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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Seneca Foods Corporation
(Name of Issuer)
Class A Common Stock, par value $.25 per share
(Title of Class of Securities)
817070501
(CUSIP Number)
Jerome J. Jenko
Senior Vice President,
General Counsel and Secretary
The Pillsbury Company
200 South Sixth Street
Minneapolis, Minnesota 55102
(612) 330-4966
copy to:
Francis J. Aquila
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
(212) 558-4000
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
March 22, 1996
(Date of Event which Requires Filing of this Statement)
If a filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the
following box [ ].
Check the following box if a fee is being paid with this statement [X].
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- --------------------
CUSIP NO. 817070501
- --------------------
- ------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Grand Metropolitan Public Limited Company
- ------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
- ------------------------------------------------------------
3. SEC USE ONLY
- ------------------------------------------------------------
4. SOURCE OF FUNDS
AF, OO
- ------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
[ ]
- ------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
England
- ------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 0
SHARES ----------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 346,570
EACH ----------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 0
WITH ----------------------------------------
10. SHARED DISPOSITIVE POWER
346,570
- ------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
346,570
- ------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
- ------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
11.0%
- ------------------------------------------------------------
14. TYPE OF REPORTING PERSON
CO
- ------------------------------------------------------------
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- --------------------
CUSIP NO. 817070501
- --------------------
- ------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The Pillsbury Company
- ------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
- ------------------------------------------------------------
3. SEC USE ONLY
- ------------------------------------------------------------
4. SOURCE OF FUNDS
00
- ------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(D) OR 2(E)
[ ]
- ------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- ------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 0
SHARES ----------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 346,570
EACH ----------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 0
WITH ----------------------------------------
10. SHARED DISPOSITIVE POWER
346,570
- ------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
346,570
- ------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
- ------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
11.0%
- ------------------------------------------------------------
14. TYPE OF REPORTING PERSON
CO
- ------------------------------------------------------------
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Item 1. Security and Issuer
This statement on Schedule 13D (this "Schedule 13D") relates to
the Class A Common Stock, par value $.25 per share (the "Common Stock"), of
Seneca Foods Corporation (the "Company"). The Company's principal
executive offices are located at 1162 Pittsford-Victor Road, Pittsford, New
York 14534.
Item 2. Identity and Background
This Schedule 13D is filed by Grand Metropolitan Public Limited
Company, a company incorporated under the laws of England (the "Parent"),
and The Pillsbury Company, a Delaware corporation (the "Purchaser"). The
Purchaser is an indirect wholly owned subsidiary of the Parent. Purchaser
and Parent are sometimes referred to herein as the "Reporting Persons."
The principal executive offices of Purchaser are located at 200
South Sixth Street, Minneapolis, Minnesota 55402. Purchaser is a
diversified food manufacturer engaged in the following major categories of
the food manufacturing business: baked goods, vegetables, ice cream,
Mexican food, soup and Italian speciality products.
The principal executive offices of Parent are located at 20 St.
James's Square, London SW1Y 4RR, England. Parent is an international
branded consumer products company engaged in two major sectors: food and
drinks.
(a) - (c); (f) The name, business address, present principal
occupation or employment and citizenship of each of the executive officers
and directors of each of the Reporting Persons are set forth in Schedule I
hereto and are incorporated by reference herein.
(d) - (e) During the last five years, none of the Reporting
Persons, and to the knowledge of each of the Reporting Persons, none of the
persons listed on Schedule I hereto, (i) has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or
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(ii) was a party to a civil proceeding of a judicial or administrative body
of competent jurisdiction as a result of which any such person was or is
subject to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation of such law.
