto in connection with the continued
use and right of entrance, maintenance, construction and repair of
municipal or utility facilities as may exist underground or overground in
or on that portion of the above-described premises which were formerly a
part of Madison Street, now partially vacated.
- Easement recorded on March 1, 1994, in Volume 26700 of Records, page
40, as Document No. 2579154.
<PAGE> 401
WELLS, MINNESOTA
<PAGE> 402
- THERE IS AN EASEMENT FOR HIGHWAY PURPOSES TO COUNTY OF FARIBAULT,
MINNESOTA, BY VIRTUE OF AN EASEMENT AGREEMENT DATED OCTOBER 4, 1940,
RECORDED DECEMBER 7, 1948, AT 17 MISCELLANEOUS, PAGE 160, OVER THE
WEST 49 1/2 FEET OF THE CAPTIONED PROPERTY. TRACT 2.
- THERE IS A TILE AGREEMENT DATED APRIL 22, 1913, FILED AT BOOK 5 OF
MISCELLANEOUS, PAGE 453, GRANTING THE RIGHT TO THE PROPERTY ADJOINING
THE CAPTIONED LAND ON THE EAST TO ENTER AND USE A CERTAIN STRING OF TILE
DRAINAGE TERMINATING AT THE EAST LINE ABOUT 1600 FEET NORTH OF THE
SOUTHEAST CORNER THEREOF FOR THE PURPOSE OF CONNECTING WITH AND
FURNISHING AN OUTLET FOR OTHER STRINGS OF TILE TO BE LAID BY THE OWNER
OF THE PROPERTY TO THE EAST BUT NOT TO EXCEED THE CAPACITY OF A 12
INCH TILE. TRACT 2.
- THERE IS A TRANSMISSION LINE EASEMENT TO INTERSTATE POWER COMPANY DATED
APRIL 20, 1964, FILED IN BOOK 23 OF MISCELLANEOUS, PAGE 486, TO
INTERSTATE POWER COMPANY. THE EASEMENT IS LISTED OVER THE CAPTIONED
PROPERTY BUT FURTHER PROVIDES THAT THE ELECTRIC TRANSMISSION LINE IS
TO RUN IN AN EASTERLY AND WESTERLY DIRECTION ALONG THE SOUTH LINE OF
THE ABOVE DESCRIBED PROPERTY. ALSO SAID LINE IS TO RUN IN A NORTHERLY
AND SOUTHERLY DIRECTION ALONG THE WEST LINE OF THE ABOVE DESCRIBED
PROPERTY AND BE LOCATED APPROXIMATELY 2 FEET EAST OF THE EAST BOUNDARY
LOCATED ALONG THE WEST LINE OF THE CAPTIONED PROPERTY. TRACT 1.
- THERE IS A RIGHT OF WAY DEED TO THE CHICAGO, MILWAUKEE AND ST. PAUL
RAILWAY COMPANY DATED APRIL 23, 1891, FILED APRIL 29, 1891, AT BOOK 20,
PAGE 599. THE RIGHT OF WAY IS OVER A STRIP OF LAND LYING SOUTHWESTERLY
OF A LINE DRAWN TO AND 50 FEET NORTHEASTERLY FROM THE CENTERLINE OF THE
MAIN TRACK OF THE MANKATO BRANCH OF THE RAILWAY AS IT CROSSES THE
SOUTHWEST QUARTER OF THE NORTHEAST QUARTER OF SECTION 5, TOWNSHIP 103,
RANGE 24. SAID DEED ALSO GRANTS THE RIGHT TO ERECT WITHIN 150 FEET FROM
THE CENTERLINE PORTABLE SNOW FENCES ARE NOT ERECTED BEFORE THE 15TH
DAY OF OCTOBER EACH YEAR AND REMOVED ON OR BEFORE THE 1ST DAY OF APRIL.
TRACTS 3 & 4.
- THERE IS A FINAL CERTIFICATE TO THE STATE OF MINNESOTA FOR HIGHWAY
PURPOSES DATED MARCH 8, 1937, FILED MARCH 30, 1937, RECORED AT 96 OF
DEEDS, PAGE 51. THE HIGHWAY RIGHT OF WAY IS OVER A TRACT OF LAND IN
THE SOUTHWEST QUARTER OF THE NORTHEAST QUARTER OF SECTION 5, TOWNSHIP
103 NORTH, RANGE 24 WEST LYING NORTHEASTERLY OF THE RAILWAY AND LYING
SOUTHWESTERLY OF A LINE PARALLEL WITH AND DISTANT 50 FEET NORTHEASTERLY
AND CONTAINING 0.86 ACRES MORE OR LESS. TRACTS 3 & 4.
- THERE IS A FINAL CERTIFICATE TO THE STATE OF MINNESOTA DATED DECEMBER
14, 1954, FILED FEBRUARY 26, 1955, AT 119 OF DEEDS, PAGE 76, FOR HIGHWAY
RIGHT OF WAY PURPOSES AS FOLLOWS: THAT PART OF THE SOUTH 20 RODS OF THE
SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER OF SECTION 4, TOWNSHIP 103
NORTH, RANGE 24 WEST LYING NORTHEASTERLY OF THE RAILROAD WHICH LIES
SOUTHWESTERLY OF A LINE PARALLEL WITH AND DISTANT 75 FEET NORTHEASTERLY
OF A DESCRIBED LINE CONTAINING 0.2 ACRES MORE OR LESS. TRACTS 3 & 4.
- - EASEMENT DATED MAY 13, 1991, FILED MAY 20, 1991, AS DOCUMENT NO.
275606. SEE ATTACHED.
- - EASEMENT AGREEMENT DATED MAY 15, 1992, FILED JUNE 3, 1992, AS DOCUMENT
NO. 279540 BETWEEN THOMAS KUECHENMEISTER AND MAXINE KUECHENMEISTER, HUSBAND
AND WIFE, AND STOKELY USA, INC. SEE ATTACHED.
<PAGE> 403
Stokely Locations covered by Mortgages/Deeds of Trust
1. Sun Prairie, Dane (County), Wisconsin
2. DeForest, Dane Wisconsin
3. Waunakee, Dane, Wisconsin
4. Pickett, Winnebago, Wisconsin
5. Merrill, Lincoln, Wisconsin
6. Walla Walla, Walla Walla, Washington*
7. Oconomowoc, Waukesha, Wisconsin
8. Jefferson, Jefferson, Wisconsin
9. Poynette, Columbia, Wisconsin
10. Wells, Faribault, Minnesota
11. Green Bay, Brown, Wisconsin
12. Appleton, Outagamie, Wisconsin**
13. Cobb, Iowa, Wisconsin
14. Hoopeston, Vermilion, Illinois*
15. Grandview, Yakima, Washington*
16. Ackely, Franklin/Hardin, Iowa
17. Scottville, Mason, Michigan
* Indicates Deed of Trust
** Mortgage neither signed nor recorded, pending sale of property
<PAGE> 404
EXHIBIT B
STOKELY USA, INC.
CERTIFICATE OF OFFICERS
We, Stephen Theobald and Robert Brill, each hereby certify that we
are, respectively, the Vice Chairman and the Secretary of STOKELY USA, INC., a
Wisconsin corporation (the "Company"), and that, as such officers, we are
authorized to execute and deliver this Certificate in the name and on behalf of
the Company, and that:
1. This Certificate is being delivered pursuant to Section 3(b) of the
Third Amendment to Note Agreement (the "Third Amendment"), dated May __, 1995,
entered into by the Company and each of the noteholders listed on Annex 1
thereto (collectively, the "Noteholders").
2. The representations and warranties contained in Section 2 of the
Third Amendment are (except as affected by transactions contemplated by the
Third Amendment) true in all material respects on the date hereof with the same
effect as though made on and as of the date hereof.
3. The Company has performed and complied with all agreements and
conditions contained in the Third Amendment that are required to be performed
or complied with by the Company before or at the date hereof.
4. Robert Brill is on and as of the date hereof, and at all times
subsequent to May, 1995 has been, the duly elected, qualified and acting
Secretary of the Company, and the signature appearing on the Certificate of
Secretary dated the date hereof and delivered to the Noteholders
contemporaneously herewith is his genuine signature.
IN WITNESS WHEREOF, we have executed this Certificate in the name and
on behalf of the Company and under its corporate seal this 25th day of May,
1995.
STOKELY USA, INC.
By: STEPHEN THEOBALD
------------------------------
Stephen Theobald
Vice Chairman
ROBERT BRILL
-------------------------------
Robert Brill
Secretary
Exhibit B1-1
<PAGE> 405
STOKELY USA, INC.
CERTIFICATE OF SECRETARY
I, Robert Brill, hereby certify that:
(a) I am the duly elected, qualified and acting Secretary of STOKELY
USA, INC. (the "Company"), a Wisconsin corporation;
(b) Attached hereto as Attachment A is a true and complete copy of the
Articles of Incorporation of the Company, as in full force and effect on the
date hereof;
(c) Attached hereto as Attachment B is a true and complete copy of the
By-Laws of the Company, including all amendments thereto;
(d) Each person who, as an officer or director of the Company, signed
any of the agreements, instruments or documents in connection with the
financing arrangements described in the resolutions attached hereto was, at the
respective time of signing and the delivery thereof, duly elected, qualified
and acting as such officer or director.
(e) Attached hereto as Attachment C is a true and complete list of the
executive officers and directors of the Company. The signature set forth
opposite the name of each officer is his or her genuine signature; and
(f) Attached hereto as Attachment D is a true and complete copy of all
resolutions duly adopted by the Board of Directors and/or stockholders of the
Company with respect to the Third Amendment to Note Agreement dated May 31,
1995, among the Company and the noteholders listed on Annex 1 thereto, and all
transactions and documents contemplated thereby, including agreements and
documents relating to holders of the Company's long-term notes; such
resolutions have not been modified, amended, repealed or rescinded and remain
in full force and effect as of the date hereof; and such resolutions are the
only resolutions adopted by the Company's Board of Directors or stockholders
relating to the matters described therein.
IN WITNESS WHEREOF, I have hereunto set my hand this 25th day of May,
1995.
STOKELY USA, INC.
ROBERT BRILL
---------------------------------
Robert Brill
Secretary
<PAGE> 406
ATTACHMENT A
ARTICLES OF INCORPORATION
OF THE COMPANY
Exhibit C1-2
<PAGE> 407
UNITED STATES OF AMERICA
STATE OF WISCONSIN )
OFFICE OF THE ) SS.
SECRETARY OF STATE )
TO ALL TO WHOM THESE PRESENTS SHALL COME, GREETING:
I, DOUGLAS LA FOLLETTE, Secretary of State of the State of Wisconsin
and Keeper of the Great Seal thereof, do hereby certify that the annexed copy
has been compared by me with the record on file in this Office and that the
same is a true copy thereof, and of the whole of such record; and that I am the
legal custodian of such record, and that this certification is in due form.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed the Great
Seal of the State.
Douglas LaFollette
DOUGLAS LaFOLLETTE
Secretary of State
[SEAL]
BY: Robert Karis DATE: APR 26 1995
<PAGE> 408
ARTICLES OF AMENDMENT AND
RESTATED ARTICLES OF INCORPORATION
OF STOKELY USA, INC.
At a meeting of the stockholders of Stokely USA, Inc. held on September
16, 1985, pursuant to the Wisconsin Statutes and the Articles and By-Laws of
said corporation, the following Articles of Amendment and Restated Articles of
Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendment and Restated Articles of Incorporation so
adopted are set forth in Exhibit A attached hereto and made a part hereof.
THIRD: The date of adoption of the Amendment and Restated Articles of
Incorporation by the stockholders was September 16, 1985.
FOURTH: The foregoing Amendment and Restated Articles of Incorporation
were adopted by the stockholders entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ----------- ----------- -------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Common 6,635,200 6,635,200 4,423,467 6,238,800 None
</TABLE>
<PAGE> 409
FIFTH: The Amendment and Restated Articles of Incorporation effect a
change in the authorized capital stock of the corporation. The total number of
authorized shares of common stock is increased from 10,000,000 shares of a par
value of $.06 per share to 12,000,000 shares of a par value of $.05 per share.
There is no change in the stated capital of the corporation, which remains at
$600,000 represented by 12,000,000 shares of a par value of $.05 per share.
Each presently outstanding share of a par value of $.06 per share shall be
converted into a share of a par value of $.05 and no new shares shall be issued
in connection with such reduction of par value.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 16th day of September, 1985.
STOKELY USA, INC.
By THOMAS W. MOUNT
---------------------------
Thomas W. Mount, President
DUANE W. THORSEN
---------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
-2-
<PAGE> 410
EXHIBIT A
RESTATED
ARTICLES OF INCORPORATION
OF
STOKELY USA, INC.
The following Restated Articles of Incorporation of Stokely USA, Inc.
supersede and take the place of the heretofore existing Articles of
Incorporation of said corporation and all prior amendments thereto:
ARTICLE I
The name of the corporation is Stokely USA, Inc.
ARTICLE II
The purpose or purposes for which the corporation is organized are to
engage in any lawful activity within the purposes for which a corporation may
be organized under the Wisconsin Business Corporation Law, Chapter 180 of the
Wisconsin Statutes.
ARTICLE III
The number of shares of capital stock which the corporation shall be
authorized to issue is Twelve Million (12,000,000) shares. Such shares shall
be designated common stock and shall be of a par value of $.05 per share. The
holders of the capital stock shall not have any preemptive rights to purchase
or to subscribe for shares of any class
<PAGE> 411
of shares of capital stock or securities convertible into capital stock, now or
hereafter authorized.
ARTICLE IV
The address of the registered office of the corporation is 626 East
Wisconsin Avenue, Box 248, Oconomowoc, Waukesha County, Wisconsin 53066, and
the name of its registered agent at such address is Joseph B. Weix.
ARTICLE V
The number of directors constituting the Board of Directors of the
corporation shall be fixed from time to time by the By-Laws of the corporation.
-2-
<PAGE> 412
STATE OF WISCONSIN
FILED
SEP 17 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 413
ARTICLES OF MERGER
OF
STOKELY USA, INC.
a Wisconsin Corporation
AND
AMERICAN NATIONAL CORP.
an Iowa Corporation
The following Articles of Merger have been duly adopted by the Board of
Directors of Stokely USA, Inc. pursuant to the provisions of Section 180.685 of
the Wisconsin Statutes.
FIRST: The Plan of Merger so adopted is set forth on Exhibit A
attached hereto and made a part hereof.
SECOND: Stokely USA, Inc., the surviving corporation, is the owner of
all of the outstanding shares of American National Corp., the merging
corporation. The Plan of Merger does not provide for any changes in the
Articles of Incorporation of Stokely USA, Inc. or any issuance of capital stock
by Stokely USA, Inc. The Plan of Merger provides for the cancellation of the
currently outstanding capital stock of American National Corp. held by Stokely
USA, Inc.
THIRD: The merger shall become effective at the close of business on
May 31, 1989 if these Articles of Merger are duly filed prior to such time. If
these Articles of Merger are not duly filed until after the close of business
on May 31, 1989, the merger shall become effective upon the due filing thereof.
FOURTH: The number of outstanding shares of each class of American
National Corp. and the number of such shares of each class owned by Stokely
USA, Inc. is as follows:
Class Outstanding Owned by Stokely USA, Inc.
----- ----------- --------------------------
Common 75,000 75,000
FIFTH: As Stokely USA, Inc., the surviving corporation, is the sole
owner of all of the outstanding capital stock of American National Corp., no
notice of the merger to each shareholder of record of American National Corp.
is required by Section 180.685(2) of the Wisconsin Statutes. Stokely USA, Inc.
<PAGE> 414
waives any and all rights to be paid the fair value of its shares as provided
in Section 180.72 of the Wisconsin Statutes.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc., the
surviving corporation, and of American National Corp., the merging corporation,
have caused these Articles of Merger to be executed as of the 26th day of
May, 1989.
STOKELY USA, INC. AMERICAN NATIONAL CORP.
By: THOMAS W. MOUNT By: THOMAS W. MOUNT
--------------- ---------------
Thomas W. Mount Thomas W. Mount
President President
Attest: DUANE W. THORSEN Attest: WILLIAM SIMONS
---------------- --------------
Duane W. Thorsen William Simons
Secretary Secretary
[CORPORATE SEAL] [NO CORPORATE SEAL]
This document was drafted by and should be returned to:
F. J. Pelisek, Esq.
Michael, Best & Friedrich
250 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
(414) 271-6560
<PAGE> 415
EXHIBIT A
PLAN OF MERGER
WHEREAS, Stokely USA, Inc., a Wisconsin corporation ("Stokely"), owns
all of the outstanding shares of stock of American National Corp., an Iowa
corporation ("American"); and
WHEREAS, it is deemed advisable that Stokely be merged with American,
with Stokely being the surviving corporation:
NOW, THEREFORE, this Plan of Merger is hereby adopted under and
pursuant to Section 496A.72 of the Iowa Code by the Board of Directors of
Stokely, the surviving corporation.
1. The corporations proposing to merge are Stokely and American, with
Stokely being the surviving corporation.
2. The terms and conditions of the proposed merger are that upon the
merger becoming effective the parties to this Plan of Merger shall become a
single corporation and shall have and succeed to all of the rights, privileges
and powers now possessed by both parties to the merger. The surviving
corporation shall assume and discharge all of the obligations and liabilities
of both of the parties to the merger.
3. All of the outstanding shares of common stock of American currently
owned by Stokely will be surrendered and cancelled. There shall be no
conversion of the shares of American into shares, obligations or other
securities of Stokely or any other corporation or, in whole or in part, into
cash or other property. Stokely will not issue any shares of its capital stock
as a result of the merger. There will be no change in the Articles of
Incorporation of Stokely as a result of the merger.
4. This Plan of Merger shall become effective at the close of business
on May 31, 1989, or upon the filing of Articles of Merger if such filing shall
occur after such time.
5. Stokely's registered office is located in Waukesha County. The
registered office of Stokely, the surviving corporation, shall remain in
Waukesha County.
<PAGE> 416
STATE OF WISCONSIN
FILED
MAY 30 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 417
ARTICLES OF AMENDMENT TO THE
RESTATED ARTICLES OF INCORPORATION OF
STOKELY USA, INC.
By action of the shareholders of Stokely USA, Inc. on June 24, 1989 at
a meeting duly convened pursuant to the provisions of the Wisconsin Statutes
and the Articles and By-Laws of said corporation, the following Articles of
Amendment to the Restated Articles of Incorporation of said corporation were
duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendments to the Restated Articles of Incorporation
so adopted are as follows:
(1) RESOLVED, that Article III of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended to
read as follows:
"Article III. The number of shares of capital stock which the
Corporation shall be authorized to issue is Twenty-One Million
(21,000,000) shares, divided into Twenty Million (20,000,000) shares of
Common Stock, $ .05 par value per share, and One Million (1,000,000)
shares of Preferred Stock, $ .10 par value per share.
(1) The Board of Directors of the Corporation is authorized at any
time or from time to time to divide the shares of preferred stock into
classes and into series within any class or classes of preferred stock;
and to determine for any such class or series its
<PAGE> 418
designation, relative rights, preferences and limitations, including, if
applicable, the rate of dividend, the price at and the terms and conditions
upon which shares may be redeemed, the amount payable upon shares in event of
voluntary or involuntary liquidation, sinking fund provisions for the
redemption or purchase of shares, and the terms and conditions upon which
shares may be converted.
(2) No holder of any shares of Common or preferred stock of the
Corporation shall have any right as such holder (other than such right, if any,
as the Board of Directors in its discretion may determine) to purchase or to
subscribe for shares of any class of shares of capital stock or securities
convertible into capital stock, now or hereafter authorized."
(2) RESOLVED, that Article V of the Restated Articles of Incorporation
of this Corporation shall be, and it hereby is, amended to read as follows:
"Article V. The number of Directors constituting the Board of
Directors of this Corporation, not less than nine (9) nor more than fifteen
(15), shall be fixed from time to time by the By-Laws of this Corporation. The
Board of Directors of this Corporation shall be divided into three (3) classes
of not less than three (3) nor more than five (5) Directors each. The term of
office of the first class of Directors shall expire at the first annual meeting
after their initial election under the provisions of this Article V, the term
of office of the second class shall expire at the second annual meeting after
their initial election under the provisions of this Article V, and that of the
third class shall expire at the third annual meeting after their initial
election under the provisions of this Article V. At each annual meeting after
the initial classification of the Board of Directors under this Article V, the
class of Directors whose term expires at the time of such election shall be
elected to hold office until the third succeeding annual meeting.
Any Director may be removed from office by affirmative vote of 80% of
the outstanding shares entitled to vote for the election of such Director,
taken at an annual meeting or a special meeting of shareholders called for that
purpose, and any vacancy so created may be filled by the affirmative vote of
80% of such shares.
2
<PAGE> 419
Notwithstanding any other provisions of these Articles of Incorporation
or the By-Laws of the Corporation (and notwithstanding the fact that a
lesser percentage may be specified by law, these Articles of Incorporation
or the By-Laws of the Corporation), the affirmative vote of the holders of
at least 80% of the voting power of all the shares of the Corporation
entitled to vote for the election of directors, voting together as a
single class, shall be required to amend or repeal, or adopt any
provisions inconsistent with, this Article V of these Articles of
Incorporation."
(3) RESOLVED, that Article VI of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, created to
read as follows:
Article VI is attached to these Articles of Amendment of Stokely USA,
Inc. as Annex A.
THIRD: The date of adoption of the Amendments by the shareholders was
June 24, 1989.
FOURTH: The foregoing Amendments were adopted by the shareholders
entitled to vote as set forth below. At the record date for the meeting of
June 24, 1989, the outstanding shares of Common Stock, all of which were
entitled to vote, are as set forth below:
(1) AMENDMENT OF ARTICLE III - INCREASE IN CAPITAL STOCK
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
Class to Vote Required For Against
----- ------------ ----------- ------ -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,966,124 694,026
</TABLE>
3
<PAGE> 420
(2) AMENDMENT OF ARTICLE V - CLASSIFIED BOARD OF DIRECTORS
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- --------- -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,951,984 634,951
</TABLE>
(3) ADDITION OF ARTICLE VI - REPURCHASE RIGHTS
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- --------- -------
<S> <C> <C> <C> <C>
Common 8,239,145 5,492,797 5,960,405 626,666
</TABLE>
FIFTH: The Amendments will effect a change in the authorized capital
stock of the Corporation. The Amendments increase the authorized capital stock
of the Corporation from 12,000,000 shares of Common Stock of $.05 par value to
20,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value, or an increase in authorized capital stock
of 8,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value. The Amendments do not increase the stated
capital of the Corporation as defined in Section 180.02(12), Wisconsin
Statutes, as there are no current plans or proposals for issuance by the
Corporation of the additional authorized Common Stock or the newly authorized
Preferred Stock.
4
<PAGE> 421
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 24th day of June, 1989.
STOKELY USA, INC.
By THOMAS W. MOUNT
-------------------------------
Thomas W. Mount, President
By DUANE W. THORSEN
-------------------------------
Duane W. Thorsen, Secretary
This document was drafted by:
Frank J. Pelisek, Attorney at Law
Michael, Best & Friedrich
100 East Wisconsin Avenue, Suite 3300
Milwaukee, Wisconsin 53202-4108
Record in Waukesha County, Wisconsin
5
<PAGE> 422
ANNEX A
ARTICLE VI
REPURCHASE OF COMMON STOCK
6.1 REPURCHASE RIGHTS.
6.1.1. In the event that any person (Acquiring Person) (i) who is the
beneficial owner, directly or indirectly, of fifty percent (50%) or more of the
Common Stock then outstanding and any of such Common Stock was acquired
pursuant to a tender offer, each holder of Common Stock shall have the right,
until and including the ninetieth (90th) day following the date the notice to
holders of Common Stock referred to in Section 6.3 herein is mailed, to have
the Common Stock held by such holder repurchased by the Corporation at the
Repurchase Price determined as provided in Section 6.5 herein, and each holder
of securities convertible into Common Stock or of options, warrants or rights
exercisable to acquire Common Stock prior to such thirtieth (30th) day shall
have the right simultaneously with the conversion of such securities or
exercise of such options, warrants or rights to have the Common Stock to be
received by such holder repurchased by the Corporation at the Repurchase Price.
6.1.2. All repurchase rights hereunder shall be subject to, and
limited by, any provision contained in the Wisconsin Business Corporation Law
which limits the amounts which may be used by the Corporation to repurchase its
Common Stock.
6.1.3. No holder of Common Stock of the Corporation shall have any
right to have Common Stock repurchased by the Corporation pursuant to this
Article VI if the Corporation, acting through a majority of its Board of
Directors, shall within ten (10) business days following the publication of
such
<PAGE> 423
tender offer or following publication of any amendment of such tender
offer recommend to the holders of Common Stock that such tender offer be
accepted.
6.2 DEFINITIONS.
6.2.1. The term "person" shall include an individual, a Corporation,
partnership, trust or other entity. When two or more persons act as a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring Common Stock, such partnership, syndicate or group shall be deemed a
"person."
6.2.2. For the purpose of determining whether a person is an Acquiring
Person, such person shall be deemed to beneficially own (i) all Common Stock
with respect to which such person has the capability to control or influence
the voting or dispositive power in respect thereof and (ii) all Common Stock
which such person has the immediate or future right to acquire, directly or
indirectly, pursuant to agreements, through the exercise of options, warrants or
rights or through the conversion of convertible securities or otherwise; and
all Common Stock which an Acquiring Person has the right to acquire in such
manner shall be deemed to be outstanding shares, but Common Stock which any
other person has the right to acquire in such manner shall not be deemed to be
outstanding shares.
6.2.3. The acquisition of Common Stock by the Corporation or by any
person controlled by the Corporation shall not engender the right to have
Common Stock repurchased pursuant to this Article VI.
6.2.4. The right to have Common Stock repurchased pursuant to this
Article VI shall attach to such shares and shall not be personal to the holder
thereof.
6.2.5. The term "tender offer" shall mean an offer to acquire or an
acquisition of Common Stock pursuant to a request or invitation for tenders or
an offer to purchase such shares for cash, securities or any other
consideration.
6.2.6. The term "market purchases" shall mean the acquisition of Common
Stock from holders of such shares in privately negotiated transactions or in
transactions effected through a broker or dealer.
6.2.7. Subject to the provisions of Section 6.2.2 herein, "outstanding
shares" shall mean shares of Common Stock which at the time in question have
been issued by the Corporation and not reacquired and held or retired by it or
held by any subsidiary of the Corporation.
-2-
<PAGE> 424
6.3 REPURCHASE PROCEDURE.
Not later than thirty (30) days following the date on which the
Corporation receives notice that any person has become an Acquiring Person and,
as a result, the right to have Common Stock repurchased by the Corporation
under this Article VI shall have been created, the Corporation shall give
written notice, by first class mail, postage prepaid, at the address shown on
the records of the Corporation to each holder of record of Common Stock (and to
any other person known by the Corporation, to have rights to demand repurchase
pursuant to Section 6.1 of this Article) as of the date not more than seven (7)
days prior to the date of the mailing pursuant to this Section 6.3 and shall
advise each such holder of the right to have shares repurchased and the
procedures for such repurchase. In the event that the Corporation fails to give
notice as required by this Section 6.3, any holder entitled to receive such
notice may, within thirty (30) days thereafter, serve written demand upon the
Corporation to give such notice. If within ten (10) days after receipt of
written demand the Corporation fails to give the required notice, such holder
may at the expense and on behalf of the Corporation take such reasonable action
as may be appropriate to give notice or to cause notice to be given pursuant to
this Section 6.3.
6.3.1. In the event Common Stock is subject to repurchase in accordance
with this Article VI, the Directors of the Corporation shall designate a
Repurchase Agent, which shall be a corporation or association (i) organized and
doing business under the laws of the United States or any state, (ii) subject
to supervision or examination by federal or state authority, (iii) having
combined capital and surplus of at least $5,000,000 and (iv) having the power
to exercise corporate trust powers.
6.3.2. For a period of ninety (90) days from the date of the mailing of
the notice to holders of Common Stock referred to in this Section 6.3, holders
of Common Stock and other persons entitled to have Common Stock repurchased
pursuant to this Article VI may, at their option, deposit certificates
representing all or less than all Common Stock held of record by them with the
Repurchase Agent together with written notice that the holder elects to have
such shares repurchased pursuant to this Article VI. Repurchase shall be deemed
to have been effected at the close of business on the day such certificates are
deposited in proper form with the Repurchase Agent.
-3-
<PAGE> 425
6.3.3. The Corporation shall promptly deposit in trust with the
Repurchase Agent cash in an amount equal to the aggregate Repurchase Price of
all of the Common Stock deposited with the Repurchase Agent for the purposes of
repurchase.
6.3.4. As soon as practicable after receipt by the Repurchase Agent of
the cash deposit by the Corporation referred to in this Section 6.3, the
Repurchase Agent shall issue its checks payable to the order of the persons
entitled to receive the Repurchase Price of the Common Stock in respect of
which such cash deposit was made.
6.3.5. In the event the Corporation is unable to deposit with the
Repurchase Agent cash in full amount of the aggregate Repurchase Price of all
shares deposited for repurchase, because of limitations upon repurchase of
Common Stock contained in the Wisconsin Business Corporation Law, the
Corporation shall promptly deposit with the Repurchase Agent the maximum amount
of cash which may be used for the repurchase of Common Stock, under the most
restrictive of the applicable limitations upon such repurchase. In the event of
deposit of less than the full aggregate Repurchase Price pursuant to the
provisions of this subsection, the Repurchase Agent shall, after the expiration
of the notice period provided for in this Section 6.3.4, use the amount so
deposited to repurchase share pro lanto, in proportion to the number of shares
deposited by each shareholder for repurchase. Certificates representing all
shares which remain unpurchased shall be returned to the depositors thereof as
soon as practicable thereafter, and there shall be no further repurchase rights
with respect to such shares arising in connection with the transactions already
completed.
6.4 RETIRED STOCK.
All Common Stock with respect to which repurchase has been effected
pursuant to this Article VI shall thereupon be deemed retired.
6.5 REPURCHASE PRICE.
The Repurchase Price shall be the amount payable by the Corporation in
respect of each share of Common Stock with respect to which repurchase has been
demanded pursuant to this Article VI and shall be the greatest amount
determined on any of the following three bases:
(i) The highest price per share of Common Stock, including
any commission paid to brokers or dealers for solicitation or whatever,
at which Common Stock held by the Acquiring Person were acquired
pursuant to a tender offer regardless of when such tender offer was
made or were
-4-
<PAGE> 426
acquired pursuant to any market purchase or otherwise within eighteen (18)
months prior to the notice to holders of Common Stock referred to in Section
6.3 herein. For purposes of this subsection (i), if the consideration paid in
any such acquisition of Common Stock consisted, in whole or part, of
consideration other than cash, the Board of Directors of the Corporation shall
take such action, as in its judgment it deems appropriate, to establish the
cash value of such consideration, but such valuation shall not be less than the
cash value, if any, ascribed to such consideration by the Acquiring Person.
(ii) The highest sale price per share of Common Stock for any
trading day during the eighteen (18) months prior to the notice to
holders of Common Stock referred to in Section 6.3 herein. For purposes
of this subsection (ii), the sale price for any trading day shall be
the closing price per share of Common Stock as furnished by the
National Association of Securities Dealers Automated Quotation System
(NASDAQ) or the last sale price per share traded on any national
securities exchange.
(iii) The amount of shareholders' equity in respect of each
outstanding share of Common Stock as determined in accordance with
generally accepted accounting principles and as reflected in any
published report by the Corporation as of the quarter ending
immediately preceding the notice to shareholders referred to in Section
6.3 herein.
6.5.1. The determinations to be made pursuant to Section 6.5 shall be
made by the Board of Directors not later than the date of the notice to holders
of Common Stock referred to in Section 6.3 herein. In making such
determination, the Board of Directors may engage such persons, including
investment banking firms and the independent accountants who have reported on
the most recent financial statements of the Corporation, and may utilize
employees and agents of the Corporation, who will, in the judgment of the Board
of Directors, be of assistance to the Board of Directors.
6.5.2. The determinations to be made pursuant to this Section 6.5, when
made by the Board of Directors acting in good faith on the basis of such
information and assistance as was then reasonably available for such purpose,
shall be conclusive and binding upon the Corporation and its shareholders,
including any person referred to in Section 6.1 herein.
-5-
<PAGE> 427
y
$24.00 RD
Amendment to Restated Articles
- - Increases authorized shares from: 12,000,000 Common at $0.05 P.V.
To: 20,000,000 Shares Common at $0.05 P.V.
1,000,000 Shares Preferred at $0.10 P.V.
- - adds Directors provision (Art V)
- - adds Stock Repurchase Provisions (new Art VI)
$650,000 plus $25.00 Exp
Michael, Best & Friedrich
P.O. Box 1806
Madison, WI 53701
Attn: Julie Bretl
STATE OF WISCONSIN
FILED
JUL 07 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 428
Form 38 (88)
UNITED STATES OF AMERICA
STATE OF WISCONSIN )
)
OFFICE OF THE ) SS.
SECRETARY OF STATE )
To All to Whom These Presents Shall Come, Greeting:
I, DOUGLAS La FOLLETTE, Secretary of State of the State of Wisconsin
and Keeper of the Great Seal thereof, do hereby certify that the annexed copy
has been compared by me with the record on file in this Office and that the
same is a true copy thereof, and of the whole of such record; and that I am the
legal custodian of such record, and that this certification is in due form.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed
the Great Seal of the State.
[CORPORATE SEAL]
Douglas La Follette
-------------------
DOUGLAS La FOLLETTE
Secretary of State
BY: [SIG] DATE: JULY 31, 1992
------------------
Corporation Division
<PAGE> 429
KNOW ALL MEN BY THESE PRESENTS: That the undersigned,
adult residents of the State of Wisconsin, do hereby make, sign
and agree to the following
ARTICLES OF ORGANIZATION
ARTICLE FIRST. - The undersigned have associated, and
do hereby associate themselves together for the purpose of
forming a corporation under Chapter 86 of the Wisconsin
Statutes and the acts amendatory thereof and supplementary
thereto, the business and purposes of which corporation shall
be: to own, operate, run and manage canning factories, and own
real estate, buildings, structures and all the necessary
machinery and appliances for running and operating canning
factories for the purpose of canning, preserving and packing
fruits, grain, meats, foods and vegetables and their
by-products; to own and hold by lease or otherwise farming
lands, from which to produce and raise such articles,
As vegetables and fruit; and to furnish and supply farmers,
Amended gardners and such laborers and workmen with seed and seeds
Mar. 27, with which to grow and produce such vegetables and products
1936 to be sold, canned, packed and preserved, and to deal in
canned goods, and to buy and sell all such canned goods
generally, and to sell and dispose of all by-products made
and resulting in the operation of such factories, and to do
all things necessary and proper in running and operating
such factories, and to do and transact all business usual
and incident to such business.
To purchase or otherwise acquire, apply for, register, hold,
use, sell or in any manner dispose of, and to grant
licenses or other rights in, and in any manner deal with
patents, inventions, improvements, processes, formulas,
trade-marks, trade names, rights and licenses secured under
letters patent, copyrights or otherwise.
To purchase, hold, sell and reissue the shares of its
own capital stock; to buy, sell, lease, pledge, mort-
<PAGE> 430
-2-
gage or otherwise deal in real estate and personal property of
every kind and description, necessary and proper to
effectuate the purposes for which this company is organized.
To purchase, hold, sell, assign, transfer, mortgage,
pledge or otherwise dispose of the shares of the capital stock
of, or any bonds, securities or evidence of indebtedness
created by any other corporation or corporations of this or any
other state, territory or country, and, while owner of such
As stock, to exercise all the rights and powers and privileges of
Amended ownership, including the right to vote thereon; to guarantee
Mar. 27, any dividends, bonds, stocks, contracts or other obligations of
1936 any corporation in which this corporation is an owner or has an
interest; to aid in any lawful manner such corporations, and to
do all legal acts and things designed for the preservation,
protection, improvement, development, or enhancement of the
value of any such corporation, or of its stock, bonds,
securities, evidences of indebtedness, contracts or other
obligations.
As
Amended ARTICLE SECOND.- The name of said corporation shall be
January OCONOMOWOC CANNING COMPANY, and its location shall be in
31, 1923 Oconomowoc, Wisconsin.
As ARTICLE THIRD - The capital stock of said corporation
Amended shall be six hundred thousand dollars ($600,000.00) and the
Mar. 27, same shall consist of six thousand (6000) shares, each of which
1936 said shares shall be of the face or par value of one hundred
dollars ($100.00).
ARTICLE FOURTH.- The general officers of said
corporation shall be a President, Vice-President, Secretary and
Treasurer, and the Board of Directors shall consist of five (5)
stockholders.
<PAGE> 431
-3-
ARTICLE FIFTH.- The principal duties of the President shall
be to preside at all meetings of the Board of Directors and to have a
general supervision of the affairs of the corporation.
The principal duties of the Vice-President shall be to
discharge the duties of the President in the event of the absence or
disability, for any cause whatever, of the latter.
The principal duties of the Secretary shall be to
countersign all deeds, leases and conveyances executed by the
corporation, affix the seal of the corporation thereto, and to such
other papers as shall be required or directed to be sealed, and to keep
a record of the proceedings of the Board of Directors, and to safely
and systematically keep all books, papers, records and documents
belonging to the corporation, or in anywise pertaining to the business
thereof.
The principal duties of the Treasurer shall be to keep and
account for all moneys, credits and property, of any and every nature,
of the corporation, which shall come into his hands, and keep an
accurate account of all moneys received and disbursed, and proper
vouchers for moneys disbursed, and to render such accounts, statements
and inventories of moneys received and disbursed, and of moneys and
property on hand, and generally of all matters pertaining to this
office, as shall be required by the Board of Directors.
The Board of Directors may provide for the appointment of
such additional officers as they may deem for the best interests of the
corporation.
Whenever the Board of Directors may so order, the offices
of Secretary and Treasurer may be held by the same person.
The said officers shall perform such additional or
different duties as shall from time to time be imposed or required by
the Board of Directors, or as may be prescribed from time to time by
the by-laws.
ARTICLE SIXTH.- Only persons holding stock according to the
regulations of the corporation shall be members of it.
ARTICLE SEVENTH.- These Articles may be amended by resolution
setting forth such amendment or amendments, adopted at any meeting of
the stockholders by a vote of at least two-thirds of all the stock of
said corporation then outstanding.
<PAGE> 432
-4-
ARTICLE 8.- NAMES AND RESIDENCES. The names and
residences of the persons forming this corporation are:
Rudolph P. Binzel, residing at Beaver Dam, Wis.
Ernest C. Theobald, residing at Oconomowoc, Wis.
H.P. MacDermott, residing at 254 Mason St., Apt. 211,
Milwaukee, Wis.
Philip Binzel, residing at Oconomowoc, Wis.
IN WITNESS WHEREOF, we have hereunto set our hands this
13th day of February, A.D. 1920.
Signed in Presence of:
PHILIP BINZEL
N.W. EVANS ) RUDOLPH P. BINZEL
JOS. A. MC CAFFREY ) ERNEST C. THEOBALD
HARRY MAC DERMOTT
STATE OF WISCONSIN, )
) SS.
COUNTY OF WAUKESHA. )
Personally came before me this 13th day of February,
A.D. 1920, the above named RUDOLPH P. BINZEL, ERNEST C.
THEOBALD, HARRY MacDERMOTT and PHILIP BINZEL, to me known to be
the persons who executed the foregoing instrument, and
acknowledged the same.
N.W. EVANS,
Notary Public, Wisconsin.
(Notarial Seal)
My Commission expires)
Aug. 14, 1921. )
STATE OF WISCONSIN, )
) SS.
COUNTY OF WAUKESHA. )
PHILIP BINZEL and ERNEST C. THEOBALD, being each duly
sworn, doth each for himself depose and say that he is one of
the original signers of the above declaration and articles;
that the above and foregoing is a true, correct and complete
copy of such original declaration and articles, and of the
whole thereof.
Subscribed and sworn to before me
this 18th day of February, A.D. 1920. ERNEST C. THEOBALD
PHILIP BINZEL
N.W. EVANS,
Notary Public, Wisconsin.
(Notarial Seal)
<PAGE> 433
REEL 258 IMAGE 115
ARTICLES OF AMENDMENT TO
THE ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
The undersigned officers of Oconomowoc Canning Company, a Wisconsin
corporation, do hereby certify that at the annual meeting of the shareholders
of said corporation, held at Oconomowoc, Wisconsin on June 20, 1977, pursuant
to the By-Laws and notice duly given, the following Amendments to the Articles
of Incorporation of said corporation were duly adopted by the shareholders:
RESOLVED, that Article FOURTH of the Articles of Incorporation
be, and the same is hereby amended to read as follows:
"ARTICLE FOURTH: The general officers of said corporation
shall be a President, Vice President, Secretary, and Treasurer, and the
Board of Directors shall consist of such number, not less than three
(3), as shall from time to time be fixed by the By-Laws. Directors need
not be shareholders."
FURTHER RESOLVED, that the first paragraph of Article FIFTH of
the Articles of Incorporation be, and the same is hereby amended to
read as follows:
"ARTICLE FIFTH: The principal duties of the President shall be
to have general supervision of the affairs of the corporation."
The foregoing amendments to the Articles of Incorporation were adopted
by the following vote:
<PAGE> 434
REEL 258 IMAGE 116
<TABLE>
<CAPTION>
Number of Number Number Voted
Classes Shares Entitled --------------------------
of Shares Outstanding to Vote For Against
- --------- ----------- -------- ---------- ----------
<S> <C> <C> <C> <C>
Common Stock 4,122 4,122 4,122 0
</TABLE>
Dated and the seal of the corporation affixed this 30th day of June,
1977.
THOMAS W. MOUNT
------------------------------
Thomas W. Mount, President
[CORPORATE SEAL]
DUANE W. THORSEN
------------------------------
Duane W. Thorsen, Secretary
STATE OF WISCONSIN
DEPARTMENT OF STATE
FILED
AUG 17 1977
DOUGLAS LAFOLLETTE
SECRETARY OF STATE
This instrument was prepared by John S. Best.
<PAGE> 435
REEL 652 IMAGE 864
ARTICLES OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
At a meeting of the stockholders of Oconomowoc Canning Company held on
June 17, 1983, pursuant to the Wisconsin Statutes and the Articles and By-Laws
of said corporation, the following Articles of Amendment to the Articles of
Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Oconomowoc Canning Company.
SECOND: The Amendment to the Articles of Incorporation so adopted is as
follows:
RESOLVED, that Article Third of the Articles of Incorporation
of this corporation be, and it hereby is, amended to read as follows:
"Third: The authorized capital of this corporation shall be Six
Hundred Thousand Dollars ($600,000) consisting of One Million Two
Hundred Thousand (1,200,000) shares of common stock of a par value of
Fifty cents ($.50) per share."
THIRD: The date of adoption of the Amendment by the stockholders was
June 17, 1983.
FOURTH: The foregoing Amendment was adopted by the stockholders
entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ---------- ----------- -------- ----------- ------ --------
<S> <C> <C> <C> <C> <C>
Common 4,122 4,122 2,749 3,854 none
</TABLE>
FIFTH: The Amendment effects a change in the authorized capital stock of
the corporation. The total number
<PAGE> 436
of authorized shares of common stock are increased from 6,000 shares of a par
value of $100 per share to 1,200,000 shares of a par value of $.50 per share.
There is no change in the stated capital of the corporation which remains at
$600,000 represented by 1,200,000 shares of a par value of $.50 per share.
Following the effectiveness of the Amendment, the presently outstanding shares
of common stock of the corporation will be split 200 for 1, effected in the
form of a stock dividend of 199 shares of common stock ($.50 par value) for
each share then outstanding.
IN WITNESS WHEREOF, the undersigned officers of Oconomowoc Canning
Company have hereunto set their hands this 2nd day of January, 1985.
OCONOMOWOC CANNING COMPANY
By THOMAS W. MOUNT
---------------------------------------
Thomas W. Mount, President
DUANE W. THORSEN
---------------------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
STATE OF WISCONSIN
FILED
JAN 16 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
-2-
<PAGE> 437
REEL 652 IMAGE 863
FORM 14 UNITED STATES OF AMERICA
State of Wisconsin
OFFICE OF THE SECRETARY OF STATE
To All to Whom These Presents Shall Come.
The undersigned, as Secretary of State of the State of Wisconsin,
certifies that the attached is a duplicate of a document accepted and filed in
my office.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed my
official seal, at Madison, on the date
of filing of said document.
Douglas La Follette
----------------------------
DOUGLAS La FOLLETTE
Secretary of State
<PAGE> 438
REEL 652 IMAGE 861
ARTICLES OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF
OCONOMOWOC CANNING COMPANY
At a meeting of the stockholders of Oconomowoc Canning Company held on
January 2, 1985, pursuant to the Wisconsin Statutes and the Articles and
By-Laws of said corporation, the following Articles of Amendment to the
Articles of Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Oconomowoc Canning Company.
SECOND: The Amendment to the Articles of Incorporation so adopted is as
follows:
RESOLVED, that Article Second of the Articles of Incorporation
of this corporation be, and it hereby is, amended to read as follows:
"Second: The name of this corporation shall be Stokely USA,
Inc."
THIRD: The date of adoption of the Amendment by the stockholders was
January 2, 1985.
FOURTH: The foregoing Amendment was adopted by the stockholders
entitled to vote by the following vote:
<TABLE>
<CAPTION>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
- ----------- ----------- -------- ----------- ------ --------
<S> <C> <C> <C> <C> <C>
Common 824,400 824,400 549,600 684,583.32 55,333.34
</TABLE>
FIFTH: The Amendment will not effect a change in the stated capital or
authorized capital stock of the corporation.
<PAGE> 439
REEL 652 IMAGE 862
IN WITNESS WHEREOF, the undersigned officers of Oconomowoc Canning
Company have hereunto set their hands this 2nd day of January, 1985.
OCONOMOWOC CANNING COMPANY
By Thomas W. Mount
---------------------------
Thomas W. Mount, President
Duane W. Thorsen
---------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
STATE OF WISCONSIN
FILED
JAN 16 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
-2-
<PAGE> 440
REEL 652 IMAGE 860
FORM 14
UNITED STATES OF AMERICA
State of Wisconsin
OFFICE OF THE SECRETARY OF STATE
To All to Whom These Presents Shall Come.
The undersigned, as Secretary of State of the State of Wisconsin,
certifies that the attached is a duplicate of a document accepted and filed in
my office.
IN TESTIMONY WHEREOF, I have
hereunto set my hand and affixed
my official seal, at Madison, on
the date of filing of said
document.
Douglas La Follette
-----------------------------
DOUGLAS La FOLLETTE
Secretary of State
<PAGE> 441
ARTICLES OF AMENDMENT AND
RESTATED ARTICLES OF INCORPORATION
OF STOKELY USA, INC.
At a meeting of the stockholders of Stokely USA, Inc. held on September
16, 1985, pursuant to the Wisconsin Statutes and the Articles and By-Laws of
said corporation, the following Articles of Amendment and Restated Articles of
Incorporation of said corporation were duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendment and Restated Articles of Incorporation so
adopted are set forth in Exhibit A attached hereto and made a part hereof.
THIRD: The date of adoption of the Amendment and Restated Articles of
Incorporation by the stockholders was September 16, 1985.
FOURTH: The foregoing Amendment and Restated Articles of Incorporation
were adopted by the stockholders entitled to vote by the following vote:
[CAPTION]
<TABLE>
Shares Affirmative Shares Shares
Shares Entitled Votes Voted Voted
Class Outstanding to Vote Required For Against
----- ----------- --------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Common 6,635,200 6,635,200 4,423,467 6,238,800 None
</TABLE>
<PAGE> 442
FIFTH: The Amendment and Restated Articles of Incorporation effect a
change in the authorized capital stock of the corporation. The total number of
authorized shares of common stock is increased from 10,000,000 shares of a par
value of $.06 per share to 12,000,000 shares of a par value of $.05 per share.
There is no change in the stated capital of the corporation, which remains at
$600,000 represented by 12,000,000 shares of a par value of $.05 per share.
Each presently outstanding share of a par value of $.06 per share shall be
converted into a share of a par value of $.05 and no new shares shall be issued
in connection with such reduction of par value.
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 16th day of September, 1985.
STOKELY USA, INC.
By Thomas W. Mount
--------------------------
Thomas W. Mount, President
D. W. Thorsen
--------------------------
D. W. Thorsen, Secretary
This document was drafted by
Frank J. Pelisek,
Attorney at Law.
Record in Waukesha County, Wisconsin.
-2-
<PAGE> 443
EXHIBIT A
RESTATED
ARTICLES OF INCORPORATION
OF
STOKELY USA, INC.
The following Restated Articles of Incorporation of Stokely USA, Inc.
supersede and take the place of the heretofore existing Articles of
Incorporation of said corporation and all prior amendments thereto:
ARTICLE I
The name of the corporation is Stokely USA, Inc.
ARTICLE II
The purpose or purposes for which the corporation is organized are to
engage in any lawful activity within the purposes for which a corporation may
be organized under the Wisconsin Business Corporation Law, Chapter 180 of the
Wisconsin Statutes.
ARTICLE III
The number of shares of capital stock which the corporation shall be
authorized to issue is Twelve Million (12,000,000) shares. Such shares shall
be designated common stock and shall be of a par value of $.05 per share. The
holderes of the capital stock shall not have any preemptive rights to purchase
or to subscribe for shares of any class
<PAGE> 444
of shares of capital stock or securities convertible into capital stock, now or
hereafter authorized.
ARTICLE IV
The address of the registered office of the corporation is 626 East
Wisconsin Avenue, Box 248, Oconomowoc, Waukesha County, Wisconsin 53066, and
the name of its registered agent at such address is Joseph B. Weix.
ARTICLE V
The number of directors constituting the Board of Directors of the
corporation shall be fixed from time to time by the By-Laws of the corporation.
-2-
<PAGE> 445
STATE OF WISCONSIN
FILED
SEP 17 1985
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 446
ARTICLES OF AMENDMENT TO THE
RESTATED ARTICLES OF INCORPORATION OF
STOKELY USA, INC.
By action of the shareholders of Stokely USA, Inc. on June 24, 1989 at
a meeting duly convened pursuant to the provisions of the Wisconsin Statutes
and the Articles and By-Laws of said corporation, the following Articles of
Amendment to the Restated Articles of Incorporation of said corporation were
duly adopted:
FIRST: The name of the corporation is Stokely USA, Inc.