Item 3. Source and Amount of Funds or Other Consideration
Effective February 1, 1995, Purchaser sold the Company six
Green Giant(r) vegetable plants in exchange for which the Company issued to
Purchaser an 8% Secured Nonrecourse Subordinated Promissory Note in the
aggregate principal amount of $73,025,000 (the "Note").* Pursuant to the
terms of the Note, the first two partial payments of principal, each in the
amount of $3,000,000, were due on October 20, 1995 and October 20, 1996,
respectively. On September 28, 1995, the Purchaser and the Company entered
into an agreement (the "Option Agreement") pursuant to which the first two
partial payments of principal under the Note were deferred until October
20, 1998 and the Company granted Purchaser an option to convert any part or
all of the $6,000,000 principal payment deferred to October 20, 1998 to
shares of Common Stock of the Company, at an exercise price per share of
Common Stock equal to the midpoint price between the bid and asked price of
Common Stock on the day Purchaser delivers a notice of exercise to the
Company (the "Option").
On December 21, 1995, Purchaser delivered notice (the "Notice")
to the Company that it was exercising the Option with respect to the entire
$6,000,000 principal
* In connection with the February 1, 1995 transaction,
the Purchaser and the Company entered into a long-term
supply agreement pursuant to which the Company
processes and retail packs food under the Green
Giant(r) label for the Purchaser. In addition, Michael
A. Schaeffer, an officer of Purchaser, is a director of
the Company.
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payment. As a result, the exercise price per share of Common Stock was
equal to $17.3125.
On March 15, 1996, Purchaser and the Company entered into the
Purchase and Registration Rights Agreement (the "Purchase Agreement"),
pursuant to which the Company will issue and deliver 346,570 shares of
Common Stock (the "Shares") to Purchaser. The source of funds for the
purchase of such stock is the deemed repayment of $6,000,000 in principal
payments due under the Note.
Item 4. Purpose of Transaction
The Reporting Persons acquired the Shares for investment
purposes and without the purpose or intent of influencing the control of
the Company. The Reporting Persons intend to review their investment
position from time to time and reserve the right to change their purposes
and intentions as described in this Item 4 based upon such review and other
factors. See Item 3.
Except as set forth below, at the present time the Reporting
Persons have no plan or proposal which relate to or would result in (a) the
acquisition by any person of additional securities of the Company, or the
disposition of securities of the Company, (b) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation, involving the
Company or any of its subsidiaries, (c) a sale or transfer of a material
amount of assets of the Company or any of its subsidiaries, (d) any change
in the present board of directors or management of the Company, including
any plans or proposals to change the number or term of directors or to fill
any existing vacancies on the board, (e) any material change in the present
capitalization or dividend policy of the Company, (f) any other material
change in the Company's business or corporate structure, (g) changes in the
Company's charter, bylaws or instruments corresponding thereto or other
actions which may impede the acquisition of control of the Company
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by any person, (h) causing a class of securities of the Company to be
delisted from a national securities exchange or to cease to be authorized
to be quoted in an inter-dealer quotation system of a registered national
securities association, (i) a class of equity securities of the Company
becoming eligible for termination of registration pursuant to Section
12(g)(4) of the Act or (j) any action similar to those enumerated above.
Pursuant to the Purchase Agreement, the Purchaser acquired the
Shares. Article V of the Purchase Agreement provides the Purchaser with
certain registration rights with respect to the Shares. The Company is
required to file with the Commission within five business days following
the filing of the Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 1996, a shelf registration statement providing for the sale
by the Purchaser in accordance with the terms of the Purchase Agreement of
all of the Shares. The Company must use its best efforts to keep the shelf
registration statement continuously effective until the earlier to occur of
(i) the time at which the Purchaser no longer owns, beneficially or
otherwise, any Shares or (ii) the second annual anniversary of the shelf
registration statement.
Pursuant to the Purchase Agreement, the Company will pay or
cause to be paid, generally, all costs and expenses incident to the
registration, offering and/or sale of the shares in connection with the
shelf registration statement, other than (i) transfer taxes payable upon
the sale of any Shares to the purchaser thereof, (ii) the fees and
disbursements of underwriters or agents, including underwriting discounts
and commissions, if any, (iii) the fees and disbursements of the
Purchaser's counsel, and (iv) any printing costs incurred at or with
respect to a financial printer in connection with the shelf registration
statement in excess of $2,500.
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Furthermore, pursuant to the Purchase Agreement, the Company
has agreed not to offer, sell, contract to sell, pledge or otherwise
dispose of, directly or indirectly, or file with the Commission a
registration statement relating to its Common Stock or publicly disclose
the intention to do any of the foregoing, without the prior written consent
of the Purchaser for a period of one year from the date of the Purchase
Agreement (the "Lock-Up Period"), except in certain limited circumstances;
provided, however, that, any person who is (A) the parent, child,
grandchild or sibling (or spouse of any such person) of either (i) Arthur
S. Wolcott or (ii) Kraig H. Kayser and who is not an officer of the
Company, or (B) any trust for the benefit of any such person referred to in
(A) above, may, without the prior written consent of the Purchaser, offer,
sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, during the Lock-Up Period, an amount of the Company's Common
Stock not in excess of 10,000 shares.
The foregoing summary of the Purchase Agreement is not intended
to be complete and is qualified in its entirety by reference to the
Purchase Agreement, a copy of which is attached hereto as Exhibit (d) and
is incorporated herein by reference.
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Item 5. Interest in Securities of the Issuer
Pursuant to the Purchase Agreement, the Purchaser will acquire
the Shares. Each of the Reporting Persons is deemed to beneficially own
the Shares and, based on information contained in the Company's Quarterly
Report on Form 10-Q for the quarterly period ended December 30, 1995, the
percentage of outstanding shares of Common Stock, listed in the responses
to Items 11 and 13, respectively, of the cover page filed herewith relating
to such Reporting Person. In addition, the number of shares of Common
Stock deemed beneficially owned by each Reporting Person with respect to
which such Reporting Person (i) has sole voting power, (ii) shares voting
power, (iii) has sole dispositive power and (iv) shares dispositive power
are listed in the responses to Items 7, 8, 9, and 10, respectively, of the
cover page filed herewith relating to such Reporting Person.
Except as set forth in this Schedule 13D, none of the Reporting
Persons, and to the knowledge of the Reporting Persons, none of the persons
listed on Schedule I, beneficially owns any shares of Common Stock.
Except as set forth in this Schedule 13D, to the knowledge of
the Reporting Persons, no person other than the Reporting Persons has the
right to receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, securities covered by this Schedule 13D.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer
Except as set forth in this Schedule 13D, none of the Reporting
Persons, and to the knowledge of each of the Reporting Persons, none of the
persons listed in Schedule I hereto, is a party to any contract,
arrangement, understanding or relationship with respect to any securities
of the Company.
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Item 7. Material to be Filed as Exhibits
(a) Filing Agreement, dated March 22, 1996
between Parent and Purchaser.
(b) Option Agreement, dated September 28, 1995,
between Purchaser and the Company.
(c) Notice, dated December 21, 1995, from the
Purchaser to the Company.
(d) Purchase and Registration Rights Agreement,
dated March 15, 1996, between Purchaser and
the Company.
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SIGNATURES
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and correct.
Dated: March 22, 1996
GRAND METROPOLITAN PLC
By:/s/ PAUL S. WALSH
Paul S. Walsh
Director
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SIGNATURES
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and correct.
Dated: March 22, 1996
THE PILLSBURY COMPANY
By:/s/ JEROME J. JENKO
Jerome J. Jenko
Senior Vice President,
General Counsel and
Secretary
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<PAGE> 1
SCHEDULE I
PURCHASER
The following table sets forth the name, business address and present
principal occupation or employment of each director and executive officer
of Purchaser. Unless otherwise specified each person listed below is a
citizen of the United States and has his or her principal business address
at the offices of Purchaser, 200 South Sixth Street, Minneapolis, Minnesota
55402.
Name and Business Address Present Principal Occupation or Employment
Paul S. Walsh* . . . . . . . Chief Executive Officer and President of
Purchaser. Director of Parent. Director of
Purchaser.
James R. Behnke . . . . . . . Senior Vice President--Research and Development
of Purchaser. Director of Purchaser.
John D'Amecourt** . . . . . . Chief Executive Officer Grand Met Foods
Europe. Director of Purchaser.