SECOND: The Amendments to the Restated Articles of Incorporation so
adopted are as follows:
(1) RESOLVED, that Article III of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended
to read as follows:
"Article III. The number of shares of capital stock which the
Corporation shall be authorized to issue is Twenty-One Million
(21,000,000) shares, divided into Twenty Million (20,000,000) shares of
Common Stock, $.05 par value per share, and One Million (1,000,000)
shares of Preferred Stock, $.10 par value per share.
(1) The Board of Directors of the Corporation is authorized at
any time or from time to time to divide the shares of preferred stock
into classes and into series within any class or classes of preferred
stock; and to determine for any such class or series its
<PAGE> 447
designation, relative rights, preferences and limitations,
including, if applicable, the rate of dividend, the price at and the
terms and conditions upon which shares may be redeemed, the amount
payable upon shares in event of voluntary or involuntary liquidation,
sinking fund provisions for the redemption or purchase of shares, and
the terms and conditions upon which shares may be converted.
(2) No holder of any shares of Common or preferred stock of
the Corporation shall have any right as such holder (other than such
right, if any, as the Board of Directors in its discretion may
determine) to purchase or to subscribe for shares of any class of
shares of capital stock or securities convertible into capital stock,
now or hereafter authorized."
(2) RESOLVED, that Article V of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, amended
to read as follows:
"Article V. The number of Directors constituting the Board of
Directors of this Corporation, not less than nine (9) nor more than
fifteen (15), shall be fixed from time to time by the By-Laws of this
Corporation. The Board of Directors of this Corporation shall be
divided into three (3) classes of not less than three (3) nor more than
five (5) Directors each. The term of office of the first class of
Directors shall expire at the first annual meeting after their initial
election under the provisions of this Article V, the term of office of
the second class shall expire at the second annual meeting after their
initial election under the provisions of this Article V, and that of
the third class shall expire at the third annual meeting after their
initial election under the provisions of this Article V. At each annual
meeting after the initial classification of the Board of Directors
under this Article V, the class of Directors whose term expires at the
time of such election shall be elected to hold office until the third
succeeding annual meeting.
Any Director may be removed from office by affirmative vote of
80% of the outstanding shares entitled to vote for the election of such
Director, taken at an annual meeting or a special meeting of
shareholders called for that purpose, and any vacancy so created may be
filled by the affirmative vote of 80% of such shares.
2
<PAGE> 448
Notwithstanding any other provisions of these Articles of
Incorporation or the By-Laws of the Corporation (and notwithstanding
the fact that a lesser percentage may be specified by law, these
Articles of Incorporation or the By-Laws of the Corporation), the
affirmative vote of the holders of at least 80% of the voting power of
all the shares of the Corporation entitled to vote for the election of
directors, voting together as a single class, shall be required to
amend or repeal, or adopt any provisions inconsistent with, this
Article V of these Articles of Incorporation.
(3) RESOLVED, that Article VI of the Restated Articles of
Incorporation of this Corporation shall be, and it hereby is, created
to read as follows:
ARITCLE VI is attached to these Articles of Amendment of
Stokely USA, Inc. as Annex A.
THIRD: The date of adoption of the Amendments by the shareholders was
June 24, 1989.
FOURTH: The foregoing Amendments were adopted by the shareholders
entitled to vote as set forth below. At the record date for the meeting of
June 24, 1989, the outstanding shares of Common Stock, all of which were
entitled to vote, are as set forth below:
(1) AMENDMENT OF ARTICLE III - INCREASE IN CAPITAL STOCK
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
Class to Vote Required For Against
------ ------------ ----------- --------- -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,966,124 694,025
</TABLE>
3
<PAGE> 449
(2) AMENDMENT OF ARTICLE V - CLASSIFIED BOARD OF DIRECTORS
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- --------- -------
<S> <C> <C> <C> <C>
Common 8,239,195 5,492,797 5,951,984 634,951
</TABLE>
(3) ADDITION OF ARTICLE VI - REPURCHASE RIGHTS
<TABLE>
<CAPTION>
Total Shares Total Total Total
Outstanding Affirmative Shares Shares
and Entitled Votes Voted Voted
to Vote Required For Against
------------ ----------- --------- -------
<S> <C> <C> <C> <C>
Common 8,239,145 5,492,797 5,960,405 626,666
</TABLE>
FIFTH: The Amendments will effect a change in the authorized capital
stock of the Corporation. The Amendments increase the authorized capital stock
of the Corporation from 12,000,000 shares of Common Stock of $.05 par value to
20,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value, or an increase in authorized capital stock
of 8,000,000 shares of Common Stock of $.05 par value and 1,000,000 shares of
Preferred Stock of $.10 par value. The Amendments do not increase the stated
capital of the Corporation as defined in Section 160.02(12), Wisconsin
Statutes, as there are no current plans or proposals for issuance by the
Corporation of the additional authorized Common Stock or the newly authorized
Preferred Stock.
4
<PAGE> 450
IN WITNESS WHEREOF, the undersigned officers of Stokely USA, Inc. have
hereunto set their hands this 24th day of June, 1989.
STOKELY USA, INC.
By Thomas W. Mount
--------------------------
Thomas W. Mount, President
By Duane W. Thorsen
--------------------------
Duane W. Thorsen, Secretary
This document was drafted by:
Frank J. Pelisek, Attorney at Law
Michael, Best & Friedrich
100 East Wisconsin Avenue, Suite 3300
Milwaukee, Wisconsin 53202-4108
Record in Waukesha County, Wisconsin
5
<PAGE> 451
ANNEX A
ARTICLE VI
REPURCHASE OF COMMON STOCK
6.1 REPURCHASE RIGHTS.
6.1.1. In the event that any person (Acquiring Person)(i) who is the
beneficial owner, directly or indirectly, or fifty percent (50%) or more of the
Common Stock then outstanding and any of such Common Stock was acquired
pursuant to a tender offer, each holder of Common Stock shall have the right,
until and including the ninetieth (90th) day following the date the notice to
holders of Common Stock referred to in Section 6.3 herein is mailed, to have
the Common Stock held by such holder repurchased by the Corporation at the
Repurchase Price determined as provided in Section 6.5 herein, and each holder
of securities convertible into Common Stock or of options, warrants or rights
exercisable to acquire Common Stock prior to such thirtieth (30th) day shall
have the right simultaneously with the conversion of such securities or
exercise of such options, warrants or rights to have the Common Stock to be
received by such holder repurchased by the Corporation at the Repurchase Price.
6.1.2. All repurchase rights hereunder shall be subject to, and
limited by, any provision contained in the Wisconsin Business Corporation Law
which limits the amounts which may be used by the Corporation to repurchase its
Common Stock.
6.1.3. No holder of Common Stock of the Corporation shall have any
right to have Common Stock repurchased by the Corporation pursuant to this
Atricle VI if the Corporation, acting through a majority of its Board of
Directors, shall within ten (10) business days following the publication of
such
<PAGE> 452
tender offer or following publication of any amendment of such tender offer
recommend to the holders of Common Stock that such tender offer be accepted.
6.2 DEFINITIONS.
6.2.1. The term "person" shall include an individual, a Corporation,
partnership, trust or other entity. When two or more persons act as a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring Common Stock, such partnership, syndicate or group shall be deemed a
"person."
6.2.2. For the purpose of determining whether a person is an Acquiring
Person, such person shall be deemed to beneficially own (i) all Common Stock
with respect to which such person has the capability to control or influence
the voting or dispositive power in respect thereof and (ii) all Common Stock
which such person has the immediate or future right to acquire, directly or
indirectly, pursuant to agreements, through the exercise of options, warrants
or rights or through the conversion of convertible securities or otherwise; and
all Common Stock which an Acquiring Person has the right to acquire in such
manner shall be deemed to be outstanding shares, but Common Stock which any
other person has the right to acquire in such manner shall not be deemed to be
outstanding shares.
6.2.3. The acquisition of Common Stock by the Corporation or by any
person controlled by the Corporation shall not engender the right to have
Common Stock repurchased pursuant to this Article VI.
6.2.4. The right to have Common Stock repurchased pursuant to this
Article VI shall attach to such shares and shall not be personal to the holder
thereof.
6.2.5. The term "tender offer" shall mean an offer to acquire or an
acquisition of Common Stock pursuant to a request or invitation for tenders or
an offer to purchase such shares for cash, securities or any other
consideration.
6.2.6. The term "market purchases" shall mean the acquisition of
Common Stock from holders of such shares in privately negotiated transactions
or in transactions effected through a broker or dealer.
6.2.7. Subject to the provisions of Section 6.2.2 herein, "outstanding
shares" shall mean shares of Common Stock which at the time in question have
been issued by the Corporation and not reacquired and held or retired by it or
held by any subsidiary of the Corporation.
-2-
<PAGE> 453
6.3 REPURCHASE PROCEDURE.
Not later than thirty (30) days following the date on which the
Corporation receives notice that any person has become an Acquiring Person and,
as a result, the right to have Common Stock repurchased by the Corporation
under this Article VI shall have been created, the Corporation shall give
written notice, by first class mail, postage prepaid, at the address shown on
the records of the Corporation to each holder of record of Common Stock (and to
any other person known by the Corporation, to have rights to demand repurchase
pursuant to Section 6.1 of this Article) as of the date not more than seven (7)
days prior to the date of the mailing pursuant to this Section 6.3 and shall
advise each such holder of the right to have shares repurchased and the
procedures for such repurchase. In the event that the Corporation fails to give
notice as required by this Section 6.3, any holder entitled to receive such
notice may, within thirty (30) days thereafter, serve written demand upon the
Corporation to give such notice. If within ten (10) days after the receipt of
written demand the Corporation fails to give the required notice, such holder
may at the expense and on behalf of the Corporation take such reasonable action
as may be appropriate to give notice or to cause notice to be given pursuant to
this Section 6.3.
6.3.1. In the event Common Stock is subject to repurchase in
accordance with this Articile VI, the Directors of the Corporation shall
designate a Repurchase Agent, which shall be a corporation or association (i)
organized and doing business under the laws of the United States or any state,
(ii) subject to supervision or examination by federal or state authority, (iii)
having combined capital and surplus of at least $5,000,000 and (iv) having the
power to exercise corporate trust powers.
6.3.2. For a period of ninety (90) days from the date of the mailing
of the notice to holders of Common Stock referred to in this Section 6.3,
holders of Common Stock and other persons entitled to have Common Stock
repurchased pursuant to this Article VI may, at their option, deposit
certificates representing all or less than all Common Stock held of record by
them with the Repurchase Agent together with written notice that the holder
elects to have such shares repurchased pursuant to this Article VI. Repurchase
shall be deemed to have been effected at the close of business on the day such
certificates are deposited in proper form with the Repurchase Agent.
-3-
<PAGE> 454
6.3.3. The Corporation shall promptly deposit in trust with the
Repurchase Agent cash in an amount equal to the aggregate Repurchase Price of
all of the Common Stock deposited with the Repurchase Agent for the purposes of
repurchase.
6.3.4. As soon as practicable after receipt by the Repurchase Agent of
the cash deposit by the Corporation referred to in this Section 6.3, the
Repurchase Agent shall issue its checks payable to the order of the persons
entitled to receive the Repurchase Price of the Common Stock in respect of
which such cash deposit was made.
6.3.5. In the event the Corporation is unable to deposit with the
Repurchase Agent cash in full amount of the aggregate Repurchase Price of all
shares deposited for repurchase, because of limitations upon repurchase of
Common Stock contained in the Wisconsin Business Corporation Law, the
Corporation shall promptly deposit with the Repurchase Agent the maximum amount
of cash which may be used for the repurchase of Common Stock, under the most
restrictive of the applicable limitations upon such repurchase. In the event of
deposit of less than the full aggregate Repurchase Price pursuant to the
provisions of this subsection, the Repurchase Agent shall, after the expiration
of the notice period provided for in this Section 6.3.4, use the amount so
deposited to repurchase shares pro tanto, in proportion to the number of shares
deposited by each shareholder for repurchase. Certificates representing all
shares which remain unpurchased shall be returned to the depositors thereof as
soon as practicable thereafter, and there shall be no further repurchase
rights with respect to such shares arising in connection with the transactions
already completed.
6.4. RETIRED STOCK
All Common Stock with respect to which repurchase has been effected
pursuant to this Article VI shall thereupon be deemed retired.
6.5. REPURCHASE PRICE
The Repurchase Price shall be the amount payable by the Corporation in
respect of each share of Common Stock with respect to which repurchase has been
demanded pursuant to this Article VI and shall be the greatest amount
determined on any of the following three bases:
(i) The highest price per share of Common Stock, including any
commission paid to brokers or dealers for solicitation or whatever, at
which Common Stock held by the Acquiring Person were acquired pursuant
to a tender offer regardless of when such tender offer was made or were
-4-
<PAGE> 455
acquired pursuant to any market purchase or otherwise within eighteen
(18) months prior to the notice to holders of Common Stock referred to
in Section 6.3 herein. For purposes of this subsection (i), if the
consideration paid in any such acquisition of Common Stock consisted,
in whole or part, of consideration other than cash, the Board of
Directors of the Corporation shall take such action, as in its
judgment it deems appropriate, to establish the cash value of such
consideration, but such valuation shall not be less than the cash
value, if any, ascribed to such consideration by the Acquiring Person.
(ii) The highest sale price per share of Common Stock for any
trading day during the eighteen (18) months prior to the notice to
holders of Common Stock referred to in Section 6.3 herein. For
purposes of this subsection (ii), the sale price for any trading day
shall be the closing price per share of Common Stock as furnished by
the National Association of Securities Dealers Automated Quotation
System (NASDAQ) or the last sale price per share traded on any
national securities exchange.
(iii) The amount of shareholders' equity in respect of each
outstanding share of Common Stock as determined in accordance with
generally accepted accounting principles and as reflected in any
published report by the Corporation as of the quarter ending
immediately preceding the notice to shareholders referred to in
Section 6.3 herein.
6.5.1 The determination to be made pursuant to Section 6.5 shall be
made by the Board of Directors not later than the date of the notice to holders
of Common Stock referred to in Section 6.3 herein. In making such
determination, the Board of Directors may engage such persons, including
investment banking firms and the independent accountants who have reported on
the most recent financial statements of the Corporation, and may utilize
employees and agents of the Corporation, who will, in the judgment of the Board
of Directors, be of assistance to the Board of Directors.
6.5.2. The determinations to be made pursuant to this Section 6.5,
when made by the Board of Directors acting in good faith on the basis of such
information and assistance as was then reasonably available for such purpose,
shall be conclusive and binding upon the Corporation and its shareholders,
including any person referred to in Section 6.1 herein.
-5-
<PAGE> 456
$24.00 RD
Amendment to Restated Articles
- - Increases authorized shares from: 12,000,000 Common at $0.05 P.V.
To: 20,000,000 Shares Common at $0.05 P.V.
1,000,000 Shares Preferred at $0.10 P.V.
- - adds Directors provision (Art V)
- - adds Stock Repurchase Provisions (new Art VI)
$650.00 plus $25.00 Exp
Michael, Best & Friedrich
P.O. Box 1806
Madison, WI 53701
Attn: Julie Bretl
STATE OF WISCONSIN
FILED
JUL 07 1989
DOUGLAS LA FOLLETTE
SECRETARY OF STATE
<PAGE> 457
ATTACHMENT B
BY-LAWS OF THE COMPANY
Exhibit C1-3
<PAGE> 458
BY-LAWS
OF
STOKELY USA, INC.
(a Wisconsin corporation)
<PAGE> 459
BY-LAWS
OF
STOKELY USA, INC.
(a Wisconsin Corporation)
Introduction - VARIABLE REFERENCES
0.01. Date of annual shareholders' meeting: the
last Saturday in June beginning at 11:00 a.m.
central standard time (See also Section 2.01)
<TABLE>
<CAPTION>
10:00 a.m. First Tuesday June 1991
- ---------- ----- ------- ---- ----
<S> <C> <C> <C> <C>
(HOUR) (WEEK) (DAY) (MONTH) (FIRST YEAR)
</TABLE>
0.02. Required notice of shareholders' meeting (See
Section 2.04): not less than 10 days.
0.03. Authorized number of Directors (See Section
3.01): 12.
0.04. Required notice of Directors' meeting (See Section 3.05):
not less than 24 hours.
0.05. Authorized number of Vice Presidents (See Section 4.01): 12.
0.06. Fiscal year of the Corporation shall commence on the first day
of April and end on the last day of March.
<PAGE> 460
TABLE OF CONTENTS
ARTICLE I. OFFICES
<TABLE>
<S> <C> <C>
1.01 Principal and Business Offices........................ 1
1.02 Registered Office..................................... 1
ARTICLE II. SHAREHOLDERS
2.01 Annual Meeting........................................ 1
2.02 Special Meeting....................................... 1
2.03 Place of Meeting...................................... 2
2.04 Notice of Meeting..................................... 2
2.05 Closing of Stock Transfer Books or Fixing
of Record Date........................................ 2
2.06 Voting Records........................................ 3
2.07 Quorum................................................ 3
2.08 Conduct of Meetings................................... 4
2.09 Proxies............................................... 4
2.10 Voting of Shares...................................... 5
2.11 Voting of Shares by Certain Holders................... 5
(a) Other Corporations............................. 5
(b) Legal Representatives and Fiduciaries.......... 5
(c) Pledgees....................................... 5
(d) Treasury Stock and Subsidiaries................ 6
(e) Minors......................................... 6
(f) Incompetents and Spendthrifts.................. 6
(g) Joint Tenants.................................. 6
2.12 Waiver of Notice By Shareholders...................... 7
2.13 Unanimous Consent Without Meeting..................... 7
ARTICLE III. BOARD OF DIRECTORS
3.01 General Powers and Number............................. 7
3.02 Tenure and Qualifications............................. 8
3.03 Nominations For Election to the
Board of Directors................................ 8
3.04 Regular Meetings...................................... 8
3.05 Special Meetings...................................... 9
3.06 Notice; Waiver........................................ 9
3.07 Quorum............................................... 10
3.08 Manner of Acting..................................... 10
3.09 Conduct of Meetings.................................. 10
3.10 Vacancies............................................ 10
3.11 Compensation......................................... 11
3.12 Presumption of Assent................................ 11
3.13 Committees........................................... 11
3.14 Unanimous Consent Without Meeting.................... 12
3.15 Meetings By Telephone Or By Other
Communication Technology......................... 12
</TABLE>
(i)
<PAGE> 461
ARTICLE IV. OFFICERS
<TABLE>
<S> <C> <C>
4.01 Number............................................... 12
4.02 Election and Term o f Office......................... 13
4.03 Removal.............................................. 13
4.04 Vacancies............................................ 13
4.05 Chairman of the Board................................ 13
4.06 President............................................ 14
4.07 Executive Vice President............................. 14
4.08 The Vice Presidents.................................. 14
4.09 The Secretary........................................ 15
4.10 The Treasurer........................................ 15
4.11 Assistant Secretaries and Assistant Treasurers....... 15
4.12 Other Assistants and Acting Officers................. 15
4.13 Salaries............................................. 16
ARTICLE V. CONFLICT OF INTEREST TRANSACTIONS,
CONTRACTS, LOANS, CHECKS AND DEPOSITS:
SPECIAL CORPORATE ACTS
5.01 Conflict of Interest Transactions.................... 16
5.02 Contracts............................................ 16
5.03 Loans................................................ 17
5.04 Checks, Drafts, etc. ................................ 17
5.05 Deposits............................................. 17
5.06 Voting of Securities Owned by this Corporation....... 17
ARTICLE VI. CERTIFICATES FOR SHARES AND THEIR TRANSFER
6.01 Certificate for Shares............................... 18
6.02 Facsimile Signatures and Seal........................ 18
6.03 Signature by Former Officers......................... 18
6.04 Transfer of Shares................................... 18
6.05 Restrictions on Transfer............................. 19
6.06 Lost, Destroyed or Stolen Certificates............... 19
6.07 Consideration for Shares............................. 19
6.08 Uncertificated Shares................................ 20
6.09 Transfer Agent and Registrar......................... 20
6.10 Stock Regulations.................................... 20
ARTICLE VII. INDEMNIFICATION
7.01 Indemnification for Successful Defense............... 20
7.02 Other Indemnification................................ 21
7.03 Written Request...................................... 21
7.04 Nonduplication....................................... 22
7.05 Determination of Right to Indemnification............ 22
7.06 Advance Expenses..................................... 23
7.07 Nonexclusivity....................................... 24
7.08 Court-Ordered Indemnification........................ 24
7.09 Insurance............................................ 25
7.10 Securities Law Claims................................ 25
7.11 Liberal Construction................................. 25
7.12 Definitions Applicable to This Article............... 26
</TABLE>
(ii)
<PAGE> 462
ARTICLE VIII. SEAL
ARTICLE IX. AMENDMENTS
<TABLE>
<S> <C> <C>
9.01 By Shareholders...................................... 27
9.02 By Directors......................................... 27
9.03 Implied Amendments................................... 28
</TABLE>
ARTICLE X. FISCAL YEAR
(iii)
<PAGE> 463
ARTICLE I. OFFICES
1.01 Principal and Business Offices. The Corporation may have
such principal and other business offices, either within or without the State
of Wisconsin, as the Board of Directors may designate or as the business of the
Corporation may require from time to time.
1.02 Registered Office. The registered office of the Corporation
required by the Wisconsin Business Corporation Law to be maintained in the
State of Wisconsin may be, but need not be, identical with the principal office
in the State of Wisconsin, and the address of the registered office may be
changed from time to time by the Board of Directors or by the registered agent.
The business office of the registered agent of the Corporation shall be
identical to such registered office.
ARTICLE II. SHAREHOLDERS
2.01 Annual Meeting. The annual meeting of the shareholders
shall be held at the date and hour in each year set forth in Section 0.01, or
at such other time and date within thirty days before or after said date as
may be fixed by or under the authority of the Board of Directors, for the
purpose of electing Directors and for the transaction of such other business as
may come before the meeting. If the day fixed for the annual meeting shall be
a legal holiday in the State of Wisconsin, such meeting shall be held on the
next succeeding business day. If the election of Directors shall not be held
on the day designated herein, or fixed as herein provided, for any annual
meeting of the shareholders, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special meeting of the
shareholders as soon thereafter as conveniently may be.
2.02 Special Meeting. Special meetings of the shareholders, for
any purpose or purposes, unless otherwise prescribed by the Wisconsin Business
Corporation Law, may be called by the Chairman of the Board or a majority of
the Board of Directors or by the holders of at least ten percent of all the
votes entitled to be cast on any issue proposed to be considered at the
proposed special meeting who sign, date and deliver to the Corporation one or
more written demands for the meeting describing one or more purposes for which
it is to be held. If duly called, the Corporation shall communicate notice of
a special meeting as set forth in Section 2.04.
-1-
<PAGE> 464
2.03 Place of Meeting. The Board of Directors may designate any
place, either within or without the State of Wisconsin, as the place of
meeting for any annual meeting or for any special meeting. If no designation
is made, the place of meeting shall be the principal business office of the
Corporation in the State of Wisconsin, but any meeting may be adjourned to
reconvene at any place designated by vote of a majority of the shares
represented thereat.
2.04 Notice of Meeting. Notice may be communicated in person, by
telephone, telegraph, teletype, facsimile or other form of wire or wireless
communication, or by mail or private carrier, and, if these forms of personal
notice are impracticable, notice may be communicated by a newspaper of general
circulation in the area where published, or by radio, television or other form
of public broadcast communication. Such notice stating the place, day and hour
of the meeting and, in case of a special meeting, a description of each purpose
for which the meeting is called, shall be communicated or sent not less than
the number of days set forth in Section 0.02 (unless a longer period is
required by the Wisconsin Business Corporation Law or the articles of
incorporation) nor more than sixty days before the date of the meeting, by or
at the direction of the Chairman of the Board or the Secretary, or other
Officer or persons calling the meeting, to each shareholder of record entitled
to vote at such meeting. Written notice by the Corporation to its shareholders
is effective when mailed and may be addressed to the shareholder's address
shown in the Corporation's current record of shareholders. Oral notice is
effective when communicated and the Corporation shall maintain a record setting
forth the date, time, manner and recipient of the notice.
2.05 Closing of Stock Transfer Books or Fixing of Record Date. A
"shareholder" of the Corporation shall mean the person in whose name shares are
registered in the stock transfer books of the Corporation or the beneficial
owner of shares to the extent of the rights granted by a nominee certificate on
file with the Corporation. Such nominee certificates, if any, shall be
reflected in the stock transfer books of the Corporation. For the purpose of
determining shareholders entitled to notice of or to vote at any meeting of
shareholders or any adjournment thereof, or shareholders entitled to receive
payment of any dividend, or in order to make a determination of shareholders
for any other proper purpose, the Board of Directors may provide that the stock
transfer books shall be closed for a stated period but not to exceed, in any
case, seventy days. If the stock transfer books shall be closed for the
purpose of determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for at least ten days
immediately preceding such meeting. In lieu of closing the stock transfer
-2-
<PAGE> 465
books, the Board of Directors may fix in advance a date as the record date for
any such determination of shareholders, such date in any case to be not more
than seventy days and, in case of a meeting of shareholders, not less than ten
days prior to the date on which the particular action requiring such
determination of shareholders is to be taken. If the stock transfer books are
not closed and no record date is fixed for the determination of shareholders
entitled to notice of or to vote at a meeting of shareholders, or shareholders
entitled to receive payment of a dividend, the close of business on the date on
which notice of the meeting is mailed or on the date on which the resolution of
the Board of Directors declaring such dividend is adopted, as the case may be,
shall be the record date for such determination of shareholders. When a
determination of shareholders entitled to vote at any meeting of shareholders
has been made as provided in this section, such determination shall be applied
to any adjournment thereof except where the determination has been made through
the closing of the stock transfer books and the stated period of closing has
expired.
2.06 Voting Record. The Officer or agent having charge of the stock
transfer books for shares of the Corporation shall, before each meeting of
shareholders, make a complete list of the shareholders entitled to vote at such
meeting, or any adjournment thereof, with the address of and the number of
shares held by each. Such record shall be produced and kept open at the time
and place of the meeting and shall be subject to the inspection of any
shareholder during the whole time of the meeting for the purposes of the
meeting. The original stock transfer books shall be prima facie evidence as to
who are the shareholders entitled to examine such record or transfer books or
to vote at any meeting of shareholders. Failure to comply with the
requirements of this section shall not affect the validity of any action taken
at such meeting.
2.07 Quorum. Shares entitled to vote as a separate voting group
as defined in the Wisconsin Business Corporation Law may take action on a
matter at a meeting only if a quorum of those shares exists with respect to
that matter. Unless the articles of incorporation or the Wisconsin Business
Corporation Law provides otherwise, a majority of the votes entitled to be cast
on the matter by the voting group constitutes a quorum of that voting group for
action on that matter.
Once a share is represented for any purpose at a meeting, other than
for the purpose of objecting to holding the meeting or transacting business at
the meeting, it is considered present for purposes of determining whether a
quorum exists, for the remainder of the meeting and for any adjournment of that
meeting unless a new record date is or must be set for that adjourned meeting.
-3-
<PAGE> 466
If a quorum exists, action on a matter by a voting group is approved if
the votes cast within the voting group favoring the action exceed the votes
cast opposing the action, unless the articles of incorporation or the Wisconsin
Business Corporation Law requires a greater number of affirmative votes.
"Voting group" means any of the following:
(a) All shares of one or more classes or series that under the
articles of incorporation or the Wisconsin Business Corporation Law are
entitled to vote and be counted together collectively on a matter at a meeting
of shareholders.
(b) All shares that under the articles of incorporation or the
Wisconsin Business Corporation Law are entitled to vote generally on a matter.
Though less than a quorum of the outstanding shares are represented at
a meeting, a majority of the shares so represented may adjourn the meeting
from time to time without further notice. At such adjourned meeting at
which a quorum shall be present or represented, any business may be transacted
which might have been transacted at the meeting as originally notified.
2.08 Conduct of Meetings. The Chairman of the Board, or in the
Chairman's absence, the President, or in the President's absence, the
Executive Vice President, or in the Executive Vice President's absence, a Vice
President in the order provided under Section 4.08, and in their absence, any
person chosen by the shareholders present shall call the meeting of the
shareholders to order and shall act as chairman of the meeting, and the
Secretary of the Corporation shall act as Secretary of all meetings of the
shareholders, but, in the absence of the Secretary, the presiding Officer may
appoint any other person to act as Secretary of the meeting.
2.09 Proxies. At all meetings of shareholders, a shareholder
entitled to vote may vote in person or by proxy. A shareholder may appoint a
proxy to vote or otherwise act for the shareholder by signing an appointment
form, either personally or by his or her attorney-in-fact. Such proxy,
appointment is effective when received by the Secretary of the Corporation
before or at the time of the meeting. Unless otherwise provided in the
appointment form of proxy, a proxy appointment may be revoked at any time
before it is voted, either by written notice filed with the Secretary or the
acting Secretary of the meeting or by oral notice given by the shareholder to
the presiding officer during the meeting. The presence of a shareholder who
has filed his or her proxy
-4-
<PAGE> 467
appointment shall not of itself constitute a revocation. No proxy appointment
shall be valid after eleven months from the date of its execution, unless
otherwise provided in the appointment form of proxy. The Board of Directors
shall have the power and authority to make rules establishing presumptions as
to the validity and sufficiency of proxy appointments.
2.10 Voting of Shares. Each outstanding share shall be entitled to
one vote upon each matter submitted to a vote at a meeting of shareholders,
except to the extent that the voting rights of the shares of any voting group
or groups are enlarged, limited or denied by the articles of incorporation.
2.11 Voting of Shares by Certain Holders.
(a) Other Corporations. Shares standing in the name of another
corporation may be voted either in person or by proxy, by the president of such
corporation or any other officer appointed by such president. An appointment
form of proxy executed by any principal officer of such other corporation or
assistant thereto shall be conclusive evidence of the signer's authority to
act, in the absence of express notice to this Corporation, given in writing
to the Secretary of this Corporation, or the designation of some other person
by the Board of Directors or by the by-laws of such other corporation.
(b) Legal Representatives and Fiduciaries. Shares held by an
administrator, executor, guardian, conservator, trustee in bankruptcy, receiver
or assignee for creditors may be voted by him, either in person or by proxy,
without a transfer of such shares into his or her name, provided that there is
filed with the Secretary before or at the time of meeting proper evidence of
his or her incumbency and the number of shares held or her. Shares standing in
the name of a fiduciary may be voted by him, either in person or by proxy. An
appointment form of proxy executed by a fiduciary shall be conclusive evidence
of the signer's authority to act, in the absence of express notice to this
Corporation, given in writing to the Secretary of this Corporation, that such
manner of voting is expressly prohibited or otherwise directed by the document
creating the fiduciary relationship.
(c) Pledgees. A shareholder whose shares are pledged shall be
entitled to vote such shares until the shares have been transferred into the
name of the pledgee, and thereafter the pledgee shall be entitled to vote the
shares so transferred; provided, however, a pledgee shall be entitled to vote
shares held of record by the pledgor if the Corporation receives acceptable
evidence of the pledgee's authority to sign.
-5-
<PAGE> 468
(d) Treasury Stock and Subsidiaries. Neither treasury
shares, nor shares held by another corporation if a majority of the shares
entitled to vote for the election of Directors of such other corporation is
held by this Corporation, shall be voted at any meeting or counted in
determining the total number of outstanding shares entitled to vote, but shares
of its own issue held by this Corporation in a fiduciary capacity, or held by
such other corporation in a fiduciary capacity, may be voted and shall be
counted in determining the total number of outstanding shares entitled to vote.
(e) Minors. Shares held by a minor may be voted by such
minor in person or by proxy and no such vote shall be subject to disaffirmance
or avoidance, unless prior to such vote the Secretary of the Corporation has
received written notice or has actual knowledge that such shareholder is a
minor. Shares held by a minor may be voted by a personal representative,
administrator, executor, guardian or conservator representing the minor if
evidence of such fidicuary status is presented and acceptable to the
Corporation.
(f) Incompetents and Spendthrifts. Shares held by an
incompetent or spendthrift may be voted by such incompetent or spendthrift in
person or by proxy and no such vote shall be subject to disaffirmance or
avoidance, unless prior to such vote the Secretary of the Corporation has
actual knowledge that such shareholder has been adjudicated an incompetent or
spendthrift or actual knowledge of filing of judicial proceedings for
appointment of a guardian. Shares held by an incompetent or spendthrift may be
voted by a personal representative, administrator, executor, guardian or
conservator representing the minor if evidence of such fiduciary status is
presented and acceptable to the Corporation.
(g) Joint Tenants. Shares registered in the names of two or
more individuals who are named in the registration as joint tenants may be
voted in person or by proxy signed by any one or more of such individuals if
either (i) no other such individual or his or her legal representative is
present and claims the right to participate in the voting of such shares or
prior to the vote files with the Secretary of the Corporation a contrary
written voting authorization or direction or written denial or authority of the
individual present or signing the appointment form of proxy proposed to be
voted or (ii) all such other individuals are deceased and the Secretary of the
Corporation has no actual knowledge that the survivor has been adjudicated not
to be the successor to the interests of those deceased.
-6-
<PAGE> 469
2.12 Waiver of Notice by Shareholders. Whenever any notice whatever
is required to be given to any shareholder of the Corporation under the
articles of incorporation or by-laws or any provision of law, a waiver thereof
in writing, signed at any time, whether before or after the time of meeting, by
the shareholder entitled to such notice, shall be deemed equivalent to the
giving of such notice and the Corporation shall include copies of such waivers
in its corporate records; provided that such waiver in respect to any matter of
which notice is required under any provision of the Wisconsin Business
Corporation Law, shall contain the same information as would have been required
to be included in such notice, except the time and place of meeting.
2.13 Unanimous Consent Without Meeting. Any action required or
permitted by the articles of incorporation or by-laws or any provision of law
to be taken at a meeting of the shareholders, may be taken without a meeting if
a consent in writing, setting forth the action so taken, shall be signed by
all of the shareholders entitled to vote with respect to the subject matter
thereof.
ARTICLE III. BOARD OF DIRECTORS
3.01 General Powers and Number. All corporate powers shall be
exercised by or under the authority of, and the business and affairs of the
Corporation managed under the direction of, the Board of Directors, subject to
any limitation set forth in the articles of incorporation. The number of
Directors of the Corporation shall be as provided in Section 0.03, but shall be
not less than nine (9) nor more than fifteen (15).
The Board of Directors shall be divided into three (3) classes of not
less than three (3) nor more than five (5) Directors each. The term of office
of the first class of Directors shall expire at the first annual meeting
after their initial election and until their successors are elected and
qualified, the term of office of the second class shall expire at the second
annual meeting after their initial election and until their successors are
elected and qualified, and the term of office of the third class shall expire
at the third annual meeting after the initial election and until their
successors are elected and qualified. At each annual meeting after the initial
classification of the Board of Directors, the class of Directors whose term
expires at the time of such election shall be elected to hold office until the
third succeeding annual meeting and until their successors are elected and
qualified.
-7-
<PAGE> 470
[STOKELY USA LETTERHEAD]
FAX number: 414-569-3860
TELECOPIES/FAX TRANSMISSION
TO: Steven Wolf DATE: 9-2-92
COMPANY: Securities and Exchange Commission
FROM: Robert Brill
NUMBER OF PAGES (including this page) 62
MESSAGE: Following are copies of relevant Articles and By-Laws of Stokely USA,
Inc. Due to age of corporation I have not included all Amendments as I fear
that doing so would tie up your fax unduly.
-Continuation of fax-
FORM 4012 C
<PAGE> 471
3.02 Tenure and Qualifications. Each Director shall hold office
until the next annual meeting of shareholders in the year in which such
Director's term expires and until his successor shall have been elected, or
until his prior death, resignation or removal for cause only. A Director may
be removed from office for cause only by affirmative vote of 80% of the
outstanding shares entitled to vote for the election of such Director, taken at
an annual meeting or a special meeting of shareholders called for that purpose,
and any vacancy so created may be filled by the affirmative vote of 80% of such
shares. A Director may resign at any time by filing his written resignation with
the Secretary of the Corporation. Directors need not be residents of the State
of Wisconsin or shareholders of the Corporation.
3.03 Nominations for Election to the Board of Directors. Nominations
for election to the Board of Directors may be made by the Board of Directors or
by any shareholder of any outstanding class of capital stock of the
Corporation entitled to vote for election of Directors. Nominations, other
than those made by or on behalf of the existing management of the Corporation,
shall be made in writing and shall be delivered or mailed to the Chief
Executive Officer and/or President of the Corporation, not less than 14 days
nor more than 60 days prior to any meeting of shareholders called for the
election of directors; provided, however, that if less than 14 days' notice of
the meeting is given to shareholders, such nomination shall be mailed or
delivered to the Chief Executive Officer and/or President of the Corporation
not later than the close of business on the fourth day following the day on
which the notice of meeting was mailed. Such notification shall contain the
following information to the extent known to the nominating shareholder: (a)
the name and address of each proposed nominee; (b) the principal occupation of
each proposed nominee; (c) the name and residence address of the nominating
shareholder; and (d) the number of shares of capital stock of the Corporation
owned by the nominating shareholder. Nominations not made in accordance
herewith may be disregarded by the chairman of the meeting, in his or her
discretion, and upon his or her instructions, the vote tellers may disregard
all votes cast for each such nominee.
3.04 Regular Meetings. A regular meeting of the Board of Directors
shall be held without other notice than this by-law immediately after the
annual meeting of shareholders, and each adjourned session thereof. The place
of such regular meeting shall be the same as the place of the meeting of
shareholders which precedes it, or such other suitable place as may be
announced at such meeting of shareholders. The Board of Directors may provide,
by resolution, the time and place,
-8-
<PAGE> 472
either within or without the State of Wisconsin, for the holding of additional
regular meetings without other notice than such resolution.
3.05 Special Meetings. Special meetings of the Board of Directors
may be called by or at the request of the Chairman of the Board, Secretary or
any two Directors. The Chairman or Secretary calling any special meeting of
the Board of Directors may fix any place, either within or without the State of
Wisconsin, as the place for holding any special meeting of the Board of
Directors called by them, and if no other place is fixed, the place of meeting
shall be the principal business office of the Corporation in the State of
Wisconsin.
3.06 Notice; Waiver. Notice may be communicated in person, by
telephone, telegraph, teletype, facsimile or other form of wire or wireless
communication, or by mail or private carrier, and, if these forms of personal
notice are impracticable, notice may be communicated by a newspaper of
general circulation in the area where published, or by radio, television or
other form of public broadcast communication. Notice of each meeting of the
Board of Directors (unless otherwise provided in or pursuant to Section 3.03)
shall be communicated to each Director at his or her business address or
telephone number or at such other address or telephone number as such Director
shall have designated in writing filed with the Secretary, in each case
not less than that number of hours prior thereto as set forth in Section 0.04.
Written notice is effective at the earliest of the following:
(i) when received;
(ii) five days after its deposit in the U.S.
Mail, if mailed postpaid and correctly
addressed; or
(iii) on the date shown on the return receipt, if sent by
registered or certified mail, return receipt requested and
the receipt is signed by or on behalf of the addressee.
Oral notice is effective when communicated and the Corporation shall maintain a
record setting forth the date, time, manner and recipient of the notice.
Whenever any notice whatever is required to be given to any Director of
the Corporation under the articles of incorporation or by-laws or any provision
of law, a waiver thereof in writing, signed at any time, whether before or
after the time of meeting, by the Director entitled to such notice,
-9-
<PAGE> 473
shall be deemed equivalent to the giving of such notice, and the Corporation
shall retain copies of such waivers in its' corporate records. A Director's
attendance at or participation in a meeting waives any required notice to him
or her of the meeting unless the director at the beginning of the meeting or
promptly upon his or her arrival objects to holding the meeting or transacting
business at the meeting and does not thereafter vote for or assert to action
taken at the meeting. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Board of Directors need be
specified in the notice or waiver of notice of such meeting.
3.07 Quorum. Except as otherwise provided by the Wisconsin Business
Corporation Law or by the articles of incorporation or these by-laws, a
majority of the number of Directors as provided in Section 0.03 shall
constitute a quorum for the transaction of business at any meeting of the Board
of Directors, but a majority of the Directors present or participating (though
less than such quorum) may adjourn the meeting from time to time without
further notice.
3.08 Manner of Acting. If a quorum is present or participating when a
vote is taken, the affirmative vote of a majority of directors present or
participating is the act of the Board of Directors or a committee of the Board
of Directors, unless the Wisconsin Business Corporation Law or the articles of
incorporation or these by-laws require the vote of a greater number of
directors.
3.09 Conduct of Meetings The Chairman of the Board, or in the
Chairman's absence, the President, or in the President's absence, the Executive
Vice President, or in the Executive Vice President's absence, a Vice President
in the order provided under Section 4.08, and in their absence, any Director
chosen by the Directors present, shall call meetings of the Board of Directors
to order and shall act as chairman of the meeting. The Secretary of the
Corporation shall act as Secretary of all meetings of the Board of Directors,
but in the absence of the Secretary, the presiding Officer may appoint any
Assistant Secretary or any Director or other person present or participating to
act as Secretary of the meeting.
3.10 Vacancies. Any vacancy occurring in the Board of Directors,
including a vacancy created by an increase in the number of Directors, may be
filled until the next succeeding annual election by the affirmative vote of a
majority of the Directors then in office, though less than a quorum of the
Board of Directors; provided, that in case of a vacancy created by the removal
of a Director for cause by vote of the shareholders, the shareholders shall
have the right to fill
-10-
<PAGE> 474
such vacancy at the same meeting or any adjournment thereof by the affirmative
vote of 80% of the outstanding shares entitled to vote for the election of such
Director.
3.11 Compensation. The Board of Directors, by affirmative vote of
a majority of the Directors then in office, and irrespective of any personal
interest of any of its members, may establish reasonable compensation of all
Directors for services to the Corporation as Directors, Officers or otherwise,
or may delegate such authority to an appropriate committee. The Board of
Directors also shall have authority to provide for or to delegate authority to
an appropriate committee to provide for reasonable pensions, disability or
death benefits, and other benefits of payments, to Directors, Officers and
employees and to their estates, families, dependents or beneficiaries on
account of prior services rendered by such Directors, Officers and employees to
the Corporation.
3.12 Presumption of Assent. A Director of the Corporation who is
present at or participates in a meeting of the Board of Directors or a
committee thereof of which he or she is a member, at which action on any
corporate matter is taken, shall be presumed to have assented to the action
taken unless his or her dissent shall be entered in the minutes of the meeting
or unless he or she shall file his or her written dissent to such action with
the person acting as the Secretary of the meeting before the adjournment
thereof or shall forward such dissent by registered mail to the Secretary of
the Corporation immediately after the adjournment of the meeting. Such right
to dissent shall not apply to a Director who voted in favor of such action.
3.13 Committees. The Board of Directors, by resolution adopted by
the affirmative vote of a majority of the number of Directors as provided in
Section 0.03, may designate one or more committees, each committee to consist
of two or more Directors elected by the Board of Directors, which to the extent
provided in said resolution as initially adopted, and as thereafter
supplemented or amended by further resolution adopted by a like vote, shall
have and may exercise, when the Board of Directors is not in session, the
powers of the Board of Directors in the management of the business and affairs
of the Corporation, except that a committee may not do any of the following:
(a) authorize distributions; (b) approve or propose to shareholders action that
the Wisconsin Business Corporation Law requires be approved by shareholders;
(c) fill vacancies on the Board of Directors or on any of its committees,
unless the Board of Directors provides by resolution that any vacancies on a
committee shall be filled by the affirmative vote of a
-11-
<PAGE> 475
majority of the remaining committee members; (d) amend articles of
incorporation under Section 180.1002 of the Wisconsin Business Corporation Law;
(e) adopt, amend or repeal by-laws; (f) approve a plan of merger not requiring
shareholder approval; (g) authorize or approve reacquisition of shares, except
according to a formula or method prescribed by the Board of Directors; or (h)
authorize or approve the issuance or sale or contract for sale of shares, or
determine the designation and relative rights, preferences and limitations of a
class or series of shares, except that the Board of Directors may authorize a
committee or a senior executive officer of the Corporation to do so within
limits prescribed by the Board of Directors. The Board of Directors may elect
one or more of its members as alternate members of any such committee who may
take the place of any absent member or members at any meeting of such
committee, upon request by the President or upon request by the chairman of
such meeting. Each such committee shall fix its own rules governing the
conduct of its activities and shall make such reports to the Board of Directors
of its activities as the Board of Directors may request.
3.14 Unanimous Consent Without Meeting. Any action required or
permitted by the articles of incorporation or by-laws or any provision of law
to be taken by the Board of Directors at a meeting or by resolution may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the Directors then in office.
3.15 Meetings By Telephone Or By Other Communication Technology.
Meetings of the Board of Directors or committees may be conducted by telephone
or by other communication technology in accordance with Section 180.0820 of
the Wisconsin Business Corporation Law.
ARTICLE IV. OFFICERS
4.01 Number. The principal Officers of the Corporation shall be a
Chairman of the Board, a President, an Executive Vice President, the number of
Vice Presidents as provided in Section 0.05, a Secretary, and a Treasurer, each
of whom shall be elected annually by the Board of Directors. Such other
Officers and assistant officers as may be deemed necessary may be elected or
appointed by the Board of Directors, and shall have such powers and perform
such duties as may be assigned by the Board of Directors or Chairman of the
Board. The Board of Directors may authorize a duly appointed officer to
appoint one or more officers or assistant officers. The same natural person
may simultaneously hold more than one office in the Corporation, provided that
such person holding any two or more offices may sign documents in only one
capacity as an officer of the Corporation.
-12-
<PAGE> 476
4.02 Election and Term of Office. The Officers of the Corporation
to be elected by the Board of Directors shall be elected annually by the Board
of Directors at the first meeting of the Board of Directors held after each
annual meeting of the shareholders. If the election of Officers shall not be
held at such meeting, such election shall be held as soon thereafter as
conveniently may be. Each Officer shall hold office until his or her successor
shall have been duly elected or until his or her prior death, resignation or
removal.
4.03 Removal. Any Officer or agent may be removed by the Board of
Directors with or without cause whenever in its judgment the best interests of
the Corporation will be served thereby, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment shall not of itself create contract rights.
4.04 Vacancies. A vacancy in any principal office because of
death, resignation, removal, disqualification or otherwise; shall be filled by
the Board of Directors for the unexpired portion of the term.
4.05 Chairman of the Board. The Chairman shall be the chief
executive officer of the Corporation and, subject to the control of the Board
of Directors, shall in general supervise and control all of the business and
affairs of the Corporation. He or she shall, when present, preside at all
meetings of the shareholders and of the Board of Directors. The Chairman shall
have authority, subject to such rules as may be prescribed by the Board of
Directors, to appoint such agents and employees of the corporation as he or she
shall deem necessary, to prescribe their powers, duties and compensation, and
to delegate authority to them. Such agents and employees shall hold office at
the discretion of the Chairman. The Chairman shall have authority to sign,
execute and acknowledge, on behalf of the Corporation, all deeds, mortgages,
bonds, stock certificates, contracts, leases, reports and all other documents
or instruments necessary or proper to be executed in the course of the
corporation's regular business, or which shall be authorized by resolution of
the Board of Directors; and, except as otherwise provided by law or the Board
of Directors, the Chairman may authorize the President, the Executive Vice
President, or any Vice President or other officer or agent of the Corporation
to sign, execute and acknowledge such documents or instruments in his or her
place and stead. In general, the Chairman shall perform all duties incident to
the office of chief executive officer and such other duties as may be
prescribed by the Board of Directors from time to time.
-13-
<PAGE> 477
4.06 President. The President shall be the chief operating officer
of the Corporation and, subject to the control of the Chairman, shall supervise
and control the operations of the Corporation. He or she shall, in the absence
of the Chairman, preside at all meetings of the shareholders and of the Board
of Directors. He or she shall have authority to sign, execute and acknowledge,
on behalf of the Corporation, all deeds, mortgages, bonds, stock certificates,
contracts, leases, reports and all other documents or instruments necessary or
proper to be executed in the course of the Corporation's regular business, or
which shall be authorized by resolution of the Board of Directors; and, except
as otherwise provided by law or the Board of Directors, he or she may authorize
the Executive Vice President or any Vice President or other Officer or agent of
the Corporation to sign, execute and acknowledge such documents or instruments
in his or her place and stead. In general, he or she shall perform all duties
incident to the office of chief operating officer and such other duties as may
be prescribed by the Board of Directors or Chairman from time to time.
4.07 The Executive Vice President. The Executive Vice President
shall assist the President in the discharge of supervisory, managerial and
executive duties and functions. In the absence of the President or in the
event of his or her death, inability or refusal to act, the Executive Vice
President shall perform the duties of the President and when so acting shall
have all the powers and duties of the President. He or she shall perform such
other duties as from time to time may be assigned to him or her by the Board of
Directors, the Chairman or the President.
4.08 The Vice Presidents. In the absence of the Chairman, President
and the Executive Vice President or in the event of their death, inability or
refusal to act, or in the event for any reason it shall be impracticable for
them to act personally, the Vice President (or in the event there be more than
one Vice President, the Vice Presidents in the order designated by the Board of
Directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the President, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
President. Any Vice President may sign, with the Secretary or Assistant
Secretary, certificates for shares of the Corporation; and shall perform such
other duties and have such authority as from time to time may be delegated or
assigned to him or her by the Chairman, the President, the Executive Vice
President or by the Board of Directors. The execution of any instrument of the
Corporation by any Vice President shall be conclusive evidence, as to third
parties, of his or her authority to act in the stead of the Chairman or the
President.
-14 -
<PAGE> 478
4.09 The Secretary. The Secretary shall: (a) keep the minutes of
the meetings of the shareholders and of the Board of Directors in one or more
books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these by-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the Corporation and see
that the seal of the Corporation is affixed to all documents, the execution of
which on behalf of the Corporation under its seal is duly authorized; (d) keep
or arrange for the keeping of a register of the post office address of each
shareholder which shall be furnished to the Secretary by such shareholder; (e)
have general charge of the stock transfer books of the Corporation; and (f) in
general, perform all duties incident to the office of Secretary and have such
other duties and exercise such authority as from time to time may be delegated
or assigned to him or her by the Chairman or President or by the Board of
Directors.
4.10 The Treasurer. The Treasurer shall: (a) have charge and
custody of and be responsible for all funds and securities of the Corporation;
(b) receive and give receipts for moneys due and payable to the Corporation
from any source whatsoever, and deposit all such moneys in the name of the
Corporation in such banks, trust companies or other depositories as shall be
selected in accordance with the provisions of Section 5.05; and (c) in general,
perform all of the duties incident to the office of Treasurer and have such
other duties and exercise such other authority as from time to time may be
delegated or assigned to him or her by the Chairman or President or by the
Board of Directors. If required by the Board of Directors, the Treasurer shall
give a bond for the faithful discharge of his duties in such sum and with such
surety or sureties as the Board of Directors shall determine.
4.11 Assistant Secretaries and Assistant Treasurers. There shall
be such number of Assistant Secretaries and Assistant Treasurers as the Board
of Directors may from time to time authorize. The Assistant Treasurers shall,
respectively, if required by the Board of Directors, give bonds for the
faithful discharge of their duties in such sums and with such sureties as the
Board of Directors shall determine. The Assistant Secretaries and Assistant
Treasurers, in general, shall perform such duties and have such authority as
shall from time to time be delegated or assigned to them by the Secretary or
the Treasurer, respectively, or by the Chairman or President or the Board of
Directors.
4.12 Other Assistants and Acting Officers. The Board of
Directors shall have the power to appoint any person to act as assistant to any
Officer, or as agent for the Corporation in his or her stead, or to perform the
duties of such Officer
-15-
<PAGE> 479
whenever for any reason it is impracticable for such Officer to act personally
and such assistant or acting Officer or other agent so appointed by the Board
of Directors shall have the power to perform all the duties of the office to
which he or her is so appointed to be assistant, or as to which he or her is so
appointed to act, except as such power may be otherwise defined or restricted
by the Board of Directors.
4.13 Salaries. The salaries of the principal Officers shall be
fixed from time to time by the Board of Directors or by a duly authorized
committee thereof, and no Officer shall be prevented from receiving such salary
by reason of the fact that he or she is also a Director of the Corporation.
ARTICLE V. CONFLICT OF INTEREST TRANSACTIONS,
CONTRACTS, LOANS, CHECKS AND DEPOSITS: SPECIAL CORPORATE ACTS
5.01 Conflict of Interest Transactions. A "conflict of interest"
transaction means a transaction with the Corporation in which a Director of the
Corporation has a direct or indirect interest. The circumstances in which a
Director of the Corporation has an indirect interest in a transaction include
but are not limited to a transaction under any of the following circumstances:
(1) another entity in which the Director has a material financial interest or
in which the Director is a general partner is a party to the transaction; or
(2) another entity of which the Director is a director, officer or trustee is a
party to the transaction and the transaction is or, because of its significance
to the Corporation, should be considered by the Board of Directors of the
Corporation. A conflict of interest transaction is not voidable by the
Corporation solely because of the Director's interest in the transaction if any
of the circumstances set forth in Section 180.0831 of the Wisconsin Business
Corporation Law are true or occur.
5.02 Contracts. The Board of Directors may authorize any Officer
or Officers, agent or agents, to enter into any contract or execute or deliver
any instrument in the name of and on behalf of the Corporation, and such
authorization may be general or confined to specific instances. In the absence
of other designation, all deeds, mortgages and instruments of assignment or
pledge made by the Corporation shall be executed in the name of the Corporation
by the Chairman of the Board, President or Executive Vice President or one of
the Vice Presidents and by the Secretary, or Assistant Secretary, the Treasurer
or Assistant Treasurer; the Secretary or an Assistant Secretary, when necessary
or required, shall affix the
-16-
<PAGE> 480
corporate seal thereto; and when so executed no other party to such instrument
or any third party shall be required to make any inquiry into the authority of
the signing officer or officers.
5.03 Loans. No indebtedness for borrowed money shall be contracted
on behalf of the Corporation and no evidences of such indebtedness shall be
issued in its name unless authorized by or under the authority of a resolution
of the Board of Directors. Such authorization may be general or confined to
specific instances.
5.04 Checks, Drafts, etc. All checks, drafts or other orders for
the payment of money, notes or other evidences of indebtedness issued in the
name of the Corporation, shall be signed by such Officer or Officers, agent or
agents of the Corporation and in such manner as shall from time to time be
determined by or under the authority of a resolution of the Board of Directors.
5.05 Deposits. All funds of the Corporation not otherwise employed
shall be deposited from time to time to the credit of the Corporation in such
banks, trust companies or other depositories as may be selected by or under
the authority of a resolution of the Board of Directors.
5.06 Voting of Securities Owned by this Corporation. Subject
always to the specific directions of the Board of Directors, (a) any shares or
other securities issued by any other corporation and owned or controlled by
this Corporation may be voted at any meeting of security holders of such other
corporation by the Chairman of the Board of this Corporation if he or she be
present, or in the Chairman's absence, by the President, or in the President's
absence, by the Executive Vice President, or in the Executive Vice President's
absence, by any Vice President of this Corporation who may be present, and (b)
whenever, in the judgment of the Chairman of the Board, or in the Chairman's
absence, the President, or in the President's absence, the Executive Vice
President, or in the Executive Vice President's absence, by any Vice President,
it is desirable for this Corporation to execute a proxy or written consent
in respect to any shares or other securities issued by any other corporation
and owned by this Corporation, such proxy or consent shall be executed in the
name of this Corporation by the Chairman, the President, the Executive Vice
President, or one of the Vice Presidents of this Corporation in the order as
provided in clause (a) of this Section, without necessity of any authorization
by the Board of Directors, affixation of corporate seal or countersignature or
attestation by another officer. Any person or persons designated in the manner
above
-17-
<PAGE> 481
stated as the proxy or proxies of this Corporation shall have full right, power
and authority to vote the shares or other securities issued by such other
corporation and owned by this Corporation the same as such shares or other
securities might be voted by this Corporation.
ARTICLE VI. CERTIFICATES FOR
SHARES AND THEIR TRANSFER
6.01 Certificates for Shares. Certificates representing shares of
the Corporation shall be in such form, consistent with law, as shall be
determined by the Board of Directors. Such Certificates shall be signed by the
Chairman or the President or by another Officer designated by the Chairman or
the Board of Directors. All certificates for shares shall be consecutively
numbered or otherwise identified. The name and address of the person to whom
the shares represented thereby are issued, with the number of shares and date
of issue, shall be entered on the stock transfer books of the Corporation. All
certificates surrendered to the Corporation for transfer shall be cancelled and
no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and cancelled, except as provided
in Section 6.06.
6.02 Facsimile Signatures and Seal. The seal of the Corporation on
any certificates for shares may be a facsimile. The signature of the Chairman
or the President or other authorized Officer upon a certificate may be a
facsimile if the certificate is manually signed on behalf of a transfer agent,
or a registrar, other than the Corporation itself or an employee of the
Corporation.
6.03 Signature by Former Officers. In case any Officer, who has
signed or whose facsimile signature has been placed upon, any certificate for
shares, shall have ceased to be such Officer before such certificate is issued,
it may be issued by the Corporation with the same effect as if he or she were
such Officer at the date of its issue.
6.04 Transfer of Shares. Prior to due presentment of a certificate
for shares for registration of transfer, the Corporation may treat the
shareholder of such shares as the person exclusively entitled to vote, to
receive notifications and otherwise to have and exercise all the rights and
powers of an owner. Where a certificate for shares is presented to the
Corporation with a request to register for transfer, the Corporation shall not
be liable to the owner or any other person suffering loss as a result of such
registration of
-18-
<PAGE> 482
transfer if (a) there were on or with the certificate the necessary
endorsements, and (b) the corporation had no duty to inquire into adverse
claims or has discharged any such duty. The Corporation may require reasonable
assurance that said endorsements are genuine and effective and in compliance
with such other regulations as may be prescribed by or under the authority of
the Board of Directors.
6.05 Restrictions on Transfer. The face or reverse side of each
certificate representing shares shall bear a conspicuous notation of any
restriction imposed by the Corporation upon the transfer of such shares.
6.06 Lost, Destroyed or Stolen Certificates. Where the owner claims
that his or her certificate for shares has been lost, destroyed or wrongfully
taken, a new certificate shall be issued in place thereof if the owner (a) so
requests before the Corporation has notice that such shares have been
acquired by a bona fide purchaser, and (b) files with the Corporation a
sufficient indemnity bond, and (c) satisfies such other reasonable
requirements as may be prescribed by or under the authority of the Board of
Directors.
6.07 Consideration for Shares. The shares of the Corporation may be
issued for such consideration as shall be fixed from time to time by the
Board of Directors, provided that any shares having a par value shall not be
issued for a consideration less than the par value thereof. The consideration
to be received for shares may consist of any tangible or intangible property or
benefit to the Corporation, including cash, promissory notes, services
performed, contracts for services to be performed or other securities of the
Corporation. When the Corporation receives the consideration for which the
Board of Directors authorized the issuance of shares, the shares issued for
that consideration are fully paid and nonassessable, except as provided by
Section 180.0622 of the Wisconsin Business Corporation Law which may require
further assessment for unpaid wages to employees under certain circumstances.
The Corporation may place in escrow shares issued for a contract for future
services or benefits or a promissory note, or make other arrangements to
restrict the transfer of the shares, and may credit distributions in respect of
the shares against their purchase price, until the services are performed, the
benefits are received or the note is paid. If the services are not performed,
the benefits are not received or the note is not paid, the Corporation may
cancel, in whole or in part, the shares escrowed or restricted and the
distributions credited.
-19-
<PAGE> 483
6.08 Uncertificated Shares. In accordance with Section 180.0626 of
the Wisconsin Business Corporation Law, the Board of Directors may issue any
shares of any of its classes or series without certificates. The authorization
does not affect shares already represented by certificates until the
certificates are surrendered to the Corporation. Within a reasonable time
after the issuance or transfer of shares without certificates, the Corporation
shall send the shareholder a written statement of the information required on
share certificates by Sections 180.0625 and 180.0627, if applicable, of the
Wisconsin Business Corporation Law, and by the By-laws of the Corporation.
The Corporation shall maintain at its offices, or at the office of its
transfer agent, an original or duplicate stock transfer book containing the
names and addresses of all shareholders and the number of shares held by each
shareholder. If the shares are uncertificated, the Corporation shall be
entitled to recognize the exclusive right of a person registered on its books
as such, as the owner of shares for all purposes, and shall not be bound to
recognize any equitable or other claim to or interest in such shares on the
part of any other person, whether or not it shall have express or other notice
thereof, except as otherwise provided by the laws of the State of Wisconsin.
6.09 Transfer Agent and Registrar. The Corporation may maintain one
or more transfer offices or agencies, each in charge of a transfer agent
designated by the Board of Directors, where the shares of stock of the
Corporation shall be transferable. The Corporation may also maintain one or
more registry offices, each in charge of a registrar designated by the Board of
Directors, where such shares of stock shall be registered. The same person or
entity may be both a transfer agent and registrar.
6.10 Stock Regulations. The Board of Directors shall have the power
and authority to make all such further rules and regulations not inconsistent
with the statutes of the State of Wisconsin as it may deem expedient concerning
the issue, transfer and registration of certificates representing shares of the
Corporation.
ARTICLE VII. INDEMNIFICATION
7.01 Indemnification for Successful Defense. Within 20 days after
receipt of a written request pursuant to Section 7.03, the Corporation shall
indemnify a Director, Officer, Employee or Agent, to the extent he or she has
been
-20-
<PAGE> 484
successful on the merits or otherwise in the defense of a proceeding, for all
reasonable expenses incurred in the proceeding if the Director, Officer,
Employee or Agent was a party because he or she is a Director, Officer,
Employee or Agent of the Corporation.
7.02 Other Indemnification. (a) In cases not included under Section
7.01, the Corporation shall indemnify a Director, Officer, Employee or Agent
against all liabilities and expenses incurred by the Director, Officer,
Employee or Agent in a proceeding to which the Director, Officer, Employee or
Agent was a party because he or she is a Director, Officer, Employee or Agent
of the Corporation, unless liability was incurred because the Director,
Officer, Employee or Agent breached or failed to perform a duty he or she owes
to the Corporation and the breach or failure to perform constitutes any of the
following:
(1) A willful failure to deal fairly with the Corporation or
its shareholders in connection with a matter in which the Director,
Officer, Employee or Agent has a material conflict of interest.
(2) A violation of criminal law, unless the Director,
Officer, Employee or Agent had reasonable cause to believe his or her
conduct was lawful or no reasonable cause to believe his or her
conduct was unlawful.
(3) A transaction from which the Director, Officer, Employee
or Agent derived an improper personal profit.
(4) Willful misconduct.
(b) Determination of whether indemnification is required under this
Section shall be made pursuant to Section 7.05.
(c) The termination of a proceeding by judgment, order, settlement
or conviction, or upon a plea of no contest or an equivalent plea, does not, by
itself, create a presumption that indemnification of the Director, Officer,
Employee or Agent is not required under this Section.
7.03 Written Request. A Director, Officer, Employee or Agent who
seeks indemnification under Sections 7.01 or 7.02 shall make a written request
to the Corporation.
-21-
<PAGE> 485
7.04 Nonduplication. The Corporation shall not indemnify a Director,
Officer, Employee or Agent under Sections 7.01 or 7.02 if the Director,
Officer, Employee or Agent has previously received indemnification or allowance
of expenses from any person, including the Corporation, in connection with the
same proceeding. However, the Director, Officer, Employee or Agent has no
affirmative duty to look to any other person for indemnification nor to first
exhaust his remedies to seek indemnification from such other person.
7.05 Determination of Right to Indemnification.
(a) Unless otherwise provided by the articles of incorporation or by
written agreement between the Director, Officer, Employee or Agent and the
Corporation, the Director, Officer, Employee or Agent seeking indemnification
under Section 7.02 shall select one of the following means for determining his
or her right to indemnification:
(1) By a majority vote of a quorum of the Board of Directors
consisting of Directors not at the time parties to the same or related
proceedings. If a quorum of disinterested Directors cannot be
obtained, by majority vote of a committee duly appointed by the Board
of Directors and consisting solely of two or more Directors not at the
time parties to the same or related proceedings. Directors who are
parties to the same or related proceedings may participate in the
designation of members of the committee.
(2) By independent legal counsel selected by a quorum of the
Board of Directors or its committee in the manner prescribed in sub.
(1) or, if unable to obtain such a quorum or committee, by a majority
vote of the full Board of Directors, including Directors who are
parties to the same or related proceedings.
(3) By a panel of three arbitrators consisting of one
arbitrator selected by those Directors entitled under sub. (2) to
select independent legal counsel, one arbitrator selected by the
Director or Officer seeking indemnification and one arbitrator
selected by the two arbitrators previously selected.
(4) By an affirmative vote of the majority of shares
represented at a meeting of shareholders at which a quorum is present.
Shares owned by, or voted under the control of, persons who are at the
time parties to the same or related proceedings, whether as plaintiffs
or defendants or in any other capacity, may not be voted in making the
determination.
-22-
<PAGE> 486
(5) By a court under Section 7.08.
(6) By any other method provided for in any additional right
to indemnification permitted under Section 7.07.
(b) In any determination under (a), the burden of proof is on the
Corporation to prove by clear and convincing evidence that indemnification
under Section 7.02 should not be allowed.
(c) A written determination as to a Director, Officer, Employee or
Agent's indemnification under Section 7.02 shall be submitted to both the
Corporation and the Director, Officer, Employee or Agent within 60 days of the
selection made under (a).
(d) If it is determined that indemnification is required under Section
7.02, the Corporation shall pay all liabilities and expenses not prohibited
by Section 7.04 within 10 days after receipt of the written determination under
(c). The Corporation shall also pay all expenses incurred by the Director,
Officer, Employee or Agent, in the determination process under (a).
7.06 Advance Expenses. Within 10 days after receipt of a written
request by a Director, Officer, Employee or Agent who is a party to a
proceeding, the Corporation shall pay or reimburse his or her reasonable
expenses as incurred if the Director, Officer, Employee or Agent provides the
Corporation with all of the following:
(1) A written affirmation of his or her good faith belief that
he or she has not breached or failed to perform his or her duties to
the Corporation.
(2) A written undertaking, executed personally or on his or
her behalf, to repay the allowance (together with reasonable interest
thereon) to the extent that it is ultimately determined under Section
7.05 that indemnification under Section 7.02 is not required and that
indemnification is not ordered by a court under Section 7.08(b)(2).
The undertaking under this subsection shall be an unlimited general
obligation of the Director, Officer, Employee or Agent, and may be
accepted without reference to his or her ability to repay the
allowance. The undertaking may be secured or unsecured.
-23-
<PAGE> 487
7.07 Nonexclusivity. (a) Except as provided in (b), Sections 7.01,
7.02 and 7.06 do not preclude any additional right to indemnification or
allowance of expenses that a Director, Officer, Employee or Agent may have
under any of the following:
(1) The articles of incorporation.
(2) A written agreement between the Director, Officer,
Employee or Agent, and the Corporation.
(3) A resolution of the Board of Directors.
(4) A resolution, after notice, adopted by a majority vote of
all of the Corporation's voting shares then issued and outstanding.
(b) Regardless of the existence of an additional right under (a), the
Corporation shall not indemnify a Director, Officer, Employee or Agent, or
permit a Director, Officer, Employee or Agent to retain any allowance of
expenses, unless it is determined by or on behalf of the Corporation that the
Director, Officer, Employee or Agent did not breach or fail to perform a duty
he or she owes to the Corporation which constitutes conduct under Section
7.02(a)(1), (2), (3) or (4). A Director, Officer, Employee or Agent who is a
party to the same or related proceeding for which indemnification or an
allowance of expenses is sought may not participate in a determination under
this subsection.
(c) Sections 7.01 to 7.12 do not affect the Corporation's power to pay
or reimburse expenses incurred by a Director, Officer, Employee or Agent in any
of the following circumstances.
(1) As a witness in a proceeding to which he or she is not a
party.
(2) As a plaintiff or petitioner in a proceeding because he or
she is or was a Director, Officer, Employee or Agent of the
Corporation.
7.08 Court-Ordered Indemnification. (a) Except as provided otherwise
by written agreement between the Director, Officer, Employee or Agent and the
Corporation, a Director, Officer, Employee or Agent who is a party to a
proceeding may apply for indemnification to the court conducting the proceeding
or to another court of competent jurisdiction. Application may be made for an
initial determination by the court under Section 7.05(a)(5) or for review by
the court of an
-24-
<PAGE> 488
adverse determination under Section 7.05(a) (1), (2), (3), (4) or (6). After
receipt of an application, the court shall give any notice it considers
necessary.
(b) The court shall order indemnification if it determines any of the
following:
(1) That the Director, Officer, Employee or Agent is entitled
to indemnification under Sections 7.01 or 7.02.
(2) That the Director, Officer, Employee or Agent is fairly
and reasonably entitled to indemnification in view of all the relevant
circumstances, regardless of whether indemnification is required under
Section 7.02.
(c) If the court determines under (b) that the Director, Officer,
Employee or Agent is entitled to indemnification, the Corporation shall pay the
Director, Officer, Employee or Agent's expenses incurred to obtain the
court-ordered indemnification.
7.09 Insurance. The Corporation may purchase and maintain insurance
on behalf of an individual who is a Director, Officer, Employee or Agent of the
Corporation against liability asserted against or incurred by the individual in
his or her capacity as a Director, Officer, Employee or Agent, regardless of
whether the Corporation is required or authorized to indemnify or allow
expenses to the individual against the same liability under Sections 7.01,
7.02, or 7.06.
7.10 Securities Law Claims. (a) Pursuant to the public policy of the
State of Wisconsin, the Corporation shall provide indemnification, allowance of
expenses and insurance for any liability incurred in connection with a
proceeding involving securities regulation described under (b) to the extent
required or permitted under Sections 7.01 to 7.09.
(b) Sections 7.01 to 7.09 apply, to the extent applicable to any other
proceeding, to any proceeding involving a federal or state statute, rule or
regulation regulating the offer, sale or purchase of securities, securities
brokers or dealers, or investment companies or investment advisers.
7.11 Liberal Construction. In order for the corporation to obtain and
retain qualified Directors, Officers, Employees and Agents, the foregoing
provisions shall be liberally administered in order to afford maximum
indemnification of Directors, Officers, Employees or Agents
-25-
<PAGE> 489
and, accordingly, the indemnification above provided for shall be granted in
all cases unless to do so would clearly contravene applicable law, controlling
precedent or public policy.
7.12 Definitions Applicable to This Article.
(a) "Affiliate" shall include, without limitation, any corporation,
partnership, joint venture, employee benefit plan, trust or other enterprise
that directly or indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, the Corporation.
(b) "Corporation" means this Corporation and any domestic or foreign
predecessor of this Corporation where the predecessor corporation's existence
ceased upon the consummation of a merger or other transaction.
(c) "Director, Officer, Employee or Agent" means any of the following:
(1) A natural person who is or was a director, officer,
employee or agent (including attorneys) of this Corporation; provided,
however, that no attorney of the Corporation shall be considered an
agent with respect to those actions taken by such attorney solely in
his capacity as an independent contractor to the Corporation.
(2) A natural person who, while a director, officer, employee
or agent, of this Corporation, is or was serving at the Corporation's
request as a director, officer, employee, agent, partner, trustee,
member of any governing or decision-making committee, of another
Corporation or foreign corporation, partnership, joint venture, trust
or other enterprise.
(3) A natural person who, while a director, officer, employee
or agent of this Corporation, is or was serving an employee benefit
plan because his or her duties to the Corporation also impose duties
on, or otherwise involve services by, the person to the plan or to
participants or beneficiaries of the plan.
(4) Unless the context requires otherwise, the estate or
personal representative of a Director, Officer, Employee or Agent.
For purposes of this Article, it shall be conclusively presumed that any
Director, Officer, Employee or Agent serving as a
-26-
<PAGE> 490
director, officer, employee, agent, partner, trustee, member of any governing or
decision-making committee of an Affiliate shall be so serving at the request of
the Corporation.
(d) "Expenses" include fees, costs, charges, disbursements, attorney
fees and other expenses incurred in connection with a proceeding.
(e) "Liability" includes the obligation to pay a judgment,
settlement, penalty, assessment, forfeiture or fine, including an excise tax
assessed with respect to an employee benefit plan, and reasonable expenses.
(f) "Party" includes a natural person who was or is, or who is
threatened to be made, a named defendant or respondent in a proceeding.
(g) "Proceeding" means any threatened, pending or completed civil,
criminal, administrative or investigative action, suit, arbitration or other
proceeding, whether formal or informal, which involves foreign, federal, state
or local law and which is brought by or in the right of the Corporation or by
any other person.
ARTICLE VIII. SEAL
The Board of Directors shall provide a corporate seal which shall be
circular in form and shall have inscribed thereon the name of the Corporation
and the state of incorporation and the words "Corporate Seal".
ARTICLE IX. AMENDMENTS
9.01. By Shareholders. These by-laws may be altered, amended or
repealed and new by-laws may be adopted by the shareholders by affirmative vote
of not less than a majority of the shares present or represented at an annual or
special meeting of the shareholders at which a quorum is in attendance.
9.02. By Directors. These by-laws may also be altered, amended or
repealed and new by-laws may be adopted by the Board of Directors by
affirmative vote of a majority of the number of Directors present at or
participating in any meeting at which a quorum is in attendance; but no by-law
adopted by the shareholders shall be amended or repealed by the Board of
Directors if the by-law so adopted so provides.
-27-
<PAGE> 491
9.03. Implied Amendments. Any action taken or authorized by the
shareholders or by the Board of Directors, which would be inconsistent with the
by-laws then in effect but is taken or authorized by affirmative vote of not
less than the number of shares or the number of Directors required to amend the
by-laws so that the by-laws would be consistent with such action, shall be
given the same effect as though the by-laws had been temporarily amended or
suspended so far, but only so far, as is necessary to permit the specific
action so taken or authorized.
ARTICLE X. FISCAL YEAR
The fiscal year of the Corporation shall be as provided in Section
0.06.
-28-
<PAGE> 492
ATTACHMENT C
LIST OF OFFICERS AND DIRECTORS
OF THE COMPANY
DIRECTORS
- ---------
Vernon L. Wiersma
Stephen W. Theobald
Frank J. Pelisek
Orren J. Bradley
Joseph B. Weix
Thomas W. Mount
James H. DeWees
Russell Britt
Charles J. Carey
Ody J. Fish
Carol Ward Knox
OFFICERS
- --------
Frank J. Pelisek Chairman of the Board
Vernon L. Wiersma President
Stephen W. Theobald Vice Chairman and Treasurer
Russell Trunk Senior Vice President of Operations
Kenneth Murray Vice President Canned Sales and Marketing
Mike Wilkes Vice President of Human Resource Development
Leslie Wilson Vice President of Finance
Robert Brill Secretary
Exhibit C1-4
<PAGE> 493
ATTACHMENT D
BOARD OF DIRECTORS
STOKELY USA, INC.
RESOLUTIONS ADOPTED
Exhibit C1-5
<PAGE> 494
RESOLUTIONS OF
STOKELY USA, INC.
WHEREAS, this Corporation is duly authorized to borrow money and obtain
other credit and financial accommodations for its corporate purposes and to
execute and deliver its promissory notes and other instruments and agreements
for amounts so borrowed or acquired; and
WHEREAS, the proper officers of this Corporation have negotiated with
Harris Trust and Savings Bank and certain other lenders (individually a "Bank"
and collectively the "Banks") for a three-year revolving credit to be made
available by the Banks to this Corporation in the form of loans and letters of
credit in an aggregate principal amount not to exceed $65,000,000 at any one
time outstanding; and
WHEREAS, as a condition precedent to the extension of said revolving
credit and any other credit or financial accommodations from the Banks to this
Corporation, the Banks require that this Corporation enter into a credit
agreement with the Banks setting forth the terms and conditions applicable
thereto and that this Corporation secure said extensions of credit from the
Banks by granting to Harris Trust and Savings Bank, as agent (the "Agent") for
the Banks, a security interest in and lien on all of this Corporation's
accounts, chattel paper, documents, instruments, general intangibles,
inventory, and certain other assets and property of this Corporation; and
WHEREAS, in order to close the credit agreement with the Banks it will
be necessary to amend (1) that certain Note Agreement with the State of
Wisconsin Investment Board ("SWIB") dated as of December 1, 1991, and (2) that
certain Note Agreement with Nationwide Life Insurance Company, Employers Life
Insurance Company of Wausau and West Coast Life Insurance Company ("Insurance
Companies") dated as of January 1, 1990 in ways to be enumerated in separate
amendment agreements, and
NOW, THEREFORE, BE IT AND IT IS HEREBY RESOLVED by the Board of
Directors of Stokely USA, Inc. as follows:
1. The amendments to the Note Agreement with SWIB dated as of
December 1, 1991, on the terms and conditions set forth in the instruments and
documents now before this Board, are in the judgment of the Board in the best
interest of this Corporation and its shareholders.
2. The amendments to the Note Agreement with the Insurance Companies
dated as of January 1, 1990, on the terms and conditions set forth in the
instruments and documents now before the Board, are in the judgment of the
Board in the best interest of this Corporation and its shareholders.
<PAGE> 495
3. Any one of the following officers of this Corporation:
Name Office
---- ------
Stephen Theobald Vice Chairman
Robert Brill Secretary
Les Wilson Vice President
be and the same is hereby authorized, empowered and directed for, in the name
and on behalf of this Corporation (and when requested by SWIB and/or the
Insurance Companies, under the corporate seal and attested to by the Secretary
or Assistant Secretary) to execute and deliver to SWIB and to the Insurance
Companies, as to their respective Note Agreements with the Corporation, all
such amendments to the said Note Agreements with SWIB and with the Insurance
Companies as are necessary and required by the said SWIB and Insurance
Companies, respectively, and to also execute and deliver to SWIB and to the
Insurance Companies such other documents, instruments and agreements and
security agreements as may from time to time be required by SWIB and the
Insurance Companies, respectively, in connection with the said amendments to
the Note Agreements with SWIB and with the Insurance Companies, respectively;
all on such terms and conditions and for such consideration as any of the
foregoing officers may in his sole discretion deem proper as evidenced by his
execution thereof.
4. Any officer, agent or employee of this Corporation is hereby
authorized, empowered and directed for, in the name and on behalf of this
Corporation to execute such further instruments and documents and to perform
such further acts and things as may by any one of them be deemed necessary or
appropriate to comply with or evidence compliance with any of the terms,
provisions or conditions of any instrument or document executed pursuant to the
authority contained in these resolutions and any other requirement or condition
specified by SWIB and the Insurance Companies, respectively, in respect
thereto, including without limiting the execution and filing of any mortgage,
financing statement or similar notice or instrument.
5. The Secretary or Assistant Secretary of this Corporation shall
deliver to SWIB and to the Insurance Companies a certified copy of these
resolutions and shall file with each of them from time to time the names of the
officers, agents and employees of this Corporation at the time authorized by
these resolutions to act in the premises together with the specimen signatures
of such officers, agents and employees. SWIB and the Insurance Companies shall
be entitled as against this Corporation conclusively to presume that the
persons so certified continue to be authorized to act as such on behalf of this
Corporation until otherwise notified in writing by the Secretary or other
officer of this Corporation and that each of the foregoing resolutions shall
continue in force until express written notice of its rescission or modification
has been received by SWIB and the Insurance Companies (but no such recission or
modification shall affect any transaction occurring before the actual receipt
by SWIB and the Insurance Companies, respectively, of such written notice), and
if the
2
<PAGE> 496
authority therein contained shall be terminated by operation of law without
such notice, it is hereby resolved and agreed for the purposes of inducing SWIB
and the Insurance Companies to act hereunder that SWIB and the Insurance
Companies shall be saved harmless from any loss suffered or liability incurred
by it in so acting under such authority without such notice of its termination.
6. These resolutions shall be in addition to and supplementary of any
and all other resolutions of this Board of Directors now or hereafter on file
with SWIB and the Insurance Companies, respectively, and nothing herein
contained shall be deemed to amend, revoke or modify any of such other
resolutions or any of the authority therein contained.
3
<PAGE> 497
[MICHAEL BEST & FRIEDRICH LETTERHEAD ATTORNEYS AT LAW LETTERHEAD]
May 31, 1995
Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43215
Employers Life Insurance Company of Wausau
One Nationwide Plaza
Columbus, Ohio 43215
West Coast Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43215
State of Wisconsin Investment Board
121 East Wilson Street
Madison, Wisconsin 53702
Ladies and Gentlemen:
We have served as counsel to Stokely USA, Inc., a Wisconsin corporation
(the "Borrower"), in connection with the execution and delivery of the
instruments and documents identified on Exhibit A to this letter (collectively
the "Loan Documents," individual Loan Documents and other capitalized terms
used below being hereinafter referred to by the designations appearing on
Exhibit A).
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of all such corporate records of the Borrower, agreements
and other instruments, certificates of officers of the Borrower, certificates
of public officials, and other documents which we have deemed relevant and
necessary to render this opinion. In rendering this opinion, we have assumed
the genuineness of all signatures (other than those of officers of the
Borrower), the authenticity of all documents submitted to us as originals, the
conformity to originals of all documents submitted to us as copies, the due
execution of the Loan Documents by, and the enforceability of the Loan
Documents against, you, and the legal capacity of all natural persons.
Whenever this opinion refers to matters within our "knowledge," "known to us,"
or of which we "know," such reference is limited to (i) the representations and
warranties of the Borrower as to factual matters contained in the Loan
Documents; and (ii) facts within our actual knowledge after an inquiry of the
attorneys of this firm who
<PAGE> 498
[MICHAEL BEST & FRIEDRICH ATTORNEYS AT LAW LETTERHEAD]
May 31, 1995
Page 2
have provided legal services to the Borrower within the past year, without
further inquiry. Furthermore, we have not undertaken any further factual
investigation of the business, properties, agreements, or litigation of the
Borrower for purposes of rendering this opinion.
Based upon the foregoing, and subject to the qualifications stated
herein, we are of the opinion that:
1. The Borrower is a corporation existing under the laws of the State
of Wisconsin and, based solely on a certificate of status of the Wisconsin
Secretary of State, (a) has filed with the Wisconsin Secretary of State during
its most recently completed report year the required annual report; (b) is not
the subject of a proceeding under Wisconsin Statutes Section 180.1421 to cause
its administrative dissolution; and (c) Articles of Dissolution of the Borrower
have not been filed with such Secretary of State.
2. The Borrower has the corporate power and authority to execute,
deliver, and perform its obligations under the Loan Documents.
3. The execution and delivery of the Loan Documents and the
performance by the Borrower of their terms do not and will not (i) contravene
any provisions of the Articles of Incorporation or Bylaws of the Borrower; (ii)
to our knowledge, contravene any presently existing provision of any law known
to us to be applicable to the Borrower; (iii) contravene any provision of any
agreement known to us under which the Borrower has borrowed money (except for
such violation or default as has been waived or consented to by the relevant
party thereto); (iv) to our knowledge, result in the creation or imposition of
any lien upon any of the property of the Borrower except pursuant to the Loan
Documents; or (v) require the consent or approval of, or any filing or
registration with, any governmental body, agency, or authority other than the
filing of the Financing Statements.
4. The Loan Documents have been duly authorized by all necessary
corporate action (no stockholder approval being required), have been executed
and delivered by the Borrower, and constitute valid and binding agreements of
the Borrower enforceable against it in accordance with their respective terms.
The Note Agreement dated as of December 1, 1991 between the Borrower and SWIB,
as amended by the SWIB Amendment, and the Note Agreement dated August 18, 1992
among the Borrower and the Insurance Companies, as amended by the Nationwide
Amendment, constitute valid
<PAGE> 499
[MICHAEL BEST & FRIEDRICH LETTERHEAD ATTORNEYS AT LAW LETTERHEAD]
May 31, 1995
Page 3
and binding agreements of the Borrower enforceable against it in accordance
with their respective terms.
5. Each of the Security Agreement and the Assignment of Contracts,
Warranties and Permits is adequate to create and provide for the liens and
security interest contemplated thereby for the benefit and security of all the
indebtedness secured thereby. The description of the Collateral set forth in
the Financing Statements is sufficient to perfect, and upon the due filing
thereof in the offices noted in Exhibit A hereto will perfect, a security
interest in the items and types of Collateral in which a security interest may
be perfected by the filing of a financing statement under the Uniform
Commercial Code of the State of Wisconsin as in effect on the date hereof (the
"UCC") to the extent that (i) Wisconsin is the proper state for filing; (ii)
the Collateral consists of the type of property for which a security interest
may be perfected by filing a financing statement in Wisconsin under the UCC; and
(iii) any part of Collateral or the proceeds or products thereof does not
constitute trust property or a trust fund which by virtue of federal or state
law is not subject to the claims, liens, or security interests of creditors.
6. To our knowledge, there is no action, suit, proceeding, or
investigation at law or in equity before or by any court or public body pending
or threatened against or affecting the Borrower or any of its assets and
properties which, if adversely determined, could result in any material adverse
change in the properties, business, operations, or financial condition of the
Borrower or in the value of the collateral security for your loans and other
credit accommodations to the Borrower except as described in Annex 2 to each of
the Nationwide Amendment and the SWIB Amendment.
7. The rates of interest provided for under the Loan Documents and
any other amounts payable thereunder that would constitute interest would not
violate any usury law of the State of Wisconsin.
All of the foregoing opinions are subject to the following additional
assumptions, limitations, and qualifications:
(a) We express no opinion as to the effect of the compliance or
noncompliance by you with any state or federal laws or regulations applicable
to you because of legal or regulatory status or the nature of your business.
<PAGE> 500
MICHAEL BEST & FRIEDRICH ATTORNEYS AT LAW LETTERHEAD]
May 31, 1995
Page 4
(b) Our opinions relating to the enforceability of the Loan Documents
are subject to and limited by:
(i) Bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, marshalling, and other similar laws now or hereafter in
effect relating to or affecting the rights and remedies of creditors
generally;
(ii) Limitations imposed by general principles of equity upon the
specific enforceability of any of the remedies or other provisions of such
documents and upon the availability of injunctive relief and other equitable
remedies (regardless of whether enforcement is considered in proceedings at law
or in equity);
(iii) The qualification that certain provisions of the Loan
Documents are or may be unenforceable in whole or in part under the laws of the
State of Wisconsin, but the inclusion of such provisions does not render the
Loan Documents invalid as a whole and there exist either in the Loan Documents
or under applicable law adequate remedies for the practicable realization of the
principal legal rights and benefits intended to be provided thereby (except for
the economic consequences of any delay resulting from such unenforceability);
(iv) Such enforcement is subject to recent court decisions which
may require lenders to act reasonably and in good faith in exercising their
rights and remedies under the Loan Documents; and
(v) The provisions of the Mortgages which (A) purport to give the
mortgagee the right, prior to the date of confirmation of a foreclosure sale by
the court (assuming the mortgagee is a successful bidder at the foreclosure
sale), to take control of the real estate described in the Mortgages, or which
(B) purport to give the mortgagee the right, prior to the date of confirmation
of a foreclosure sale by the court (assuming the mortgagee is a successful
bidder at the foreclosure sale), to collect the rents, issues, or profit
thereof, are subject to acquiescence of the Borrower after a default, unless
the mortgagee obtains a court order and the appointment of a receiver for such
purpose. Such rights will not be available in any event if the mortgagee
elects certain redemption periods pursuant to Wisconsin Statutes. We note that
under Wisconsin law, despite an assignment of rents, the equitable right to
rent remains with the mortgagor in
<PAGE> 501
[MICHAEL BEST & FRIEDRICH ATTORNEYS AT LAW LETTERHEAD]
May 31, 1995
Page 5
the event of default, until such time as the mortgagee's interest in the rents
is perfected.
(c) We render no advice concerning and do not express any opinion as
to:
(i) the priority of any security interest; or
(ii) items of Collateral which by operation of law cannot be
subject to a consensual security interest.
(d) We express no opinion as to the following:
(i) the Borrower's rights in or title to the Collateral;
(ii) any security interest that is terminated or released;
(iii) the effect of noncompliance with the federal Assignment of
Claims Act; or
(iv) future advances.
(e) In the case of property which becomes Collateral after the date
hereof, (i) Section 547 of the United States Bankruptcy Code provides that a
transfer is not made until the debtor has rights in the property transferred so
a security interest in after-acquired property may be treated as a voidable
preference under the conditions (and subject to the exceptions) provided by
Section 547; (ii) Chapter 128 of the Wisconsin Statutes contains a four-month
preference provision that may apply to after-acquired property; and (iii)
Section 552 of the United States Bankruptcy Code limits the extent to which
property acquired by a debtor after the commencement of a case under the United
States Bankruptcy Code may be subject to a security interest arising from a
security agreement entered into by the debtor before the comencement of such
case.
(f) In the case of any interest in or claim in or under any policy of
insurance covering the Collateral, the security interest of the secured party
therein is limited to proceeds payable to the named insured (and not to any
other party named as loss payee under such policy) by reason of loss or damage
to the collateral insured under such insurance policies.
<PAGE> 502
[MICHAEL BEST & FRIEDRICH ATTORNEYS AT LAW LETTERHEAD]
May 31, 1995
Page 6
(g) In the case of all Collateral in which the security interest of
the secured party has been perfected by the filing of the Financing Statements,
Article 9 of the UCC requires the filing of continuation statements within the
period of six months prior to the expiration of five years from the date of the
original filings in order to maintain the effectiveness of the filings referred
to in this paragraph.
(h) The duties to exercise reasonable care in the custody and
preservation of the Collateral in a secured party's possession and to deal with
and dispose of the collateral in a commercially reasonable manner as required by
the UCC may not be disclaimed by agreement, waived, or released.
We call to your attention that the perfection of the above security interests
will be terminated (i) as to any Collateral acquired by the Borrower more than
four months after the Borrower so changes its name, identity, or corporate
structure as to make any financing statements filed against such party
seriously misleading, unless new appropriate financing statements indicating
the new name, identity, or corporate structure of such party are properly filed
before the expiration of such four months; (ii) as to any Collateral
consisting of accounts or general intangibles, four months after the Borrower
changes its chief executive office to a new jurisdiction outside Wisconsin
unless such security interests are perfected in such new jurisdiction before
that termination; (iii) as against buyers of items of the Collateral consisting
of goods of the Borrower sold in the ordinary course of business; and (iv) as
to Collateral otherwise disposed of by the Borrower if such disposition is
authorized under the Loan Documents.
We express no opinion as to (i) any provision affording indemnification
to you; (ii) provisions imposing penalties, forfeitures, or increases in rates
of interest upon delinquency in any payment or upon any breach or default under
the Loan Documents; or (iii) broadly stated waivers of presentment, protest,
demand, notice, appraisement, valuation, stay, extension, moratorium,
redemption, marshalling of assets, or other rights granted by law to the extent
such waivers or rights are held to be against public policy or
prohibited by law.
This opinion deals only with the specific legal issues that it
explicitly addresses and no opinion shall be implied as to matters not so
addressed. The opinions expressed herein are specifically limited to the laws
of the State of Wisconsin and the federal laws of the United States. The
opinions expressed herein
<PAGE> 503
[MICHAEL BEST AND FRIEDRICH ATTORNEYS AT LAW LETTERHEAD]
May 31, 1995
Page 7
are given as of the date of this letter and are intended to apply only to those
facts and circumstances that exist as of the date hereof, and we assume no
obligation or responsibility to update or supplement this opinion to reflect
any facts or circumstances occurring after the date hereof that would alter
the opinions contained herein. This opinion is rendered solely for your
information and assistance in connection with the transactions described above
and may not be relied upon by any other person or for any other purpose without
our prior written consent.
Sincerely,
MICHAEL, BEST & FRIEDRICH
Michael, Best & Friedrich
<PAGE> 504
EXHIBIT A
THE LOAN DOCUMENTS
(All Loan Documents are dated as of May 31, 1995. The "Insurance
Companies" shall mean Nationwide Life Insurance Company, Employers Life
Insurance Company of Wausau, and West Coast Life Insurance Company. "SWIB"
shall mean State of Wisconsin Investment Board.)
1. Third Amendment to Note Agreement among the Borrower and the Insurance
Companies (the "Nationwide Amendment").
2. Third Amendment to Note Agreement between the Borrower and SWIB (the
"SWIB Amendment").
3. Security Agreement among the Borrower, the Insurance Companies, and
SWIB.
4. Mortgages executed by the Borrower in favor of the Insurance Companies
and SWIB.
5. Environmental Indemnification Agreement from the Borrower to the
Insurance Companies and SWIB.
6. Assignment of Contracts, Warranties and Permits from the Borrower to
the Insurance Companies and SWIB.
7. Intercreditor Agreement among the Insurance Companies and SWIB,
acknowledged by the Borrower.
8. UCC financing statements to be filed in the offices of the Wisconsin
Secretary of State and the Register of Deeds for the following Wisconsin
counties (the "Financing Statements"):
Brown Jefferson
Columbia Lincoln
Dane Waukesha
Iowa Winnebago
<PAGE> 505
[LOGO] CERTIFICATE OF INSURANCE 9644 ISSUE DATE (MM/DD/YY)
GLL / / 5/30/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
Marsh & McLennan, Incorporated CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 East Wisconsin Avenue DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
Suite 900 POLICIES BELOW.
Milwaukee, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A LUMBERMENS UNDRWRTNG ALLIANCE
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
Stokely USA, Inc. ---------------------------------------------------------------
1055 Corporate Center Drive COMPANY
Oconomowoc, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
LTR TYPE OF INSURANCE DATE DATE
POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S><C>
GENERAL LIABILITY GENERAL AGGREGATE $
/ / COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $
/ / / / CLAIMS MADE / / OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $
/ / --------------------------------------------------
---------------------------- EACH OCCURRENCE $
--------------------------------------------------
FIRE DAMAGE (Any one fire) $
--------------------------------------------------
MED. EXPENSE (Any one person) $
- ------------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY COMBINED SINGLE
/ / ANY AUTO LIMIT $
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY
/ / (Per Accident) $
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURRENCE $
/ / UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
A FIRE & ALLIED 307733 11/01/94 11/01/96
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
Harris Trust and Savings Bank EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
Individually and as Agent MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 West Monroe LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
Chicago, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
[Sig.]
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 506
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE NUMBER 9644 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
All Risk Coverage including Flood and Earthquake*
Replacement Cost with Agreed Amount
Scheduled limits per location
* Flood and Earthquake coverage provided by Lumbermens Underwriting Alliance
Policy No. 307733 effective 11/1/94 - 11/1/96.
The following are recognized as Loss Payee as respects coverage for Stokely:
Harris Trust and Savings Bank Individually and as Agent pursuant to that certain
Secured Agreement among Stokely USA, Inc. and Harris Trust and Savings Bank,
Mercantile Bank of St. Louis National Association, Sanwa Business Credit
Corporation and General Electric Credit Corporation Dated May 22, 1995; State of
Wisconsin Investment Board; and Nationwide Life Insurance Company; Employers
Life Insurance Company of Wausau and West Coast Life Insurance Company as their
interests may appear.
PAGE: 2 OF 2
<PAGE> 507
[LOGO] CERTIFICATE OF INSURANCE 9641 ISSUE DATE (MM/DD/YY)
GLL / / 5/24/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
Marsh & McLennan, Incorporated CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 East Wisconsin Avenue DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
Suite 900 POLICIES BELOW.
Milwaukee, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A HARTFORD STEAM BOILER
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
Stokely USA, Inc. ---------------------------------------------------------------
1055 Corporate Center Drive COMPANY
Oconomowoc, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
DATE DATE
LTR TYPE OF INSURANCE POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S><C>
GENERAL LIABILITY GENERAL AGGREGATE $
/ / COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $
/ / / / CLAIMS MADE / / OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $
/ / ____________________________ --------------------------------------------------
EACH OCCURRENCE $
--------------------------------------------------
FIRE DAMAGE (Any one fire) $
--------------------------------------------------
MED. EXPENSE (Any one person) $
- ------------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY COMBINED SINGLE
/ / ANY AUTO LIMIT $
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY $
/ / (Per accident)
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURRENCE $
/ / UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
A BOILER 9184893-00 11/01/94 11/01/95 See Below
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
Harris Trust and Savings Bank EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
Individually and as Agent MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 West Monroe LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
Chicago, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
[SIG]
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 508
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE NUMBER 9641 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
The following are recognized as Loss Payee as respects coverage for Stokely:
Harris Trust and Savings Bank Individually and as Agent pursuant to that certain
Secured Agreement among Stokely USA, Inc. and Harris Trust and Savings Bank,
Mercantile Bank of St. Louis National Association, Sanwa Business Credit
Corporation and General Electric Credit Corporation Dated May 22, 1995; State of
Wisconsin Investment Board; and Nationwide Life Insurance Company; Employers
Life Insurance Company of Wausau and West Coast Life Insurance Company as their
interests may appear.
PAGE: 2 OF 2
<PAGE> 509
[LOGO] CERTIFICATE OF INSURANCE 9642 ISSUE DATE (MM/DD/YY)
GLL / / 5/24/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
Marsh & McLennan, Incorporated CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 East Wisconsin Avenue DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
Suite 900 POLICIES BELOW.
Milwaukee, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A LUMBERMENS MUTUAL CASUALTY
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
Stokely USA, Inc. ---------------------------------------------------------------
1055 Corporate Center Drive COMPANY
Oconomowoc, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
DATE DATE
LTR TYPE OF INSURANCE POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S><C>
GENERAL LIABILITY GENERAL AGGREGATE $
/ / COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $
/ / / / CLAIMS MADE / / OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $
/ / ____________________________ --------------------------------------------------
EACH OCCURRENCE $
--------------------------------------------------
FIRE DAMAGE (Any one fire) $
--------------------------------------------------
MED. EXPENSE (Any one person) $
- ------------------------------------------------------------------------------------------------------------------------------------
AUTOMOBILE LIABILITY COMBINED SINGLE
/ / ANY AUTO LIMIT $
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY $
/ / (Per accident)
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
EXCESS LIABILITY EACH OCCURRENCE $
/ / UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
A INLAND MARINE 3AT626693-01 11/01/94 11/01/95 $2,500,000
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
Harris Trust and Savings Bank EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
Individually and as Agent MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 West Monroe LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
Chicago, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
[SIG]
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 510
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE NUMBER 9642 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
The following are recognized as Loss Payee as respects coverage for Stokely:
Harris Trust and Savings Bank Individually and as Agent pursuant to that certain
Secured Agreement among Stokely USA, Inc. and Harris Trust and Savings Bank,
Mercantile Bank of St. Louis National Association, Sanwa Business Credit
Corporation and General Electric Credit Corporation Dated May 22, 1995; State of
Wisconsin Investment Board; and Nationwide Life Insurance Company; Employers
Life Insurance Company of Wausau and West Coast Life Insurance Company as their
interests may appear.
PAGE: 2 OF 2
<PAGE> 511
[LOGO] CERTIFICATE OF INSURANCE 10460 ISSUE DATE (MM/DD/YY)
GLL / / 5/24/95
<TABLE>
<S><C>
---------------------------------------------------------------
PRODUCER THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND
Marsh & McLennan, Incorporated CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE
411 East Wisconsin Avenue DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE
Suite 900 POLICIES BELOW.
Milwaukee, WI 53202 ---------------------------------------------------------------
COMPANIES AFFORDING COVERAGE
---------------------------------------------------------------
COMPANY
LETTER A UNITED STATES FIRE INS CO
---------------------------------------------------------------
- --------------------------------------------------------------- COMPANY
INSURED LETTER B
Stokely USA, Inc. ---------------------------------------------------------------
1055 Corporate Center Drive COMPANY
Oconomowoc, WI 53066 LETTER C
---------------------------------------------------------------
COMPANY
LETTER D
---------------------------------------------------------------
COMPANY
LETTER E
- ------------------------------------------------------------------------------------------------------------------------------------
COVERAGES
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY
PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO
WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO
ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
POLICY POLICY
CO EFFECTIVE EXPIRATION
DATE DATE
LTR TYPE OF INSURANCE POLICY NUMBER (MM/DD/YY) (MM/DD/YY) LIMITS
- ------------------------------------------------------------------------------------------------------------------------------------
<S><C>
A GENERAL LIABILITY 541 020411-9 11/01/94 11/01/95 GENERAL AGGREGATE $ 2000000
/X/ COMMERCIAL GENERAL --------------------------------------------------
LIABILITY PRODUCTS-COMP/OP AGG. $ 2000000
/ / / / CLAIMS MADE /X/ OCCUR. --------------------------------------------------
/ / OWNER'S & CONTRACTOR'S PROT. PERSONAL & ADV. INJURY $ 1000000
/ / ____________________________ --------------------------------------------------
EACH OCCURRENCE $ 1000000
--------------------------------------------------
FIRE DAMAGE (Any one fire) $ 100000
--------------------------------------------------
MED. EXPENSE (Any one person) $ 5000
- ------------------------------------------------------------------------------------------------------------------------------------
A AUTOMOBILE LIABILITY 138 017166 3 11/01/94 11/01/95 COMBINED SINGLE
/X/ ANY AUTO LIMIT $ 1000000
/ / ALL OWNED AUTOS --------------------------------------------------
/ / SCHEDULED AUTOS BODILY INJURY
/ / HIRED AUTOS (Per person) $
/ / NON-OWNED AUTOS --------------------------------------------------
/ / GARAGE LIABILITY BODILY INJURY $
/ / (Per accident)
--------------------------------------------------
PROPERTY DAMAGE $
- ------------------------------------------------------------------------------------------------------------------------------------
A EXCESS LIABILITY 553 021448 4 11/01/94 11/01/95 EACH OCCURRENCE $ 20000000
/X/ UMBRELLA FORM --------------------------------------------------
/ / OTHER THAN UMBRELLA FORM AGGREGATE $ 20000000
--------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
/ / STATUTORY LIMITS
--------------------------------------------------
WORKER'S COMPENSATION EACH ACCIDENT $
--------------------------------------------------
AND DISEASE-POLICY LIMIT $
--------------------------------------------------
EMPLOYERS' LIABILITY DISEASE-EACH EMPLOYEE $
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER
- ------------------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
(SEE REVERSE AND/OR ATTACHED)
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE HOLDER CANCELLATION
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
Harris Trust and Savings Bank EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL ENDEAVOR TO
Individually and as Agent MAIL 30 DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
111 West Monroe LEFT, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR
Chicago, IL 60690 LIABILITY OF ANY KIND UPON THE COMPANY, ITS AGENTS OR REPRESENTATIVES.