Thomas A. Debrowski . . . . . Senior Vice President--Operations of Purchaser.
Director of Purchaser.
Luis J. de Ocejo . . . . . . Senior Vice President--Human Resources &
Corporate Affairs of Purchaser. Director of
Purchaser.
V. Ann Hailey . . . . . . . . Senior Vice President and Chief Financial
Officer of Purchaser. Treasurer of the
Purchaser. Director of Purchaser.
H. Robert Hawthorne*** . . . President--Pillsbury Brands of Purchaser.
Jerome J. Jenko . . . . . . . Senior Vice President, Secretary and General
Counsel of Purchaser. Director of Purchaser.
Richard Lenny . . . . . . . . President--Specialty Brands of Purchaser.
Director of Purchaser.
John B. McGrath . . . . . . . Group Chief Executive of Parent. Director of
Parent. Director of Purchaser.
__________
* Citizen of the United Kingdom.
** Citizen of France.
*** Citizen of Canada.
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Stanley Paul Oliver* . . . . President of Pillsbury Bakeries and Food
Service, Inc. Director of Purchaser.
Lucio Rizzi** . . . . . . . . President--International of Purchaser.
Director of Purchaser.
John Robert Speirs . . . . . Senior Vice President--Strategic Brand
Development of Purchaser. Director of
Purchaser.
__________
* Citizen of Canada.
** Citizen of Italy.
PARENT
The following table sets forth the name, business address and present
principal occupation or employment of each director and executive officer
of the Parent. Unless otherwise specified, each person listed below is a
citizen of the United Kingdom and has his or her principal business address
at 20 St. James's Square, London SW1Y 4RR, England.
Name and Business Address Present Principal Occupation or Employment
George J. Bull . . . . . . . Chairman of Parent. Director of Parent.
Richard V. Giordano KBE* . . Chairman, British Gas PLC. Deputy Chairman of
British Gas PLC Parent. Non-Executive Director of Parent.
Rivermill House
152 Grosvenor Road
London SW1V 3JL, England
Peter E.B. Cawdron . . . . . Group Strategy Development Director of Parent.
Director of Parent.
Gerald M.N. Corbett . . . . . Group Finance Director of Parent. Director of
Parent.
John B. McGrath . . . . . . . Group Chief Executive of Parent. Director of
Parent. Director of Purchaser.
David E. Tagg . . . . . . . . Group Services Director of Parent. Director of
Parent.
Paul S. Walsh . . . . . . . . Director of Parent, Chief Executive Officer and
200 South Sixth Street President of Purchaser. Director of Purchaser.
Minneapolis, Minnesota 55402
Michael L. Hepher . . . . . . Non-Executive Director of Parent.
Flat 6
8 Hans Crescent
Knightsbridge
London SWIX OLJ1 England
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* Citizen of the United States.
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Peter J.D. Job . . . . . . . Chief Executive of Reuters Holdings PLC. Non-
85 Fleet Street Executive Director of Parent.
London EC4P 4AJ, England
Sir David Simon CBE . . . . . Chairman of The British Petroleum Company
Brittanic House p.l.c. Non-Executive Director of Parent.
1 Finsbury Circus
London EC2N 7BA, England
Carol St. Mark* . . . . . . . President and Chief Executive Officer of Pitney
Stamford Connecticut Bowes Business Services. Non-Executive
06926-0700 Director of Parent.
Roger H. Myddelton . . . . . Secretary and Group Legal Director of Parent.
John Keenan* . . . . . . . . Chairman and Chief Executive Officer of
1 York Gate International Distillers & Vintners, a sector
London NW1 4PU, England of Parent. Director of Parent.
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* Citizen of the United States.
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INDEX TO EXHIBITS
Sequentially
Numbered
Exhibit No. Description Page
(a) Filing Agreement, dated
March 22, 1996, between
Parent and Purchaser.
(b) Option Agreement, dated
September 28, 1995,
between Purchaser and the
Company.
(c) Notice, dated December 21,
1995, from the Purchaser
to the Company.