--------------------------------------------------------------------------
AUTHORIZED REPRESENTATIVE
[SIG]
- ------------------------------------------------------------------------------------------------------------------------------------
ACORD 25-S (7/90) PAGE: 1 OF 2 ACORD CORPORATION 1990
</TABLE>
<PAGE> 512
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE NUMBER 10460 (CONTINUED) GLL
INSURED : Stokely USA, Inc.
HOLDER : Harris Trust and Savings Bank
Individually and as Agent
111 West Monroe
Chicago, IL 60690
Comprehensive and Collision coverages apply with a $500 deductible for
Tractor/Trailers and a $1,000 deductible for all other vehicles. The following
are recognized as Loss Payee as respects liability coverage for Stokely: Harris
Trust and Savings Bank Individually and as Agent pursuant to that certain
Secured Agreement among Stokely USA, Inc. and Harris Trust and Savings Bank,
Mercantile Bank of St. Louis National Association, Sanwa Business Credit
Corporation and General Electric Credit Corporation Dated May 22, 1995; State
of Wisconsin Investment Board; and Nationwide Life Insurance Company; Employers
Life Insurance Company of Wausau and West Coast Life Insurance Company as their
interests may appear.
PAGE: 2 OF 2
<PAGE> 513
BANK ONE, MILWAUKEE, NA Tel. 414 765 3000
Main Office
111 East Wisconsin Avenue
P O Box 2033
Milwaukee Wisconsin 53201
[BANK ONE LOGO]
May 25, 1995
Nationwide Life Insurance Company
Employers Life Insurance Company of Wausau
West Coast Life Insurance Company
State of Wisconsin Investment Board
Stokely USA, Inc.,
Ladies and Gentlemen:
Bank One, Milwaukee, National Association, a National Banking Association, as
Agent ("Agent") for the ratable benefit of the "Lenders," as defined in a
certain Security Agreement dated August 18, 1992, as amended by First Amendment
to Security Agreement dated June 11, 1993, and as defined in a certain
Intercreditor and Collateral Agency Agreement dated August 18, 1992, as amended
by First Amendment to Intercreditor and Collateral Agency Agreement dated June
11, 1993, herein agrees as follows:
Upon payment in full by Stokely USA, Inc. ("Borrower") of a certain
amount to be set forth in a payout statement to be prepared by Shawmut
Capital Corporation and dated on or about May 30, 1995 ("Payout Amount"),
which Payout Amount will include payment of all principal and interest,
together with attorneys' fees, and any other outstanding costs or charges
incurred by Agent with respect to any indebtedness owed Lenders by
Borrower, the undersigned, as Agent for the Lenders, herein agrees to
release all Mortgage, Assignment of Leases and Rents, a Security Agreement
and Financing Statement documents which encumber Borrower's real estate and
fixed assets and any other collateral security document, excepting
financing statements, encumbering Borrower's assets which additionally
secure any indebtedness owed Lenders by Borrower. Agent, as requested by
Borrower, additionally agrees that upon payment in full of Payout Amount,
Agent will execute assignments to a group of lenders consisting of
Nationwide Life Insurance Company, Employers Life Insurance Company of
Wausau, West Coast
<PAGE> 514
Stokely USA, Inc.
May 25, 1995
Page Two
Life Insurance Company and State of Wisconsin Investment Board of Agent's
interest as secured party in all Uniform Commercial Code financing
Statement previously filed by Agent.
Very truly yours,
Bank One, Milwaukee, National Association,
As Agent for the Ratable Benefit of Lenders
RONALD J. CAREY
Ronald J. Carey
Vice President
RJC/dlf
<PAGE> 515
[SHAWMUT CAPITAL LETTERHEAD]
May 30, 1995
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60690
General Electric Capital Corporation
105 West Madison Street
Suite 1500
Chicago, Illinois 60602
Mercantile Bank of St. Louis,
National Association
Mercantile Tower
St. Louis, Missouri 63166
Sanwa Business Credit Corporation
One South Wacker Drive
Chicago, Illinois 60606
RE: STOKELY USA, INC. (HEREINAFTER REFERRED TO AS "BORROWER")
Gentlemen:
The undersigned, Shawmut Capital Corporation ("SCC"), formerly known as
Barclays Business Credit, Inc., as Agent (the "Agent") for itself and certain
Lenders (the "Lenders") under a certain Loan and Security Agreement dated
August 18, 1992, as amended (the "Loan Agreement"), has been informed by
Borrower that you will be entering into a financing arrangement with Borrower
and Borrower will be using the proceeds of certain loans made in connection
therewith to pay in full all of the liabilities, obligations and indebtedness
owing by Borrower to the Agent and the Lenders under the Loan Agreement. If
paid by the close of business on May 31, 1995, the amount necessary to pay all
of the liabilities, obligations and indebtedness owing by Borrower to the Agent
and the Lenders under the Loan Agreement is $24,624,552.40, comprised of (i)
$24,390,474.24 in respect of principal and (ii) $234,078.16 in respect of
accrued interest, fees and expenses (collectively, the "Payoff Amount"). Such
liabilities, obligations, and indebtedness would be increased by $7,622.02 for
each day after May 31, 1995 until the Payoff Amount is paid in full (the "Per
Diem Amount"). In addition to the
<PAGE> 516
Harris Trust and Savings Bank
May 30, 1995
Page 2
foregoing, Borrower would need to provide replacements for the letters of
credit listed on Exhibit A hereto (the "SCC L/Cs") and return the originals of
the SCC L/Cs to the undersigned.
This letter will confirm that, upon (i) the execution by Borrower and
Harris Trust and Savings Bank, as Agent for you ("Harris"), of the attached
Indemnity Agreement and delivery thereto to SCC, (ii) the delivery to SCC of
the original SCC L/Cs and (iii) payment by wire transfer of the Payoff Amount,
plus the Per Diem Amount, if any, to the following account:
Harris Trust and Savings Bank
Chicago, Illinois
ABA #0710-0028-8
Acct. #183-842-4
Reference: Shawmut Capital Corporation and
Stokely USA, Inc.,
all liens and security interests of any kind of the Agent, for the benefit of
itself and the Lenders, on and in any and all of the property of Borrower and
its subsidiaries, shall be deemed to be released and terminated.
The undersigned will deliver to Harris, immediately after receipt of
the Payoff Amount, the SCC L/Cs and the aforesaid Indemnity Agreement,
executed termination statements, mortgage releases and other releases
pertaining to any liens and security interests of the Agent, for the benefit of
itself and the Lenders, on and in any of the property of Borrower and of its
subsidiaries. The undersigned further agrees to deliver to Harris, upon
payment of the Payoff Amount and receipt of the SCC L/Cs and the aforesaid
Indemnity Agreement, such other termination statements, releases and other
agreements, in form and substance satisfactory to Harris, as Harris may
reasonably request in connection with the above described release and
termination of liens and security interests of Agent, for the benefit of itself
and the Lenders, on and in any of the property of Borrower and of its
subsidiaries.
Sincerely,
SHAWMUT CAPITAL CORPORATION, as Agent
By [SIG]
-----------------------------
Its Vice President
-------------------------
<PAGE> 517
EXHIBIT A
SCC L/Cs
(NONE)
<PAGE> 518
INDEMNITY AGREEMENT
Stokely USA, Inc. ("Borrower"), for good and valuable consideration,
does hereby indemnify Shawmut Capital Corporation ("SCC"), in its capacity as
Agent and as a Lender, and all other Lenders under the certain Loan and
Security Agreement dated August 18, 1992, as amended, and in each case, their
respective successors and assigns, (each, an "Indemnitee"), from any losses
arising from the failure on the part of any Indemnitee to collect the full
amount of customers' or other checks previously received by any Indemnitee and
credited to the account of Borrower and for any service or other charges due to
any Indemnitee upon any loans heretofore made by any Indemnitee to Borrower.
SCC acknowledges that Borrower shall have no indemnity obligation under the
second sentence of this paragraph unless any such indemnification claim is made
within 180 days of the date hereof.
IN WITNESS WHEREOF, Borrower has caused this indemnity and release to
be executed by one of its officers thereunto duly authorized this ____ day of
May, 1995.
STOKELY USA, INC.
By
----------------------------
Name
--------------------------
Its
---------------------------
Harris Trust and Savings Bank, as Agent (the "Agent") for itself,
General Electric Capital Corporation, Sanwa Business Credit Corporation,
Mercantile Bank of St. Louis, National Association (collectively, the "Banks")
for good and valuable consideration, does hereby agree to indemnify the
Indemnitees from any losses arising from the failure on the part of any
Indemnitee to collect the full amount of customers' or other checks previously
received by any Indemnitee and credited to the account of Borrower and for any
service or other similar charges due to any Indemnitee upon any loans
heretofore made by any Indemnitee to Borrower. SCC acknowledges that neither
the Agent nor the Banks shall have any indemnity obligation under this
paragraph unless any such indemnification claim is made within 180 days of the
date hereof.
IN WITNESS WHEREOF, the Agent has caused this indemnity to be executed
by one of its officers thereunto duly authorized this ____ day of May, 1995.
HARRIS TRUST AND SAVINGS BANK
By
----------------------------
Name
--------------------------
Its Vice President
Acknowledged and Agreed to
this ____ day of May, 1995.
SHAWMUT CAPITAL CORPORATION
By
----------------------------
Its
---------------------------
<PAGE> 519
STOKELY USA, INC.
THIRD AMENDMENT TO NOTE AGREEMENT
Re:
Note Agreement Dated as of January 1, 1990
and
$25,000,000 Original Principal Amount of
9.37% Senior Notes Due January 15, 2000
DATED MAY 31, 1995
<PAGE> 520
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SECTION 1. DEFINED TERMS 2
SECTION 2. REPRESENTATIONS AND WARRANTIES 2
SECTION 3. CONDITIONS PRECEDENT 4
SECTION 4. AMENDMENTS TO EXISTING NOTE AGREEMENT 7
SECTION 5. CONSENT TO PARTIAL RELEASE 14
SECTION 6. EFFECT OF AMENDMENT 15
SECTION 7. NO LEGEND REQUIRED 16
SECTION 8. FEES AND EXPENSES 16
SECTION 10. DUPLICATE ORIGINALS; EXECUTION IN COUNTERPART 16
SECTION 11. GOVERNING LAW 16
Annex 1 -- Schedule of Holders
Annex 2 -- Schedule of IRB Indebtedness
Annex 3 -- Schedule of Pending Litigation
Exhibit A -- Form of Closing Opinion of Special Counsel to the Company
Exhibit B -- Form of Officers' Certificate of the Company
Exhibit C -- Form of Secretary's Certificate of the Company
</TABLE>
i
<PAGE> 521
STOKELY USA, INC.
THIRD AMENDMENT TO NOTE AGREEMENT
Re:
Note Agreement Dated as of January 1, 1990
and
$25,000,000 Original Principal Amount of
9.37% Senior Notes Due January 15, 2000
Dated May 31, 1995
To the Institutional Investors
listed on Annex 1 hereto which
are signatories to this Agreement
Ladies and Gentlemen:
Reference is made to the Note Agreement dated as of January 1, 1990, as
amended by an Amendment to Note Agreement dated August 18, 1992 and a Second
Amendment to Note Agreement dated June 11, 1993 (said Note Agreement as so
amended is herein referred to as the "Existing Note Agreement"), among Stokely
USA, Inc., a Wisconsin corporation (the "Company"), and each of the
institutions named in Schedule I hereto (the "Holders"), under and pursuant to
which Twenty-Five Million Dollars ($25,000,000) aggregate principal amount of
9.37% Senior Notes due January 15, 2000 (the "Notes") were originally issued.
The Company desires to enter into a proposed transaction in which:
(i) The Company will enter into a Secured Credit Agreement
dated as of May 22, 1995 (the "Credit Agreement") with Harris Trust and
Savings Bank ("Harris Bank") and the other lenders referred to therein
(Harris Bank and such other lenders, along with their respective
successors and assigns, are herein collectively referred to as the
"Short-Term Lenders"), and Harris Bank, as agent for the Short-Term
Lenders, pursuant to which the Short-Term Lenders will agree to make
certain loans and advances to, and issue certain standby letters of
credit for the account of, the Company in the aggregate principal
amount of up to Sixty-Five Million Dollars ($65,000,000);
(ii) the obligations of the Company under the Credit Agreement
will be secured by a security interest in and Lien upon the Current
Asset Collateral (defined below), all as more fully set forth in the
Security Agreement dated as of May 22, 1995 (the "Bank Security
Agreement"), by and among the Company, the Short-Term Lenders, and
Harris Bank, as agent for the Short-Term Lenders;
(iii) all indentedness and other obligations of the Company
and its Subsidiaries under the Loan and Security Agreement will be paid
in full and the lenders party to the
<PAGE> 522
Loan and Security Agreement having any Lien on or security interest in
the collateral securing the Notes (the "Old Lenders") shall consent to
or acknowledge the released of all such Liens (the "Old Lenders' Lien
Release") held for the benefit of the Old Lenders; and
(iv) the Holders and State of Wisconsin Investment Board
("SWIB") will consent to the release by Bank One, as agent for the
Holders and SWIB, of the Lein on and security interest in the Current
Asset Collateral heretofore granted to Bank One as agent for the
Holders and SWIB.
In exchange for the Holders' consent to the Partial Release (defined
below), the Company agrees to amend certain terms and provisions of the
Existing Note Agreement to conform certain provisions of the Existing Note
Agreement to the terms and provisions of the Credit Agreement.
In consideration of the foregoing and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged),
the Company and the Holders (subject to satisfaction of the conditions set
forth below) hereby agree to the amendments set forth below and the Holders
(subject to satisfaction of the conditions set forth below) hereby consent to
the Partial Release, in the manner herein provided.
SECTION 1. DEFINED TERMS.
All capitalized terms used but not specifically defined in this
Amendment have the respective meanings assigned to them in, or pursuant to the
provisions of, the Existing Note Agreement as amended by this Amendment (as so
amended herein referred to as the "Amended Note Agreement").
SECTION 2. REPRESENTATIONS AND WARRANTIES.
The Company warrants and represents to each Holder that as of the date
of this Amendment and as of the Effective Date (as defined in Section 3):
(A) ORGANIZATION AND AUTHORITY; SUBSIDIARIES. The Company is a
corporation duly organized and existing and in good standing under the laws of
the State of Wisconsin, has full and adequate corporate power to carry on its
business as now conducted, is duly licensed or qualified in all jurisdictions
wherein the nature of its activities requires such licensing or qualification
except where the failure to be so licensed or qualified would not have a
material adverse effect on the business, prospects, profits, Properties or
condition (financial or otherwise) of the Company, and has full right and
authority to enter into this Amendment and the Security Documents (defined
below), and to perform each and all of the matters and things herein and therein
provided for. The aggregate amount of assets of the U.S. Subsidiaries does not
exceed One Hundred Thousand Dollars ($100,000).
(B) PENDING LITIGATION. Except as disclosed on Annex 2 hereto, there
is no litigation or governmental proceeding pending, or to the knowledge of the
Company threatened, against the Company or any Subsidiary which, if adversely
determined, is likely to have a material adverse effect on the business,
prospects, profits, Properties or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or the ability of the Company
to perform
2
<PAGE> 523
its obligations set forth in this Amendment, the Amended Note Agreement, the
Notes or any of the Security Documents.
(C) NO DEFAULTS. No event has occurred and is continuing and no
condition exists which, upon execution and delivery of this Amendment, would
constitute a Default or Event of Default. The Company is not in default in the
payment of principal or Interest on any Indebtedness and is not in default
under any instrument or instruments or agreements under and subject to which
any Indebtedness has been issued and no event has occurred and is continuing
under the provisions of any such instrument or agreement which with the lapse
of time or the giving of notice, or both, would constitute a default or an
event of default thereunder, except for a possible default with respect to
certain Indebtedness in principal amount not exceeding $400,000, which possible
default could have a material adverse effect on the business, prospects,
profits, Properties or condition (financial or otherwise) of the Company and
its Subsidiaries, taken as a whole, or the ability of the Company to perform
its obligations set forth in this Amendment, the Amended Note Agreement, the
Notes or any of the Security Documents.
(D) SECURITY INTERESTS AND DEBT. There are no Liens on any of the
Property of the Company and its Subsidiaries except Liens permitted by Section
5.7 of the Amended Note Agreement. The Company and its Subsidiaries have no
Funded Debt outstanding other than Funded Debt that would be permitted to be
incurred by Section 5.6 of the Amended Note Agreement. Annex 3 to this
Amendment correctly lists all outstanding IRB Indebtedness of the Company as of
the Effective Date (defined below).
(E) FULL DISCLOSURE. Each written statement and all written materials
furnished by, or on behalf of, the Company to the Holders in connection with
this Amendment or pursuant to the provisions of Section 5.14 of the Existing
Note Agreement do not contain any untrue statement of a material fact or omit a
material fact necessary to make the statements contained therein or herein not
misleading in light of the circumstances in which they were made. There is no
fact known to the Company which the Company has not disclosed to the Holders in
writing which materially affects adversely or, so far as the Company can now
foresee, shall materially affect adversely the business, prospects, profits,
Properties or condition (financial or otherwise) of the Company and its
Subsidiaries, taken as a whole, or the ability of the Company to perform its
obligations set forth in this Amendment, the Amended Note Agreement, the Notes
or any of the Security Documents.
(F) TRANSACTION IS LEGAL AND AUTHORIZED. The execution and delivery
by the Company of this Amendment and the Security Documents, the consummation
of each of the transactions contemplated by this Amendment and the compliance
by the Company with all the provisions of this Amendment, the Amended Note
Agreement and each Security Document: (i) are within the corporate powers of
the Company; and (ii) are legal and do not conflict with, result in any breach
in any of the provisions of, or constitute a default (or require any consent
other than the consents heretofore obtained) under, or result in the creation
of any Lien upon any Property of the Company or any Subsidiary under the
provisions of, the articles of incorporation or by-laws of the Company or any
Subsidiary or any agreement or instrument to which the Company or any
Subsidiary is a party or by which it or any of its Property may be bound.
(G) GOVERNMENTAL CONSENT. Neither the nature of the Company or any
Subsidiary, or of any of their respective businesses or Properties, nor any
relationship between the Company
3
<PAGE> 524
or any Subsidiary and any other Person, nor any circumstance in connection with
the execution and delivery of this Amendment and the Security Documents (except
as provided under Section 3), is such as to require an order, consent,
approval, license, authorization or validation of, or filing, recording,
registration or qualification with, any Governmental Authority on the part of
the Company as a condition to the execution, delivery or performance of this
Amendment, the Amended Note Agreement or any Security Document, or the
legality, validity, binding effect or enforceability of this Amendment, the
Amended Note Agreement or any Security Document.
(H) OBLIGATIONS ARE ENFORCEABLE. The obligations of the Company set
forth in this Amendment, the Amended Note Agreement, the Notes and the
Security Documents are valid, binding and enforceable in accordance with their
respective terms, except as such enforceability may be: (i) limited by
bankruptcy, insolvency or other similar laws affecting the enforceability of
creditors' rights generally and (ii) subject to the availability of equitable
remedies.
(I) COMPLIANCE WITH LAW. The Company and each Subsidiary is in
compliance with all laws, ordinances, governmental rules or regulations to
which it is subject, including without limitation the Occupational Safety and
Health Act of 1970, ERISA and all Environmental Legal Requirements, the
violation of which could have a material adverse effect on the business,
prospects, profits, Properties or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or the ability of the Company
or any U.S. Subsidiary to perform its respective obligations set forth in this
Amendment, the Amended Note Agreement, the Notes or any of the Security
Documents.
SECTION 3. CONDITIONS PRECEDENT.
The consent to the Partial Release set forth in Section 5 and each of
the amendments to the Existing Note Agreement shall have no effect until all of
the following conditions precedent shall have been satisfied or waived by each
of the Holders (such time of effectiveness is herein referred to as the
"Effective Date"):
(A) OPINION OF COUNSEL. The Holders shall have received from Michael,
Best & Friedrich, special counsel to the Company, a favorable opinion
satisfactory to the Holders and substantially in the form appended to this
Amendment as Exhibit A.
(B) WARRANTIES AND REPRESENTATIONS TRUE. The warranties and
representations set forth in Section 2 shall be true in all material respects;
there shall exist on the Effective Date no Default or Event of Default; and the
Holders shall have received an Officers' Certificate of the Company, dated the
Effective Date, substantially in the form of Exhibit B to this Amendment,
certifying to both such effects and that the conditions specified in this
Section 3 have been fulfilled, and a certificate dated the Effective Date and
signed by the Secretary or an Assistant Secretary of the Company, substantially
in the form of Exhibit C to this Amendment, with respect to the matters therein
set forth.
(C) CONSENT OF ALL NOTEHOLDERS. The Company and the Holders of one
hundred percent (100%) of the outstanding principal amount of the Notes shall
have executed this Amendment.
4
<PAGE> 525
(D) CREDIT AGREEMENT AND BANK SECURITY AGREEMENT. The Company, the
Short-Term Lenders and Harris Bank, as agent for the Short-Term Lenders, shall
have executed and delivered to the Holders copies of the Credit Agreement and
the Bank Security Agreement, in form and substance satisfactory to the Holders.
(E) OLD LENDERS' LIEN RELEASE. Each of the Old Lenders shall have
executed and delivered to the Holders consents to or acknowledgements of the
Old Lenders' Lien Release and Bank One shall have executed and delivered to the
Holders the Old Lenders' Lien Release, such consents or acknowledgements and
such Release each being in form and substance satisfactory to the Holders.
(F) ASSIGNMENT BY BANK ONE; UCC STATEMENTS. Bank One, as agent for the
benefit of the Holders and SWIB, shall have executed and delivered to the
Holders an assignment of the Lien on and security interest in the Property of
the Company described in the Security Documents heretofore granted to Bank One,
as agent, and a release of the Current Asset Collateral, such assignment and
such release each being in form and substance satisfactory to the Holders,
together with appropriate forms of UCC financing statements reflecting such
assignment and release (the "UCC Amendments"). The Company shall have executed
the UCC Amendments and shall have executed and delivered such other UCC
financing statements as shall be necessary to perfect the security interest of
the Holders and SWIB in certain other Property described in the Security
Documents acquired by the Company from one of its Subsidiaries.
(G) SECURITY DOCUMENTS. The following agreements (herein collectively
referred to as the "Security Documents") shall have been duly executed and
delivered to the Holders by the parties thereto, in form and substance
satisfactory to the Holders and their special counsel:
(i) a Security Agreement among the Company and the Lenders,
pursuant to which the Company will grant the Lenders a Lien on and
security interest in certain assets of the Company therein described;
(ii) an Assignment of Contracts, Warranties and Permits by
the Company, pursuant to which the Company will assign to the Lenders
all contracts, warranties and permits affecting the Properties (as
defined therein);
(iii) one or more mortgages or deeds of trust (collectively,
the "Mortgages") on all interests in real property of the Company
(other than the real property described in Section 3N of the Security
Agreement) in favor of the Lenders; and
(iv) an Environmental Indemnification Agreement by the
Company, pursuant to which the Company will agree to indemnify the
Lenders for losses relating to environmental matters.
(H) INTERCREDITOR AGREEMENT. SWIB shall have delivered to the Holders
a fully executed counterpart of the Intercreditor Agreement, in form and
substance satisfactory to the Holders and their special counsel.
5
<PAGE> 526
(I) TITLE MATTERS. The Company shall have delivered or caused to be
delivered to the Holders one or more loan policies of title insurance, or
endorsements or existing loan policies down-dating such policies to the date of
the recording of the Mortgages, in either case satisfactory to the Lenders and
showing no exception to title except as contained in the existing loan policies
or otherwise acceptable to the Holders.
(J) LIEN SEARCHES. The Company shall have delivered to the Holders
Lien searches showing that the Property of the Company and its Subsidiaries is
subject to no Liens other that Liens permitted under Section 5.7 of the Amended
Note Agreement.
(K) CERTIFICATES OF INSURANCE. The Company shall have delivered to
the Holders certificates of insurance evidencing the insurance required by
Section 3G of the Security Agreement, showing the Holders and SWIB as loss
payees (as their interests may appear) thereunder.
(L) EXPENSES. The Company shall have paid all costs and expenses of
the Holders relating to this Amendment and the Security Documents in accordance
with Section 8.
(M) PROCEEDINGS SATISFACTORY. All proceedings taken in connection with
the execution and delivery of this Amendment and the transactions contemplated
hereby shall be satisfactory to the Holders and their special counsel; and the
Holders and their special counsel shall have received copies of such documents
and papers as they may reasonably request in connection therewith.
SECTION 4. AMENDMENTS TO EXISTING NOTE AGREEMENT.
(A) SECTION 5.6. Clauses (a)(3) and (a)(4) of Section 5.6 of the
Existing Note Agreement are hereby amended and restated in their entirety to
read as follows:
(3) Funded Debt of the Company and its Subsidiaries from
time to time outstanding under the Credit Agreement in an aggregate
principal amount not exceeding $65,000,000 and renewals, extensions,
refundings and replacements thereof, provided that any renewal,
extension, refunding or replacement of such Funded Debt in excess of
$65,000,000 shall be deemed to constitute the issuance of new Funded
Debt subject to the limitations of Section 5.6(a)(4);
(4) additional Funded Debt of the Company and its
Subsidiaries, provided that at the time of issuance thereof and after
giving effect thereto and to the application of the proceeds thereof,
Consolidated Funded Debt would not exceed 65% of Consolidated Total
Capitalization if such time is prior to May 1, 1996, and if such time
is in any fiscal quarter of the Company thereafter, a percentage of
Consolidated Total Capitalization determined by subtracting from 65%,
.5% for each fiscal quarter ending after April 30, 1996 (so that the
applicable percentage would be 64.5% for the fiscal quarter ending June
30, 1996, 64% for the fiscal quarter ending September 30, 1996, and so
on), except that such percentage shall not be decreased to less than
60% of Consolidated Total Capitalization;
6
<PAGE> 527
(B) SECTION 5.6. Section 5.6 of the Existing Note Agreement is hereby
amended by adding a new clause (d) which shall read as follows:
(d) The Company will not permit the sum of (i) the
aggregate amount of Indebtedness secured by Liens described in Section
5.7(j) outstanding at any time, plus (ii) the aggregate amount of
unsecured Indebtedness of Subsidiaries outstanding at such time, to
exceed 15% of Consolidated Tangible Net Worth at such time.
(C) SECTION 5.7. Clause (h) of Section 5.7 of the Existing Note
Agreement is hereby amended and restated in its entirety so that the same shall
read as follows:
(h) Liens (i) on the Current Asset Collateral securing the
Indebtedness referred to in Section 5.6(a)(3) and (ii) on all Property
of the Company and its Subsidiaries other than the Current Asset
Collateral securing the Notes and other Indebtedness as described in
the Security Agreement;
(D) SECTION 5.8. Section 5.8 of the Existing Note Agreement is hereby
amended and restated in its entirety so that the same shall read as follows:
5.8 Maintenance of Consolidated Tangible Net Worth. The
Company will at all times maintain Consolidated Tangible Net Worth of
no less than $45,000,000, which amount shall be increased on the first
day of each fiscal quarter of the Company, beginning July 1, 1995, by
an amount equal to 50% of Consolidated Net Income (but not less than
zero) for the immediately preceding fiscal quarter then most recently
ended.
(E) SECTION 5.10. Section 5.10 of the Existing Note Agreement is
hereby amended by
(1) amending and restating clause (c) in its entirety so
that the same shall read as follows:
(c) subject to the last paragraph of this Section
5.10, in addition to transactions permitted by subsections (a)
or (b), the Company may sell, lease, transfer or otherwise
dispose of assets (a "Transfer") if such Transfer does not
involve a Substantial Portion of the assets of the Company and
its Subsidiaries;
and (2) amending and restating clause (f) in its entirety so that the
smae shall read as follows:
(f) subject to the last paragraph of this Section
5.10, in addition to the transactions permitted by subsections
(a), (b), (c), (d) or (e), the Company may sell, lease or
otherwise dispose of assets within the limitations of Section
3D of the Security Agreement.
(F) SECTIONS 5.11. Clause (c) of Section 5.11 of the Existing Note
Agreement is hereby amended by deleting the reference to "Section 5.6" therein
and replacing it with "Section 5.6(a)(3)."
7
<PAGE> 528
(G) SECTION 5.15. Section 5 of the Existing Note Agreement is
hereby amended to add a new Section 5.15 which shall read as follows:
5.15. Subsidiaries. The Company will not permit the
aggregate amount of assets of all U.S. Subsidiaries to exceed $200,000 at any
time.
(H) SECTION 5.16. Section 5 of the Existing Note Agreement is
hereby amended to add a new Section 5.16 which shall read as follows:
5.16. Transactions with Subsidiaries. The Company will not
enter into any transaction, including, without limitation, the
purchase, sale, lease or exchange or any Property, or the
rendering of any service, with any Subsidiary, except in the
ordinary course of and pursuant to the reasonable requirements of
the Company's business and upon fair and reasonable terms not
materially less favorable to the Company than would be obtained
in a comparable arm's-length transaction with a Person not a
Subsidiary.
(I) SECTION 6.1. Section 6.1 of the Existing Note
Agreement is hereby amended by
(1) amending and restating clause (d) so that the same
shall read as follows:
(d) (i) Default shall occur in the performance or
observance of any covenant or agreement contained in (x) any
indenture, agreement or other instrument under which any
Indebtedness of the Company in excess of $3,000,000 in the
aggregate is outstanding (other than IRB Indebtedness) or (y)
any agreement or other instrument under which any IRB
Indebtedness is outstanding and any such default shall result in
acceleration of the maturity of any Indebtedness evidenced
thereby or outstanding or secured thereunder, or (ii) any
event of default shall occur under the Credit Agreement, any
of the Other Agreements, or any Security Document; or
and (2) amending and restating clause (e) so that the same
shall read as follows:
(e) Default shall occur in the observance or
performance of any covenant or agreement contained in
Section 5.5, 5.6, 5.7, 5.8, 5.9, 5.10, 5.11, 5.15 or 5.16
hereof; or Default shall occur in the performance or
observance of any other covenant or agreement contained in
this Agreement which is not remedied within thirty days
after the earlier of: (1) the date on which such Default
shall first become known to a Responsible Financial Officer
of the Company, or (2) written notice thereof to the Company
by the holder of any Note, which notice shall specify the
Default to be remedied and state that it is a notice
hereunder; or
(J) SECTION 8.1 Section 8.1 of the Existing Note Agreement is
hereby amended by amending the definitions of "Consolidated Tangible Net
Worth," "Funded Debt," "Intercreditor Agreement," "Lenders," "Other Agreements"
and "Security Agreement" in their entirety to read as follows:
"Consolidated Tangible Net Worth" shall mean, as of the date of
any determination thereof, Consolidated Net Worth as of such date
minus the amount of all Intangible
8
<PAGE> 529
Assets of the Company and its Subsidiaries as of such date, determined
on a consolidated basis in accordance with GAAP.
"Funded Debt" with respect to any Person shall mean all indebtedness
for borrowed money of such Person maturing by its terms more than one year
after, or which is renewable or extendible at the option of such Person for
a period ending one year or more after, the date of determination, and
shall include indebtedness for borrowed money of such maturity created,
assumed or guaranteed by such Person either directly or indirectly,
including obligations of such maturity secured by liens upon Property of
such Person and upon which such entity customarily pays the interest, all
current maturities of all such indebtedness of such maturity and all rental
payments under Capitalized Leases of such maturity, and including, in the
case of the Company, the lesser of the amount outstanding under the Credit
Agreement as of the date of determination or the amount that is not
required to be prepaid at such time pursuant to Section 7.25 of the Credit
Agreement.
"Intercreditor Agreement" shall mean the Intercreditor Agreement dated
as of May 31, 1995, by and among the Lenders, as from time to time
amended, modified or supplemented.
"Lenders" shall mean the holders of the Notes and the holders of the
Company's 9.49% Senior Notes due December 15, 2001.
"Other Agreements" shall mean any and all agreements, instruments and
documents (other than the Security Documents), heretofore, now or hereafter
executed by the Company and delivered to the holders of the Notes, or to
any agent appointed to act on behalf of the holders of the Notes, in
respect to the transactions contemplated by this Agreement.
"Security Agreement" shall mean the Security Agreement dated as of May
31, 1995, by and among the Company and the Lenders, as from time to time
amended, modified or supplemented, including, without limitation, any
amendment or supplement pursuant to which an agent or trustee is appointed
to act on behalf of the Notes and any other Indebtedness secured by the
Security Agreement.
(K) NEW DEFINITIONS. Section 8.1 of the Existing Note Agreement is hereby
amended to add the following definitions in appropriate alphabetical order:
"Assignment of Contracts, Warranties and Permits" shall mean the
Assignment of Contracts, Warranties and Permits dated as of May 31, 1995,
entered into by the Company for the benefit of the Lenders, as from time to
time amended, modified or supplemented.
"Consolidated Net Worth" shall mean, as of the date of any
determination thereof, Total Assets as of such date minus Total Liabilities
as of such date, determined on a consolidated basis in accordance with
GAAP.
9
<PAGE> 530
"Credit Agreement" shall mean the Secured Credit Agreement dated as of
May 22, 1995 (the "Credit Agreement") entered into by and among the
Company, Harris Trust and Savings Bank ("Harris Bank") and the other
lenders referred to therein (collectively, along with their respective
successors and assigns, the "Short-Term Lenders"), and Harris Bank, as
agent for the Short-Term Lenders.
"Current Asset Collateral" is defined in Section 5 of the Third
Amendment.
"Disposition Value" shall mean, as of the date of any determination
thereof, with respect to any assets,
(a) in the case of any asset that does not constitute
Subsidiary Stock, the book value thereof, valued at the time of such
disposition in good faith by the Company, and
(b) in the case of any asset that constitutes Subsidiary
Stock, an amount equal to the percentage of the book value of the
assets of the Subsidiary that issued such stock as is equal to the
percentage that the book value of such Subsidiary Stock represents of
the book value of all of the outstanding capital stock of such
Subsidiary (assuming, in making such calculations, that all Securities
convertible into such capital stock are so converted and giving full
effect to all transactions that would occur or be required in
connection with such conversion) determined at the time of the
disposition thereof, in good faith by the Company.
"Intangible Assets" shall mean license agreements, trademarks, trade
names, patents, capitalized research and development, proprietary products
(the results of past research and development treated as long-term assets
and excluded from inventory), goodwill and all other Property which would
be considered to be intangible under GAAP.
"Partial Release" is defined in Section 5 of the Third Amendment.
"Subsidiary Stock" shall mean, with respect to any Person, the stock
(or any options or warrants to purchase stock or other Securities
exchangeable for or convertible into stock) of any Subsidiary of such
Person.
"Substantial Portion" shall mean, with respect to any Transfer of
assets, any portion of assets of the Company and its Subsidiaries, if
(a) the Disposition Value of such assets, when added to the
Disposition Value of all other assets of the Company and its
Subsidiaries that were subject to a Transfer (other than pursuant to
clause (a) or clause (b) or Section 5.10) during the period beginning
on the first day of such fiscal year and ending on and including the
date of the Transfer of such assets, exceeds an amount equal to 10%
of Consolidated Total Assets determined as of the end of the then most
recently ended fiscal quarter of the Company, or
10
<PAGE> 531
(b) The Disposition Value of such assets, when
added to the Disposition Value of all other assets of the
Company and its Subsidiaries that were subject to a Transfer
(other than pursuant to clause (a) or clause (b) of Section
5.10) during the period beginning on the Closing Date and
ending on and including the date of the Transfer of such
assets, exceeds an amount equal to 25% of Consolidated Total
Assets determined as of the end of the then most recently ended
fiscal quarter of the Company.
"Third Amendment" shall mean the Third Amendment to Note
Agreement dated May 31, 1995, by and among the Company and the holders
of the Notes.
"Total Assets" shall mean, as of the date of any determination
thereof, the aggregate amount of assets of the Company and its
Subsidiaries as of such date, determined on a consolidated basis in
accordance with GAAP.
"Total Liabilities" shall mean, as of the date of any
determination thereof, the aggregate amount of liabilities of the
Company and its Subsidiaries as of such date, determined on a
consolidated basis in accordance with GAAP.
"Transfer" is defined in Section 5.10.
"U.S. Subsidiaries" shall mean all Subsidiaries organized and
existing under the laws of the United States or any state thereof.
SECTION 5. CONSENT OF PARTIAL RELEASE.
Subject to satisfaction of the conditions set forth in Section 3, the
Holders hereby consent to the release of the Lien on and security interest in
the following described property and interest in such property (collectively,
the "Current Asset Collateral") heretofore granted to Bank One as agent for the
Holders (the "Partial Release"):
(a) Receivables. Receivables of the Company and its
Subsidiaries, whether now existing or hereafter arising, and however
evidenced or acquired, or in which the Company or any Subsidiary now
has or hereafter acquires any rights (the term "Receivables" means and
includes accounts, accounts receivable, contract rights, instruments,
notes, drafts, acceptances, documents, chattel paper, general
intangibles, any right of the Company or any such Subsidiary to payment
for goods sold or leased or for services rendered, whether arising out
of the sale of Inventory (as hereinafter defined) or otherwise and
whether or not earned by performance, and all other forms of
obligations owing to the Company or any such Subsidiary, and all rights
of the Company or any such Subsidiary to any mechandise (including
without limitation any returned or repossessed goods and the right of
stoppage in transit) which is represented by, arises from or is related
to any of the foregoing); provided that the term "Receivables" shall
not include the "Collateral" (as defined in the Assignment of
Contracts, Warranties and Permits as in effect on the date hereof);
(b) Inventory. Inventory of the Company and its
Subsidiaries, whether now owned or hereafter acquired, and all
documents of title at any time evidencing or
11
<PAGE> 532
representing any part thereof (the term "Inventory" means and includes
all goods which are held for sale or lease or are to be furnished
under contracts of service, or which are raw materials,
work-in-process, finished goods, materials and supplies of every nature
used or usable in connection with the manufacture, processing, supply,
servicing, storing, packing, shipping, advertising, selling, leasing or
furnishing of such goods and any constituents or ingredients thereof,
and returned or repossessed goods, and all of the Company's or such
Subsidiary's right, title and interest in and to all trademarks,
trademark registrations, trademark licenses, trade names, trade styles,
patents, patent applications, patent licenses and similar properties,
rights, interests and privileges used or usable in connection with, or
in any way related to or being a part of, any of the foregoing), and
without limiting the foregoing, all of the Company's inventory of fresh
vegetables and canned and frozen vegetables produced or acquired in the
ordinary course of business;
(c) Deposits and Property in Possession. All deposit
accounts and investment accounts (whether general, specific or
otherwise) of the Company and its Subsidiaries and all sums now or
hereafter in possession of any of the Short-Term Lenders or Harris
Bank, as agent for the Short-Term Lenders, or any agent or affiliate of
any of them, in any way and for any purpose (whether for safekeeping,
custody, pledge, transmission, collection or otherwise), other than
proceeds of the disposition of Property of the Company securing the
Notes;
(d) Records and Cabinets. Supporting evidence and documents
relating to any of the above described property, including without
limitation, computer programs, discs, tapes and related electronic data
processing media, and all rights of the Company and its Subsidiaries to
retrieve the same from third parties, written applications, credit
information, account information, account cards, payment records,
correspondence, invoice copies, delivery receipts, notes and other
evidences of indebtedness, insurance certificates and the like,
together with all books of account, ledgers and cabinets in which the
same are reflected or maintained, all whether now existing or hereafter
arising; and
(e) Proceeds and Products. All proceeds and products of the
foregoing and all insurance of the foregoing and proceeds thereof,
whether now existing or hereafter arising.
Bank One shall be entitled to rely upon the consent set forth herein
and is hereby authorized to execute all such documents, instruments and
financing statements as are reasonably requested by the Lenders in order to
effect the Partial Release consented to herein.
SECTION 6. EFFECT OF AMENDMENT.
If the foregoing is acceptable to you, please note your acceptance in
the space provided below. Upon the execution and delivery by the Company and
the Holders of one hundred percent (100%) in aggregate principal amount of the
outstanding Notes and the satisfaction of the conditions set forth in Section
3, the Existing Note Agreement shall be deemed to be amended as set forth above
and the Partial Release shall be deemed to be effective. This Amendment shall
be binding upon, and shall inure to the benefit of, the successors and assigns
of the parties hereto and the holders from time to time of the Notes. Except as
amended herein,
12
<PAGE> 533
the terms and provisions of the Existing Note Agreement are hereby ratified,
confirmed and approved in all respects.
SECTION 7. NO LEGEND REQUIRED.
Any and all notices, requests, certificates and other instruments
including, without limitation, the Notes, may refer to the Note Agreement or
the Note Agreement dated as of January 1, 1990 without making specific
reference to this Third Amendment to Note Agreement, but nevertheless all such
references shall be deemed to include this Third Amendment to Note Agreement
unless the context shall otherwise require.
SECTION 8. FEES AND EXPENSES.
On the Effective Date, the Company shall pay all costs and expenses of
the Holders relating to this Amendment and the Security Documents, including,
but not limited to, the statement for reasonable fees and disbursements of the
Holders' special counsel presented to the Company on or prior to the Effective
Date. The Company will also pay, upon receipt of any statement thereof, (i)
each additional statement for reasonable fees and disbursements of the Holders'
special counsel rendered after the Effective Date in connection with this
Amendment, the Amended Note Agreement or the Security Documents, and (i) all
fees and expenses of any trustee which may be appointed pursuant to the
Intercreditor Agreement to act as agent for the Lenders for the purpose of
administration of collateral under the Security Documents. The obligations of
the Company under this Section 8 shall survive the termination of this
Amendment.
SECTION 9. SURVIVAL.
All warranties, representations, certifications and covenants made by
the Company in this Amendment or in any certificate or other instrument
delivered by it or on its behalf under this Amendment shall be considered to
have been relied upon by the Holders and shall survive the execution of this
Amendment, regardless of any investigation made by or on behalf of any Holder.
All statements in any such certificate or other instrument shall constitute
warranties and representations of the Company under this Amendment.
SECTION 10. DUPLICATE ORIGINALS; EXECUTION IN COUNTERPART.
Two or more duplicate originals of this Amendment may be signed by the
parties, each of which shall be an original but all of which together shall
constitute one and the same instrument. This Amendment may be executed in one
or more counterparts and shall be effective when at least one counterpart shall
have been executed by each party to this Amendment, and each set of
counterparts which, collectively, show execution by each such party to this
Amendment shall constitute one duplicate original.
SECTION 11. GOVERNING LAW.
This Amendment shall be governed by, and construed in accordance with,
internal Wisconsin law.
13
<PAGE> 534
IN WITNESS WHEREOF, the Company and the Holders have executed this
Amendment as of the date first above written.
STOKELY USA, INC.
By: ROBERT BRILL
--------------------------
Name:
Title: Secretary
NATIONWIDE LIFE INSURANCE COMPANY
By:
--------------------------
Name:
Title:
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU
By:
--------------------------
Name:
Title:
WEST COAST LIFE INSURANCE COMPANY
By:
--------------------------
Name:
Title:
[Signature page to THIRD AMENDMENT TO NOTE AGREEMENT of STOKELY USA, INC.]
<PAGE> 535
IN WITNESS WHEREOF, the Company and the Holders have executed this
Amendment as of the date first above written.
STOKELY USA, INC.
By:
----------------------------------------
Name:
Title:
NATIONWIDE LIFE INSURANCE COMPANY
By: Jeffrey G. Milburn
----------------------------------------
Name: Jeffrey G. Milburn, Vice President
Title: Corporate Fixed-Income Securities
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU
By: Jeffrey G. Milburn
----------------------------------------
Name: Jeffrey G. Milburn
Title: Attorney-in-Fact
WEST COAST LIFE INSURANCE COMPANY
By: Jeffrey G. Milburn
----------------------------------------
Name: Jeffrey G. Milburn
Title: Attorney-in-Fact
[Signature page to THIRD AMENDMENT TO NOTE AGREEMENT of STOKELY USA, INC.]
<PAGE> 536
ANNEX 1
(TO THIRD AMENDMENT)
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
NOTEHOLDER OF NOTES
<S> <C>
Nationwide Life Insurance Company [$17,182,733.83]
Columbus, Ohio 43216
Employers Life Insurance Company of Wausau [$2,514,546.42]
Columbus, Ohio 43216
West Coast Life Insurance Company [$1,257,273.21]
Columbus, Ohio 43216
</TABLE>
Annex 1-1
<PAGE> 537
ANNEX 2
(TO THIRD AMENDMENT)
Section 1(a)(ii)
Appleton, Wisconsin. Indemnifying Party removed a number of
underground storage tanks from this property during the 1980's and early
1990's. All such tanks were used for storage of petroleum based products.
Leakage and soil contamination was detected in connection with three tanks.
The sites were over-excavated, and contaminated soil was removed from site
and disposed of in accordance with the requirements of law.
However, because of unique soil conditions, small amounts of
contaminated soil may remain at the site in areas near where the tanks were
located. The WDNR allowed the site to be closed contingent upon agreement
by the Indemnifying Party to notify it in the event that future excavation
discloses contaminated soil that requires removal. A deed restriction to
that effect is in place.
Section 1(a)(iii)
None.
Section 1(a)(iv)
Sun Prairie and Waunakee, Wisconsin. Indemnifying Party has been
identified as a potentially responsible party in connection with the
clean-up of the Refuse Hideaway Landfill site in Middleton, Wisconsin.
Indemnifying Party contributed general refuse to that site from its plants
in Sun Prairie and Waunakee, Wisconsin. It did not contribute hazardous
materials to the site. Indemnifying Party is in the process of negotiating
a de-minimus settlement on the basis it contributed insignificant volume to
the site and no waste involved in the contamination of the site.
<PAGE> 538
LITIGATION
1. Walter Reinholdt v. Stokely USA, Inc. (Law No. C2017 in the Iowa
District Court for Franklin County, Iowa)
This is an action brought by plaintiff for damages of $56,633.43 plus
interest and costs. The claim is based on the Company's alleged negligence
in connection with the storage of dark red kidney beans at its plant in
Ackley, Iowa. The Company denies liability.
This case was tried to a jury in July of 1994, and a verdict was
returned which found no liability on the part of the Company. Plaintiff
has, however, appealed to the Court of Appeals of the State of Iowa. A
decision on that appeal is expected later this year.
Davis, Hockenberg, Wine, Brown, Koehn & Shors of Des Moines, Iowa
represents the Company in this matter.
2. Kurt Boehm v. Stokely USA, Inc., et al. (Case No. 93-L-003414 in
the Circuit Court of Cook County, Illinois)
This action was filed in April of 1993 and is for personal injuries
suffered by plaintiff in a boiler explosion that occurred at the Company's
plant in Hoopeston, Illinois while plaintiff was present as a business
invitee.
The Company has liability insurance in force for this claim through
Crum and Forster Commercial Insurance Co., and the Company's defense has
been undertaken by Crum and Forster Insurance Co. through the law firm of
Crystal, Heytow and Warnick, P.C. of Chicago, IL.
3. Robert Potratz and James Potratz v. Stokely USA, Inc. (Case No.
93-CV-811 in the Circuit Court of Winnebago County, Wisconsin.)
This action sought damages of $180,000 on a breach of contract claim
plus punitive damages of an unstated amount. The Company denied liability,
and the case was tried to a jury in April of 1995. The jury found that the
Company breached the contract and returned a damage verdict of $73,283
against the Company.
The Company has filed motions after verdict to set aside or reduce the
damages to $34,788. These motions are scheduled to be heard by the court
on May 11, 1995. The Company plans to appeal if the verdict as to damages
is not set aside. Robert Brill, general counsel of the Company,
<PAGE> 539
set aside. Robert Brill, general counsel of the Company, represents
the Company in this action.
4. Renee Estrada v. Arnold Bowman and Stokely USA, Inc. (Cause No.
C-1327-94-D, Hidalgo County, Texas District Court).
This action was filed on March 18, 1994 and is an action for damages
based on plaintiff's claim that he was wrongfully discharged as an employee
at the Company's plant in McAllen, Texas. There is no substance to the
plaintiff's claim. Damages sought include lost earnings and punitive
damages. The Complaint, however, fails to state a specific damage amount.
The exposure is minimal.
The Company is represented by the law firm of Adams and Graham, L.L.P.
of Harlingen, Texas in this action.
5. Baker's Best Frozen Commodities Co., v. Stokely USA, Inc. et al. (Case No.
BC102425 Los Angeles County Superior Court).
This action was filed on April 11, 1994 and seeks compensatory and
punitive damages arising from an alleged breach of contract. The amount of
damages is not stated in the Complaint but is generally represented to be
in excess of $500,000; of which sum the compensatory damage claim comprises
a small part. Stokely USA, Inc. denies liability.
A tentative settlement has been reached which is in the process of
being reduced to writing. Pursuant to this settlement, the Company will
forgive outstanding invoices owed it by Plaintiff in the amount of $16,700
and will provide $15,000 of trade discounts to Plaintiff in each of the
next 3 years.
The Company is represented in this action by Lane, Powell, Spears and
Lubersky of Los Angeles, California.
6. Duane C. Klingler v. Stokely USA, Inc. (Case No. CI-95-046 in the
Common Pleas Court of Paulding County, Ohio).
This action was filed in March of 1995 and claims that the Company
breached a warehouse lease agreement with Plaintiff. Damages of $44,000
are claimed.
The Company has denied liability. Glenn Troth of Paulding, Ohio
represents the Company in this action.
7. Pedro Rodriguez v. Stokely USA, Inc. (Case No. C94-3057 in the United
States District Court for the Northern District of Iowa).
2
<PAGE> 540
This action was filed in August of 1994 and claims that the Company
breached an employment agreement with Plaintiff. Damages are unstated in
the complaint but are estimated by the Company to be less than $5,000.
The Company has denied liability. No trial date has been set. Robert
Brill, general counsel of the Company, represents the Company in this
action.
8. Philip D. Freeman v. Stokely USA, Inc. (Case No. 95-C-003 in the
United States District Court for the Eastern District of Wisconsin).
This is a class action lawsuit which was filed on January 3, 1995, in
the United States District Court for the Eastern District of Wisconsin,
by Philip D. Freeman, a Minnesota resident, against the Company, all of
the individual members of the Board of Directors of the Company (in both
their capacity as a member of the Board of Directors and as an executive
officer, as applicable), William Blair & Company and Dain Bosworth, Inc.
The plaintiff brought the action pursuant to Sections 11, 12(2) and 15 of
the Securities Act of 1934, as amended, and Rule 10b-5 promulgated
thereunder. The plaintiff alleges that he sustained losses in connection
with his purchase of shares of Common Stock of the Company following a
secondary offering by the Company during the period from October 17, 1994
to December 19, 1994, as a result of defendants' alleged misleading
statements and omission to state material facts. The complaint seeks
rescission and/or compensatory damages, and costs and expenses related to
the bringing of the lawsuit. The Company believes that the allegations are
without merit or substance.
The Company retained the law firm of Gibbs, Roper, Loots and Williams
of Milwaukee, Wisconsin to represent the Company and its officers. The
Company has retained the law firm of Michael, Best & Friedrich of
Milwaukee, Wisconsin, to represent the Company's non-employee directors.
The Company has Directors and Officers Liability Insurance coverage through
two carriers with total coverage of $10,000,000, less retention of
$250,000. The Company has negotiated allocation of defense costs with the
primary carrier assuming 75% of such costs and the Company 25% after the
retention.
Motions for dismissal of the Complaint have been filed on behalf of all
defendants and remain pending.
9. Daniel J. Sweeney v. Stokely USA, Inc., et al. (Case No. 95-C-0501)
in the United States District Court for Eastern District of Wisconsin).
3
<PAGE> 541
This case was filed on 5/10/95 and served 5/17/95. It is a class
action suit arising from the same events as the Freeman case.
The Company has retained the law firm of Gibbs, Roper, Loots &
Williams of Milwaukee, Wisconsin to represent it and its employees named
as defendants.
ADMINISTRATIVE PROCEEDINGS PENDING
1. Cynthia A. Spencer v. Stokely USA, Inc. (Case No. CP 08-92-22838 Iowa
Civil Rights Commission)
Cynthia A. Spencer filed a complaint with the Iowa Civil Rights
Commission in August of 1992. She claims that she was not hired in 1992 as
a mechanic due to her gender. There is no substance to her complaint which
remains under investigation by the Iowa Civil Rights Commission.
The Company is represented in this matter by its general counsel,
Robert Brill.
2. John Areklet v. Stokely USA, Inc. (PACA N-7964 in the United States
Department of Agriculture)
John Areklet filed a complaint with the United States Department of
Agriculture in February of 1995 which claims the Company violated the
Perishable Agricultural Commodities Act by rejecting a quantity of green
beans grown under contract with the Company by Mr. Areklet in 1994. Mr.
Areklet claims damages of $12,474.
Stokely has denied liability. An administrative decision on the claim
is forthcoming. The Company is represented in this matter by its general
counsel, Robert Brill.
3. Robert Van der Zanden v. Stokely USA, Inc. (PACA N-8003 in the United
States Department of Agriculture).
Robert Van der Zanden filed a complaint with the United States
Department of Agriculture in March of 1995 which claims the Company
violated the Perishable Agricultural Commodities Act by rejecting a
quantity of green beans grown under contract with the Company by Mr. Van
der Zanden in 1994. Mr. Van der Zanden claims damages of $5,770.
Stokely has denied liability. An administrative decision on the claim
is forthcoming. The Company is represented in this matter by its general
counsel, Robert Brill.
4
<PAGE> 542
THREATENED LITIGATION
1. Middleton Refuse Hideaway. The Company has been named as a potentially
responsible party with regard to the Middleton Refuse Hideaway Landfill
Site in Dane County, Wisconsin. The Company believes its responsibility,
if any, is de minimus on the basis that it contributed no hazardous
materials to the landfill site and an insignificant volume of materials in a
volumetric ranking scheme.
The Company joined with several other de minimus parties to retain the
law firm of Michael Best and Friedrich of Madison, Wisconsin to represent
it with regard to this matter; although there is no legal action pending
against the Company at this time. This Company is currently negotiating a
de minimus settlement.
5
<PAGE> 543
ANNEX 3
(TO THIRD AMENDMENT)
DESCRIPTION OF IRB INDEBTEDNESS
IRB Indebtedness of the Company and its Subsidiaries outstanding on the
date hereof is as follows:
<TABLE>
<CAPTION>
ISSUE COUPON/RATE DATED PRINCIPAL MATURES BALANCE DUE OUTSTANDING
BALANCE
<S> <C> <C> <C> <C> <C> <C> <C>
DeForest (Town of Windsor) First Trust 6.000 01-Mar-85 1,500,000 01-Mar-95 0 0
1989 Poynette IRB NationsBK 7.750 01-Dec-89 1,600,000 O1-Dec-2004 1,600,000 1,600,000
City of Jefferson IRB NationsBK 8.500 15-Dec-85 6,500,000 15-Dec-95 700,000 700,000
County of Paulding IRB Society 7.375 01-Jun-89 1,400,000 6/1/99-7/5/94 0 0
Port of Walla Walla IRB NationsBK 8.250 01-Sep-90 4,000,000 01-Sep-2002 2,500,000 4,000,000
8.500 01-Sep-2005 1,500,000
Scottville IRB (MI Job) First Trust 3.960 16-Oct-84 1,800,000 01-Oct-94 0 0
Pickett IRB (Town of Utica) NationsBK 7.750 01-Jun-90 3,000,000 01-Jun-2005 3,000,000 3,000,000
Appleton IRB First Trust 3.960 01-Dec-85 1,000,000 01-Jun-95 50,000 350,000
01-Jan-96 300,000
1988 Poynette Kraut IRB Norwest 8.000 01-Aug-88 6,000,000 01-Aug-98 1,065,000 4,645,000
8.500 01-Aug-2001 3,580,000
Green Bay IRB NationsBK 8.000 01-Dec-88 3,000,000 01-Dec-98 3,000,000 3,000,000
Waunakee IRB NationsBK 8.000 01-Dec-88 4,000,000 01-Jul-2001 1,000,000 4,000,000
01-Jul-2002 1,000,000
01-Jul-2003 1,000,000
01-Jul-2004 1,000,000
Ackley IA IRB Norwest 7.750 01-Jul-89 3,000,000 01-Jul-2002 1,000,000 3,000,000
01-Jul-2004 1,000,000
01-Jul-2005 1,000,000
</TABLE>
Annex 3-1
<PAGE> 544
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
City of Wells First Trust 4.050 01-Dec-91 3,000,000 01-Dec-95 150,000 2,550,000
01-Dec-96 150,000
01-Dec-97 150,000
01-Dec-98 150,000
01-Dec-99 150,000
01-Dec-2000 150,000
01-Dec-2001 150,000
01-Dec-2002 150,000
01-Dec-2003 150,000
01-Dec-2004 150,000
01-Dec-2005 150,000
01-Dec-2006 150,000
01-Dec-2007 150,000
01-Dec-2008 150,000
01-Dec-2009 150,000
01-Dec-2010 150,000
01-Dec-2011 150,000
</TABLE>
Annex 3-2
<PAGE> 545
EXHIBIT A
[Michael Best & Friedrich Letterhead]
May 31, 1995
Nationwide Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43215
Employers Life Insurance Company of Wausau
One Nationwide Plaza
Columbus, Ohio 43215
West Coast Life Insurance Company
One Nationwide Plaza
Columbus, Ohio 43215
State of Wisconsin Investment Board
121 East Wilson Street
Madison, Wisconsin 53702
Ladies and Gentlemen:
We have served as counsel to Stokely USA, Inc., a Wisconsin corporation
(the "Borrower"), in connection with the execution and delivery of the
instruments and documents indentified on Exhibit A to this letter (collectively
the "Loan Documents," individual Loan Documents and other capitalized terms
used below being hereinafter referred to by the designations appearing on
Exhibit A).
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of all such corporate records of the Borrower, agreements
and other instruments, certificates of officers of the Borrower, certificates
of public officials, and other documents which we have deemed relevant and
necessary to render this opinion. In rendering this opinion, we have assumed
the genuineness of all signatures (other than those of officers of the
Borrower), the authenticity of all documents submitted to us as originals, the
conformity to originals of all documents submitted to us as copies, the due
execution of the Loan Documents by, and the enforceability of the Loan
Documents against, you, and the legal capacity of all natural persons. Whenever
this opinion refers to matters within our "knowledge," "known to us," or of
which we "know," such reference is limited to (i) the representations and
warranties of the Borrower as to factual matters contained in the Loan
Documents; and (ii) facts within our actual knowledge after an inquiry of the
attorneys of this firm who
<PAGE> 546
[Michael Best & Friedrich Letterhead]
May 31, 1995
Page 2
have provided legal services to the Borrower within the past year, without
further inquiry. Furthermore, we have not undertaken any further factual
investigation of the business, properties, agreements, or litigation of the
Borrower for purposes of rendering this opinion.
Based upon the foregoing, and subject to the qualifications stated
herein, we are of the opinion that:
1. The Borrower is a corporation existing under the laws of the
State of Wisconsin and, based solely on a certificate of status of the
Wisconsin Secretary of State, (a) has filed with the Wisconsin Secretary of
State during its most recently completed report year the required annual
report; (b) is not the subject of a proceeding under Wisconsin Statutes Section
180.1421 to cause its administrative dissolution; and (c) Articles of
Dissolution of the Borrower have not been filed with such Secretary of State.
2. The Borrower has the corporate power and authority to execute,
deliver, and perform its obligations under the Loan Documents.
3. The execution and delivery of the Loan Documents and the
performance by the Borrower of their terms do not and will not (i) contravene
any provisions of the Articles of Incorporation or Bylaws of the Borrower; (ii)
to our knowledge, contravene any presently existing provision of any law known
to us to be applicable to the Borrower; (iii) contravene any provision of any
agreement known to us under which the Borrower has borrowed money (except for
such violation or default as has been waived or consented to by the relevant
party thereto); (iv) to our knowledge, result in the creation or imposition of
any lien upon any of the property of the Borrower except pursuant to the Loan
Documents; or (v) require the consent or approval of, or any filing or
registration with, any governmental body, agency, or authority other than the
filing of the Financing Statements.
4. The Loan Documents have been duly authorized by all necessary
corporate action (no stockholder approval being required), have been executed
and delivered by the Borrower, and constitute valid and binding agreements of
the Borrower enforceable against it in accordance with their respective terms.
The Note Agreement dated as of December 1, 1991 between the Borrower and SWIB,
as amended by the SWIB Amendment, and the Note Agreement dated August 18, 1992
among the Borrower and the Insurance Companies, as amended by the Nationwide
Amendment, constitute valid
<PAGE> 547
[Michael Best & Friedrich Letterhead]
May 31, 1995
Page 3
and binding agreements of the Borrower enforceable against it in accordance
with their respective terms.
5. Each of the Security Agreement and the Assignment of Contracts,
Warranties and Permits is adequate to create and provide for the liens and
security interests contemplated thereby for the benefit and security of all the
indebtedness secured thereby. The description of the Collateral set forth in
the Financing Statements is sufficient to perfect, and upon the due filing
thereof in the offices noted in Exhibit A hereto will perfect, a security
interest in the items and types of Collateral in which a security interest may
be perfected by the filing of a financing statement under the Uniform
Commercial Code of the State of Wisconsin as in effect on the date hereof (the
"UCC") to the extent that (i) Wisconsin is the proper state for filing; (ii)
the Collateral consists of the type of property for which a security interest
may be perfected by filing a financing statement in Wisconsin under the
UCC; and (iii) any part of the Collateral or the proceeds or products thereof
does not constitute trust property or a trust fund which by virtue of federal
or state law is not subject to the claims, liens, or security interests of
creditors.
6. To our knowledge, there is no action, suit, proceeding, or
investigation at law or in equity before or by any court or public body pending
or threatened against or affecting the Borrower or any of its assets and
properties which, if adversely determined, could result in any material adverse
change in the properties, business, operations, or financial condition of the
Borrower or in the value of the collateral security for your loans and other
credit accommodations to the Borrower except as described in Annex 2 to each of
the Nationwide Amendment and the SWIB Amendment.
7. The rates of interest provided for under the Loan Documents and
any other amounts payable thereunder that would constitute interest would not
violate any usury law of the State of Wisconsin.
All of the foregoing opinions are subject to the following additional
assumptions, limitations, and qualifications:
(a) We express no opinion as to the effect of the compliance or
noncompliance by you with any state or federal laws or regulations applicable
to you because of legal or regulatory status or the nature of your business.
<PAGE> 548
[Michael Best & Friedrich Letterhead]
May 31, 1995
Page 4
(b) Our opinions relating to the enforceability of the Loan Documents
are subject to and limited by:
(i) Bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance, marshalling, and other similar laws now or
hereafter in effect relating to or affecting the rights and remedies of
creditors generally;
(ii) Limitations imposed by general principles of equity upon
the specific enforceability of any of the remedies or other provisions of
such documents and upon the availability of injunctive relief and other
equitable remedies (regardless of whether enforcement is considered in
proceedings at law or in equity);
(iii) The qualification that certain provisions of the Loan
Documents are or may be unenforceable in whole or in part under the laws
of the State of Wisconsin, but the inclusion of such provisions does not
render the Loan Documents invalid as a whole and there exist either in the
Loan Documents or under applicable law adequate remedies for the
practicable realization of the principal legal rights and benefits
intended to be provided thereby (except for the economic consequences of
any delay resulting from such unenforceability);
(iv) Such enforcement is subject to recent court decisions
which may require lenders to act reasonably and in good faith in exercising
their rights and remedies under the Loan Documents; and
(v) The provisions of the Mortgages which (A) purport to give
the mortgagee the right, prior to the date of confirmation of a foreclosure
sale by the court (assuming the mortgagee is a successful bidder at the
foreclosure sale), to take control of the real estate described in the
Mortgages, or which (B) purport to give the mortgagee the right, prior to
the date of confirmation of a foreclosure sale by the court (assuming the
mortgagee is a successful bidder at the foreclosure sale), to collect the
rents, issues, or profit thereof, are subject to acquiescence of the
Borrower after a default, unless the mortgagee obtains a court order and
the appointment of a receiver for such purpose. Such rights will not be
available in any event if the mortgagee elects certain redemption periods
pursuant to Wisconsin Statutes. We note that under Wisconsin law, despite
an assignment of rents, the equitable right to rent remains with the
mortgagor in
<PAGE> 549
[Michael Best & Friedrich Letterhead]
May 31, 1995
Page 5
the event of default, until such time as the mortgagee's interest in the rents
is perfected.
(c) We render no advice concerning and do not express any opinion as to:
(i) the priority of any security interest; or
(ii) items of Collateral which by operation of law cannot be subject to
a consensual security interest.
(d) We express no opinion as to the following:
(i) the Borrower's rights in or title to the Collateral;
(ii) any security interest that is terminated or released;
(iii) The effect of noncompliance with the federal Assignment of Claims
Act; or
(iv) future advances.
(e) In the case of property which becomes Collateral after the
date hereof, (i) Section 547 of the United States Bankruptcy Code provides that
a transfer is not made until the debtor has rights in the property transferred
so a security interest in after-acquired property may be treated as a voidable
preference under the conditions (and subject to the exceptions) provided by
Section 547; (ii) Chapter 128 of the Wisconsin Statutes contains a four-month
preference provision that may apply to after-acquired property; and (iii)
Section 552 of the United States Bankruptcy Code limits the extent to which
property acquired by a debtor after the commencement of a case under the United
States Bankruptcy Code may be subject to a security interest arising from a
security agreement entered into by the debtor before the commencement of such
case.
(f) In the case of any interest in or claim in or under any policy of
insurance covering the Collateral, the security interest of the secured party
therein is limited to proceeds payable to the named insured (and not to any
other party named as loss payee under such policy) by reason of loss or damage
to the Collateral insured under such insurance policies.
<PAGE> 550
[Michael Best & Friedrich Letterhead]
May 31, 1995
Page 6
(g) In the case of all Collateral in which the security interest of the
secured party has been perfected by the filing of the Financing Statements,
Article 9 of the UCC requires the filing of continuation statements within the
period of six months prior to the expiration of five years from the date of the
original filings in order to maintain the effectiveness of the filings referred
to in this paragraph.
(h) The duties to exercise reasonable care in the custody and
preservation of the Collateral in a secured party's possession and to deal with
and dispose of the collateral in a commercially reasonable manner as required
by the UCC may not be disclaimed by agreement, waived, or released.
We call to your attention that the perfection of the above security interests
will be terminated (i) as to any Collateral acquired by the Borrower more than
four months after the Borrower so changes its name, identity, or corporate
structure as to make any financing statements filed against such party
seriously misleading, unless new appropriate financing statements indicating
the new name, identity, or corporate structure of such party are properly
filed before the expiration of such four months; (ii) as to any Collateral
consisting of accounts or general intangibles, four months after the Borrower
changes its chief executive office to a new jurisdiction outside Wisconsin
unless such security interests are perfected in such new jurisdiction before
that termination; (iii) as against buyers of items of the Collateral consisting
of goods of the Borrower sold in the ordinary course of business; and (iv) as
to Collateral otherwise disposed of by the Borrower if such disposition is
authorized under the Loan Documents.
We express no opinion as to (i) any provision affording indemnification
to you; (ii) provisions imposing penalties, forfeitures, or increases in rates
of interest upon delinquency in any payment or upon any breach or default under
the Loan Documents; or (iii) broadly stated waivers of presentment, protest,
demand, notice, appraisement, valuation, stay, extension, moratorium,
redemption, marshalling of assets, or other rights granted by law to the extent
such waivers or rights are held to be against public policy or prohibited by
law.
This opinion deals only with the specific legal issues that it
explicitly addresses and no opinion shall be implied as to matters not so
addressed. The opinion expressed herein are specifically limited to the laws
of the State of Wisconsin and the federal laws of the United States. The
opinions expressed herein
<PAGE> 551
[Michael Best & Friedrich Letterhead]
May 31, 1995
Page 7
are given as of the date of this letter and are intended to apply only to those
facts and circumstances that exist as of the date hereof, and we assume no
obligation or responsibility to update or supplement this opinion to reflect
any facts or circumstances occurring after the date hereof that would alter the
opinions contained herein. This opinion is rendered solely for your
information and assistance in connection with the transactions described above
and may not be relied upon by any other person or for any other purpose without
our prior written consent.
Sincerely,
MICHAEL, BEST & FRIEDRICH
Michael, Best & Friedrich
<PAGE> 552
EXHIBIT A
THE LOAN DOCUMENTS
(All Loan Documents are dated as of May 31, 1995. The "Insurance
Companies" shall mean Nationwide Life Insurance Company, Employers Life
Insurance Company of Wausau, and West Coast Life Insurance Company. "SWIB"
shall mean State of Wisconsin Investment Board.)
1. Third Amendment to Note Agreement among the Borrower and the Insurance
Companies (the "Nationwide Amendment").
2. Third Amendment to Note Agreement between the Borrower and SWIB (the
"SWIB Amendment").
3. Security Agreement among the Borrower, the Insurance Companies, and
SWIB.
4. Mortgages executed by the Borrower in favor of the Insurance Companies
and SWIB.
5. Environmental Indemnification Agreement from the Borrower to the
Insurance Companies and SWIB.
6. Assignment of Contracts, Warranties and Permits from the Borrower to
the Insurance Companies and SWIB.
7. Intercreditor Agreement among the Insurance Companies and SWIB,
acknowledged by the Borrower.
8. UCC financing statements to be filed in the offices of the Wisconsin
Secretary of State and the Register of Deeds for the following Wisconsin
counties (the "Financing Statements"):
Brown Jefferson
Columbia Lincoln
Dane Waukesha
Iowa Winnebago
<PAGE> 553
EXHIBIT B
FORM OF OFFICERS' CERTIFICATE
STOKELY USA, INC.
CERTIFICATE OF OFFICERS
We, Stephen Theobald and Robert Brill, each hereby certify that we are,
respectively, the Vice Chairman and the Secretary of STOKELY USA, INC., a
Wisconsin corporation (the "Company"), and that, as such officers, we are
authorized to execute and deliver this Certificate in the name and on behalf of
the Company, and that:
1. This Certificate is being delivered pursuant to Section 3(b) of
the Third Amendment to Note Agreement (the "Third Amendment"), dated May 31,
1995, entered into by the Company and each of the noteholders listed on Annex 1
thereto (collectively, the "Noteholders").
2. The representations and warranties contained in Section 2 of
the Third Amendment are (except as affected by transactions contemplated by the
Third Amendment) true in all material respects on the date hereof with the same
effect as though made on and as of the date hereof.
3. The Company has performed and complied with all agreements and
conditions contained in the Third Amendment that are required to be performed or
complied with by the Company before or at the date hereof.
4. Robert Brill is on and as of the date hereof, and at all times
subsequent to ___, 1995 has been, the duly elected, qualified and acting
Secretary of the Company, and the signature appearing on the Certificate of
Secretary dated the date hereof and delivered to the Noteholders
contemporaneously herewith is his genuine signature.
IN WITNESS WHEREOF, we have executed this Certificate in the name and
on behalf of the Company and under its corporate seal this ___ day of May,
1995.
STOKELY USA, INC.
By: Stephen Theobald
---------------------------
Name: Stephen Theobald
By: Robert Brill
---------------------------
Name: Robert Brill
Exhibit B-1
<PAGE> 554
EXHIBIT C
FORM OF SECRETARY'S CERTIFICATE
STOKELY USA, INC.
CERTIFICATE OF SECRETARY
I, Robert Brill, hereby certify that:
(a) I am the duly elected, qualified and acting Secretary of STOKELY
USA, INC. (the "Company"), a Wisconsin corporation;
(b) Attached hereto as Attachment A is a true and complete copy of the
Articles of Incorporation of the Company, as in full force and effect on the
date hereof;
(c) Attached hereto as Attachment B is a true and complete copy of the
By-Laws of the Company, including all amendments thereto;
(d) Each person who, as an officer or director of the Company, signed any
of the agreements, instruments or documents in connection with the financing
arrangements described in the resolutions attached hereto was, at the
respective time of signing and the delivery thereof, duly elected, qualified
and acting as such officer or director;
(e) Attached hereto as Attachment C is a true and complete list of the
executive officers and directors of the Company. The signature set forth
opposite the name of each officer is his or her genuine signature; and
(f) Attached hereto as Attachment D is a true and complete copy of all
resolutions duly adopted by the Board of Directors and/or stockholders of the
Company with respect to the Third Amendment to Note Agreement dated May 31,
1995, among the Company and the noteholders listed on Annex 1 thereto, and all
transactions and documents contemplated thereby, including agreements and
documents relating to holders of the Company's long-term notes; such
resolutions have not been modified, amended, repealed or rescinded and remain
in full force and effect as of the date hereof; and such resolutions are the
only resolutions adopted by the Company's Board of Directors or stockholders
relating to the matters described therein.
IN WITNESS WHEREOF, I have hereunto set my hand this _ day of May, 1995.
STOKELY USA, INC.
-------------------------
Secretary
Exhibit C-1
<PAGE> 555
Attachment A
ARTICLES OF INCORPORATION
OF THE COMPANY
Intentionally Omitted
Exhibit C-2
<PAGE> 556
ATTACHMENT B
BY-LAWS OF THE COMPANY
Intentionally Omitted
Exhibit C-3
<PAGE> 557
Attachment C
LIST OF OFFICERS AND DIRECTORS
OF THE COMPANY
Intentionally Omitted
Exhibit C-4
<PAGE> 558
Attachment D
BOARD OF DIRECTORS
STOKELY USA, INC.
RESOLUTIONS ADOPTED
Intentionally Omitted
Exhibit C-5
<PAGE> 559
SECURED CREDIT AGREEMENT
AMONG
STOKELY USA, INC.
AND
HARRIS TRUST AND SAVINGS BANK
Individually and as Agent
AND
MERCANTILE BANK OF ST. LOUIS NATIONAL ASSOCIATION
SANWA BUSINESS CREDIT CORPORATION
GENERAL ELECTRIC CAPITAL CORPORATION
as Lenders
Dated as of May 22, 1995
5/22/95
<PAGE> 560
TABLE OF CONTENTS
STOKELY USA, INC.
SECURED CREDIT AGREEMENT
<TABLE>
<CAPTION>
SECTION DESCRIPTION PAGE
<S> <C> <C>
SECTION 1. THE CREDIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1. The Revolving Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2. The Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.3. Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.4. Conversion and Continuation of Loans . . . . . . . . . . . . . . . . . . . . 4
Section 1.5. Manner of Borrowing and Rate Selection . . . . . . . . . . . . . . . . . . . 5
Section 1.6. Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 1.7. Reimbursement Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1.8. Participation in L/Cs . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 1.9. Capital Adequacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 1.10. Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 2. FEES, PREPAYMENTS AND TERMINATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.1. Commitment Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.2. Agent's Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.3. Optional Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.4. Mandatory Prepayments; Borrowing Base . . . . . . . . . . . . . . . . . . . 9
Section 2.5. Closing Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.6. Collateral Collections . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 2.7. Terminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 3. PLACE AND APPLICATION OF PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 4. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 4.1. Certain Terms Defined . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 4.2. Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 5. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.1. Organization and Qualification . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.2. Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 5.3. Financial Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 5.4. Litigation; Tax Returns; Approvals . . . . . . . . . . . . . . . . . . . . 23
Section 5.5. Regulation U . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.6. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.7. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.8. Security Interests and Debt . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.9. Accurate Information . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
</TABLE>
-i-
<PAGE> 561
<TABLE>
<S> <C> <C>
Section 5.10. Corporate Authority and Validity of Obligations . . . . . . . . . . . . . 24
Section 5.11. Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 5.12. Restrictive Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 5.13. No Default under Other Agreements . . . . . . . . . . . . . . . . . . . . 24
Section 5.14. Status under Certain Laws . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 5.15. Federal Food Security Act . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 6. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.1. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.2. Initial Extension of Credit . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.3. Each Extension of Credit . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.4. Legal Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.5. Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 6.6. Lien Searches . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 7. COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 7.1. Maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 7.2. Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 7.3. Maintenance of Insurance . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 7.4. Financial Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 7.5. Inspection and Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 7.6. Consolidation and Merger . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 7.7. Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . 30
Section 7.8. Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 7.9. Tangible Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.10. Minimum Net Working Capital . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.11. Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.12. Dividends and Certain Other Restricted Payments . . . . . . . . . . . . . 31
Section 7.13. Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 7.14. Borrowings and Guaranties . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 7.15. Investments, Loans, Advances and Acquisitions . . . . . . . . . . . . . . 33
Section 7.16. Sale of Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 7.17. Notice of Suit, Adverse Change in Business or Default . . . . . . . . . . 35
Section 7.18. ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 7.19. Use of Loan Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 7.20. Conduct of Business and Maintenance of Existence . . . . . . . . . . . . . 35
Section 7.21. Compliance with Laws, etc. . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 7.22. Environmental Covenant . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 7.23. New Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 7.24. Sale and Leasebacks . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 7.25. Sale Clean-Up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 7.26. Subsidiary Assets and Operations . . . . . . . . . . . . . . . . . . . . . 37
Section 7.27. Compliance with Federal Food Security Act . . . . . . . . . . . . . . . . 37
Section 7.28. Additional Trademark Collateral . . . . . . . . . . . . . . . . . . . . . 37
</TABLE>
-ii-
<PAGE> 562
<TABLE>
<S> <C> <C>
SECTION 8. EVENTS OF DEFAULT AND REMEDIES . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.2. Remedies for Non-Bankruptcy Defaults . . . . . . . . . . . . . . . . . . . . 39
Section 8.3. Remedies for Bankruptcy Defaults . . . . . . . . . . . . . . . . . . . . . . 39
Section 8.4. L/Cs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 9. CHANGE IN CIRCUMSTANCES REGARDING EURODOLLAR LOANS . . . . . . . . . . . . 40
Section 9.1. Change of Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 9.2. Unavailability of Deposits or Inability to Ascertain the
Adjusted Eurodollar Rate . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 9.3. Taxes and Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 9.4. Funding Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 9.5. Lending Branch . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 9.6. Discretion of Bank as to Manner of Funding . . . . . . . . . . . . . . . . 42
SECTION 10. THE AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 10.1. Appointment and Powers . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 10.2. Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 10.3. General Immunity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 10.4. No Responsibility for Loans, Recitals, etc . . . . . . . . . . . . . . . . 43
Section 10.5. Right to Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 10.6. Action Upon Instructions of Banks . . . . . . . . . . . . . . . . . . . . . 43
Section 10.7. Employment of Agents and Counsel . . . . . . . . . . . . . . . . . . . . . 43
Section 10.8. Reliance on Documents; Counsel . . . . . . . . . . . . . . . . . . . . . . 44
Section 10.9. May Treat Payee as Owner . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 10.10. Agent's Reimbursement . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 10.11. Rights as a Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 10.12. Bank Credit Decision . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 10.13. Resignation of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 10.14. Removal of Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 10.15. Duration of Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 10.16. Certain Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 11. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 11.1. Amendments and Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 11.2. Waiver of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 11.3. Several Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 11.4. Non-Business Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 11.5. Survival of Indemnities . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 11.6. Documentary Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 11.7. Survival of Representations . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 11.8. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 11.9. Costs and Expenses; Indemnity . . . . . . . . . . . . . . . . . . . . . . . 47
</TABLE>
-iii-
<PAGE> 563
<TABLE>
<S> <C> <C>
Section 11.10. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 11.11. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 11.12. No Joint Venture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 11.13. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 11.14. Table of Contents and Headings . . . . . . . . . . . . . . . . . . . . . . 48
Section 11.15. Participants and Note Assignors . . . . . . . . . . . . . . . . . . . . . . 48
Section 11.16. Assignment of Commitments by Bank . . . . . . . . . . . . . . . . . . . . . 49
Section 11.17. Sharing of Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 11.18. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 11.19. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 11.20. Submission to Jurisdiction; Waiver of Jury Trial . . . . . . . . . . . . . 50
Signature Page . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Exhibit A Secured Revolving Credit Note
Exhibit B Form of Legal Opinion
Exhibit C Compliance Certificate
Exhibit D Borrowing Base Certificate
Exhibit E Application and Agreement for Standby Letter of Credit
Schedule 5.2 Subsidiaries
Schedule 5.4 Litigation
Schedule 5.15 Farm Product Purchases and Registrations
Schedule 7.13 Liens
-iv-
</TABLE>
<PAGE> 564
STOKELY USA, INC.
SECURED CREDIT AGREEMENT
Harris Trust and Savings Bank
Chicago, Illinois
Mercantile Bank of St. Louis
National Association
St. Louis, Missouri
Sanwa Business Credit Corporation
Chicago, Illinois
General Electric Capital Corporation
Chicago, Illinois
Ladies and Gentlemen:
The undersigned, STOKELY USA, INC., a Wisconsin corporation (the
"Company"), applies to you for your several commitment, subject to all the
terms and conditions hereof and on the basis of the representations and
warranties hereinafter set forth, to make a revolving credit (the "Revolving
Credit") available to the Company, all as more fully hereinafter set forth.
Each of you (and your respective successors and assigns) is hereinafter
referred to individually as "Bank" and collectively as "Banks." Harris Trust
and Savings Bank in its individual capacity is sometimes referred to herein as
"Harris", and in its capacity as Agent for the Banks is hereinafter in such
capacity called the "Agent."
SECTION 1. THE CREDIT.
Section 1.1. The Revolving Credit. (a) Subject to all of the terms and
conditions hereof, the Banks agree, severally and not jointly, to extend a
Revolving Credit to the Company which may be utilized by the Company in the
form of loans (individually a "Revolving Credit Loan" and collectively the
"Revolving Credit Loans"), and L/Cs (as hereinafter defined). The aggregate
principal amount of all Revolving Credit Loans under the Revolving Credit plus
the amount available for drawing under all L/Cs and the aggregate principal
amount of all unpaid Reimbursement Obligations (as hereinafter defined) at any
time outstanding shall not exceed the lesser of (i) the sum of the Banks'
Revolving Credit Commitments (as hereinafter defined) in effect from time to
time during the term of this Agreement (as hereinafter defined) or (ii) the
Borrowing Base. The Revolving Credit shall be available to the Company, and
may be availed of by the Company from time to time, be repaid (subject to the
restrictions on prepayment set forth herein) and used again, during the period
from the date hereof to and including July 31, 1998 (the "Termination Date").
<PAGE> 565
(b) At any time not earlier than August 31, 1997, nor later than
December 31, 1997, (the "Extension Request Date"), the Company may request
that the Banks extend the then scheduled Termination Date to the date one year
from such Termination Date. If such request is made by the Company each Bank
shall inform the Agent of its willingness to extend the Termination Date no
later than 30 days after the Banks receive such request. The Banks shall have
the right in their sole discretion to determine whether to grant any requested
extension of the Termination Date. Any Bank's failure to respond by such date
shall indicate its unwillingness to agree to such requested extension, and all
Banks must approve any requested extension. At any time more than 30 days
after such Extension Request Date the Banks may propose, by written notice to
the Company, an extension of this Agreement to such later date on such terms
and conditions as the Banks may then require. If the extension of this
Agreement to such later date is acceptable to the Company on the terms and
conditions proposed by the Banks, the Company shall notify the Banks of its
acceptance of such terms and conditions no later than 30 days after the date of
the Banks' written notice to the Company, and such later date will become the
Termination Date hereunder and this Agreement shall otherwise be amended in the
manner described in the Banks' notice proposing the extension of this Agreement
upon the Agent's receipt of (i) an amendment to this Agreement signed by the
Company and all of the Banks, (ii) resolutions of the Company's Board of
Directors authorizing such extension and (iii) an opinion of counsel to the
Company equivalent in form and substance to the form of opinion attached hereto
as Exhibit B and otherwise acceptable to the Banks.
(c) The respective maximum aggregate principal amounts of the
Revolving Credit at any one time outstanding and the percentage of the
Revolving Credit available at any time which each Bank by its acceptance
hereof severally agrees to make available to the Company are as follows
(collectively, the "Revolving Credit Commitments" and individually, a
"Revolving Credit Commitment"):
<TABLE>
<S> <C> <C>
Harris Trust and Savings Bank $20,000,000 30.76923076%
Mercantile Bank of St. Louis
National Association $ 5,000,000 7.69230769%
Sanwa Business Credit Corporation $12,500,000 19.23076923%
General Electric Capital Corporation $27,500,000 42.30769230%
-----------
Total $65,000,000 100%
</TABLE>
(d) Loans under the Revolving Credit may be Eurodollar Loans or
Domestic Rate Loans. All Loans under the Revolving Credit shall be made from
each Bank in proportion to its respective Revolving Credit Commitment as above
set forth. Each Domestic Rate Loan shall be in an amount not less than
$100,000 or such greater amount which is an integral multiple of $10,000 and
each Eurodollar Loan shall be in an amount not less than $1,000,000 or such
greater amount which is an integral multiple of $500,000.
(e) The initial borrowing under this Agreement shall be in an
amount sufficient to pay all amounts outstanding under that Loan and Security
Agreement dated as of August 18, 1992 (the "Existing Agreement") between the
Company, Shawmut Capital Corporation, as successor to Barclay's Business Credit
Inc., as agent and lender, and the other lenders named
-2-
<PAGE> 566
therein (the "Existing Lenders"). The Company shall apply the proceeds of the
initial borrowing hereunder to pay all amounts outstanding under the Existing
Agreement.
Section 1.2. The Notes. All Revolving Credit Loans made by each
Bank hereunder shall be evidenced by a single Secured Revolving Credit Note of
the Company payable to the order of such Bank substantially in the form of
Exhibit A hereto (individually, a "Revolving Note" and together, the "Revolving
Notes") in the principal amount of such Bank's Revolving Credit Commitment, but
the aggregate principal amount of indebtedness evidenced by such Revolving Note
at any time shall be, and the same is to be determined by, the aggregate
principal amount of all Revolving Credit Loans outstanding made by such Bank to
the Company pursuant hereto on or prior to the date of determination. Each
Revolving Note shall be dated as of the execution date of this Agreement, shall
be delivered concurrently herewith, and shall be expressed to mature on the
Termination Date and to bear interest as provided in Section 1.3 hereof. Each
Bank shall record on its books or records or on a schedule to its Revolving
Note the amount of each Revolving Credit Loan made by it hereunder, whether
each Revolving Credit Loan is a Domestic Rate Loan or Eurodollar Loan, and,
with respect to Eurodollar Loans, the interest rate and Interest Period
applicable thereto, and all payments of principal and interest and the
principal balance from time to time outstanding, provided that prior to any
transfer of such Revolving Note all such amounts shall be recorded on a
schedule to such Revolving Note. The record thereof, whether shown on such
books or records or on the schedule to the Revolving Note, shall be prima facie
evidence as to all such amounts; provided, however, that the failure of any
Bank to record or any mistake in recording any of the foregoing shall not limit
or otherwise affect the obligation of the Company to repay all Revolving Credit
Loans made hereunder together with accrued interest thereon. Upon the request
of any Bank, the Company will furnish a new Revolving Note to such Bank to
replace its outstanding Revolving Note and at such time the first notation
appearing on the schedule on the reverse side of, or attached to, such
Revolving Note shall set forth the aggregate unpaid principal amount of
Revolving Credit Loans then outstanding from such Bank, and, with respect to
each Eurodollar Loan, the interest rate and Interest Period applicable thereto.
Such Bank will cancel the outstanding Revolving Note upon receipt of the new
Revolving Note.
Section 1.3 Interest Rates. (a) Domestic Rate Loans. Each
Domestic Rate Loan shall bear interest (computed on the basis of a year of 360
days and actual days elapsed) on the unpaid principal amount thereof from the
date such Loan is made until maturity (whether by acceleration, upon prepayment
or otherwise) at a rate per annum equal to the sum of the Applicable Rate plus
the Domestic Rate from time to time in effect, payable monthly in arrears on
the last day of each calendar month, commencing on the first of such dates
occurring after the date hereof and at maturity (whether by acceleration, upon
prepayment or otherwise).
(b) Eurodollar Loans. Each Eurodollar Loan under the Revolving
Credit shall bear interest (computed on the basis of a year of 360 days and
actual days elapsed) on the unpaid principal amount thereof from the date such
Loan is made until the last day of the Interest Period applicable thereto or, if
earlier, until maturity (whether by acceleration or otherwise) at a rate per
annum equal to the sum of the Applicable Rate plus the Adjusted
-3-
<PAGE> 567
Eurodollar Rate, payable on the last day of each Interest Period applicable
thereto and at maturity (whether by acceleration or otherwise) and, with
respect to Eurodollar Loans with an Interest Period in excess of three months,
on the date occurring every three months from the first day of the Interest
Period applicable thereto.
(c) Default Rate. If any payment of principal or interest on any
Loan or Reimbursement Obligation is not made when due (including any payment
due upon acceleration), all Loans and Reimbursement Obligations shall bear
interest (computed on the basis of a year of 360 days and actual days elapsed)
from the date such payment was due until paid in full, payable on demand, at a
rate per annum equal to:
(i) with respect to any Domestic Rate Loan and Reimbursement
Obligation, the sum of 3% plus the Applicable Rate plus the Domestic
Rate from time to time in effect; and
(ii) with respect to any Eurodollar Loan, the sum of 3% plus
the Applicable Rate plus the Adjusted Eurodollar Rate applicable
thereto at the time of such default until the end of the Interest
Period then applicable thereto, and, thereafter, at a rate per annum
equal to the sum of 3% plus the Applicable Rate plus the Domestic Rate
from time to time in effect.
Section 1.4. Conversion and Continuation of Loans. (a) Provided that
no Event of Default or Potential Default has occurred and is continuing, the
Company shall have the right, subject to the other terms and conditions of this
Agreement, to continue in whole or in part (but, if in part, in the minimum
amount specified for Eurodollar Loans in Section 1.1 hereof) any Eurodollar
Loan from any current Interest Period into a subsequent Interest Period,
provided that the Company shall give the Agent notice of the continuation of
any such Loan as provided in Section 1.5 hereof.
(b) In the event that the Company fails to give notice pursuant to
Section 1.5 hereof of the continuation of any Eurodollar Loan or fails to
specify the Interest Period applicable thereto, or an Event of Default or
Potential Default has occurred and is continuing at the time any such Loan is
to be continued hereunder, then such Loan shall be automatically converted to
(and the Company shall be deemed to have given notice requesting) a Domestic
Rate Loan, subject to Sections 1.5(b), 8.2 and 8.3 hereof, unless paid in full
on the last day of the then applicable Interest Period.
(c) Provided that no Event of Default or Potential Default has
occurred and is continuing, the Company shall have the right, subject to the
terms and conditions of this Agreement, to convert Loans of one type (in whole
or in part) into Loans of another type from time to time provided that: (i) the
Company shall give the Agent notice of each such conversion as provided in
Section 1.5 hereof, (ii) the principal amount of any Loan converted hereunder
shall be in an amount not less than the minimum amount specified for the type
of Loan in Section 1.1 hereof, (iii) after giving effect to any such conversion
in part, the principal amount of any Eurodollar Loan then outstanding shall not
be less than the minimum amount specified for the type of Loan in Section 1.1
hereof, (iv) any conversion
-4-
<PAGE> 568
of a Loan hereunder shall only be made on a Business Day, and (v) any
Eurodollar Loan may be converted only on the last day of the Interest Period
then applicable thereto.
Section 1.5. Manner of Borrowing and Rate Selection. (a) The Company
shall give telephonic, telex or telecopy notice to the Agent (which notice, if
telephonic, shall be promptly confirmed in writing) no later than (i) 10:30
a.m. (Chicago time) on the date the Banks are requested to make each Domestic
Rate Loan, and (ii) 10:30 a.m. (Chicago time) on the date at least three (3)
Business Days prior to the date of (A) each Eurodollar Loan which the Banks are
requested to make or continue, and (B) the conversion of any Domestic Rate Loan
into a Eurodollar Loan. Each such notice shall specify the date of the Loan
requested (which shall be a Business Day), the amount of such Loan, whether the
Loan is to be made available by means of a Domestic Rate Loan or Eurodollar
Loan and, with respect to Eurodollar Loans, the Interest Period applicable
thereto; provided, that in no event shall the principal amount of any requested
Revolving Credit Loan plus the aggregate principal or face amount, as
appropriate, of all Loans, L/Cs, and unpaid Reimbursement Obligations
outstanding hereunder exceed the amounts specified in Section 1.1 hereof. The
Company agrees that the Agent may rely on any such telephonic, telex or
telecopy notice given by any person who the Agent believes is authorized to
give such notice without the necessity of independent investigation and in the
event any notice by such means conflicts with the written confirmation, such
notice shall govern if any Bank has acted in reliance thereon. The Agent
shall, no later than 11:30 a.m. (Chicago time) on the day any such notice is
received by it, give telephonic, telex or telecopy (if telephonic, to be
confirmed in writing within one Business Day) notice of the receipt of notice
from the Company hereunder to each of the Banks, and, if such notice requests
the Banks to make, continue or convert any Eurodollar Loans, the Agent shall
confirm to the Company by telephonic, telex or telecopy means, which
confirmation shall be conclusive and binding on the Company in the absence of
manifest error, the Interest Period and the interest rate applicable thereto
promptly after such rate is determined by the Agent.
(b) Subject to the provisions of Section 6 hereof, the proceeds of
each Loan shall be made available to the Company at the principal office of the
Agent in Chicago, Illinois, in immediately available funds, on the date such
Loan is requested to be made, except to the extent such Loan represents (i) the
conversion of an existing Loan or (ii) a refinancing of a Reimbursement
Obligation, in which case each Bank shall record such conversion on the
schedule to its Revolving Note, or in lieu thereof, on its books and records,
and shall effect such conversion or refinancing, as the case may be, on behalf
of the Company in accordance with the provisions of Section 1.4(a) hereof and
1.7 hereof, respectively. Not later than 2:00 p.m. Chicago time, on the date
specified for any Loan to be made hereunder, each Bank shall make its portion
of such Loan available to the Company in immediately available funds at the
principal office of the Agent, except (i) as otherwise provided above with
respect to converting or continuing any outstanding Loans and (ii) to the
extent such Loan represents a refinancing of any outstanding Reimbursement
Obligations.
(c) Unless the Agent shall have been notified by a Bank prior to
12:00 noon (Chicago time) on the date a Loan is to be made by such Bank (which
notice shall be effective upon receipt) that such Bank does not intend to make
the proceeds of such Loan
-5-
<PAGE> 569
available to the Agent, the Agent may assume that such Bank has made such
proceeds available to the Agent on such date and the Agent may in reliance upon
such assumption (but shall not be required to) make available to the Company a
corresponding amount. If such corresponding amount is not in fact made
available to the Agent by such Bank, the Agent shall be entitled to receive
such amount on demand from such Bank (or, if such Bank fails to pay such amount
forthwith upon such demand, to recover such amount, together with interest
thereon at the rate otherwise applicable thereto under Section 1.3 hereof, from
the Company) together with interest thereon in respect of each day during the
period commencing on the date such amount was made available to the Company and
ending on the date the Agent recovers such amount, at a rate per annum equal to
the effective rate charged to the Agent for overnight Federal funds
transactions with member banks of the Federal Reserve System for each day, as
determined by the Agent (or, in the case of a day which is not a Business Day,
then for the preceding Business Day) (the "Fed Funds Rate"); provided that the
Agent shall be entitled to retain only a single satisfaction pursuant hereto.
Nothing in this Section 1.5(c) shall be deemed to permit any Bank to breach its
obligations to make Loans under the Revolving Credit or to limit the Company's
claims against any Bank for such breach.
Section 1.6. (a) Letters of Credit. Subject to all the terms and
conditions hereof, satisfaction of all conditions precedent to borrowing under
this Agreement and so long as no Potential Default or Event of Default is in
existence, at the Company's request Harris shall issue letters of credit (an
"L/C" and collectively the "L/Cs") for the account of the Company subject to
availability under the Revolving Credit, and the Banks hereby agree to
participate therein as more fully described in Section 1.8 hereof. Each L/C
shall be issued pursuant to a reimbursement agreement or an application and
agreement for letter of credit (the "L/C Agreement") in Harris' customary form
at the time such L/C is requested, shall conform to the general requirements of
Harris for the issuance of letters of credit as to form and substance, shall be
in U.S. Dollars and shall be a letter of credit which Harris may lawfully
issue. The L/Cs shall consist of standby letters of credit in an aggregate
face amount not to exceed $15,000,000. Each L/C shall have an expiry date not
more than thirteen (13) months from the date of issuance thereof (but in no
event later than the Termination Date). The amount available to be drawn under
each L/C issued pursuant hereto shall be deducted from the credit otherwise
available under the Revolving Credit. In consideration of the issuance of L/Cs
the Company agrees to pay Harris a fee (the "L/C Issuance Fee") in the amount
per annum (computed on the basis of a 360-day year and actual days elapsed)
equal to 1.25% of the stated amount of each standby L/C issued hereunder. In
addition the Company shall pay Harris for its own account for each L/C such
drawing, negotiation, amendment and other administrative fees in connection
with each L/C as may be established by Harris from time to time (the "L/C
Administrative Fee"). All L/C Issuance Fees will be payable quarterly in
arrears on the last day of each calendar quarter and all L/C Administrative
Fees shall be payable on the date of issuance of each L/C hereunder, on the
date of each extension, if any, of the expiry date of each L/C and on the date
of each drawing under or amendment of each L/C.
(b) Upon the satisfaction of all conditions precedent to the
initial Loan or L/C hereunder, without any further action on the part of the
Company, Harris, the Agent or any
-6-
<PAGE> 570
Bank, (i) that certain Irrevocable Letter of Credit Number SPL34631 dated May
17, 1995 issued by Harris for the account of the Company to NBD Bank shall
constitute an L/C issued under this Agreement for all purposes hereof, (ii) the
Application and Agreement for Standby Letter of Credit dated May 17, 1995 from
the Company to Harris relating to such letter of credit (the "Initial L/C
Agreement") shall constitute an L/C Agreement for all purposes of this
Agreement, and (iii) all of the Company's indebtedness, obligations and
liabilities to Harris under the Initial L/C Agreement shall constitute
Reimbursement Obligations for all purposes of this Agreement.
(c) Upon the satisfaction of all conditions precedent to the
Initial Loan or L/C hereunder, the Initial L/C Agreement shall be amended by
(i) deleting the phrase ", or if so demanded by you, on demand in advance of
any drawing or maturity" appearing in the last line of numbered paragraph 1
thereof, (ii) numbered paragraphs 3, 4 and 7 thereof shall be deleted, and
(iii) the phrase "and in addition to the provisions of paragraph numbered 7
hereof" appearing in the first line of numbered paragraph 10 thereof shall be
deleted.
Section 1.7. Reimbursement Obligation. The Company is obligated,
and hereby unconditionally agrees, to pay in immediately available funds to the
Agent for the account of Harris and the Banks who are participating in L/Cs
pursuant to Section 1.8 hereof the face amount of each draft drawn and
presented under an L/C issued by Harris hereunder not later than 10:30 a.m.
(Chicago Time) on the date such draft is presented for payment to Harris (the
obligation of the Company under this Section 1.7 with respect to any L/C is a
"Reimbursement Obligation"). If at any time the Company fails to pay any
Reimbursement Obligation when due, the Company shall be deemed to have
automatically requested a Domestic Rate Loan from the Banks hereunder, as of
the maturity date of such Reimbursement Obligation, the proceeds of which Loan
shall be used to repay such Reimbursement Obligation. Such Loan shall only be
made if no Potential Default or Event of Default shall exist and upon approval
by all of the Banks, and shall be subject to availability under the Revolving
Credit. If such Loan is not made by the Banks for any reason, the unpaid
amount of such Reimbursement Obligation shall be due and payable to the Agent
for the pro rata benefit of the Banks upon demand and shall bear interest at
the rate of interest specified in Section 1.3(c)(i) hereof.