(d) Purchase and Registration
Rights Agreement, dated
March 15, 1996, between
Purchaser and the Company.
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Exhibit (a)
FILING AGREEMENT
Pursuant to Rule 13d-1(f) promulgated under the Securities and
Exchange Act of 1934, the undersigned hereby agree to the filing of the
Statement on Schedule 13D relating to the acquisition by The Pillsbury
Company of 346,570 shares of Class A Common Stock, par value $.25 per
share, of Seneca Foods Corporation on behalf of The Pillsbury Company, a
Delaware corporation, and Grand Metropolitan Public Limited Company, a
company incorporated under the laws of England.
This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
Dated: March 22, 1996
GRAND METROPOLITAN PLC
By: /s/ PAUL S. WALSH
Paul S. Walsh
Director
THE PILLSBURY COMPANY
By: /s/ JEROME J. JENKO
Jerome J. Jenko
Senior Vice President,
General Counsel and
Secretary
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Exhibit (b)
Agreement between The Pillsbury Company, Pillsbury Center, 200
South Sixth Street, Minneapolis, Minnesota 55402 ("Pillsbury") and Seneca
Foods Corporation, 1162 Pittsford-Victor Road, Pittsford, New York 14534
("Seneca").
RECITALS
The Pillsbury Company is the payee, and Seneca is the maker, of
an 8% Secured Nonrecourse Subordinated Promissory Note dated February 1,
1995, in the original principal amount of $73,025,000 (the "Note"). The
first two partial payments of principal, each payment in the sum of
$3,000,000 (a total of $6,000,000) are due on October 20, 1995, and October
20, 1996, respectively.
TERMS OF AGREEMENT
In consideration of their mutual promises, Pillsbury and Seneca hereby
agree as follows:
1. The due date of the first two payments of principal under the Note,
aggregating $6,000,000, is hereby deferred to October 20, 1998.
2. Seneca hereby grants Pillsbury an option to convert any part or all
of the $6,000,000 principal payment deferred pursuant to paragraph 1 hereof
to shares of Class A Common Stock of Seneca. Pillsbury must deliver to
Seneca written notice of its intention to exercise the option with respect
to a specified amount or percentage of the $6,000,000 deferred payment not
later than December 31, 1995, and it must take delivery of the shares which
it has so elected to acquire not later than September 30, 1996. The
exercise
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price shall be the midpoint price between the bid and asked price of Seneca
Class A Common Stock on the day the notice of exercise is delivered to
Seneca, but not less than the book value per share of Class A Common Stock
as reflected on the consolidated balance sheet of Seneca as at September
30, 1995.
3. The parties will agree in good faith as quickly as is mutually
feasible upon the form of notice of exercise of option, securities
registration provisions and other reasonable provisions with respect to the
issuance of Seneca's Class A Common Stock in the event of exercise of the
option granted by this Agreement.
Dated: September 28, 1995
The Pillsbury Company
By: /s/ JEROME J. JENKO
Jerome J. Jenko, SVP
Gen. Counsel & Sec.
SENECA FOODS CORPORATION
By: /s/ KRAIG KAYSER
Kraig Kayser, President
<PAGE> 1
Exhibit (c)
The Pillsbury Company
200 South Sixth Street
Minneapolis, Minnesota 55402-1464
STRICTLY CONFIDENTIAL
December 21, 1995
Mr. Kraig Kayser
President & CEO
Seneca Foods Corporation
1162 Pittsford-Victor Rd.
Pittsford, NY 14534
Facsimile 716.385.4249
Dear Kraig:
This is to inform you that The Pillsbury Company hereby exercises its
option to convert $6,000,000 of debt to fully tradeable shares of Seneca
Foods Corporation in accordance with the agreement dated September 28,
1995.
We will be in touch with you after the first of the year to commence the
paperwork.