Section 1.8. Participation in L/Cs. Each of the Banks will
acquire a risk participation for its own account, without recourse to or
representation or warranty from Harris, in each L/C upon the issuance thereof
ratably in accordance with its Commitment Percentage. In the event any
Reimbursement Obligation is not immediately paid by the Company pursuant to
Section 1.7 hereof, each Bank will pay to Harris funds in an amount equal to
such Bank's ratable share of the unpaid amount of such Reimbursement Obligation
(based upon its proportionate share relative to its percentage of the Revolving
Credit (as set forth in Section 1.1 hereof)). At the election of all of the
Banks, such funding by the Banks of the unpaid Reimbursement Obligations shall
be treated as additional Revolving Credit Loans to the Company hereunder rather
than a purchase of participation by the Banks in the related L/Cs held by
Harris. The availability of funds to the Company under the Revolving Credit
shall be reduced in an amount equal to the amount available to be drawn under
each L/C. The obligation of the Banks to Harris under this Section 1.8 shall
be absolute and
-7-
<PAGE> 571
unconditional and shall not be affected or impaired by any Event of Default or
Potential Default which may then be continuing hereunder. Harris shall notify
each Bank by telephone of its proportionate share relative to its percentage of
the total Banks' Revolving Credit Commitments set forth in Section 1.1 hereof
(a "Commitment Percentage") of such unpaid Reimbursement Obligation. If such
notice has been given to each Bank by 11:00 a.m., Chicago time, each Bank
agrees to pay Harris in immediately available and freely transferable funds on
the same Business Day. If such notice is received on a day other than a
Business Day or after 11:00 a.m., Chicago time, on a Business Day, each Bank
agrees to pay Harris in immediately available and freely transferable funds no
later than the following Business Day. Funds shall be so made available at the
account designated by Harris in such notice to the Banks. Upon the election by
the Banks to treat such funding as additional Revolving Credit Loans hereunder
and payment by each Bank, such Loans shall bear interest in accordance with
Section 1.3(a) hereof. Harris shall share with each Bank on a pro rata basis
relative to its Commitment Percentage a portion of each payment of a
Reimbursement Obligation (whether of principal or interest) and any L/C
Issuance Fee (but not any L/C Administrative Fee) payable by the Company. Any
such amount shall be promptly remitted to the Banks when and as received by
Harris from the Company.
Section 1.9. Capital Adequacy. If, after the date hereof, any Bank
or the Agent shall have determined in good faith that the adoption of any
applicable law, rule or regulation regarding capital adequacy, or any change
therein (including, without limitation, any revision in the Final Risk-Based
Capital Guidelines of the Board of Governors of the Federal Reserve System (12
CFR Part 208, Appendix A; 12 CFR Part 225, Appendix A) or of the Office of the
Comptroller of the Currency (12 CFR Part 3, Appendix A), or in any other
applicable capital rules heretofore adopted and issued by any governmental
authority), or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Lending Office) with any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Bank's capital, or on the capital of any corporation controlling such
Bank, in each case as a consequence of its obligations hereunder to a level
below that which such Bank would have achieved but for such adoption, change or
compliance (taking into consideration such Bank's policies with respect to
capital adequacy) by an amount reasonably deemed by such Bank to be material,
then from time to time, within fifteen (15) days after demand by such Bank
(with a copy to the Agent), the Company shall pay to such Bank such additional
amount or amounts as will compensate such Bank for such reduction. Any Bank
requesting compensation pursuant to this Section shall submit a certificate to
the Company setting forth the calculation of the amount so requested, and such
certificate shall be conclusive and binding on the Company as to the amount
thereof except in the case of manifest errors, so long as such determination is
made on a reasonable basis.
Section 1.10. Collateral. The payment and performance of the
Obligations shall be secured by all of the Company's accounts, chattel paper,
documents, instruments, general intangibles, inventory, and certain other
assets and property of the Company, whether now owned or held or hereafter
acquired or arising, pursuant to that certain Security Agreement
-8-
<PAGE> 572
dated of even date herewith from the Company to the Agent, as the same may be
amended, modified or supplemented from time to time (the "Security Agreement").
SECTION 2. FEES, PREPAYMENTS AND TERMINATIONS.
Section 2.1. Commitment Fee. From and after the earlier of the
initial Loan or L/C hereunder or May 31, 1995, to the Termination Date, the
Company shall pay to the Agent for the account of the Banks a commitment fee
with respect to the Revolving Credit at the Applicable Rate (computed in each
case on the basis of a year of 360 days for the actual number of days elapsed)
of the average daily unused amount of the Banks' Revolving Credit Commitment
hereunder in effect from time to time, all such fees to be payable quarterly in
arrears on the last day of each calendar quarter commencing on the last day of
June, 1995, and on the Termination Date, unless the Revolving Credit is
terminated in whole on an earlier date, in which event the commitment fee for
the final period shall be paid on the date of such earlier termination in
whole.
Section 2.2. Agent's Fee. The Company shall pay to and for the
sole account of the Agent such fees as may be agreed upon in writing from time
to time by the Agent and the Company. Such fees shall be in addition to any
fees and charges the Agent may be entitled to receive under Section 10
hereunder or under the other Loan Documents.
Section 2.3. Optional Prepayments. The Company shall have the
privilege of prepaying without premium or penalty and in whole or in part (but
if in part, then in a minimum principal amount of $100,000 or such greater
amount which is an integral multiple of $10,000) any Domestic Rate Loan at any
time upon prior telex or telephonic notice to the Agent on or before 12:00 noon
on the same Business Day. The Company may not prepay any Eurodollar Loan. Any
amount prepaid under the Revolving Credit may, subject to the terms and
conditions of this Agreement, be borrowed, repaid and borrowed again.
Section 2.4. Mandatory Prepayments; Borrowing Base. The Company
shall not permit the sum of the principal amount of all Loans plus the amount
available for drawing under all L/Cs and the aggregate principal amount of all
unpaid Reimbursement Obligations at any time outstanding to exceed the lesser
of (i) the sum of the Banks' Revolving Credit Commitments or (ii) the Borrowing
Base. In addition to the Company's obligations to pay any outstanding
Reimbursement Obligations as set forth in Section 1.7 hereof, the Company will
make such payments on any outstanding Loans and Reimbursement Obligations (and,
if any L/Cs are then outstanding, deposit an amount equal to the aggregate face
amount of all such L/Cs into an account with the Agent which shall be held as
additional collateral security for such L/Cs) which are necessary to cure any
such excess within one Business Day after the occurrence thereof. Any amount
prepaid under the Revolving Credit may, subject to the terms and conditions of
this Agreement, be borrowed, prepaid and borrowed again.
Section 2.5. Closing Fee. The Company shall pay to the Agent for
the account of the Banks a closing fee in the amount equal to 0.375% of the
Revolving Credit Commitment of each Bank with a Revolving Credit Commitment of
$25,000,000 or more and 0.25% of the
-9-
<PAGE> 573
Revolving Credit Commitment of all other Banks, which fee shall be payable on
the date of the execution and delivery of this Agreement.
Section 2.6. Collateral Collections. The Company agrees to
forthwith make such arrangements as shall be necessary or appropriate to assure
that all proceeds of all Collateral, including without limitation the Inventory
and Receivables of the Company, are promptly deposited (in the same form as
received) in an account maintained with the Agent, such account to constitute a
special restricted account (the "Restricted Account"). The Company
acknowledges that the Agent has (and is hereby granted to the extent that it
does not already have) a lien on such account and all funds contained therein
to secure the indebtedness, obligations and liabilities of the Company under
the Loan Documents. The Company irrevocably authorizes and directs that all
amounts from time to time deposited in the Restricted Account maintained with
the Agent be applied as and when received (but not less often than once each
Business Day) against the Revolving Credit Loans and Reimbursement Obligations;
provided, however, that if at the time of application there are no outstanding
Revolving Credit Loans and Reimbursement Obligations or the amount on deposit
in such accounts is in excess of the amount necessary to prepay the Revolving
Credit Loans and Reimbursement Obligations in full, then such payment or excess
(as appropriate) shall be held in the Restricted Account or in an investment
account in which the Agent has a first priority perfected lien until needed by
the Company in the ordinary course of its business (including making
expenditures and investments permitted by this Agreement), and all such amounts
shall be held by the Agent as additional collateral security for any other
remaining indebtedness, obligations and liabilities of the Company under the
Loan Documents. The Agent shall not in any event setoff any amount at any time
on deposit in the Restricted Account or any such investment account against any
indebtedness, obligations and liabilities of the Company to it except for any
such arising under the Loan Documents.
Section 2.7. Terminations. The Company shall have the right at
any time upon thirty (30) days' prior notice to the Agent to terminate the
unused Revolving Credit in whole or in part (and if in part, in a minimal
amount of $1,000,000 or any integral multiple thereof), provided, however, that
the Company may not terminate any portion of the Revolving Credit which remains
available for payment under any L/C. Not later than the termination date
stated in such notice, the Company shall prepay Reimbursement Obligations and
the Revolving Notes in an aggregate principal amount equal to the excess, if
any, of all amounts outstanding under the Revolving Credit (including the
amount of outstanding L/Cs) over the Revolving Credit in effect after giving
effect to such reduction, subject to the terms of Section 9.4 hereof, and shall
also pay the interest on such principal amount and accrued and unpaid
commitment fees thereon to such termination date.
SECTION 3. PLACE AND APPLICATION OF PAYMENTS.
All amounts payable by the Company hereunder, shall be made to the
Agent at its office at 111 West Monroe Street, Chicago, Illinois 60690 and in
immediately available funds, prior to 12:00 noon on the date of such payment.
All such payments shall be made without setoff or counterclaim and without
reduction for, and free from, any and all present and future levies, imposts,
duties, fees, charges, deductions withholdings, restrictions or
-10-
<PAGE> 574
conditions of any nature imposed by any government or any political subdivision
or taxing authority thereof. Unless the Banks otherwise agree, any payments
received after 12:00 noon Chicago time shall be deemed received on the
following Business Day. The Agent shall remit to each Bank its proportionate
share of each payment of principal, interest and commitment fees and L/C
Issuance Fees received by the Agent by 3:00 P.M. Chicago time on the same day
of its receipt if received by the Agent by 12:00 noon, Chicago time, and its
proportionate share of each such payment received by the Agent after 12:00 noon
on the Business Day following its receipt by the Agent. In the event the Agent
does not remit any amount to any Bank when required by the preceding sentence,
the Agent shall pay to such Bank interest on such amount until paid at a rate
per annum equal to the Fed Funds Rate. In addition to the Agent's rights under
Section 2.6 hereof, the Company hereby authorizes the Agent to automatically
debit its account with Harris for any principal, interest and fees when due
under the Notes, any L/C Agreement or this Agreement and to transfer the amount
so debited from such account to the Agent for application as herein provided.
All proceeds of Collateral shall be applied in the manner specified in Section
2.6 hereof and in the Security Agreement.
SECTION 4. DEFINITIONS.
Section 4.1. Certain Terms Defined. The terms hereinafter set
forth when used herein shall have the following meanings:
"Account Debtor" shall mean the Person who is obligated on a
Receivable.
"Adjusted Eurodollar Rate" means a rate per annum determined pursuant
to the following formula:
Adjusted Eurodollar Rate = Eurodollar Rate
-------------------------------
100% - Reserve Percentage
"Affiliate" shall mean any person, firm or corporation which, directly
or indirectly controls, or is controlled by, or is under common control with,
the Company.
"Agent" is defined in the first paragraph of this Agreement.
"Agreement" shall mean this Secured Credit Agreement as supplemented,
modified, restated and amended from time to time.
"Applicable Rate" shall mean, with respect to each type of Loan
described in each row below and the commitment fee payable pursuant to Section
2.1 hereof, (a) from the date of this Agreement through May 31, 1996, the rates
set forth in Column C below, and (b) after May 31, 1996, the rate of interest
per annum shown in Columns A, B and C below for the range of Leverage Ratio
specified for each Column:
-11-
<PAGE> 575
<TABLE>
<CAPTION>
A B C
<S> <C> <C> <C>
LEVERAGE <50% >50% and < >60%
RATIO - 60% -
DOMESTIC RATE 0.% 0% .50%
LOANS
EURODOLLAR 1.25% 1.75% 2.00%
LOANS
COMMITMENT 0.20% 0.25% 0.375%
FEE
</TABLE>
Not later than 5 Business Days after receipt by the Agent of the financial
statements called for by Section 7.4(a) or (b) hereof for the last month of the
applicable fiscal quarter, the Agent shall determine the Leverage Ratio for the
applicable period and shall promptly notify the Company and the Banks of such
determination and of any change in the Applicable Rate resulting therefrom.
Any such change in the Applicable Rate shall be effective as of the date the
Agent so notifies the Company and the Banks with respect to all Loans
outstanding on such date and the commitment fee, and such new Applicable Rate
shall continue in effect until the effective date of the next quarterly
redetermination in accordance with this Section. Each determination of the
Leverage Ratio and Applicable Rate by the Agent in accordance with this Section
shall be conclusive and binding on the Company and the Banks absent manifest
error.
"Bank" and "Banks" shall have the meanings specified in the first paragraph
of this Agreement.
"Borrowing Base", as determined by the Agent on the basis of the information
contained in the most recent Borrowing Base Certificate and any other
information available to the Agent, shall mean an amount equal to:
(a) 85% of the amount of Eligible Receivables, plus
(b) 65% of the Value of Eligible Inventory, minus
(c) the aggregate outstanding amount of all Secured Grower
Payables, minus
(d) any storage fees relating to Inventory that remain unpaid
after their due date.
"Borrowing Base Certificate" shall mean the certificate in the form of
Exhibit D hereto which is required to be delivered to the Banks in accordance
with Section 7.4(d) hereof.
-12-
<PAGE> 576
"Business Day" shall mean a day on which banks are open for business
in Chicago, Illinois, other than a Saturday or Sunday, and, with respect to
Eurodollar Loans, dealing in United States Dollar deposits in London, England
and Nassau, Bahamas.
"Capitalized Lease" shall mean, as applied to any Person, any lease of
any Property the discounted present value of the rental obligations of such
person as lessee under which, in accordance with generally accepted accounting
principles, is required to be capitalized on the balance sheet of such Person.
"Capitalized Lease Obligation" shall mean, as applied to any Person,
the discounted present value of the rental obligation, as aforesaid, under any
Capitalized Lease.
Change in Law" shall have the meaning specified in Section 9.3 hereof.
"Change of Control" shall mean at any time any person or group of
persons (within the meaning of Section 13 or 14 of the Securities and Exchange
Act of 1934, as amended) acquires legal or beneficial ownership (within the
meaning of Rule 13d-3 promulgated by the SEC under said Act) of 20% or more in
voting power of the outstanding voting stock of the Company.
"Collateral" shall mean the collateral security provided to the Agent
for the benefit of the Banks pursuant to the Security Agreement.
"Commitment Percentage" shall have the meaning set forth in Section
1.8 hereof.
"Company" shall have the meaning specified in the first paragraph of
this Agreement.
"Consolidated Subsidiary" shall mean any Subsidiary whose accounts are
consolidated with those of the Company in accordance with generally accepted
accounting principles.
"control" or "controlled by" or "under common control" shall mean
possession, directly or indirectly, of power to direct or cause the direction
of management or policies (whether through ownership of voting securities, by
contract or otherwise); provided that, in any event any Person which
beneficially owns, directly or indirectly, 10% or more (in number of votes) of
the securities having ordinary voting power for the election of directors of a
corporation shall be conclusively presumed to control such corporation, and
provided further that any Consolidated Subsidiary shall be conclusively
presumed to be controlled by the Company.
"Current Assets" shall mean the aggregate amount of assets of the
Company and its Consolidated Subsidiaries which in accordance with generally
accepted accounting principles may be properly classified as current assets
after deducting adequate reserves where proper.
"Current Liabilities" shall mean all items (including taxes accrued as
estimated) of the Company and its Consolidated Subsidiaries which in accordance
with generally accepted accounting principles may be properly classified as
current liabilities, but excluding in any
-13-
<PAGE> 577
event all amounts outstanding from time to time under this Agreement which are
not required to be prepaid under Section 7.25 hereof.
"Debt" of any Person shall mean as of any time the same is to be
determined, the aggregate of:
(a) all indebtedness, obligations and liabilities of such
Person with respect to borrowed money (including by the issuance of
debt securities);
(b) all guaranties, endorsements and other contingent
obligations of such Person with respect to indebtedness arising from
money borrowed by others;
(c) all reimbursement obligations with respect to letters
of credit, bankers acceptances, customer advances and other extensions
of credit whether or not representing obligations for borrowed money;
(d) the aggregate of the principal components of all
Capitalized Lease Obligations;
(e) all indebtedness, obligations and liabilities
representing the deferred purchase price of property or services; and
(f) all indebtedness secured by a lien on the Property of
such Person, whether or not such Person has assumed or become liable
for the payment of such indebtedness.
"Domestic Rate" means for any day the rate of interest announced by
Harris from time to time as its prime commercial rate in effect on such day,
with any change in the Domestic Rate resulting from a change in said prime
commercial rate to be effective as of the date of the relevant change in said
prime commercial rate (the "Harris Prime Rate"), provided that if the rate per
annum determined by adding 1/2 of 1% to the rate at which Harris would offer to
sell federal funds in the interbank market on or about 10:00 a.m. (Chicago
time) on any day (the "Adjusted Fed Funds Rate") shall be higher than the
Harris Prime Rate on such day, then the Domestic Rate for such day and for any
succeeding day which is not a Business Day shall be such Adjusted Fed Funds
Rate. The Agent shall give notice to each Bank of any period when the Domestic
Rate is based on the Adjusted Fed Funds Rate. The determination of the
Adjusted Fed Funds Rate by Harris shall be final and conclusive except in the
case of manifest error or willful misconduct.
"Domestic Rate Loan" means a Revolving Credit Loan which bears interest
as provided in Section 1.3(a) hereof.
"Eligible Inventory" shall mean any Inventory of the Company itself in
which the Agent has a first priority perfected security interest, which the
Agent in its sole judgment deems to be acceptable for inclusion in the
Borrowing Base and which complies with each of the following requirements:
-14-
<PAGE> 578
(a) it consists solely of canned and frozen vegetables
produced or acquired in the ordinary course of business;
(b) it is not obsolete, and is readily usable or salable by
the Company in the ordinary course of its business;
(c) it substantially conforms to the advertised or
represented specifications and other quality standards of the Company,
and has not been determined by the Agent to be unacceptable due to age
and/or quality;
(d) all warranties as set forth in this Agreement and the
Security Agreement are true and correct with respect thereto;
(e) it has been identified to the Agent in the manner
prescribed pursuant to the Security Agreement;
(f) it is located at a location within the United States
disclosed to the Agent and approved by the Agent and, if requested by
the Agent, any Person (other than the Company) owning or controlling
such location disclosed to the Agent shall have waived all right, title
and interest in and to such Inventory, except for any interest securing
only accrued and unpaid storage fees, in a manner satisfactory to the
Agent;
(g) the purchase Price therefor has not been prepaid in
whole or in part; and
(h) the Company has not received a notice from any
governmental agency or other party claiming or indicating the existence
of a lien or other interest therein.
"Eligible Receivables" shall mean any Receivable of the Company itself
in which the Agent has a first priority perfected security interest, which the
Agent, in its sole judgment deems to be acceptable for inclusion in the
Borrowing Base and which complies with each of the following requirements:
(a) It arises out of a bona fide rendering of services or
sale of goods sold and delivered by or on behalf of the Company to, or
in the process of being delivered by or on behalf of the Company to,
the Account Debtor on said Receivables;
(b) all warranties set forth in this Agreement and the
Security Agreement are true and correct with respect thereto;
(c) it has been identified to the Agent in a manner
satisfactory to the Agent;
(d) it is evidenced by an invoice (dated not later than 30
days after the date of shipment or performance of services) rendered to
the Account Debtor thereunder;
(e) such Receivable shall not remain unpaid more than 120
days following its invoice date;
-15-
<PAGE> 579
(f) it is not owing by an Account Debtor who shall have
failed to pay 25% or more of all Receivables owed by such Account
Debtor within 90 days after their respective due dates or who has
become insolvent or is the subject of any bankruptcy, arrangement,
reorganization proceedings or other proceedings for relief of debtors;
(g) it is payable in U.S. Dollars;
(h) it is not owing by the United States of America or any
department, agency or instrumentality thereof unless the Company shall
have provided evidence satisfactory to the Agent of compliance with the
Assignment of Claims Act, or by any state or local government unless
the Company shall provide evidence satisfactory to the Agent of
compliance with any similar state or local statute;
(i) it is not owing by any Account Debtor located outside
of the United States, unless such Receivable is supported by a
transferable irrevocable letter of credit in form and substance and
issued by a bank satisfactory to the Agent, and which letter of credit
will be assigned or transferred to the Agent upon the Agent's request;
(j) it is net of any credit or allowance given by the
Company to such Account Debtor;
(k) the Receivable is not subject to any counterclaim or
defense asserted by the Account Debtor thereunder, nor is it subject to
any offset or contra account payable to the Account Debtor (in any
case, unless the amount of such Receivable is net of such counterclaim,
defense, offset or contra account);
(l) it is not owing by an Account Debtor that is an
Affiliate of the Company;
(m) it is net of any payment or prepayment made by the
Account Debtor thereon; and
(n) the Company has not received any notice from any
governmental agency or other party claiming or indicating the existence
of a lien or other interest therein.
"Environmental Laws" shall mean all federal, state and local
environmental, health and safety statutes and regulations, including without
limitation all statutes and regulations establishing quality criteria and
standards for air, water, land and toxic or hazardous wastes and substances.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Eurodollar Loan" shall mean a Revolving Credit Loan which bears
interest as provided in Section 1.3(b) hereof.
-16-
<PAGE> 580
"Eurodollar Rate" shall mean for each Interest Period applicable to a
Eurodollar Loan, (a) the LIBOR Index Rate for such Interest Period, if such
rate is available, and (b) if the LIBOR Index Rate cannot be determined, the
arithmetic average of the rates of interest per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) at which deposits in U.S. dollars in
immediately available funds are offered to the Agent at 11:00 a.m. (London,
England time) two (2) Business Days before the beginning of such Interest
Period by three (3) or more major banks in the interbank eurodollar market
selected by the Agent for a period equal to such Interest Period and in an
amount equal or comparable to the principal amount of the Eurodollar Loan
scheduled to be made by the Agent during such Interest Period.
"Event of Default" shall mean any event or condition identified as
such in Section 8.1 hereof.
"Existing Agreement" shall have the meaning specified in Section
1.1(e) hereof.
"Existing Lenders" shall have the meaning specified in Section 1.1(e)
hereof.
"Fed Funds Rate" shall have the meaning specified in Section 1.5(c)
hereof.
"Funded Debt," with respect to any Person shall mean all indebtedness
for borrowed money of such Person and with respect to the Company all
indebtedness for borrowed money of the Company, in each case maturing by its
terms more than one year after, or which is renewable or extendible at the
option of such Person for a period ending one year or more after, the date of
determination, and shall include indebtedness for borrowed money of such
maturity created, assumed or guaranteed by such Person either directly or
indirectly, including obligations of such maturity secured by liens upon
Property of such Person and upon which such entity customarily pays the
interest, and all rental payments under Capitalized Leases of such maturity;
provided, however, that with respect to amounts outstanding under this
Agreement the term "Funded Debt" shall include the lesser of amounts
outstanding from time to time under this Agreement or amounts not required to
be prepaid under Section 7.25 hereof.
"Harris" shall have the meaning specified in the first paragraph of
this Agreement.
"Intangible Assets" shall mean license agreements, trademarks, trade
names, patents, capitalized research and development, proprietary products (the
results of past research and development treated as long term assets and
excluded from Inventory) and goodwill (all determined on a consolidated basis
in accordance with generally accepted accounting principles consistently
applied).
"Interest Period" shall mean with respect to the Eurodollar Loans, the
period used for the computation of interest commencing on the date the relevant
Eurodollar Loan is made, continued or effected by conversion and concluding on
the date one, two, three or six months thereafter as selected by the Company in
its notice as provided herein; provided that all of the foregoing provisions
relating to Interest Periods are subject to the following:
-17-
<PAGE> 581
(i) if any Interest Period would otherwise end on a day
which IS not a Business Day, that Interest Period shall be extended to
the next succeeding Business Day, unless in the case of an Interest
Period for a Eurodollar Loan the result of such extension would be to
carry such Interest Period into another calendar month in which event
such Interest Period shall end on the immediately preceding Business
Day;
(ii) no Interest Period may extend beyond the final maturity
date of the Revolving Notes;
(iii) the interest rate to be applicable to each Loan for
each Interest Period shall apply from and including the first day of
such Interest Period to but excluding the last day thereof; and
(iv) no Interest Period may be selected if after giving
effect thereto the Company will be unable to make a principal payment
scheduled to be made during such Interest Period without paying part of
a Eurodollar Loan on a date other than the last day of the Interest
Period applicable thereto.
For purposes of determining an Interest Period, a month means a period starting
on one day in a calendar month and ending on a numerically corresponding day in
the next calendar month, provided, however, if an Interest Period begins on the
last day of a month or if there is no numerically corresponding day in the
month in which an Interest Period is to end, then such Interest Period shall
end on the last Business Day of such month.
"Inventory" shall mean all raw materials, work in process, finished
goods, and goods held for sale or lease or furnished or to be furnished under
contracts of service in which the Company or any Subsidiary now has or
hereafter acquires any right.
"L/C" shall have the meaning set forth in Section 1.6 hereof.
"L/C Agreement" shall have the meaning set forth in Section 1.6 hereof.
"L/C Administrative Fee" has the meaning specified in Section 1.6
hereof.
"L/C Issuance Fee" has the meaning specified in Section 1.6 hereof.
"Leverage Ratio" shall mean the ratio for the Company and its
Consolidated Subsidiaries of (a) the aggregate outstanding principal amount of
all Funded Debt to (b) the sum of the aggregate outstanding principal amount of
all Funded Debt plus Tangible Net Worth.
"LIBOR Index Rate" shall mean, for any Interest Period applicable to a
Eurodollar Loan, the rate per annum (rounded upwards, if necessary, to the next
higher one hundred-thousandth of a percentage point) for deposits in U.S.
Dollars for a period equal to such Interest Period, which appears on the
Telerate Page 3750 as of 11:00 a.m. (London, England time) on the day two
Business Days before the commencement of such Interest Period.
-18-
<PAGE> 582
"License Agreement" shall have the meaning specified in Section 6.2(c)
hereof.
"Loan" shall mean a Revolving Credit Loan and the term "Loans" shall
mean any two or more Revolving Credit Loans collectively.
"Loan Documents" shall mean this Agreement and any and all exhibits
hereto, the Revolving Notes, the L/C Agreements, the Trademark Agreement, the
License Agreements and the Security Agreement.
"Net Income" shall mean the net income of the Company and its
Consolidated Subsidiaries determined on a consolidated basis in accordance with
generally accepted accounting principles, consistently applied.
"Net Working Capital" shall mean the excess of Current Assets over
Current Liabilities.
"Net Worth" shall mean the Total Assets minus the Total Liabilities of
the Company and its Consolidated Subsidiaries, all determined on a consolidated
basis in accordance with generally accepted accounting principles, consistently
applied.
"Obligations" means all fees payable hereunder, all obligations of the
Company to pay principal or interest on Loans and Reimbursement Obligations and
all other payment obligations of the Company arising under or in relation to
any Loan Document.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Person" shall mean and include any individual, sole proprietorship,
partnership, joint venture, trust, unincorporated organization, association,
corporation, institution, entity, party or government (whether national,
federal, state, county, city, municipal, or otherwise, including, without
limitation, any instrumentality, division, agency, body or department thereof).
"Plan" shall mean any employee benefit plan covering any officers or
employees of the Company or any Subsidiary, any benefits of which are, or are
required to be, guaranteed by the PBGC.
"Potential Default" shall mean any event or condition which, with the
lapse of time, or giving of notice, or both, would constitute an Event of
Default.
"Property" shall mean any interest in any kind of property or asset,
whether real, personal or mixed or tangible or intangible.
"Receivables" shall mean all accounts, contract rights, instruments,
documents, chattel paper and general intangibles in which the Company now has
or hereafter acquires any right.
-19-
<PAGE> 583
"Reimbursement Obligation" has the meaning specified in Section 1.7
hereof.
"Required Banks" shall mean any Bank or Banks which in the aggregate
hold at least 66-2/3% of the aggregate unpaid principal balance of the Loans
and Reimbursement Obligations or, if no Loans or Reimbursement Obligations are
outstanding hereunder, any Bank or Banks in the aggregate having at least
66-2/3% of the Revolving Credit Commitments.
"Reserve Percentage" means the daily arithmetic average maximum rate
at which reserves (including, without limitation, any supplemental, marginal
and emergency reserves) are imposed on member banks of the Federal Reserve
System during the applicable Interest Period by the Board of Governors of the
Federal Reserve System (or any successor) under Regulation D on "eurocurrency
liabilities" (as such term is defined in Regulation D), subject to any
amendments of such reserve requirement by such Board or its successor, taking
into account any transitional adjustments thereto. For purposes of this
definition, the Eurodollar Loans shall be deemed to be eurocurrency liabilities
as defined in Regulation D without benefit or credit for any prorations,
exemptions or offsets under Regulation D.
"Restricted Account" shall have the meaning set forth in Section 2.6
hereof.
"Revolving Credit" shall have the meaning specified in the first
paragraph of this Agreement.
"Revolving Credit Commitment" and "Revolving Credit Commitments" shall
have the meanings SPECIFIED in Section 1.1(c) hereof.
"Revolving Credit Loan" and "Revolving Credit Loans" shall have the
meanings specified in Section 1.1(a) hereof.
"Revolving Note" or "Revolving Notes" shall have the meanings
specified in Section 1.1(d) hereof.
"Secured Grower Payables" shall mean all amounts owed from time to
time by the Company to any Person on account of the purchase price of
agricultural products or services if the Agent reasonably determines that such
Person is entitled to the benefits of any grower's lien, statutory trust or
similar security arrangements to secure the payment of any amounts owed to such
Person.
"Security Agreement" shall have the meaning specified in Section 1.10
hereof.
"Senior Secured Notes" shall mean the Company's 9.37% Senior Secured
Notes maturing January 15, 2000 and the Company's 9.74% Senior Secured Notes
maturing December 15, 2001.
"Subsidiary" shall mean collectively any corporation or other entity
at least a majority of the outstanding voting equity interests (other than
directors' qualifying shares) of which is
-20-
<PAGE> 584
at the time owned directly or indirectly by the Company or by one of more
Subsidiaries or by the Company and one or more Subsidiaries.
"Tangible Net Worth" shall mean the Net Worth minus the amount of all
Intangible Assets of the Company and its Consolidated Subsidiaries, determined
on a consolidated basis in accordance with generally accepted accounting
principles, consistently applied.
"Telerate Page 3750" shall mean the display designated as "Page 3750"
on the Telerate Service (or such other page as may replace Page 3750 on that
service or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar deposits).
"Termination Date" shall have the meaning set forth in Section 1.1(a)
hereof.
"Total Assets" shall mean at any date, the aggregate amount of assets
of the Company and its Consolidated Subsidiaries determined on a consolidated
basis in accordance with generally accepted accounting principles consistently
applied.
"Total Liabilities" shall mean at any date, the aggregate amount of
all liabilities of the Company and its Consolidated Subsidiaries determined on
a consolidated basis in accordance with generally accepted accounting
principles, consistently applied.
"Trademark Agreement" shall have the meaning specified in Section
6.2(d) hereof.
"Value of Eligible Inventory" shall mean as of any given date with
respect to Eligible Inventory an amount equal to the lower of average cost or
market value.
Section 4.2. Accounting Terms. Any accounting term or the
character or amount of any asset or liability or item of income or expense
required to be determined under this Agreement, shall be determined or made in
accordance with generally accepted accounting principles at the time in effect,
to the extent applicable, except where such principles are inconsistent with
the requirements of this Agreement.
SECTION 5. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to the Banks as to itself and,
where the following representations and warranties apply to Subsidiaries, as to
each of its Subsidiaries, as follows:
Section 5.1 Organization and Qualification. The Company is a
corporation duly organized and existing and in good standing under the laws of
the State of Wisconsin, has full and adequate corporate power to carry on its
business as now conducted, is duly licensed or qualified in all jurisdictions
wherein the nature of its activities requires such licensing or qualification
except where the failure to be so licensed or qualified would not have a
material adverse effect on the financial condition, Property, business or
operations of the
-21-
<PAGE> 585
Company and its Subsidiaries taken as a whole, and has full right and authority
to enter into this Agreement and the other Loan Documents, to make the
borrowings herein provided for, to issue the Notes in evidence thereof, to
encumber its assets as security for its Obligations under the Loan Documents,
and to perform each and all of the matters and things herein and therein
provided for.
Section 5.2. Subsidiaries. Schedule 5.2 hereto identifies each
Subsidiary, joint venture, and entity in which the Company or any Subsidiary
has a minority interest, the jurisdiction of its incorporation or organization,
as the case may be, the percentage of issued and outstanding shares of each
class of its capital stock or other equity interest owned by the Company and
the Subsidiaries and, if such percentage is not 100% (excluding directors'
qualifying shares as required by law), a description of each class of its
authorized capital stock and other equity interests and the number of shares of
each class issued and outstanding. From the date any Subsidiary exists, each
Subsidiary is duly incorporated and existing in good standing as a corporation
under the laws of the jurisdiction of its incorporation, has all necessary
corporate power to carry on its present business, and is duly licensed or
qualified and in good standing in each jurisdiction in which the nature of the
business transacted by it or the nature of the Property owned or leased by it
makes such licensing or qualification necessary and in which the failure to be
so licensed or qualified would have a material adverse effect on the financial
condition, or the Property, business or operations, of the Company and its
Subsidiaries taken as a whole. All of the issued and outstanding shares of
capital stock of each Subsidiary are validly issued and outstanding and
fully paid and non assessable and all such shares owned by the Company are
owned beneficially and of record, free of any lien. None of the Company's
Subsidiaries currently conducts any business or operations, and none of the
Company's Subsidiaries owns any Property except that (a) Stokely U.K. Limited
acts as the Company's sales representative in the United Kingdom and may from
time to time have current assets with an aggregate fair market value not in
excess of $1,500,000, and (b) Ocono International, Ltd. is a foreign sales
corporation for the Company and may from time to time have assets with an
aggregate fair market value not in excess of $100,000.
Section 5.3. Financial Reports. The Company has heretofore
delivered to the Agent a copy of the Audit Report as of March 31, 1994 of the
Company and its Subsidiaries prepared by Deloitte Touche LLP, unaudited
financial statements (including a balance sheet, statement of income, statement
of cash flows and comparison to the comparable prior year period) of the
Company and its Subsidiaries as of, and for the period ending December 31,
1994, and unaudited financial statements (including a balance sheet, statement
of income, statement of cash flows and comparison to the comparable prior year
period) of the Company and its Subsidiaries as of, and for the fiscal year
ending, March 31, 1995. Such audited financial statements have been prepared
in accordance with generally accepted accounting principles on a basis
consistent, except as otherwise noted therein, with that of the previous fiscal
year or period and fairly reflect the financial position of the Company and its
Subsidiaries as of the dates thereof, and the results of its operations for the
periods covered thereby. The Company and its Subsidiaries have no material
contingent liabilities other than as indicated on said financial statements and
since said date of March 31, 1994 there has been no material adverse change in
the condition, financial or otherwise, of the Company or
-22-
<PAGE> 586
any Subsidiary that has not been disclosed in writing to the Banks prior to the
initial Loan or L/C issuance.
Section 5.4. Litigation; Tax Returns; Approvals. There is no
litigation or governmental proceeding pending, nor to the knowledge of the
Company threatened, against the Company or any Subsidiary which, if adversely
determined, is likely to result in any material adverse change in the
Properties, business, financial condition and operations of the Company or any
Subsidiary, except as disclosed on Schedule 5.4 hereto. All income tax returns
for the Company required to be filed have been filed on a timely basis, and all
amounts required to be paid as shown by said returns have been paid. There are
no pending or, to the best of the Company's knowledge, threatened objections to
or controversies in respect of the United States federal income tax returns of
the Company for any fiscal year. No authorization, consent, license, exemption
or filing (other than the filing of financing statements) or registration with
any court or governmental department, agency or instrumentality, is or will be
necessary to the valid execution, delivery or performance by the Company of the
Loan Documents.
Section 5.5. Regulation U. Neither the Company nor any Subsidiary
is engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System); no part of the proceeds of any Loan
made or any L/C issued hereunder will be used to purchase or carry any margin
stock or to extend credit to others for such a purpose; and neither the making
of any Loan or the issuance of any L/C hereunder, nor the use of the proceeds
thereof, will violate the provisions of Regulations G, T, U or X of the Board
of Governors of the Federal Reserve System.
Section 5.6. No Default. As of the date of this Agreement, the
Company is in full compliance with all of the terms and conditions of this
Agreement, and no Potential Default or Event of Default is existing under this
Agreement.
Section 5.7. ERISA. The Company and its Subsidiaries are in
compliance in all material respects with ERISA to the extent applicable to them
and have received no notice to the contrary from the PBGC or any other
governmental entity or agency.
Section 5.8. Security Interests and Debt. There are no security
interests, liens or encumbrances on any of the Property of the Company or any
Subsidiary except such as are permitted by Section 7.13 of this Agreement, and
the Company and its Subsidiaries have no Debt except such as is permitted by
Section 7.14 of this Agreement.
Section 5.9. Accurate Information. No information, exhibit or
report furnished by the Company to the Banks in connection with the negotiation
of the Loan Documents contained any material misstatement of fact or omitted to
state a material fact or any fact necessary to make the statements contained
therein not misleading in light of the circumstances in which made. The
financial projections furnished by the Company to the Banks contain to the
Company's knowledge and belief, reasonable projections as of the date hereof of
future results of operations and financial position of the Company and its
-23-
<PAGE> 587
Subsidiaries. As of the date hereof, there is no material inaccuracy in,
material omission from, or material change in, the information contained in
said projections.
Section 5.10. Corporate Authority and Validity of Obligations. The
Company has full right and authority to enter into this Agreement and the other
Loan Documents to which it is a party, to make the borrowings herein provided
for, to issue its Notes in evidence thereof, and to perform all of its
obligations in connection therewith and to perform all of its obligations under
the Loan Documents to which it is a party; each Loan Document to which it is a
party has been duly authorized, executed and delivered by the Company and
constitutes valid and binding obligations of the Company enforceable in
accordance with its terms; and no Loan Document, nor the performance or
observance by the Company of any of the matters or things therein provided for,
contravenes any provision of law or any charter or by-law provision of the
Company or (individually or in the aggregate) any material covenant, indenture
or agreement of or affecting the Company or any of its Properties or results in
or requires the creation or imposition of any lien on any of the Properties or
revenues of the Company.
Section 5.11. Compliance with Laws. The Company and its
Subsidiaries each are in compliance with the requirements of all federal, state
and local laws, rules and regulations applicable to or pertaining to their
Properties or business operations (including, without limitation, the
Occupational Safety and Health Act of 1970, the Americans with Disabilities Act
of 1990, and Environmental Laws), non-compliance with which could have a
material adverse effect on the financial condition, Properties, business or
operations of the Company or any Subsidiary. Neither the Company nor any
Subsidiary has received notice to the effect that its operations are not in
compliance with any of the requirements of applicable Environmental Laws or are
the subject of any governmental investigation evaluating whether any remedial
action is needed to respond to a release of any toxic or hazardous waste or
substance into the environment, which non-compliance or remedial action could
have a material adverse effect on the financial condition, Properties, business
or operations of the Company or any Subsidiary.
Section 5.12. Restrictive Agreements. Neither the Company nor any
Subsidiary is a party to any contract or agreement, or subject to any charge or
other corporate restriction, which affects its ability to execute, deliver and
perform the Loan Documents to which it is a party and repay its indebtedness,
obligations and liabilities under the Loan Documents or which materially and
adversely affects or, insofar as the Company can reasonably foresee, could
materially and adversely affect, the Property, business, operations or
condition (financial or otherwise) of the Company or any of its Subsidiaries,
or would in any respect materially and adversely affect the Collateral, the
repayment of the indebtedness, obligations and liabilities under the Loan
Documents, or any Bank's or the Agent's rights under the Loan Documents.
Section 5.13. No Default under Other Agreements. Neither the
Company nor any Subsidiary is in default with respect to any note, indenture,
loan agreement, mortgage, lease, deed, or other agreement to which it is a
party or by which it or its Property is bound, which default might materially
and adversely affect the Collateral, the repayment of the
-24-
<PAGE> 588
indebtedness, obligations and liabilities under the Loan Documents, any Bank's
or the Agent's rights under the Loan Documents or the Property, business,
operations or condition (financial or otherwise) of the Company or any
Subsidiary.
Section 5.14. Status under Certain Laws. Neither the Company nor any
of its Subsidiaries is an "investment company" or a person directly or
indirectly controlled by or acting on behalf of an "investment company" within
the meaning of the Investment Company Act of 1940, as amended, or a "holding
company," or a "subsidiary company" of a "holding company," or an "affiliate"
of a "holding company" or a "subsidiary company" of a "holding company," within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
Section 5.15. Federal Food Security Act. The Company has received no
notice given pursuant to Section 1324(e)(1) or (3) of the Federal Food Security
Act and there has not been filed any financing statement or notice, purportedly
in compliance with the provisions of the Federal Food Security Act, purporting
to perfect a security interest in farm products purchased by the Company in
favor of a secured creditor of the seller of such farm products. The Company
has registered, pursuant to Section 1324(c)(2)(D) of the Federal Food Security
Act, with the Secretary of State of each State in which are produced farm
products purchased by the Company and which has established or hereafter
establishes a central filing system, as a buyer of farm products produced in
such State; and each such registration is in full force and effect. The states
in which the Company buys farm products as of the date of this Agreement,
whether such states have established a central filing system under the Federal
Food Security Act as of the date of this Agreement, and the states in which the
Company has registered pursuant to the Federal Food Security Act as of the date
of this Agreement, are set forth on Schedule 5.15 hereto.
SECTION 6. CONDITIONS PRECEDENT.
The obligation of the Banks to make any Loan or issue any L/C
pursuant hereto shall be subject to the following conditions precedent:
Section 6.1. General. The Agent shall have received the notice of
borrowings and the Revolving Notes hereinabove provided for.
Section 6.2. Initial Extension of Credit. Prior to the initial Loan
or L/C hereunder, the Company shall have delivered the required Borrowing Base
Certificate to the Agent, and shall have delivered to the Agent for the benefit
of the Banks in sufficient counterparts for distribution to the Banks:
(a) a fully executed counterpart of this Agreement;
(b) a fully executed Security Agreement;
(c) a fully executed License Agreement from each of the
Company's Subsidiaries (the "License Agreements");
-25-
<PAGE> 589
(d) a fully executed Trademark Collateral
Agreement from the Company to the Agent (the "Trademark Agreement");
(e) evidence that the holders of the Senior Secured Notes
have released all of their liens and security interest in the
Collateral and the current assets of the Company and its Subsidiaries;
(f) appropriate forms of financing statements to perfect
the security interest of the Agent provided for by the Security
Agreement;
(g) evidence of insurance required by Section 7.3 hereof
and by the Security Agreement showing the Agent as loss payee
thereunder;
(h) a good standing certificate or certificate of
existence for the Company, dated as of the date no earlier than 30
days prior to the date hereof, from the office of the secretary of
state of the state of its incorporation and each state in which it is
qualified to do business as a foreign corporation;
(i) copies of the Certificate of Incorporation, and all
amendments thereto, of the Company certified by the office of the
secretary of state of its state of incorporation as of the date no
earlier than the date 30 days prior to the date hereof;
(j) copies of the By-Laws, and all amendments thereto, of
the Company, certified as true, correct and complete on the date
hereof by the Secretary of the Company;
(k) copies, certified by the Secretary or Assistant
Secretary of the Company of resolutions regarding the transactions
contemplated by this Agreement, duly adopted by the Board of Directors
of the Company and satisfactory in form and substance to all of the
Banks;
(l) an incumbency and signature certificate for the
Company satisfactory in form and substance to all of the Banks;
(m) a pay-off letter satisfactory in form and substance to
all of the Banks from Shawmut Capital Corporation as agent for the
Existing Lenders together with lien releases relating to all liens in
favor of such agent for the Existing Lenders or any security trustee
or agent on their behalf;
(n) the Agent's fees payable under Section 2.2 hereof and
the closing fee payable pursuant to Section 2.5 of this Agreement;
(o) the results of a field audit of the Collateral; and
(p) such other documents as the Banks may reasonably
require.
-26-
<PAGE> 590
Section 6.3. Each Extension of Credit. As of the time of the making
of each Loan and the issuance of each L/C hereunder (including the initial Loan
or L/C, as the case may be):
(a) each of the representations and warranties set forth
in Section 5 hereof shall be and remain true and correct as of said
time as if made at said time, except that, the representations and
warranties made under Section 5.3 shall be deemed to refer to the most
recent financial statements furnished to the Banks pursuant to Section
7.4 hereof;
(b) the Company shall be in full compliance with all of
the terms and conditions hereof, and no Potential Default or Event of
Default shall have occurred and be continuing;
(c) after giving effect to the requested extension of
credit and to each Loan that has been made, and L/C issued
hereunder, the aggregate principal amount of all Loans, the amount
available for drawing under an L/Cs and the aggregate principal amount
of all Reimbursement Obligations then outstanding shall not exceed the
lesser of (i) the sum of the Banks' Revolving Credit Commitments then
in effect and (ii) the Borrowing Base, except as otherwise agreed by
the Company and all of the Banks; and
(d) no litigation involving the Company or any of its
Affiliates or Agent or any Bank shall be commenced, in process or
threatened, which, in the reasonable business judgment of any Bank,
threatens or challenges the financing contemplated by the Loan
Documents;
and the request by the Company for any Loan or L/C pursuant hereto shall be and
constitute a warranty to the foregoing effects.
Section 6.4. Legal Matters. Legal matters incident to the execution
and delivery of the Loan Documents shall be satisfactory to each of the Banks
and their legal counsel; and prior to the initial Loan or L/C hereunder, the
Agent shall have received the favorable written opinion of Michael Best &
Friedrich, counsel for the Company substantially in the form of Exhibit B, in
substance satisfactory to each of the Banks and their respective legal counsel.
Section 6.5. Documents. The Agent shall have received copies
(executed or certified, as may be appropriate) of all documents or proceedings
taken in connection with the execution and delivery of the Loan Documents to
the extent any Bank or its respective legal counsel requests.
Section 6.6. Lien Searches. The Agent shall have received lien
searches showing that the Property of the Company is subject to no security
interest or liens except those permitted by Section 7.13 hereof.
-27-
<PAGE> 591
SECTION 7. COVENANTS.
It is understood and agreed that so long as credit is in use or
available under this Agreement or any amount remains unpaid on any Note,
Reimbursement Obligation or L/C, except to the extent compliance in any case or
cases is waived in writing by the Required Banks:
Section 7.1. Maintenance. The Company will, and will cause each
Subsidiary to, maintain, preserve and keep its plant, Properties and equipment
in good repair, working order and condition and will from time to time make all
needful and proper repairs, renewals, replacements, additions and betterments
thereto so that at all times the efficiency thereof shall be preserved and
maintained in all material respects, normal wear and tear excepted.
Section 7.2. Taxes. The Company will, and will cause each Subsidiary
to, duly pay and discharge all taxes, rates, assessments, fees and governmental
charges upon or against the Company or its Subsidiaries or against their
respective Properties in each case before the same become delinquent and before
penalties accrue thereon unless and to the extent that the same are being
contested in good faith and by appropriate proceedings diligently conducted and
for which adequate reserves have been established in accordance with generally
accepted accounting principles, provided that the Company shall pay or cause to
be paid all such taxes, rates, assessments, fees and governmental charges
forthwith upon the commencement of proceedings to foreclose any lien which is
attached as security therefor, unless such foreclosure is stayed by the filing
of an appropriate bond in a manner satisfactory to the Required Banks.
Section 7.3. Maintenance of Insurance. The Company will, and will
cause each Subsidiary to, maintain insurance coverage by good and responsible
insurance underwriters in such forms and amounts and against such risks and
hazards as are customary for companies engaged in similar businesses and owning
and operating similar Properties, and in any event, the Company will insure any
of its Property which is insurable against loss or damage by fire, theft,
burglary, pilferage and loss in transit, all in amounts and under policies
containing loss payable clauses to the Agent as its interest may appear (and
naming the Agent as additional insured therein) and providing for advance
notice to the Agent of cancellation thereof, issued by sound and reputable
insurers and all premiums thereon shall be paid by the Company and certificates
summarizing the same delivered to the Agent. The Company shall in any event
maintain insurance on the Collateral to the extent required by the Security
Agreement.
Section 7.4. Financial Reports. The Company will, and will cause
each Subsidiary to, maintain a standard and modern system of accounting in
accordance with sound accounting practice and will furnish to the Banks and
their duly authorized representatives such information respecting the business
and financial condition of the Company and its Subsidiaries as may be
reasonably requested and, without any request, will furnish to the Banks:
-28-
<PAGE> 592
(a) as soon as available, and in any event within (i) 60
days after the last day of every April, (ii) 45 days after the last day
of every May, and (iii) 35 days after the close of every other
monthly fiscal period of the Company, except March, a copy of the
consolidated balance sheet, statement of income, and statement of cash
flows, for such period of the Company and its Subsidiaries, together
with all such information for the year to date, all in reasonable
detail, prepared by the Company and certified on behalf of the Company
by the Company's chief financial officer;
(b) as soon as available, and in any event within 60 days
after the close of each fiscal year, a copy of the audit report for
such year and accompanying financial statements, including a
consolidated balance sheet, a consolidated statement of income and
retained earnings, and a consolidated statement of cash flows, together
with all footnotes thereto, for the Company and its Subsidiaries, in
each case, showing in comparative form the figures for the previous
fiscal year of the Company, all in reasonable detail, accompanied by an
unqualified opinion of Deloitte & Touche LLP or other independent
public accountants of nationally recognized standing selected by the
Company and satisfactory to the Agent, such opinion to indicate that
such statements are made in accordance with generally accepted
accounting principles;
(c) each of the financial statements furnished to the
Banks pursuant to paragraph (a) and (b) above shall be accompanied by a
Compliance Certificate in the form of Exhibit C hereto signed on behalf
of the Company by its chief financial officer;
(d) within 5 days after the end of each week (or at such
other intervals as the Company and the Agent may agree upon), (i) a
Borrowing Base Certificate in the form of Exhibit D hereto, setting
forth a computation of the Borrowing Base as of that week's end date,
certified as correct on behalf of the Company by the Company's chief
financial officer, (ii) an accounts receivable aging report, grower
payables report and inventory report each in form satisfactory to the
Agent, and (iii) written notice of the receipt by the Company of any
notice or claim of a lien or other interest with respect to any
Collateral;
(e) promptly upon their becoming available, copies of all
registration statements and regular periodic reports, if any, which the
Company shall have filed with the Securities and Exchange
Commission or any governmental agency substituted therefor, or any
national securities exchange, including copies of the Company's form
10-K annual report, including financial statements audited by Deloitte
& Touche LLC or other independent public accountants of nationally
recognized standing selected by the Company and satisfactory to the
Agent, its form 10-Q quarterly report to the Securities and Exchange
Commission and any Form 8-K filed by the Company with the Securities
and Exchange Commission;
(f) promptly upon the mailing thereof to the shareholders
of the Company generally, copies of all financial statements, reports
and proxy statements so mailed; and
-29-
<PAGE> 593
(g) as soon as available but in any event by June 30 of
each year, a copy of the annual projections for the current fiscal
year of the Company.
Section 7.5. Inspection and Reviews. The Company shall, and shall
cause each Subsidiary to, permit the Agent, by its representatives and agents
(who may be accompanied by the Banks or their representatives and agents), to
inspect any of the properties, corporate books and financial records of the
Company and its Subsidiaries, to review and make copies of the books of
accounts and other financial records of the Company and its domestic
Subsidiaries, and to discuss the affairs, finances and accounts of the Company
and its Subsidiaries with, and to be advised as to the same by, its officers at
such reasonable times and intervals as the Agent may designate. In addition to
any other compensation or reimbursement to which the Agent may be entitled
under the Loan Documents, the Company shall pay to the Agent from time to time
upon demand the amount necessary to compensate the Agent for all fees, charges
and expenses incurred by it or its designees in connection with the audits of
Collateral, or inspections or review of the books, records and accounts of the
Company or any Subsidiary conducted by the Agent.
Section 7.6. Consolidation and Merger. The Company will not, and
will not permit any Subsidiary to, consolidate with or merge into any Person,
or permit any other Person to merge into it, or acquire (in a transaction
analogous in purpose or effect to a consolidation or merger) all or
substantially all the Property or stock of the other Person, or acquire
substantially as an entirety the business of any other Person, provided,
however, that the Company or any Subsidiary may allow any other Person to merge
into it so long as:
(a) the Company or a Subsidiary shall be the surviving
entity;
(b) the entity merging into the Company or a Subsidiary is
in the same or a related line of business as the Company or such
Subsidiary; and
(c) after giving effect to such merger, no Potential
Default or Event of Default shall have occurred and be continuing and
the Banks shall have received a pro forma calculation of the
covenants contained in Sections 7.8, 7.9 and 7.10 hereof showing that
the Company is in compliance.
Section 7.7. Transactions with Affiliates. The Company will not, and
will not permit any Subsidiary to, enter into any transaction, including
without limitation, the purchase, sale, lease or exchange of any Property, or
the rendering of any service, with any Affiliate of the Company or such
Subsidiary except in the ordinary course of and pursuant to the reasonable
requirements of the Company's or such Subsidiary's business and upon fair and
reasonable terms not materially less favorable to the Company than would be
obtained in a comparable arm's-length transaction with a Person not an
Affiliate of the Company or such Subsidiary.
Section 7.8. Leverage Ratio. The Company will not permit its
Leverage Ratio at any time to exceed 0.62 to 1.
-30-
<PAGE> 594
Section 7.9. Tangible Net Worth. The Company shall maintain its
Tangible Net Worth at all times during the periods specified below in an amount
not less than the minimum required amount for each period set forth below:
(a) from the date hereof through March 31, 1996,
$51,000,000; and
(b) during each fiscal quarter of the Company thereafter,
an amount equal to the minimum amount required to be maintained during
the immediately preceding fiscal quarter of the Company plus an amount
equal to 50% of the Company's Net Income (but not less than zero)
during such immediately preceding fiscal quarter.
Section 7.10. Minimum Net Working Capital. The Company will maintain
Net Working Capital at all times in an amount not less than $35,000,000.
Section 7.11. Capital Expenditures. The Company will not, and will
not permit any Subsidiary to, make or commit to make any capital expenditures
(as defined and classified in accordance with generally accepted accounting
principles consistently applied;) provided, however, that if no Event of
Default or Potential Default shall exist before and after giving effect
thereto, the Company and its Subsidiaries may make capital expenditures in an
aggregate amount in each fiscal year of the Company not to exceed the sum of
(a) $2,000,000, (b) the amount of all depreciation charges shown on the
Company's audited financial statements for the immediately preceding fiscal
year of the Company, (c) the amount, if any, by which such capital expenditures
made by the Company in the immediately preceding fiscal year was less than the
maximum amount permitted by this Section 7.11 for such preceding year excluding
any amount carried over into such preceding year from prior years, and (d)
capital expenditures funded exclusively with the proceeds of property
insurance.
Section 7.12. Dividends and Certain Other Restricted Payments. The
Company will not (a) declare or pay any dividends or make any distribution on
any class of its capital stock (other than dividends payable solely in its
capital stock) or (b) directly or indirectly purchase, redeem or otherwise
acquire or retire any of its capital stock (except out of the proceeds of, or
in exchange for, a substantially concurrent issue and sale of capital stock) or
(c) make any other distributions with respect to its capital stock; provided,
however, that if no Potential Default or Event of Default shall exist before
and after giving effect thereto, the Company may pay dividends in each fiscal
year of the Company commencing with the fiscal year ending March 31, 1997 in an
aggregate amount not to exceed 15% of the Company's positive Net Income for the
immediately preceding fiscal year.
Section 7.13. Liens. The Company will not, and will not permit any
Subsidiary to, pledge, mortgage or otherwise encumber or subject to or permit
to exist upon or be subjected to any lien, charge or security interest of any
kind (including any conditional sale or other title retention agreement and any
lease in the nature thereof), on any of its Properties of any kind or character
other than:
-31-
<PAGE> 595
(a) liens, pledges or deposits for workmen's compensation,
unemployment insurance, old age benefits or social security obligations, taxes,
assessments, statutory obligations or other similar charges, good faith
deposits made in connection with tenders, contracts or leases to which the
Company or a Subsidiary is a party or other deposits required to be made in the
ordinary course of business, provided in each case the obligation secured is
not overdue or, if overdue, is being contested in good faith by appropriate
proceedings and adequate reserves have been provided therefor in accordance
with generally accepted accounting principles and that the obligation is not
for borrowed money, customer advances, or trade payables;
(b) the pledge of Property for the purpose of securing an appeal or
stay or discharge in the course of any legal proceedings, provided that the
aggregate amount of liabilities of the Company and its Subsidiaries so secured
by a pledge of Property permitted under this subsection (b) including interest
and penalties thereon, if any, shall not be in excess of $500,000 at any one
time outstanding;
(c) liens, pledges, mortgages, security interests, or other charges
granted to the Agent to secure the Notes, L/Cs or the Reimbursement
Obligations;
(d) liens, pledges, security interests or other charges now or
hereafter created under the Security Agreement;
(e) security interests or other interests of a lessor in equipment
leased by the Company or any Subsidiary as lessee under any financing lease, to
the extent such security interest or other interest secures rental payments
payable by the Company thereunder;
(f) liens, mortgages and security interests in (1) the capital stock
of D & K Frozen Foods, Inc., and (2) the real estate, machinery and equipment,
and in all licenses, permits, representations and warranties relating thereto,
of the Company and its Subsidiaries, in favor of the holders of the Senior
Secured Notes or a security agent or trustee on their behalf;
(g) liens of carriers, warehousemen, mechanics and materialmen and
other like liens, in each case arising in the ordinary course of the Company's
or any Subsidiary's business to the extent they secure obligations that are not
past due;
(h) such minor defects, irregularities, encumbrances, easements,
rights of way, and clouds on title as normally exist with respect to similar
properties which do not materially impair the Property affected thereby for the
purpose for which it was acquired;
(i) liens, pledges, mortgages, security interests or other charges
disclosed on Schedule 7.13 attached hereto;
-32-
<PAGE> 596
(j) liens, security interests, pledges, mortgages or other charges in
any Property other than the Collateral securing obligations in an aggregate
amount not exceeding $500,000 at any time;
(k) statutory liens and security interests in agricultural products in
favor of the producers thereof securing the purchase price of such agricultural
products;
(l) the interests of customers who have made customer advances to the
Company in Inventory permitted by Section 7.14(f); and
(m) liens and security interests in favor of the Existing Lenders,
but only until the first Loan is made or L/C issued hereunder.
Section 7.14. Borrowings and Guaranties. The Company will not, and will not
permit any Subsidiary to, issue, incur, assume, create or have outstanding any
Debt or customer advances, nor assume, be or remain liable, whether as
endorser, surety, guarantor or otherwise, for or in respect of any liability,
claim or indebtedness of any other Person, other than:
(a) indebtedness of the Company arising under or pursuant to this
Agreement or the other Loan Documents;
(b) the liability of the Company arising out of the endorsement for
deposit or collection of commercial paper received in the ordinary course of
business;
(c) the indebtedness evidenced by the Company's Senior Secured Notes;
(d) trade payables of the Company arising in the ordinary course of
the Company's business;
(e) indebtedness disclosed on the audited financial statements
referred to in Section 5.3 hereof, except indebtedness to the Existing Lenders
under the Existing Agreement; and
(f) customer advances made in the ordinary course of business.
Section 7.15. Investments, Loans, Advances and Acquisitions. The Company
will not, and will not permit any Subsidiary to, make or retain any investment
(whether through the purchase of stock, obligations or otherwise) in or make
any loan or advance to, any other Person, or acquire all or substantially all
of the assets or business of any Person, other than:
(a) investments in certificates of deposit having a maturity of one
year or less issued by any United States commercial bank having capital and
surplus of not less than $50,000,000;
(b) existing investments in Subsidiaries;
-33-
<PAGE> 597
(c) investments in commercial paper rated P1 by Moody's Investors
Service, Inc. ("Moody's") or A1 by Standard & Poor's Ratings Group ("S&P")
maturing within 180 days of the date of issuance thereof,
(d) marketable obligations of the United States;
(e) marketable obligations guaranteed by or insured by the United
States, or those for which the full faith and credit of the United States is
pledged for the repayment of principal and interest thereof; provided that such
obligations have a final maturity of no more than one year from the date
acquired by the Company;
(f) repurchase, reverse repurchase agreements and security lending
agreements collateralized by securities of the type described in subsection (c)
and having a term of no more than 90 days, provided, however, that the Company
shall hold (individually or through an agent) all securities relating thereto
during the entire term of such arrangement;
(g) loans, investments (excluding retained earnings) and advances by
the Company to its Subsidiaries in an aggregate outstanding amount not to
exceed $100,000 at any time;
(h) loans and advances to employees, officers, directors and contract
growers for reasonable expenses incurred in the ordinary course of business;
(i) acquisitions permitted by Section 7.6 hereof; and
(j) investments in money-market preferred stock issued by corporations
incorporated in any of the states of the United States and rated "A" or better
by Moody's or S&P.
Section 7.16. Sale of Property. The Company will not, and will not permit
any Subsidiary to, sell, lease, assign, transfer or otherwise dispose of
(whether in one transaction or in a series of transactions) all or a material
part of its Property to any other Person; provided, however, that this Section
shall not prohibit:
(a) sales of Inventory by the Company and its Subsidiaries in the
ordinary course of business;
(b) sales or leases by the Company and its Subsidiaries of its
surplus, obsolete or worn-out machinery and equipment;
(c) the sale of the Company's vegetable processing facilities located
in Appleton, Wisconsin, Jefferson, Wisconsin, Union Grove, Wisconsin, Cobb,
Wisconsin and Merrill, Wisconsin; and
-34-
<PAGE> 598
(d) sales that are a part of sale and leaseback transactions permitted
by Section 7.24 hereof.
For purposes of this Section 7.16, "material part" shall mean 5% or more of the
lesser of the book or fair market value of the Property of the Company.
Section 7.17. Notice of Suit, Adverse Change in Business or Default. The
Company shall, as soon as possible, and in any event within ten (10) days after
the Company learns of the following, give written notice to the Banks of (a)
any proceeding(s) that, if determined adversely to the Company or any
Subsidiary could have a material adverse effect on the Properties, business or
operations of the Company or such Subsidiary being instituted or threatened to
be instituted by or against the Company or such Subsidiary in any federal,
state, local or foreign court or before any commission or other regulatory body
(federal, state, local or foreign); (b) any material adverse change in the
business, Property or condition, financial or otherwise, of the Company or any
Subsidiary; and (c) the occurrence of a Potential Default or Event of Default.
Section 7.18. ERISA. The Company will, and will cause each Subsidiary to,
promptly pay and discharge all obligations and liabilities arising under ERISA
of a character which if unpaid or unperformed might result in the imposition of
a lien against any of its Property and will promptly notify the Agent of (i)
the occurrence of any reportable event (as defined in ERISA) which might result
in the termination by the PBGC of any Plan covering any officers or employees
of the Company or any Subsidiary any benefits of which are, or are required to
be, guaranteed by PBGC, (ii) receipt of any notice from PBGC of its intention
to seek termination of any Plan or appointment of a trustee therefor, and (iii)
its intention to terminate or withdraw from any Plan. The Company will not,
and will not permit any Subsidiary to, terminate any Plan or withdraw therefrom
unless it shall be in compliance with all of the terms and conditions of this
Agreement after giving effect to any liability to PBGC resulting from such
termination or withdrawal.
Section 7.19. Use of Loan Proceeds. The Company will use the proceeds of
all Loans and L/Cs made or issued hereunder solely to refinance existing Debt
and to finance its working capital requirements. The Company shall not use any
part of the proceeds of any of the Loans or of the L/Cs directly or indirectly
to purchase or carry any margin stock (as defined in Section 5.5 hereof) or to
extend credit to others for the purpose of purchasing or carrying any such
margin stock.
Section 7.20. Conduct of Business and Maintenance of Existence. The Company
will, and will cause each Subsidiary to, continue to engage in business of the
same general type as now conducted by it, and the Company will, and will cause
each Subsidiary to, preserve, renew and keep in full force and effect its
corporate existence and its rights, privileges and franchises necessary or
desirable in the normal conduct of business.
Section 7.21. Compliance with Laws, etc. The Company will, and will cause
each of its Subsidiaries to, comply in all material respects with all
applicable laws, rules, regulations and orders, such compliance to include
(without limitation) (a) compliance with all
-35-
<PAGE> 599
Environmental Laws, (b) the registration pursuant to the Federal Food Security
Act of 1985, as amended, with the Secretary of State of each State in which are
produced any farm products purchased by the Company and which has established a
central filing system, as a buyer of farm products produced in such state, and
the maintenance of each such registration, (c) compliance with all applicable
rules and regulations promulgated by the United States Department of
Agriculture and all similar applicable state rules and regulations, and (d)
compliance with all rules and regulations promulgated pursuant to the
Occupational Safety and Health Act of 1970, as amended.
Section 7.22. Environmental Covenant. The Company will, and will cause
each of its Subsidiaries to:
(a) use and operate all of its facilities and Properties in material
compliance with all Environmental Laws, keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in material compliance therewith,
and handle all hazardous materials in material compliance with all
applicable Environmental Laws;
(b) immediately notify the Agent and provide copies upon receipt of
all material written claims, complaints, notices or inquiries relating to the
condition of its facilities and Property or compliance with Environmental
Laws, and shall promptly cure and have dismissed, to the reasonable
satisfaction of the Required Banks, any actions and proceedings relating
to compliance with Environmental Laws unless and to the extent that the
same are being contested in good faith and by appropriate proceedings
diligently conducted and for which adequate reserves in form and amount
reasonably satisfactory to the Required Banks have been established,
provided that no proceedings to foreclose any lien which is attached as
security therefor shall have been commenced unless such foreclosure is
stayed by the filing of an appropriate bond in a manner satisfactory to
the Agent; and
(c) provide such information and certifications which the Agent
may reasonably request from time to time to evidence compliance with
this Section 7.22.
Section 7.23. New Subsidiaries. The Company will not, directly or
indirectly, create or acquire any Subsidiary.
Section 7.24. Sale and Leasebacks. The Company will not, and will not
permit any Subsidiary to, enter into any arrangement with any lender or
investor providing for the leasing by the Company or any Subsidiary of any
Property previously owned by the Company or any Subsidiary, except (a) such
transactions entered into to finance capital expenditures permitted by Section
7.11, and (b) such transactions if the entire proceeds of such transaction are
applied first to the repayment of any Debt secured by liens and security
interests in the Property involved in such transaction until all such Debt has
been fully paid, and then to the repayment of Loans and Reimbursement
Obligations outstanding hereunder.
-36-
<PAGE> 600
Section 7.25. Seasonal Clean-Up. The Company shall not allow the
aggregate principal amount of all Loans and Reimbursement Obligations
outstanding hereunder to exceed either (a) $20,000,000 for a period of 30
consecutive days during the period ending July 31, 1996, and (b) $15,000,000
for a period of 30 consecutive days during each annual period ending on any
July 31 occurring thereafter.
Section 7.26. Subsidiary Assets and Operations. The Company will not permit
any Subsidiary to conduct any business or operations or own any Property,
except as described in Section 5.2 hereof.
Section 7.27. Compliance with Federal Food Security Act. The Company will
register, pursuant to Section 13.24(c)(2)(D) of the Federal Food Security Act,
with the Secretary of State of each state in which are produced farm products
purchased by the Company and which has established or hereafter establishes a
central filing system, as a buyer of farm products produced in such state, and
the Company will maintain each such registration in full force and affect; and
the Company will give written notice to the Agent, no later than 30 days after
the end of each fiscal quarter of the Company, of each state in which it is
required to file a registration under the Federal Food Security Act,
accompanied by evidence that the Company has made such required filings.
Section 7.28. Additional Trademark Collateral. The Company will provide to
the Agent within 30 days of acquiring any trademarks, tradenames, or
tradestyles, or making any trademark applications, a Trademark Agreement in the
same form as the Trademark Collateral Agreement of even date herewith executed
and delivered in satisfaction of Section 6.2(d) hereof, in form suitable for
registration with United States Patent and Trademark Office, covering all such
new property.
SECTION 8. EVENTS OF DEFAULT AND REMEDIES.
Section 8.1. Definitions. Any one or more of the following shall constitute
an Event of Default:
(a) Default in the payment when due of (i) any interest on or
principal of any Note or Reimbursement Obligation, whether at the stated
maturity thereof or as required by Section 2.4 hereof or at any other time
provided in this Agreement, or (ii) any fee or other amount payable by the
Company pursuant to this Agreement, and the continuation under this clause
(ii) thereof for 5 days;
(b) Default in the observance or performance of any covenant set
forth in Sections 2.6, 7.6, 7.7, 7.8, 7.9, 7.10, 7.11, 7.12, 7.13,
7.14, 7.15, 7.16, 7.17, 7.19, 7.20, 7.23, 7.24 and 7.25, inclusive, hereof,
or of any provision of the Security Agreement requiring the maintenance of
insurance on the Collateral subject thereto or dealing with the use or
remittance of proceeds of such Collateral;
-37-
<PAGE> 601
(c) Default in the observance or performance of any covenant set
forth in Sections 7.4 or 7.5 of this Agreement and such default shall
continue for 5 days after written notice thereof to the Company by any Bank;
(d) Default in the observance or performance of any other covenant,
condition, agreement or provision hereof or any of the other Loan
Documents and such default shall continue for 30 days after written notice
thereof to the Company by any Bank;
(e) Default shall occur under any evidence of indebtedness in a
principal amount exceeding $500,000 issued or assumed or guaranteed by
the Company, or under any mortgage, agreement or other similar instrument
under which the same may be issued or secured and such default shall
continue for a period of time sufficient to permit the acceleration of
maturity of any indebtedness evidenced thereby or outstanding or secured
thereunder or any such indebtedness shall have been declared or become due
and payable as a result of any such default;
(f) Any representation or warranty made by the Company or any
subsidiary herein or in any Loan Document or in any statement or
certificate furnished by it pursuant hereto or thereto, proves untrue in any
material respect as of the date made or deemed made pursuant to the terms
hereof;
(g) Any judgment or judgments, writ or writs, or warrant or warrants
of attachment, or any similar process or processes in an aggregate
amount in excess of $500,000 shall be entered or filed against the Company
or any Subsidiary or against any of their respective Property or assets and
remain unbonded, unstayed and undischarged for a period of 45 days from the
date of its entry;
(h) Any reportable event (as defined in ERISA) which constitutes
grounds for the termination of any Plan or for the appointment by the
appropriate United States District Court of a trustee to administer or
liquidate any such Plan, shall have occurred; or any such Plan shall be
terminated; or a trustee shall be appointed by the appropriate United States
District Court to administer any such Plan; or the PBGC shall institute
proceedings to administer or terminate any such Plan;
(i) The Company or any Subsidiary shall (i) have entered
involuntarily against it an order for relief under the Bankruptcy Code
of 1978, as amended, (ii) admit in writing its inability to pay, or not pay,
its debts generally as they become due or suspend payment of its
obligations, (iii) make an assignment for the benefit of creditors, (iv)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, conservator, liquidator or similar official for it or
any substantial part of its property, (v) file a petition seeking relief or
institute any proceeding seeking to have entered against it an order for
-38-
<PAGE> 602
relief under the Bankruptcy Code of 1978, as amended, to adjudicate it
insolvent, or seeking dissolution, winding up, liquidation, reorganization,
arrangement, marshalling of assets, adjustment or composition of it or its
debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fail to file an answer or other pleading denying the
material allegations of any such proceeding filed against it, or (vi) fail
to contest in good faith any appointment or proceeding described in Section
8.1(j) hereof;
(j) A custodian, receiver, trustee, conservator, liquidator or similar
official shall be appointed for the Company, any Subsidiary or any
substantial part of its respective Property, or a proceeding described in
Section 8.1(i)(v) shall be instituted against the Company or any Subsidiary
and such appointment continues undischarged or any such proceeding continues
undismissed or unstayed for a period of 60 days;
(k) The Security Agreement, or any part thereof, shall cease to be
valid and binding on any party thereto, or any party to the Security
Agreement shall terminate, disavow, repudiate or breach any of its
obligations under the Security Agreement; or
(l) The occurrence of a Change of Control.
Section 8.2. Remedies for Non-Bankruptcy Defaults. When any Event of
Default, other than an Event of Default described in subsections (i) and (j) of
Section 8.1 hereof, has occurred and is continuing, the Agent, if directed by
the Required Banks, shall give notice to the Company and take any or all of the
following actions: (i) terminate the remaining Revolving Credit Commitments
hereunder on the date (which may be the date thereof) stated in such notice,
(ii) declare the principal of and the accrued interest on the Notes and unpaid
Reimbursement Obligations to be forthwith due and payable and thereupon the
Notes and unpaid Reimbursement Obligations including both principal and
interest, shall be and become immediately due and payable without further
demand, presentment, protest or notice of any kind, and (iii) proceed to
foreclose against any Collateral under the Security Agreement, take any action
or exercise any remedy under the Loan Documents or exercise any other action,
right, power or remedy permitted by law. Any Bank may exercise the right of
set off with regard to any deposit accounts or other accounts maintained by the
Company with any of the Banks.
Section 8.3. Remedies for Bankruptcy Defaults. When any Event of Default
described in subsections (i) or (j) of Section 8.1 hereof has occurred and is
continuing, then the Notes and all Reimbursement Obligations shall immediately
become due and payable without presentment, demand, protest or notice of any
kind, and the obligation of the Banks to extend further credit pursuant to any
of the terms hereof shall immediately terminate.
Section 8.4. L/Cs. Promptly following the acceleration of the maturity of
the Notes pursuant to Section 8.2 or 8.3 hereof, the Company shall immediately
pay to the Agent for the benefit of the Banks the full aggregate amount of all
outstanding L/Cs. The Agent shall
-39-
<PAGE> 603
hold all such funds and proceeds thereof as additional collateral security for
the obligations of the Company to the Banks under the Loan Documents. The
amount paid under any of the L/Cs for which the Company has not reimbursed the
Banks shall bear interest from the date of such payment at the default rate of
interest specified in Section 13(c)(i) hereof.
SECTION 9. CHANGE IN CIRCUMSTANCES REGARDING EURODOLLAR LOANS.
Section 9.1. Change of Law. Notwithstanding any other provisions of this
Agreement or any Note to the contrary, if at any time after the date hereof
with respect to Eurodollar Loans, any Bank shall determine in good faith that
any change in applicable law or regulation or in the interpretation thereof
makes it unlawful for such Bank to make or continue to maintain any Eurodollar
Loan or to give effect to its obligations as contemplated hereby, such Bank
shall promptly give notice thereof to the Company to such effect, and such
Bank's obligation to make, relend, continue or convert any such affected
Eurodollar Loans under this Agreement shall terminate until it is no longer
unlawful for such Bank to make or maintain such affected Loan. The Company
shall prepay the outstanding principal amount of any such affected Eurodollar
Loan made to it, together with all interest accrued thereon and all other
amounts due and payable to the Banks under Section 9.4 of this Agreement, on
the earlier of the last day of the Interest Period applicable thereto and the
first day on which it is illegal for such Bank to have such Loans outstanding;
provided, however, the Company may then elect to borrow the principal amount of
such affected Loan by means of another type of Loan available hereunder,
subject to all of the terms and conditions of this Agreement.
Section 9.2. Unavailability of Deposits or Inability to Ascertain the
Adjusted Eurodollar Rate. Notwithstanding any other provision of this Agreement
or any Note to the contrary, if prior to the commencement of any Interest
Period any Bank shall determine (i) that deposits in the amount of any
Eurodollar Loan scheduled to be outstanding are not available to it in the
relevant market or (ii) by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining the
Adjusted Eurodollar Rate, then such Bank shall promptly give telephonic or
telex notice thereof to the Company, the Agent and the other Banks (such notice
to be confirmed in writing), and the obligation of the Banks to make, continue
or convert any such Eurodollar Loan in such amount and for such Interest Period
shall terminate until deposits in such amount and for the Interest Period
selected by the Company shall again be readily available in the relevant market
and adequate and reasonable means exist for ascertaining the Adjusted
Eurodollar Rate. Upon the giving of such notice, the Company may elect to
either (i) pay or prepay, as the case may be, such affected Loan or (ii)
reborrow such affected Loan as another type of Loan available hereunder,
subject to all terms and conditions of this Agreement.
Section 9.3. Taxes and Increased Costs. With respect to the Eurodollar
Loans, if any Bank shall determine in good faith that any change in any
applicable law, treaty, regulation or guideline (including, without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or any
new law, treaty, regulation or guideline, or any interpretation of any of the
foregoing by any governmental authority charged with the administration thereof
or any central bank or other fiscal, monetary or other authority
-40-
<PAGE> 604
having jurisdiction over such Bank or its lending branch or the Eurodollar
Loans contemplated by this Agreement (whether or not having the force of law)
("Change in Law") shall:
(i) impose, modify or deem applicable any reserve, special deposit or
similar requirements against assets held by, or deposits in or for the
account of, or Loans by, or any other acquisition of funds or disbursements
by, such Bank (other than reserves included in the determination of the
Adjusted Eurodollar Rate);
(ii) subject such Bank, any Eurodollar Loan or any Note to any tax
(including, without limitation, any United States interest equalization tax
or similar tax however named applicable to the acquisition or holding of
debt obligations and any interest or penalties with respect thereto), duty,
charge, stamp tax, fee, deduction or withholding in respect of this
Agreement, any Eurodollar Loan or any Note except such taxes as may be
measured by the overall net income of such Bank or its lending branch and
imposed by the jurisdiction, or any political subdivision or taxing
authority thereof, in which such Bank's principal executive office or its
lending branch is located;
(iii) change the basis of taxation of payments of principal and
interest due from the Company to such Bank hereunder or under any Note
(other than by a change in taxation of the overall net income of such Bank);
or
(iv) impose on such Bank any penalty with respect to the foregoing or
any other condition regarding this Agreement, any Eurodollar Loan or any
Note;
and such Bank shall determine that the result of any of the foregoing is to
increase the cost (whether by incurring a cost or adding to a cost) to such
Bank of making or maintaining any Eurodollar Loan hereunder or to reduce the
amount of principal or interest received by such Bank, then the Company shall
pay to such Bank from time to time as specified by such Bank such additional
amounts as such Bank shall reasonably determine are sufficient to compensate
and indemnify it for such increased cost or reduced amount. If any Bank
makes such a claim for compensation, it shall provide to the Company a
certificate setting forth such increased cost or reduced amount as a result of
any event mentioned herein specifying such Change in Law, and such certificate
shall be conclusive and binding on the Company as to the amount thereof except
in the case of manifest error. Upon the imposition of any such cost, the
Company may prepay any affected Loan, subject to the provisions of Sections 2.3
and 9.4 hereof.
Section 9.4. Funding Indemnity. (a) In the event any Bank shall incur any
loss, cost, expense or premium (including, without limitation, any loss of
profit and any loss, cost, expense or premium incurred by reason of the
liquidation or re-employment of deposits or other funds acquired by such Bank
to fund or maintain any Eurodollar Loan or the
-41-
<PAGE> 605
relending or reinvesting of such deposits or amounts paid or prepaid to such
Bank) as a result of:
(i) any payment or prepayment of a Eurodollar Loan on a date other
than the last day of the then applicable Interest Period;
(ii) any failure by the Company to borrow, continue or convert any
Eurodollar Loan on the date specified in the notice given pursuant to
Section 1.5 hereof; or
(iii) the occurrence of any Event of Default resulting in the
acceleration of any Eurodollar Loans;
then, upon the demand of such Bank, the Company shall pay to such Bank such
amount as will reimburse such Bank for such loss, cost or expense.
(b) If any Bank makes a claim for compensation under this Section 9.4, it
shall provide to the Company a certificate setting forth the amount of such
loss, cost or expense in reasonable detail and such certificate shall be
conclusive and binding on the Company as to the amount thereof except in the
case of manifest error.
Section 9.5. Lending Branch. Each Bank may, at its option, elect to make,
fund or maintain its Eurodollar Loans hereunder at the branch or office
specified opposite its signature on the signature page hereof or such other of
its branches or offices as such Bank may from time to time elect, subject to
the provisions of Section 1.5(b) hereof.
Section 9.6. Discretion of Bank as to Manner of Funding. Notwithstanding any
provision of this Agreement to the contrary, each Bank shall be entitled to
fund and maintain its funding of all or any part of its Loans in any manner it
sees fit, it being understood however, that for the purposes of this Agreement
all determinations hereunder shall be made as if the Banks had actually
funded and maintained each Eurodollar Loan during each Interest Period for such
Loan through the purchase of deposits in the relevant interbank market having a
maturity corresponding to such Interest Period and bearing an interest rate
equal to the Adjusted Eurodollar Rate, as the case may be, for such Interest
Period.
SECTION 10. THE AGENT.
Section 10.1. Appointment and Powers. Harris Trust and Savings Bank is
hereby appointed by the Banks as Agent under the Loan Documents, including but
not limited to the Security Agreement, wherein the Agent shall hold a security
interest for the benefit of the Banks, solely as the Agent of the Banks, and
each of the Banks irrevocably authorizes the Agent to act as the Agent of such
Bank. The Agent agrees to act as such upon the express conditions contained in
this Agreement.
Section 10.2. Powers. The Agent shall have and may exercise such powers
hereunder as are specifically delegated to the Agent by the terms of the Loan
Documents, together with
-42-
<PAGE> 606
such powers as are incidental thereto. The Agent shall have no implied duties
to the Banks, nor any obligation to the Banks to take any action under the Loan
Documents except any action specifically provided by the Loan Documents to be
taken by the Agent.
Section 10.3. General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Banks or any Bank for any
action taken or omitted to be taken by it or them under the Loan Documents or
in connection therewith except for its or their own gross negligence or willful
misconduct.
Section 10.4. No Responsibility for Loans, Recitals, etc. The Agent shall
not (i) be responsible to the Banks for any recitals, reports, statements,
warranties or representations contained in the Loan Documents or furnished
pursuant thereto, (ii) be responsible for the payment or collection of or
security for any Loans or Reimbursement Obligations hereunder except with money
actually received by the Agent for such payment, (iii) be bound to ascertain or
inquire as to the performance or observance of any of the terms of the Loan
Documents, (iv) be obligated to determine or verify the existence, eligibility
or value of any Collateral, or the correctness of any Borrowing Base
Certificate or compliance certificate, or (v) be responsible to the Banks for
the enforceability or validity of any of the Loan Documents or for the
existence, creation, attachment, perfection or priority of any security
interest in the Collateral.
Section 10.5. Right to Indemnity. The Banks hereby indemnify the Agent for
any actions taken in accordance with this Section 10, and the Agent shall be
fully justified in failing or refusing to take any action hereunder, unless it
shall first be indemnified to its satisfaction by the Banks pro rata against
any and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action, other than any liability which
may arise out of Agent's gross negligence or willful misconduct.
Section 10.6. Action Upon Instructions of Banks. The Agent agrees, upon the
written request of the Required Banks or all of the Banks, as the case may be,
to take any action of the type specified in the Loan Documents as being within
the Agent's rights, duties, powers or discretion. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder in
accordance with written instructions signed by the Required Banks or all of the
Banks, as the case may be, and such instructions and any action taken or
failure to act pursuant thereto shall be binding on all of the Banks and on all
holders of the Notes. In the absence of a request by the Required Banks or all
of the Banks, as the case may be, the Agent shall have authority, in its sole
discretion, to take or not to take any action, unless the Loan Documents
specifically require the consent of the Required Banks or all of the Banks.
Section 10.7. Employment of Agents and Counsel. The Agent may execute any
of its duties as Agent hereunder by or through agents (other than employees)
and attorneys-in-fact and shall not be answerable to the Banks, except as to
money or securities received by it or its authorized agents, for the default or
misconduct of any such agents or attorneys-in-fact selected by it in good faith
and with reasonable care. The Agent shall be entitled to advice and opinion of
legal counsel concerning all matters pertaining to the duties of the agency
hereby created.
-43-
<PAGE> 607
Section 10.8. Reliance on Documents; Counsel. The Agent shall be entitled
to rely upon any Note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in
respect to legal matters, upon the opinion of legal counsel selected by the
Agent.
Section 10.9. May Treat Payee as Owner. The Agent may deem and treat the
payee of any Note as the owner thereof for all purposes hereof unless and until
a written notice of the assignment or transfer thereof shall have been filed
with the Agent. Any request, authority or consent of any person, firm or
corporation who at the time of making such request or giving such authority or
consent is the holder of any such Note shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note issued in
exchange therefor.
Section 10.10. Agent's Reimbursement. Each Bank agrees to reimburse the
Agent pro rata in accordance with its Commitment Percentage for any reasonable
out-of-pocket expenses (including fees and charges for field audits) not
reimbursed by the Company (a) for which the Agent is entitled to reimbursement
by the Company under the Loan Documents and (b) for any other reasonable
out-of-pocket expenses incurred by the Agent on behalf of the Banks, in
connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents and for which the Agent is entitled to
reimbursement by the Company and has not been reimbursed.
Section 10.11. Rights as a Lender. With respect to its commitment, Loans
made by it, L/Cs issued by it and the Notes issued to it, Harris shall have the
same rights and powers hereunder as any Bank and may exercise the same as
though it were not the Agent, and the term "Bank" or "Banks" shall, unless the
context otherwise indicates, include Harris in its individual capacity.
Harris and each of the Banks may accept deposits from, lend money to, and
generally engage in any kind of banking or trust business with the Company as
if it were not the Agent or a Bank hereunder, as the case may be.
Section 10.12. Bank Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank and based
on the financial statements referred to in Section 5.3 and such other documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into the Loan Documents. Each Bank also acknowledges that it
will, independently and without reliance upon the Agent or any other Bank and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents.
Section 10.13. Resignation of Agent. Subject to the appointment of a
successor Agent, the Agent may resign as Agent for the Banks under this
Agreement and the other Loan Documents at any time by sixty days' notice in
writing to the Banks. Such resignation shall take effect upon appointment of
such successor. The Required Banks shall have the right to appoint a successor
Agent who shall be entitled to all of the rights of, and vested with the same
powers as, the original Agent under the Loan Documents. In the event a
successor
-44-
<PAGE> 608
Agent shall not have been appointed within the sixty day period following the
giving of notice by the Agent, the Agent may appoint its own successor.
Resignation by the Agent shall not affect or impair the rights of the Agent
under Sections 10.5 and 10.10 hereof with respect to all matters preceding such
resignation. Any successor Agent must be a Bank holding a Revolving Credit
Commitment for its own account of not less than $12,500,000.
Section 10.14. Removal of Agent. Subject to the appointment of a successor
Agent, the Required Banks, with the consent of the Company (which consent will
not be unreasonably withheld) if no Event of Default shall have occurred and be
continuing and without the Company's consent if an Event of Default shall have
occurred and be continuing, may remove the Agent for the Banks under this
Agreement at any time by 30 days' notice in writing to the Agent. Such removal
shall take effect upon appointment of such successor. The Required Banks shall
have the right to appoint a successor Agent who shall be entitled to all of the
rights of, and vested with the same powers as, the original Agent under the
Loan Documents. In the event a successor Agent shall not have been appointed
within the thirty day period following the giving of notice to the Agent, the
Agent may appoint its own successor. The removal of the Agent shall not affect
or impair the rights of the Agent under Sections 11.5 and 11.10
hereof with respect to all matters preceding such removal. Any successor
Agent must meet the eligibility criteria set forth in Section 10.13 hereof.
Section 10.15. Duration of Agency. The agency established by Section 10.1
hereof shall continue, and Sections 10.1 through and including Section 10.14
shall remain in full force and effect, until the Notes and all other amounts
due hereunder and thereunder, including without limitation all Reimbursement
Obligations, shall have been paid in full and the Banks' commitments to extend
credit to or for the benefit of the Company shall have terminated or expired.
Section 10.16. Certain Notices. The Agent shall promptly (a) deliver to each
of the Banks a copy of any written notice of the occurrence of an Event of
Default under this Agreement received by the Agent and any schedules, reports
or other written information relating to the Collateral received by the Agent,
and (b) give written notice to the Banks if the amount of the Agent's Revolving
Credit Commitment held for the Agent's own account becomes less than
$5,000,000.
SECTION 11. MISCELLANEOUS.
Section 11.1. Amendments and Waivers. Any term, covenant, agreement or
condition of this Agreement or any other Loan Documents may be amended only by
a written amendment executed by the Company, the Required Banks and, if the
rights or duties of the Agent are affected thereby, the Agent, or compliance
therewith only may be waived (either generally or in a particular instance and
either retroactively or prospectively), if the Company shall have obtained the
consent in writing of the Required Banks and, if the rights or duties of the
Agent are affected thereby, the Agent, provided, however, that without the
consent in writing of the holders of all outstanding Notes and unpaid
Reimbursement Obligations and the issuer of any L/C, or all Banks if no Notes,
L/Cs or Reimbursement Obligations are outstanding, no such amendment or waiver
shall
-45-
<PAGE> 609
(i) change the amount or postpone the date of payment of any scheduled payment
or required prepayment of principal of the Notes or reduce the rate or extend
the time of payment of interest on the Notes, or reduce the amount of principal
thereof, or modify any of the provisions of the Notes with respect to the
payment or prepayment thereof, (ii) give to any Note any preference over any
other Notes, (iii) amend the definition of Required Banks, (iv) alter, modify
or amend the provisions of this Section 11.1, (v) change the amount
(individually or in the aggregate) or term of any of the Banks' Revolving
Credit Commitments or reduce or postpone any fee or other amount coming due to
the Banks under this Agreement or any of the other Loan Documents, (vi) alter,
modify, waive or amend the provisions of Sections 1.9, 6 or 9 of this
Agreement, (vii) alter, modify or amend any Bank's right hereunder to consent
to any action, make any request or give any notice, (viii) change the advance
rates under the Borrowing Base or the definitions of "Borrowing Base",
"Eligible Inventory" or "Eligible Receivables," or waive the deduction of the
Secured Grower Payables from the Borrowing Base, or (ix) release any Collateral
under the Security Agreement or release or discharge any guarantor of the
Company's Obligations to the Banks, in each case, unless such release or
discharge is permitted or contemplated by the Loan Documents. Any such
amendment or waiver shall apply equally to all Banks and the holders of the
Notes and Reimbursement Obligations and shall be binding upon them, upon each
future holder of any Note and Reimbursement Obligation and upon the Company
whether or not such Note shall have been marked to indicate such amendment or
waiver. No such amendment or waiver shall extend to or affect any obligation
not expressly amended or waived.
Section 11.2. Waiver of Rights. No delay or failure on the part of the
Agent or any Bank or on the part of the holder or holders of any Note or
Reimbursement Obligation in the exercise of any power or right shall operate as
a waiver thereof, nor as an acquiescence in any Potential Default or Event of
Default, nor shall any single or partial exercise of any power or right
preclude any other or further exercise thereof, or the exercise of any other
power or right, and the rights and remedies hereunder of the Agent, the Banks
and of the holder or holders of any Notes are cumulative to, and not exclusive
of, any rights or remedies which any of them would otherwise have.
Section 11.3. Several Obligations. The commitments of each of the Banks
hereunder shall be the several obligations of each Bank and the failure on the
part of any one or more of the Banks to perform hereunder shall not affect the
obligation of the other Banks hereunder, provided that nothing herein contained
shall relieve any Bank from any liability for its failure to so perform. In
the event that any one or more of the Banks shall fail to perform its
commitment hereunder, all payments thereafter received by the Agent on the
principal of Loans and Reimbursement Obligations hereunder, whether from any
Collateral or otherwise, shall be distributed by the Agent to the Banks making
such additional Loans ratably as among them in accordance with the principal
amount of additional Loans made by them until such additional Loans shall have
been fully paid and satisfied. All payments on account of interest shall be
applied as among all the Banks ratably in accordance with the amount of
interest owing to each of the Banks as of the date of the receipt of such
interest payment.
-46-
<PAGE> 610
Section 11.4. Non-Business Day. (a) If any payment of principal or interest
on any Domestic Rate Loan shall fall due on a day which is not a Business Day,
interest at the rate such Loan bears for the period prior to maturity shall
continue to accrue on such principal from the stated due date thereof to and
including the next succeeding Business Day on which the same is payable.
(b) If any payment of principal or interest on any Eurodollar Loan shall
fall due on a day which is not a Business Day, the payment date thereof shall
be extended to the next date which is a Business Day and the Interest Period
for such Loan shall be accordingly extended, unless as a result thereof any
payment date would fall in the next calendar month, in which case such payment
date shall be the next preceding Business Day.
Section 11.5. Survival of Indemnities. All indemnities and all provisions
relative to reimbursement to the Banks of amounts sufficient to protect the
yield to the Banks with respect to Eurodollar Loans, including, but not limited
to, Sections 9.3 and 9.4 hereof, shall survive the termination of this
Agreement and the payment of the Notes and Reimbursement Obligations.
Section 11.6. Documentary Taxes. The Company agrees to pay all documentary
or similar taxes payable in respect of this Agreement or any of the other Loan
Documents, including interest and penalties, in the event any such taxes are
assessed irrespective of when such assessment is made and whether or not any
credit is then in use or available hereunder.
Section 11.7. Survival of Representations. All representations and
warranties made herein or in certificates given pursuant hereto shall survive
the execution and delivery of this Agreement and of the Notes, and shall
continue in full force and effect with respect to the date as of which they
were made and as reaffirmed on the date of each borrowing or request for L/C
and as long as any credit is in use or available hereunder.
Section 11.8. Notices. Unless otherwise expressly provided herein, all
communications provided for herein shall be in writing or by telex and shall be
deemed to have been given or made when served personally, when an answer back
is received in the case of notice by telex or telecopy or 2 days after the date
when deposited in the United States mail (registered, if to the Company)
addressed if to the Company to 1055 Corporate Center Drive, Oconomowoc,
Wisconsin 53066, Attention: Stephen Theobald; if to the Agent or Harris at
111 West Monroe Street, Chicago, Illinois 60690, Attention: Agribusiness
Division; and if to any of the Banks, at the address for each Bank set forth
under its signature hereon; or at such other address as shall be designated by
any party hereto in a written notice to each other party pursuant to this
Section 11.8.
Section 11.9. Costs and Expenses; Indemnity. The Company agrees to pay on
demand all costs and expenses of the Agent, in connection with the negotiation,
preparation, execution and delivery of this Agreement, the Notes and the other
instruments and documents to be delivered hereunder or in connection with the
transactions contemplated hereby, including the fees and expenses of Messrs.
Chapman and Cutler, special counsel to the Agent; all costs and expenses of the
Agent (including attorneys' fees) incurred in
-47-
<PAGE> 611
connection with any consents or waivers hereunder or amendments hereto, and all
reasonable costs and expenses (including attorneys' fees), if any, incurred by
the Agent, the Banks or any other holders of a Note or any Reimbursement
Obligation in connection with the enforcement of this Agreement or the Notes
and the other instruments and documents to be delivered hereunder. The Company
agrees to indemnify and save harmless the Banks and the Agent from any and all
liabilities, losses, costs and expenses incurred by the Banks or the Agent in
connection with any action, suit or proceeding brought against the Agent or any
Bank by any Person which arises out of the transactions contemplated or
financed hereby or by the Notes, or out of any action or inaction by the Agent
or any Bank hereunder or thereunder, except for such thereof as is caused by
the gross negligence or willful misconduct of the party indemnified. The
provisions of this Section 11.9 shall survive payment of the Notes and
Reimbursement Obligations and the termination of the Revolving Credit
Commitments hereunder.
Section 11.10. Counterparts. This Agreement may be executed in any number
of counterparts and all such counterparts taken together shall be deemed to
constitute one and the same instrument. One or more of the Banks may execute a
separate counterpart of this Agreement which has also been executed by the
Company, and this Agreement shall become effective as and when all of the Banks
have executed this Agreement or a counterpart thereof and lodged the same with
the Agent.
Section 11.11. Successors and Assigns.. This Agreement shall be binding upon
each of the Company, the Guarantors and the Banks and their respective
successors and assigns, and shall inure to the benefit of the Company, and each
of the Banks and the benefit of their respective successors and assigns,
including any subsequent holder of any Note or Reimbursement Obligation. The
Company may not assign any of its rights or obligations hereunder without the
written consent of the Banks.
Section 11.12. No Joint Venture. Nothing contained in this Agreement
shall be deemed to create a partnership or joint venture among the parties
hereto.
Section 11.13. Severability. In the event that any term or provision hereof
is determined to be unenforceable or illegal, it shall deemed severed herefrom
to the extent of the illegality and/or unenforceability and all other
provisions hereof shall remain in full force and effect.
Section 11.14. Table of Contents and Headings. The table of contents and
section headings in this Agreement are for reference only and shall not affect
the construction of any provision hereof.
Section 11.15. Participants and Note Assignors. Each Bank shall have the
right at its own cost to grant participations (to be evidenced by one or more
agreements or certificates of participation) in the Loans made, and/or
Revolving Credit Commitment and participations in L/Cs and Reimbursement
Obligations held, by such Bank at any time and from time to time, and to assign
its rights under such Loans, participations in L/Cs and Reimbursement
Obligations or the Notes evidencing such Loans to one or more other Persons;
provided that
-48-
<PAGE> 612
no such participation or assignment shall relieve any Bank of any of its
obligations under this Agreement, and any agreement pursuant to which such
participation or assignment of a Note or the rights thereunder is granted shall
provide that the granting Bank shall retain the sole right and responsibility
to enforce the obligations of the Company under the Loan Documents, including,
without limitation, the right to approve any amendment, modification or waiver
of any provision thereof, except that such agreement may provide that such Bank
will not agree without the consent of such participant or assignee to any
modification, amendment or waiver of this Agreement or the other Loan Documents
that would (A) increase any Revolving Credit Commitment of such Bank, or (B)
reduce the amount of or postpone the date for payment of any principal of or
interest on any Loan or Reimbursement Obligation or of any fee payable
hereunder in which such participant or assignee has an interest or (C) reduce
the interest rate applicable to any Loan or other amount payable in which such
participant or assignee has an interest or (D) release any collateral security
for or guarantor for any of the Company's Obligations under the Loan Documents,
and provided further that no such assignee or participant shall have any rights
under this Agreement except as provided in this Section 11.15, and the Agent
shall have no obligation or responsibility to such participant or assignee,
except that nothing herein provided is intended to affect the rights of an
assignee of a Note to enforce the Note assigned. Any party to which such a
participation or assignment has been granted shall have the benefits of Section
1.9, Section 9.3 and Section 9.4 hereof but shall not be entitled to receive
any greater payment under any such Section than the Bank granting such
participation or assignment would have been entitled to receive with respect to
the rights transferred. Any Bank assigning any Note hereunder shall give
prompt notice thereof to the Company and the Agent, who shall in each case only
be required to treat such assignee of a Note as the holder thereof after
receipt of such notice. The Company authorizes each Bank to disclose to any
purchaser or prospective purchaser of an interest in its Loans or Reimbursement
Obligations owed to it or its Revolving Credit Commitment under this Section
11.15 any financial or other information pertaining to the Company.
Section 11.16. Assignment of Commitments by Bank. Each Bank shall have the
right at any time, with the prior consent of the Company and the Agent (which
consent will not be required in the case of an assignment to another Bank or an
affiliate of the assigning Bank and otherwise will not be unreasonably
withheld), to sell, assign, transfer or negotiate all or any part of its
Revolving Credit Commitment to one or more commercial banks or other financial
institutions; provided that such assignment is in an amount of at least
$10,000,000 or, if less, the entire remaining Revolving Credit Commitment of
the assigning Bank. Upon any such assignment, and its notification to the
Agent, the assignee shall become a Bank hereunder, all Loans, Reimbursement
Obligations and the Revolving Credit Commitment it thereby holds shall be
governed by all the terms and conditions hereof, and the Bank granting such
assignment shall have its Revolving Credit Commitment and its obligations and
rights in connection therewith, reduced by the amount of such assignment. Upon
each such assignment the Bank granting such assignment shall pay to the Agent
for the Agent's sole account a fee of $2,500. The Company authorizes each Bank
to disclose to any purchaser or prospective purchaser of an interest in its
Loans or Reimbursement Obligations owed to it or its Revolving Credit
Commitment under this Section 11.16 any financial or other information
pertaining to the Company.
-49-
<PAGE> 613
Section 11.17. Sharing of Payments. Each Bank agrees with each other Bank
that if such Bank shall receive and retain any payment, whether by set-off or
application of deposit balances or otherwise ("Set-Off"), on any Loan,
Reimbursement Obligation or other amount outstanding under this Agreement in
excess of its ratable share of payments on all Loans, Reimbursement Obligations
and other amounts then outstanding to the Banks, then such Bank shall purchase
for cash at face value, but without recourse, ratably from each of the other
Banks such amount of the Loans and Reimbursement Obligations held by each such
other Bank (or interest therein) as shall be necessary to cause such Bank to
share such excess payment ratably with all the other Banks; provided, however,
that if any such purchase is made by any Bank, and if such excess payment or
part thereof is thereafter recovered from such purchasing Bank, the related
purchases from the other Banks shall be rescinded ratably and the purchase
price restored as to the portion of such excess payment so recovered, but
without interest. Each Bank's ratable share of any such Set-Off shall be
determined by the proportion that the aggregate principal amount of Loans and
Reimbursement Obligations then due and payable to such Bank bears to the total
aggregate principal amount of Loans and Reimbursement Obligations then due and
payable to all the Banks. Each Bank agrees that any set-off made by such Bank
shall be applied first to all Loans and Reimbursement Obligations outstanding
under the Loan Documents until they are paid in full and then to any other
indebtedness, obligations and liabilities of the Company to such Bank.
Section 11.18. Entire Agreement. The Loan Documents constitute the entire
understanding of the parties thereto with respect to the subject matter thereof
and any prior or contemporaneous agreements, whether written or oral, with
respect thereto are superseded hereby.
Section 11.19. Governing Law. This Agreement and the other Loan Documents,
and the rights and duties of the parties hereto, shall be construed and
determined in accordance with the internal laws of the State of Illinois.
SECTION 11.20. SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL. THE COMPANY
HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT
COURT FOR THE NORTHERN DISTRICT OF ILLINOIS AND OF ANY ILLINOIS STATE COURT
SITTING IN THE CITY OF CHICAGO FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. THE COMPANY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN
SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. THE COMPANY, THE AGENT AND EACH BANK
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN A LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE TRANSACTIONS
CONTEMPLATED THEREBY.
-50-
<PAGE> 614
Upon your acceptance hereof in the manner hereinafter set forth, this
Agreement shall be a contract between us for the purposes hereinabove set
forth.
Dated as of May 22, 1995.
STOKELY USA, INC.
By Stephen W. Theobald
----------------------
Its Vice Chairman
------------------
-51-
<PAGE> 615
Accepted and Agreed to as of the day and year last above written.
HARRIS TRUST AND SAVINGS BANK
individually and as Agent
By HJW Clue
------------------------
Its Vice President
Address: 111 West Monroe Street
Chicago, Illinois 60690
Attention: Agribusiness Division
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION
By Wayne C. Lewis
------------------------
Its Vice President
--------------------
Address: Mercantile Tower
St. Louis, Missouri 63166
Attention:
-----------------
SANWA BUSINESS CREDIT CORPORATION
By Michael J. Cue
------------------------
Its Vice President
--------------------
Address: One South Wacker Drive
Chicago, Illinois 60606
Attention:
------------------
GENERAL ELECTRIC CAPITAL CORPORATION
By Shaun Pett
-----------------------
Its Region Operations Manager
--------------------------
Address: 105 West Madison Street
Suite 1500
Chicago, Illinois 60602
Attention:
-------------------
-52-
<PAGE> 616
EXHIBIT A
STOKELY USA, INC.
SECURED REVOLVING CREDIT NOTE
$__________________ May 22, 1995
FOR VALUE RECEIVED, the undersigned, STOKELY USA, INC., a Wisconsin
corporation (the "Company"), promises to pay to the order of ____(the "Lender")
on July 31, 1998, at the principal office of Harris Trust and Savings Bank in
Chicago, Illinois, the principal sum of ____ or, if less, the aggregate unpaid
principal amount of all Revolving Credit Loans made by the Lender to the
Company under the Revolving Credit provided for under the Credit Agreement
hereinafter mentioned and remaining unpaid on July 31, 1998, together with
interest on the principal amount of each Revolving Credit Loan from time to
time outstanding hereunder at the rates, and payable in the manner and on the
dates specified in said Credit Agreement.
The Lender shall record on its books or records or on the schedule to
this Note which is a part hereof the principal amount of each Revolving Credit
Loan made under the Revolving Credit, whether each Loan is a Domestic Rate Loan
or a Eurodollar Loan and, with respect to Eurodollar Loans, the interest rate
and Interest Period applicable thereto, and all payments of principal and
interest and the principal balances from time to time outstanding; provided
that prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such
books or records or on the schedule to this Note, shall be prima facie evidence
as to all such amounts; provided, however, that the failure of the Lender to
record or any mistake in recording any of the foregoing shall not limit or
otherwise affect the obligation of the Company to repay all Revolving Credit
Loans made under the Revolving Credit, together with accrued interest thereon.
This Note is one of the Revolving Notes referred to in and issued
under that certain Secured Credit Agreement dated as of May 22, 1995, among the
Company, Harris Trust and Savings Bank, as Agent, and the lenders named
therein, as amended from time to time (the "Credit Agreement"), and this Note
and the holder hereof are entitled to all of the benefits and security provided
for thereby or referred to therein, including without limitation the collateral
security provided pursuant to the Security Agreement (as defined in the Credit
Agreement), to which Credit Agreement and Security Agreement reference is
hereby made for a statement thereof and a statement of the terms and conditions
upon which the Agent may exercise rights with respect to such collateral. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.
<PAGE> 617
Prepayments may be made on any Revolving Credit Loan evidenced hereby
and this Note (and the Revolving Credit Loans evidenced hereby) may be declared
due prior to the expressed maturity thereof, all in the events, on the terms
and in the manner as provided for in said Credit Agreement and the Security
Agreement.
The undersigned hereby expressly waives diligence, presentment,
demand, protest, notice of protest, notice of intent to accelerate, notice of
acceleration, and notice of any other kind.
IT IS AGREED THAT THIS NOTE AND THE RIGHTS AND REMEDIES OF THE HOLDER
HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS
OF THE STATE OF ILLINOIS.
STOKELY USA, INC.
By ________________________________
Its ____________________________
2
<PAGE> 618
EXHIBIT B
May 22, 1995
Harris Trust and Savings Bank
Chicago, Illinois
General Electric Capital Corporation
Chicago, Illinois
Sanwa Business Credit Corporation
Chicago, Illinois
Mercantile Bank of St. Louis National
Association
St. Louis, Missouri
Ladies and Gentlemen:
We have served as counsel to Stokely USA, Inc., a Wisconsin
corporation (the "Borrower"), in connection with the execution and delivery of
the instruments and documents identified on Exhibit A to this letter
(collectively the "Loan Documents," individual Loan Documents and other
capitalized terms used below being hereinafter referred to by the designations
appearing on Exhibit A).
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of all such corporate records of the Borrower,
agreements and other instruments, certificates of officers of the Borrower,
certificates of public officials, and other documents which we have deemed
relevant and necessary to render this opinion. In rendering this opinion, we
have assumed the genuineness of all signatures (other than those of officers of
the Borrower), the authenticity of all documents submitted to us as originals,
the conformity to originals of all documents submitted to us as copies, the due
execution of the Loan Documents by, and the enforceability of the Loan
Documents against, you, and the legal capacity of all natural persons.
Whenever this
<PAGE> 619
May 22, 1995
Page 2
opinion refers to matters within our "knowledge," "known to us," or of which
we "know," such reference is limited to (i) the representations and warranties
of the Borrower contained in the Loan Documents; and (ii) facts within our
actual knowledge after an inquiry of the attorneys of this firm who have
provided legal services to the Borrower in connection with the Loan Documents,
without further inquiry. Furthermore, we have not undertaken any further
factual investigation of the business, properties, agreements, or litigation of
the Borrower for purposes of rendering this opinion.
Based upon the foregoing, and subject to the qualifications stated
herein, we are of the opinion that:
1. The Borrower is a corporation existing under the laws of the State
of Wisconsin and, based solely on a certificate of status of the Wisconsin
Secretary of State, (a) has filed with the Wisconsin Secretary of State during
its most recently completed report year the required annual report; (b) is not
the subject of a proceeding under Wisconsin Statutes Section 180.1421 to cause
its administrative dissolution; and (c) Articles of Dissolution of the Borrower
have not been filed with such Secretary of State.
2. The Borrower has the corporate power and authority to execute,
deliver, and perform its obligations under the Loan Documents.
3. The execution and delivery of the Loan Documents and the
performance by the Borrower of their terms do not and will not (i) contravene
any provisions of the Articles of Incorporation or Bylaws of the Borrower; (ii)
based on our knowledge of the business, operations, and properties of the
Borrower, contravene any presently existing provision of any law applicable to
the Borrower; (iii) contravene any provision of any agreement known to us under
which the Borrower has borrowed money (except for such violation or default as
has been waived or consented to by the relevant party thereto); (iv) to our
knowledge, result in the creation or imposition of any lien upon any of the
property of the Borrower except pursuant to the Loan Documents; or (v) require
the consent or approval of, or any filing or registration with, any
governmental body, agency, or authority other than the filing of the Financing
Statement.
<PAGE> 620
May 22, 1995
Page 3
4. The Borrower is not an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as amended,
or, to our knowledge, controlled by such a company.
5. The Borrower is not a "holding company" or a "subsidiary
company" of a "holding company" or an "affiliate" of a "holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
6. The Loan Documents have been duly authorized by all necessary
corporate action (no stockholder approval being required), have been executed
and delivered by the Borrower, and constitute valid and binding agreements of
the Borrower enforceable against it in accordance with their respective terms.
7. The Security Agreement is adequate to create and provide for
the liens and security interests contemplated thereby for the benefit and
security of all the indebtedness secured thereby. The description of the
Collateral set forth in the Financing Statement is sufficient to perfect, and
upon the due filing thereof in the office of the Wisconsin Secretary of State
will perfect, a security interest in the items and types of Collateral in which
a security interest may be perfected by the filing of a financing statement
under the Uniform Commercial Code of the State of Wisconsin as in effect on the
date hereof (the "UCC") to the extent that (i) Wisconsin is the proper state
for filing; (ii) the Collateral consists of the type of property for which a
security interest may be perfected by filing a financing statement in Wisconsin
under the UCC; and (iii) any part of the Collateral or the proceeds or products
thereof does not constitute trust property or a trust fund which by virtue of
federal or state law is not subject to the claims, liens, or security interests
of creditors.
8. To our knowledge, there is no action, suit, proceeding, or
investigation at law or in equity before or by any court or public body pending
or threatened against or affecting the Borrower or any of its assets and
properties which, if adversely determined, could result in any material adverse
change in the properties, business, operations, or financial condition of the
Borrower or in the value of the collateral security for your loans and other
credit accommodations to the Borrower except as described in Schedule 5.4 to
the Secured Credit Agreement.
<PAGE> 621
May 22, 1995
Page 4
9. The rates of interest provided for under the Loan Documents
and any other amounts payable thereunder that would constitute interest would
not violate any usury law of the State of Wisconsin.
All of the foregoing opinions are subject to the following additional
assumptions, limitations, and qualifications:
(a) We express no opinion as to the effect of the compliance or
noncompliance by you with any state or federal laws or regulations applicable
to you because of legal or regulatory status or the nature of your business.
(b) Our opinions relating to the enforceability of the Loan
Documents are subject to and limited by:
(i) Bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance, marshalling, and other similar laws now or
hereafter in effect relating to or affecting the rights and remedies of
creditors generally;
(ii) Limitations imposed by general principles of
equity upon the specific enforceability of any of the remedies or other
provisions of such documents and upon the availability of injunctive relief and
other equitable remedies (regardless of whether enforcement is considered in
proceedings at law or in equity);
(iii) The qualification that certain provisions of
the Loan Documents are or may be unenforceable in whole or in part under the
laws of the State of Wisconsin, but the inclusion of such provisions does not
render the Loan Documents invalid as a whole and there exist either in the Loan
Documents or under applicable law adequate remedies for the practicable
realization of the principal legal rights and benefits intended to be provided
thereby (except for the economic consequences of any delay resulting from such
unenforceability); and
(iv) Such enforcement is subject to recent court
decisions which may require lenders to act reasonably and in good faith in
exercising their rights and remedies under the Loan Documents.
<PAGE> 622
May 22, 1995
Page 5
(c) We render no advice concerning and do not express any opinion
as to:
(i) the priority of any security interest; or
(ii) items of Collateral which by operation of law cannot
be subject to a consensual security interest.
(d) We express no opinion as to the following:
(i) the Borrower's rights in or title to the Collateral;
(ii) any security interest that is terminated or released;
(iii) the effect of noncompliance with the federal
Assignment of Claims Act; or
(iv) future advances other than loans made or to be made
pursuant to the terms of the Secured Credit Agreement.
(e) In the case of property which becomes Collateral after the
date hereof, (i) Section 547 of the United States Bankruptcy Code provides
that a transfer is not made until the debtor has rights in the property
transferred so a security interest in after-acquired property may be treated as
a voidable preference under the conditions (and subject to the exceptions)
provided by Section 547; (ii) Chapter 128 of the Wisconsin Statutes contains a
four-month preference provision that may apply to after-acquired property; and
(iii) Section 552 of the United States Bankruptcy Code limits the extent to
which property acquired by a debtor after the commencement of a case under the
United States Bankruptcy Code may be subject to a security interest arising
from a security agreement entered into by the debtor before the commencement of
such case.
(f) In the case of any interest in or claim in or under any policy
of insurance covering the Collateral, the security interest of the secured
party therein is limited to proceeds payable to the named insured (and not to
any other party named as loss payee under such policy) by reason of loss or
damage to the collateral insured under such insurance policies.
<PAGE> 623
May 22, 1995
Page 6
(g) In the case of all Collateral in which the security interest
of the secured party has been perfected by the filing of the Financing
Statement, Article 9 of the UCC requires the filing of continuation statements
within the period of six months prior to the expiration of five years from the
date of the original filings in order to maintain the effectiveness of the
filings referred to in this paragraph.
(h) The duties to exercise reasonable care in the custody and
preservation of the Collateral in a secured party's possession and to deal with
and dispose of the collateral in a commercially reasonable manner as required
by the UCC may not be disclaimed by agreement, waived, or released.
We call to your attention that the perfection of the above security interests
will be terminated (i) as to any Collateral acquired by the Borrower more than
four months after the Borrower so changes its name, identity, or corporate
structure as to make any financing statements filed against such party
seriously misleading, unless new appropriate financing statements indicating
the new name, identity, or corporate structure of such party are properly filed
before the expiration of such four months; (ii) as to any Collateral consisting
of accounts or general intangibles, four months after the Borrower changes its
chief executive office to a new jurisdiction outside Wisconsin unless such
security interests are perfected in such new jurisdiction before that
termination; (iii) as against buyers of items of the Collateral consisting of
goods of the Borrower sold in the ordinary course of business; and (iv) as to
Collateral otherwise disposed of by the Borrower if such disposition is
authorized under the Loan Documents.
We express no opinion as to (i) any provision affording
indemnification to you; (ii) provisions imposing penalties, forfeitures, or
increases in rates of interest upon delinquency in any payment or upon any
breach or default under the Loan Documents; or (iii) broadly stated waivers of
presentment, protest, demand, notice, appraisement, valuation, stay, extension,
moratorium, redemption, marshalling of assets, or other rights granted by law
to the extent such waivers or rights are held to be against public policy or
prohibited by law.
This opinion deals only with the specific legal issues that it
explicitly addresses and no opinion shall be implied as to matters not so
addressed. The opinions expressed herein are
<PAGE> 624
May 22, 1995
Page 7
specifically limited to the laws of the State of Wisconsin and the federal laws
of the United States. The opinions expressed herein are given as of the date
of this letter and are intended to apply only to those facts and circumstances
that exist as of the date hereof, and we assume no obligation or responsibility
to update or supplement this opinion to reflect any facts or circumstances
occurring after the date hereof that would alter the opinions contained herein.
This opinion is rendered solely for your information and assistance in
connection with the transactions described above and may not be relied upon by
any other person or for any other purpose without our prior written consent.
Sincerely,
MICHAEL, BEST & FRIEDRICH
<PAGE> 625
EXHIBIT A
THE LOAN DOCUMENTS
(Except as noted below, all Loan Documents are dated as of May 22,
1995. Harris Trust and Savings Bank ("Harris") in its capacity as agent under
the Secured Credit Agreement is referred to below as the "Agent" and Harris in
its individual capacity, together with General Electric Capital Corporation
("GECC"), Mercantile Bank of St. Louis National Association ("Mercantile") and
Sanwa Business Credit Corporation ("SBCC") are referred to below as the
"Banks.")
1. Secured Credit Agreement by and among the Borrower, the Agent,
and the Banks.
2. Secured Revolving Credit Note of the Borrower payable to the
order of Harris in the principal amount of $20,000,000.
3. Secured Revolving Credit Note of the Borrower payable to the
order of GECC in the principal amount of $27,500,000.
4. Secured Revolving Credit Note of the Borrower payable to the
order of Mercantile in the principal amount of $5,000,000.
5. Secured Revolving Credit Note of the Borrower payable to the
order of SBCC in the principal amount of $12,500,000.
6. Security Agreement Re: Accounts Receivable and Inventory from
the Borrower to the Agent for the benefit of itself and the Banks (the
"Security Agreement").
7. Application and Agreement for Irrevocable Standby Letter of
Credit dated May 17, 1995 from the Borrower to Harris.
8. Trademark Collateral Agreement from the Borrower to the Agent
for the benefit of itself and the Banks.
9. UCC financing statement to be filed in the office of the
Wisconsin Secretary of State (the "Financing Statement").
<PAGE> 626
EXHIBIT C
STOKELY USA, INC.
COMPLIANCE CERTIFICATE
This Compliance Certificate is furnished to Harris Trust and Savings
Bank, as agent (the "Agent"), pursuant to that certain Secured Credit Agreement
dated as of May 22, 1995 by and among Stokely USA, Inc. (the "Company"), Harris
Trust and Savings Bank and the other lenders parties thereto (the "Agreement").
Unless otherwise defined herein, the terms used in this Compliance Certificate
have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected __________________________ of the
Company;
2. 1 have reviewed the terms of the Agreement and I have made, or
have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Company during the accounting period covered
by the attached financial statements;
3. The examinations described in paragraph 2 did not disclose,
and I have no knowledge of, the existence of any condition or event which
constitutes a Potential Default or Event of Default during or at the end of the
accounting period covered by the attached financial statements or as of the
date of this Certificate, except as set forth below; and
4. If attached financial statements are being furnished pursuant
to Section 7.4(a) or (b) of the Agreement, Schedule I attached hereto sets
forth financial data and computations, evidencing the Company's compliance with
certain covenants of the Agreement, all of which data and computations are
true, complete and correct.
Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Company has taken, is taking or proposes to
take with respect to each such condition or event:
_____________________________________
_____________________________________
<PAGE> 627
The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this _____ day
of________, 19__.
STOKELY USA, INC.
By ________________________
Its______________________
-2-
<PAGE> 628
SCHEDULE I
STOKELY USA, INC.
Compliance Calculations for Secured
Credit Agreement Dated as of May 22, 1995
SECTION 7.8 LEVERAGE RATIO
(a) Funded Debt . . . . . . . . . . . . . . . . . . . . . . $_____
(b) Funded Debt plus Tangible Net Worth . . . . . . . . . . $_____
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . $_____
(a)/(b) . . . . . . . . . . . . . ______*
*Required to not exceed 0.62 to 1.
Compliance . . . . . . . . . . Yes ____ No ____
SECTION 7.9 TANGIBLE NET WORTH
(a) Net Worth . . . . . . . . . . . . . . . . . . . . . . $_____
(b) Intangible Assets . . . . . . . . . . . . . . . . . . . $_____
(a) - (b). . . . . . . . . . . . . . . . . . . . . . . . _____*
Tangible Net Worth . . . . . . . . . . . . . . . . . . . . . . $_____*
*Required to be no less than $______ during this compliance period.
Compliance . . . . . . . . . . Yes ____ No ____
SECTION 7.10 NET WORKING CAPITAL
(a) Current Assets . . . . . . . . . . . . . . . . . . . . . $_____
(b) Current Liabilities. . . . . . . . . . . . . . . . . . . $_____
(a)-(b) . . . . . . . . . . . . . . . . . . . . . . . . _____*
*Required to be no less than $35,000,000.
Compliance . . . . . . . . . . Yes ____ No ____
<PAGE> 629
EXHIBIT D
STOKELY USA, INC.
BORROWING BASE CERTIFICATE
as of__________________
($000's omitted)
This Borrowing Base Certificate is furnished to Harris Trust and Savings
Bank, as agent (the "Agent"), pursuant to that certain Secured Credit Agreement
dated as of May 22, 1995, by and among Stokely USA, Inc. (the "Company"),
Harris Trust and Savings Bank and the other lenders parties thereto (the
"Agreement"). Unless otherwise defined herein, the terms used in this
Borrowing Base Certificate have the meanings ascribed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected __________ of the Company.
2. I have reviewed the terms of the Agreement and I have made, or
have caused to be made under my supervision, the attached computation of
the Borrowing Base as defined in Section 4.1 of the Agreement.
3. No change of name, corporate identity or address of the chief
executive office of the Company has occurred.
4. The information above and any attached exhibits do not contain
any untrue statement of material fact or omit a material fact, either
individually or in aggregate, that would make the information or any
attached exhibits misleading.
STOKELY USA, INC.
By _____________________
Its __________________
<PAGE> 630
STOKELY USA, INC.
BORROWING BASE CERTIFICATE
<TABLE>
<CAPTION>
BORROWING
GROSS NON PRIME PRIME ADVANCE % BASE
<S> <C> <C> <C> <C> <C> <C> <C>
ACCOUNTS __________ __________ __________ __________ __________
RECEIVABLE
INVENTORY __________ __________ __________ __________ __________ __________ ___________
TOTAL __________ __________ __________ __________
BORROWING BASE __________ __________
LOAN BALANCE 05-May-95 __________ Sum <A> __________
L.O.C. RESERVE __________
AVAILABLE AMOUNT __________
</TABLE>
<PAGE> 631
<TABLE>
<CAPTION>
GROSS NON PRIME PRIME ADVANCE % ADVANCE
<S> <C> <C> <C> <C> <C>
CANNED RAW MATERIAL _______ ___________ ___________ ___________ ___________
FG CANNED _______ ___________ ___________ ___________ ___________
FROZEN RAW MATERIAL _______ ___________ ___________ ___________ ___________
FG FROZEN _______ ___________ ___________ ___________ ___________
_______ ___________ ___________ ___________
</TABLE>
<PAGE> 632
<TABLE>
<S> <C> <C>
NON PRIME-CANNED
SEED INVENTORY ____________
CANNERY RETAIL INVENTORY ____________
PLASTIC INVENTORY ____________
GLASS INVENTORY ____________
BOX INVENTORY ____________
LABEL INVENTORY ____________
FARM SUPPLIES ____________
FACTORY SUPPLIES ____________
SUBTOTAL RAW MATERIALS ____________
NON-PRIME FINISHED GOODS CANNED
GROWER PAYABLES Jan 31 Trial Balance ____________
GROWER PAYMENTS ____________
MONTH TO DATE INCREASE IN GROWER PAYABLE ____________
GRADE 8 & 9 ____________
SUBTOTAL NP FINISHED ____________
TOTAL NON PRIME CANNED ____________
</TABLE>
<PAGE> 633
<TABLE>
<S> <C> <C>
NON PRIME-FROZEN
SEED INVENTORY ____________
HANDLING AND STORAGE ____________
BOX INVENTORY ____________
POLYBAG INVENTORY ____________
FROZEN TOTE INVENTORY ____________
FROZEN OVERWRAP ____________
FARM SUPPLIES ____________
FACTORY SUPPLIES ____________
INGREDIENTS ____________
SUBTOTAL ____________
GROWER PAYABLES Jan 31 Trial Balance ____________
GROWER PAYMENTS ____________
ESTIMATED MONTH TO DATE INCREASE IN GROWERS ____________
20% OF U INVENTORY ____________
ALL OF Z INVENTORY ____________
SUBTOTAL ____________
</TABLE>
<PAGE> 634
<TABLE>
<CAPTION>
DOLLARS UNITS VARIABLE COST PER
CASE OR POUND
<S> <C> <C> <C>
FINISHED GOODS CANNED PER RPT ________ ________ ___________
________ ________ ___________
BURDEN RATE ________ ________ ___________
CANNED FINISHED GOODS W/BURDEN ________ ________ ___________
FINISHED GOODS FROZEN PER RPT ________ ________ ___________
BURDEN RATE ________
FROZ FINISHED GOODS W/BURDEN ________
</TABLE>
<PAGE> 635
<TABLE>
<CAPTION>
TOTAL NON PRIME PRIME ADVANCE % ADVANCE
<S> <C> <C> <C> <C> <C>
PRIVATE LABEL _____ _________ ______ ________ _________
BRAND _____ _________ ______ ________ _________
FROZEN _____ _________ ______ ________ _________
_____ _________ ______ ________ _________
_____ _________ ______ _________
</TABLE>
<TABLE>
<CAPTION>
PRIVATE BRAND FROZEN TOTAL
<S> <C> <C> <C> <C> <C>
OVER 90 DAYS _______ _______ _______ _______ ___________
CROSS AGE _______ _______ _______ _______ ___________
FOREIGN <90 _______ _______ _______ _______ ___________
LESS FOREIGN ALLOWED _______ _______ _______ _______ ___________
GOVERNMENT _______ _______ _______ _______ ___________
LESS GOV'T ALLOWED _______ _______ _______ _______ ___________
AGED REC. - PACKER FOODS _______ _______ _______ _______ ___________
</TABLE>
<PAGE> 636
EXHIBIT E
APPLICATION AND AGREEMENT FOR IRREVOCABLE
STANDBY LETTER OF CREDIT
Date________________________
SPL_________________________
International Operations Division
Harris Trust and Savings Bank
P.O. Box 765
111 West Monroe Street
Chicago, Illinois 60690
Gentlemen:
We request you to open and transmit by cable/airmail your Irrevocable Letter of
Credit in favor of:
available by their drafts, drawn at sight on: Harris Trust and Savings Bank, or
not exceeding a total of:
accompanied by the following document(s):
Drafts drawn under this Letter of Credit must be drawn and presented together
with accompanying documentation at your principal office in Chicago, Illinois
not later than:
In consideration of your issuing at our request your Irrevocable Letter of
Credit (hereinafter called "Credit") on the terms mentioned above:
1. We hereby agree to pay you in immediately available and freely
transferable funds the amount of each draft or acceptance drawn under,
or purporting to be drawn under, the Credit, such payment to be made at
the maturity of each respective draft or acceptance.
2. Payment shall be made by us at your office in Chicago, Illinois
in lawful money of the United States, provided that, if a draft or
other request for payment under the Credit is drawn in a currency other
than United States currency, we shall pay the equivalent in United
States currency, at the rate of exchange then current in Chicago for
cable transfers to the place of payment in the currency in which
drawing was made, as determined by you and notified to us, or, if you
so request of us at your option, we shall pay you the amount of such
drawing in the currency in which the drawing was made in a place, form
and manner acceptable to you.
<PAGE> 637
5. We agree that in the event of any extension of the maturity or time for
presentation of drafts, acceptances or documents, or any other
modification of the terms of the Credit, at the request of any of us,
with or without notification to the others, or in the event of any
increase in the amount of the Credit at our request, this agreement
shall be binding upon us with regard to the credit extended, increased
or otherwise modified, to drafts, documents and property covered
thereby, and to any action taken by you or any of your correspondents,
in accordance with such extension, increase or other modification.
6. The users of the Credit shall be deemed our agents and we assume all
risks of their acts, omissions, or misrepresentations. Neither you nor
your correspondents shall be responsible for the validity, sufficiency,
truthfulness, or genuineness of any documents even if such documents
should in fact prove to be in any or all respects invalid, insufficient,
fraudulent or forged; for failure of any draft to bear any reference or
adequate reference to the Credit, or failure of any person to note the
amount of any draft on the reverse of the Credit, or to surrender or to
take up the Credit as required by the terms of the Credit; each of
which provisions, if contained in the Credit itself, it is agreed may
be waived by you, or for errors, omissions, interruptions or delays
in transmission or delivery of any message, by mail, cable, telegraph,
wireless, or otherwise, whether or not they be in cipher; nor shall you
be responsible for any error, neglect or default of any of your
correspondents; and none of the above shall affect, impair or prevent
the vesting of any of your rights or powers hereunder. In furtherance
and extension and not in limitation of the specific provisions
hereinbefore set forth, we agree that any action taken by you or by any
correspondent of yours under or in connection with the Credit or the
relative drafts, documents or property, if taken in good faith, shall
be binding on us and shall not put you or your correspondent under any
resulting liability to us; and we make like agreement as to any
inaction or omission, unless in breach of good faith, except for acts
caused by gross negligence or willful misconduct.
8. You shall not be deemed to have waived any of your rights hereunder,
unless you or your authorized agent shall have signed such waiver in
writing. No such waiver, unless expressly as stated therein, shall be
effective as to any transaction which occurs subsequent to the date of
such waiver, or as to any continuance of a breach after such waiver.
9. The word "property", as used in this agreement, includes goods,
merchandise, securities, funds, choses in action, and any and all other
forms of property, whether real, personal or mixed, and any right or
interest therein.
10. Without limiting the foregoing hereof, we agree that all property
belonging to any of us, now or at any time hereafter delivered,
deposited, conveyed, transferred, assigned or paid to you, or coming
into your possession or into the possession of any one for you in
any manner whatsoever, whether expressly as security for any
obligations or liabilities of us to you or otherwise, are hereby made
and shall be and constitute collateral security for any and all
obligations and liabilities, absolute or contingent, due or to become
due, which are now or may at any time hereafter be owing by us or any
one or more of us to you.
11. Without limiting the foregoing and in addition to the provisions of
paragraph numbered 6 hereof, you are hereby expressly authorized and
directed to honor any request for payment which is made under and in
compliance with the terms of said Credit without regard to, and without
any duty on your part to inquire into, the existence of any disputes or
controversies between any of the undersigned, the beneficiary of the
Credit or any other person, firm or corporation, or the respective
rights, duties or liabilites of any of them or whether any facts or
occurrences represented in any of the documents presented under the
Credit are true or correct. Furthermore, we fully understand and
agree that your sole obligation to us shall be limited to honoring
requests for payment made under and in compliance with the terms of the
Credit and this application and your obligation remains so limited even
if you may have assisted us in the preparation of the wording of the
Credit or any documents required to be presented thereunder or you may
otherwise be aware of the underlying transaction giving rise to the
Credit and this application. In addition, and without limiting any of
the other provisions hereof, you and your correspondents may (a) act in
reliance upon any oral, telephonic, telegraphic, electronic or written
request or notice believed by you or your relevant correspondent in
good faith to have been authorized by us or any one of us, whether or
not given or signed by an authorized person, and (b) receive, accept or
pay as complying with the terms of the Credit any drafts or other
document, otherwise in order, that may be signed by, or issued to, the
administrator or executor of, or the trustee in bankruptcy of, or the
receiver for any of the property of, or any other person or entity
acting as the representative of, in the place of or as the successor in
interest to, the party in whose name the Credit provides that any
drafts or other documents should be drawn or issued.
12. If this agreement is signed by one party, the terms "we," "our," "us,"
shall be read throughout as "I," "my," "me," as the case may be. If
this agreement is signed by two or more parties, it shall constitute
the joint and several agreement of such parties. This agreement shall
be deemed to be made under and shall in all respects be governed by the
law of the State of Illinois. The Credit and, to the extent not
inconsistant with the laws of the State of Illinois, this agreement
will be subject to the Uniform Customs and Practice for Documentary
Credits as most recently published by the International Chamber of
Commerce (the "UCP"), except that Article 41 and 43 of the UCP (1993
Revision) published by the International Chamber of Commerce as
Publication No. 500 shall not apply nor shall any equivalent provision
in any future version of the UCP.
Very truly yours,
-------------------------------------
(Firm's name, if applicable)
For Bank Use Only By___________________________________
Title________________________________
______________________ _________ By___________________________________
Signatures Approved by Date
Title________________________________
<PAGE> 638
SCHEDULE 5.2
SUBSIDIARIES
<TABLE>
<CAPTION>
JURISDICTION OF PERCENTAGE
NAME INCORPORATION OWNERSHIP
<S> <C> <C>
1. Oconomowoc Canning Company, Inc., Wisconsin 100%
2. Ocono International, Ltd. U.S. Virgin Islands 100%
3. ANC Express, Inc. Iowa 100%
4. D & K Frozen Foods, Inc. Washington 100%
5. Stokely U.K. Limited England 100%
</TABLE>
<PAGE> 639
Schedule 5.4
LITIGATION
1. Walter Reinholdt v. Stokely USA, Inc. (Law No. C2017 in the
Iowa District Court for Franklin County, Iowa)
This is an action brought by plaintiff for damages of $56,633.43 plus
interest and costs. The claim is based on the Company's alleged
negligence in connection with the storage of dark red kidney beans at its
plant in Ackley, Iowa. The Company denies liability.
This case was tried to a jury in July of 1994, and a verdict was
returned which found no liability on the part of the Company. Plaintiff
has, however, appealed to the Court of Appeals of the State of Iowa. A
decision on that appeal is expected later this year.
Davis, Hockenberg, Wine, Brown, Koehn & Shors of Des Moines, Iowa
represents the Company in this matter.
2. Kurt Boehm v. Stokely USA, Inc., et al. (Case No. 93-L-003414 in the
Circuit Court of Cook County, Illinois)
This action was filed in April of 1993 and is for personal injuries
suffered by plaintiff in a boiler explosion that occurred at the Company's
plant in Hoopeston, Illinois while plaintiff was present as a business
invitee.
The Company has liability insurance in force for this claim through
Crum and Forster Commercial Insurance Co., and the Company's defense has
been undertaken by Crum and Forster Insurance Co. through the law firm of
Crystal, Heytow and Warnick, P.C. of Chicago, IL.
3. Robert Potratz and James Potratz v. Stokely USA, Inc. (Case No. 93-CV-811
in the Circuit Court of Winnebago County, Wisconsin.)
This action sought damages of $180,000 on a breach of contract claim
plus punitive damages of an unstated amount. The Company denied
liability, and the case was tried to a jury in April of 1995. The jury
found that the Company breached the contract and returned a damage verdict
of $73,283 against the Company.
The Company has filed motions after verdict to set aside or reduce
the damages to $34,788. These motions are scheduled to be heard by the
court on May 11, 1995. The Company plans to appeal if the verdict as to
damages is not
<PAGE> 640
set aside. Robert Brill, general counsel of the Company, represents the
Company in this action.
4. Renee Estrada v. Arnold Bowman and Stokely USA, Inc. (Cause No.
C-1327-94-D, Hidalgo County, Texas District Court).
This action was filed on March 18, 1994 and is an action for damages
based on plaintiff's claim that he was wrongfully discharged as an
employee at the Company's plant in McAllen, Texas. There is no substance
to the plaintiff's claim. Damages sought include lost earnings and
punitive damages. The Complaint, however, fails to state a specific
damage amount. The exposure is minimal.
The Company is represented by the law firm of Adams and Graham,
L.L.P. of Harlingen, Texas in this action.
5. Baker's Best Frozen Commodities Co., v. Stokely USA, Inc. et
al. (Case No. BC102425 Los Angeles County Superior Court).
This action was filed on April 11, 1994 and seeks compensatory and
punitive damages arising from an alleged breach of contract. The amount
of damages is not stated in the Complaint but is generally represented to
be in excess of $500,000; of which sum the compensatory damage claim
comprises a small part. Stokely USA, Inc. denies liability.
A tentative settlement has been reached which is in the process of
being reduced to writing. Pursuant to this settlement, the Company will
forgive outstanding invoices owed it by Plaintiff in the amount of $16,700
and will provide $15,000 of trade discounts to Plaintiff in each of the
next 3 years.
The Company is represented in this action by Lane, Powell, Spears and
Lubersky of Los Angeles, California.
6. Duane C. Klingler v. Stokely USA, Inc. (Case No. CI-95-046 in the Common
Pleas Court of Paulding County, Ohio).
This action was filed in March of 1995 and claims that the Company
breached a warehouse lease agreement with Plaintiff. Damages of $44,000
are claimed.
The Company has denied liability. Glenn Troth of Paulding, Ohio
represents the Company in this action.
7. Pedro Rodriguez v. Stokely USA, Inc. (Case No. C94-3057 in the United
States District Court for the Northern District of Iowa).
2
<PAGE> 641
This action was filed in August of 1994 and claims that the Company
breached an employment agreement with Plaintiff. Damages are unstated in
the complaint but are estimated by the Company to be less than $5,000.
The Company has denied liability. No trial date has been set.
Robert Brill, general counsel of the Company, represents the Company in
this action.
8. Philip D. Freeman v. Stokely USA, Inc. (Case No. 95-C-003 in the United
States District Court for the Eastern District of Wisconsin).
This is a class action lawsuit which was filed on January 3, 1995, in
the United States District Court for the Eastern District of Wisconsin, by
Philip D. Freeman, a Minnesota resident, against the Company, all of the
individual members of the Board of Directors of the Company (in both their
capacity as a member of the Board of Directors and as an executive
officer, as applicable), William Blair & Company and Dain Bosworth, Inc.
The plaintiff brought the action pursuant to Sections 11, 12(2) and 15 of
the Securities Act of 1934, as amended, and Rule 10b-5 promulgated
thereunder. The plaintiff alleges that he sustained losses in connection
with his purchase of shares of Common Stock of the Company following a
secondary offering by the Company during the period from October 17, 1994
to December 19, 1994, as a result of defendants' alleged misleading
statements and omission to state material facts. The complaint seeks
rescission and/or compensatory damages, and costs and expenses related to
the bringing of the lawsuit. The Company believes that the allegations
are without merit or substance.
The Company retained the law firm of Gibbs, Roper, Loots and Williams
of Milwaukee, Wisconsin to represent the Company and its officers. The
Company has retained the law firm of Michael, Best & Friedrich of
Milwaukee, Wisconsin, to represent the Company's non-employee directors.
The Company has Directors and Officers Liability Insurance coverage
through two carriers with total coverage of $10,000,000, less retention of
$250,000. The Company has negotiated allocation of defense costs with the
primary carrier assuming 75% of such costs and the Company 25% after the
retention.
Motions for dismissal of the Complaint have been filed on behalf of
all defendants and remain pending.
9. Daniel J. Sweeney v. Stokely USA, Inc., et al. (Case No. 95-C-0501) in the
United States District Court for Eastern District of Wisconsin).
3
<PAGE> 642
This case was filed on 5/10/95 and served 5/17/95. It is a class
action suit arising from the same events as the Freeman case.
The Company has retained the law firm of Gibbs, Roper, Loots &
Williams of Milwaukee, Wisconsin to represent it and its employees named
as defendants.
ADMINISTRATIVE PROCEEDINGS PENDING
1. Cynthia A. Spencer v. Stokely USA, Inc. (Case No. CP 08-92-22838 Iowa Civil
Rights Commission)
Cynthia A. Spencer filed a complaint with the Iowa Civil Rights
Commission in August of 1992. She claims that she was not hired in 1992
as a mechanic due to her gender. There is no substance to her complaint
which remains under investigation by the Iowa Civil Rights Commission.
The Company is represented in this matter by its general counsel,
Robert Brill.
2. John Areklet v. Stokely USA, Inc. (PACA N-7964 in the United States
Department of Agriculture)
John Areklet filed a complaint with the United States Department of
Agriculture in February of 1995 which claims the Company violated the
Perishable Agricultural Commodities Act by rejecting a quantity of green
beans grown under contract with the Company by Mr. Areklet in 1994. Mr.
Areklet claims damages of $12,474.
Stokely has denied liability. An administrative decision on the
claim is forthcoming. The Company is represented in this matter by its
general counsel, Robert Brill.
3. Robert Van der Zanden v. Stokely USA, Inc. (PACA N-8003 in the United
States Department of Agriculture).
Robert Van der Zanden filed a complaint with the United States
Department of Agriculture in March of 1995 which claims the Company
violated the Perishable Agricultural Commodities Act by rejecting a
quantity of green beans grown under contract with the Company by Mr. Van
der Zanden in 1994. Mr. Van der Zanden claims damages of $5,770.
Stokely has denied liability. An administrative decision on the
claim is forthcoming. The Company is represented in this matter by its
general counsel, Robert Brill.
4
<PAGE> 643
THREATENED LITIGATION
1. Middleton Refuse Hideaway. The Company has been named as a potentially
responsible party with regard to the Middleton Refuse Hideaway Landfill
Site in Dane County, Wisconsin. The Company believes its responsibility,
if any, is de minimus on the basis that it contributed no hazardous
materials to the landfill site and an insignificant volume of materials in
a volumetric ranking scheme.
The Company joined with several other de minimus parties to retain
the law firm of Michael Best and Friedrich of Madison, Wisconsin to
represent it with regard to this matter; although there is no legal action
pending against the Company at this time. The Company is currently
negotiating a de minimus settlement.
5
<PAGE> 644
SCHEDULE 5.15
FARM PRODUCT PURCHASES AND REGISTRATIONS
States in Which The
Company is Registered
States in Which Farm Central Filing System Under the Federal Food
Products are Purchased (Yes/No) Security Act
Wisconsin NO
Illinois NO
Iowa NO
Texas NO
Washington NO
Florida NO
Michigan NO
Minnesota YES Minnesota
Missouri NO
<PAGE> 645
SCHEDULE 7.13
PERMITTED LIENS
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------- -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Arkansas UCC
Secretary of
State
Pulaski County, UCC
AR
Illinois UCC
Secretary of
State
3077203 01/25/93 Heekin Can, Inc. Inventory:
Ready to fill
cans
Indiana Secretary UCC
of State
1812696 11/12/93 Packer Foods, Inventory
Inc. produced by
Packer Foods,
Inc. and A/R
generated by its
sale
Iowa Secretary UCC 04/26/95 K363187 05/26/92 Heekin Can, Inc. Ready to fill
of State cans
K405321 11/16/92 Leasing LEASE: Specific
Dynamics, Inc. equipment
K430927 01/26/93 Heekin Can, Inc. Ready to fill
cans
Michigan UCC 04/19/95 C677593 01/25/93 Heekin Can, Inc. Inventory:
Secretary of Ready to fill
State cans
</TABLE>
<PAGE> 646
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------- -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Minnesota UCC 05/02/95 1504490 05/26/92 Heekin Can, Inc. Inventory:
Secretary of Ready to fill
State cans
1510939 06/22/92 Budach Tractors
Implement, Inc.
assigned to Case
Credit, a
division of Case
Corporation
Missouri UCC
Secretary of
State
Greene County, UCC
MO
New York UCC
Department of
State
Albany County, UCC
NY
Oklahoma UCC
County Clerk,
OK
Oregon UCC
Secretary of
State
Tennessee UCC
Secretary of
State
Texas Secretary UCC
of State
9400224522 11/18/94 LDI Corporation LEASE: Specific
equipment
Virginia State UCC
Corporation
Commission
</TABLE>
-2-
<PAGE> 647
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Indep. City of UCC
Richmond, VA
Washington UCC 04/24/95 92-188-0990 07/06/92 Industrial (1) Hyster Lift
Department of Finance truck
Licensing Company
92-353-9651 12/18/92 Industrial ASSIGNMENT:
ASSIGNMENT Finance to CIT Group/
Company Equipment
Financing, Inc.
94-144-0173 05/24/94 Hyster Sales (1) Hyster Lift
Company truck
95-090-0314 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0315 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0316 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0317 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0318 03/31/95 Container Specific
Corporation of machinery/
America equipment
95-090-0319 03/31/95 Container Specific
Corporation of machinery/
America equipment
Wisconsin UCC 12/07/94 845203 05/01/86 First Bank (2) Forklifts w.
Secretary of (N.A.), as clamps
State Trustee
</TABLE>
-3-
<PAGE> 648
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
1171913 12/28/90 First Bank CONTINUATION
CONTINUATION (N.A.), as
Trustee
1007611 08/23/88 Village of Specific
Poynette furniture,
assigned to First machinery,
Bank (N.A.), as equipment paid
Trustee for by proceeds
of $6,000,000
Village of
Poynette Indus.
Revenue Bonds
1296582 08/10/92 First Bank ASSIGNMENT
ASSIGNMENT (N.A.), as to Nations Bank
Trustee of Virginia,
N.A.
1369947 07/28/93 NationsBank of CONTINUATION
CONTINUATION Virginia, N.A.
1158190 10/12/90 Port of Walla (1) FMC
Walla Public pressure cooker
Corporation
assigned to First
Bank (N.A.), as
Trustee
1303747 09/18/92 Port of Walla ASSIGNMENT
ASSIGNMENT Walla Public to Nations Bank
Corporation of Virginia,
assigned to First N.A.
Bank (N.A.), as
Trustee
1315321 11/17/92 First Bank ASSIGNMENT
ASSIGNMENT (N.A.), as to Nations Bank
Trustee of Virginia,
N.A.
1216491 07/11/91 American LEASE: (1)
Industrial Omega phone
Leasing system
</TABLE>
-4-
<PAGE> 649
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
1107349 01/25/90 Key Key Color-sort
Technology, Inc. system
822029 01/02/86 First Bank Machinery,
(N.A.), as equipment,
Trustee fixtures, other
personal
property from
proceeds from
sale of $6.5MM
Jefferson,
Wisconsin
Indus. Develop.
Revenue Bonds
1170976 12/21/90 First Bank CONTINUATION
CONTINUATION (N.A.), as
Trustee
1296533 08/10/92 First Bank ASSIGNMENT
ASSIGNMENT (N.A.), as to Nations Bank
Trustee of Virginia,
N.A.
1331277 02/08/93 GTE Leasing LEASE: Norstar
Corp. Telephone
System
1328653 01/26/93 Heekin Can, Inc. Inventory--
"Cans", "Ends"
i.e. "Containers"
1094129 11/14/89 Thorstad Motorola
Leasing, Inc. Cellular phone
1313536 11/09/92 Packer Foods, Inventory
Inc. produced by
Packer Foods
and accounts
generated by sale
of such
1152613 09/13/90 Orix Credit LEASE: Specific
Alliance, Inc. equipment
</TABLE>
-5-
<PAGE> 650
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
1298316 08/19/92 Orix Credit RELEASE:
RELEASE Alliance, Inc. Specific leased
equipment
1155291 09/27/90 Leasing LEASE: Specific
Dynamics, Inc. equipment
0751194813 04/05/91 Leasing LEASE: Specific
Dynamics, Inc. office equipment
1340380 03/17/93 IBM Specific IBM
equipment for
$170,000
1340382 03/17/93 IBM Specific IBM
equipment for
$170,000
1419066 03/30/94 LDI LEASE: specific
Corporation IBM equipment
Brown County, UCC
WI
Columbia UCC
County, WI
670109 04/02/93 Rhyme Supply (1) Fax system
Dane County, UCC
WI
Outagamie UCC 05/05/95 2124 05/01/86 First Bank (2) Fork lifts,
County, WI (N.A.) as railroad track,
Trustee security system
315 01/25/91 First Bank CONTINUATION
CONTINUATION (N.A.) as
Trustee
419 02/08/95 Comerica Bank - Blanket lien/
Illinois Fixtures
Waukesha UCC
County, WI
</TABLE>
-6-
<PAGE> 651
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ----------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
</TABLE>
-7-
<PAGE> 652
<TABLE>
<CAPTION>
Jurisdiction Type of Search Search Date File Number Filing Date Secured Party Collateral
- ------------ -------------- ----------- ----------- ------------ ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
D&K FROZEN FOODS, INC.
Washington UCC 12/01/94 86-057-0460 02/26/86 Caterpillar (1) New CAT
Department of Financial lift truck
Licensing Services
Corporation
91-004-0453 01/04/91 Caterpillar CONTINUATION
CONTINUATION Financial
Services
Corporation
91-100-0520 04/10/91 Tumac Lease & LEASE: Specific
Finance Inc. equipment
93-210-0455 07/29/93 United States Machinery,
Department of equipment,
Commerce furniture,
fixtures located
on real property-
-subject to
Subordination
Agrmt (Rainier
National Bank)
</TABLE>
-8-
<PAGE> 1
EXHIBIT 21.1
SUBSIDIARIES OF STOKELY USA, INC.
OCONOMOWOC CANNING COMPANY, INC., incorporated in Wisconsin January 16,
1985.
President Vernon L. Wiersma
Vice President John R. McCormick
Secretary Robert M. Brill
Treasurer Stephen W. Theobald
Directors Vernon L. Wiersma
Frank J. Pelisek
Stephen W. Theobald
OCONO INTERNATIONAL, LTD., incorporated in U.S. Virgin Islands,
December 31, 1984.
President Vernon L. Wiersma
Secretary Robert M. Brill
Treasurer Stephen W. Theobald
Directors Vernon L. Wiersma
Stephen W. Theobald
Stuart Sonne
ANC EXPRESS, INC., incorporated in Iowa, July 1, 1967.
President Vernon L. Wiersma
Vice President Stephen W. Theobald
Secretary Robert M. Brill
Directors Vernon L. Wiersma
Stephen W. Theobald
D & K FROZEN FOODS, INC., incorporated in Washington, August 22, 1977.
President Vernon L. Wiersma
Vice President James Beal
Treasurer Stephen W. Theobald
Secretary Robert M. Brill
Directors Vernon L. Wiersma
Stephen W. Theobald
<PAGE> 2
SUBSIDIARIES OF STOKELY USA, INC.
STOKELY U.K. LIMITED, incorporated in England on May 17, 1991.
President Vernon L. Wiersma
Vice President Stephen W. Theobald
Treasurer Stephen W. Theobald
Secretary Leslie J. Wilson
Directors Vernon L. Wiersma
Stephen W. Theobald
Kenneth C. Murray
Leslie J. Wilson
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
33-18801 of Stokely USA, Inc. and subsidiaries, on Form S-8 of our report dated
May 22, 1995 appearing in the Annual Report on Form 10-K of Stokely USA, Inc.
and subsidiaries for the year ended March 31, 1995.
DELOITTE & TOUCHE LLP
Milwaukee, Wisconsin
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 1,177
<SECURITIES> 0
<RECEIVABLES> 25,911
<ALLOWANCES> 452
<INVENTORY> 79,389
<CURRENT-ASSETS> 108,230
<PP&E> 107,381
<DEPRECIATION> 38,784
<TOTAL-ASSETS> 181,294
<CURRENT-LIABILITIES> 40,178
<BONDS> 78,497
<COMMON> 572
0
0
<OTHER-SE> 43,683
<TOTAL-LIABILITY-AND-EQUITY> 181,294
<SALES> 231,422
<TOTAL-REVENUES> 231,939
<CGS> 186,814
<TOTAL-COSTS> 220,431
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,796
<INCOME-PRETAX> 712
<INCOME-TAX> 142
<INCOME-CONTINUING> 570
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 570
<EPS-PRIMARY> 0.06
<EPS-DILUTED> 0.06
</TABLE>