Very truly yours,
/s/ JEFFREY N. BOYER
Jeffrey N. Boyer
<PAGE> 1
Exhibit (d)
PURCHASE AND REGISTRATION RIGHTS AGREEMENT
Dated as of March 15, 1996
by and between
THE PILLSBURY COMPANY
and
SENECA FOODS CORPORATION
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PURCHASE AND REGISTRATION RIGHTS AGREEMENT, dated as of March
15, 1996, by and between THE PILLSBURY COMPANY, a Delaware corporation (the
"Purchaser"), and SENECA FOODS CORPORATION, a New York corporation (the
"Issuer").
RECITALS
WHEREAS, the Issuer issued and delivered to Purchaser an 8%
Secured Nonrecourse Subordinated Promissory Note dated February 1, 1995 in
the aggregate principal amount of $73,025,000 (the "Note");
WHEREAS, pursuant to the terms of the Note, the first two
partial payments of principal due thereunder, each such payment in the
amount of $3,000,000, were or are due on October 20, 1995 and October 20,
1996, respectively;
WHEREAS, pursuant to an agreement, dated September 28, 1995,
between the Purchaser and the Issuer (the "Option Agreement"), the due date
for the first two partial payments of principal under the Note was deferred
until October 20, 1998 and the Issuer granted the Purchaser an option to
convert any part or all of the $6,000,000 principal payment deferred to
October 20, 1998 to shares of Class A Common Stock, par value $0.25 per
share (the "Common Stock"), of the Issuer at an exercise price per share of
Common Stock equal to the midpoint price between the bid and asked price of
Common Stock on the day the Purchaser delivers a notice of exercise to the
Issuer (the "Option");
WHEREAS, on December 21, 1995, the Purchaser delivered notice
to the Issuer that it was exercising the Option with respect to the entire
$6,000,000 principal payment;
WHEREAS, the exercise price per share of Common Stock is
$17.3125;
WHEREAS, the Issuer has duly authorized and will issue 346,570
shares of Common Stock of the Issuer to the Purchaser upon the terms and
subject to the conditions set forth herein; and
WHEREAS, the Issuer has agreed to provide the Purchaser with
the registration rights set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained herein, and subject to
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and on the terms and conditions herein set forth, the parties hereto agree
as follows:
ARTICLE I
DEFINITIONS AND TERMS
Section 1.1 Specific Definitions. As used in this Agreement,
the following terms shall have the meanings set forth or as referenced
below:
"Agreement" shall mean this Agreement, as the same may be
amended or supplemented from time to time in accordance with the
terms hereof.
"Black-out Event" shall have the meaning set forth in
Section 5.3(b).
"Business Day" shall mean a day other than a Saturday, a
Sunday or a day on which banks in New York City are authorized or
obligated by law or executive order to close.
"Certificates" shall have the meaning set forth in Section
2.3.
"Closing" shall have the meaning set forth in Section 2.2.
"Closing Date" shall have the meaning set forth in Section
2.2.
"Commission" shall have the meaning set forth in Section
3.5.
"Common Stock" shall have the meaning set forth in the
recitals.
"Exchange Act" shall have the meaning set forth in Section
3.5.
"Issuer" shall have the meaning set forth in the recitals.
"Issuer Financial Statements" shall have the meaning set
forth in Section 3.6.
"Issuer Reports" shall have the meaning set forth in Section
3.5.
"Lock-up Period" shall have the meaning set forth in Section 5.6.
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<PAGE> 4
"Note" shall have the meaning set forth in the recitals.
"Option" shall have the meaning set forth in the recitals.
"Option Agreement" shall have the meaning set forth in the
recitals.
"Prospectus" shall mean the prospectus included in the Shelf
Registration Statement, as amended or supplemented by any prospectus
supplement with respect to the terms of the offering made pursuant to
Section 5.1 of any of the Shares covered by such Shelf Registration
Statement and by all other amendments and supplements to such
prospectus, including post-effective amendments and all material
incorporated by reference in such prospectus.
"Purchase Price" shall have the meaning set forth in Section
2.1.
"Purchaser" shall have the meaning set forth in the
recitals.
"Registration Period" shall have the meaning set forth in
Section 5.1.
"Securities Act" shall have the meaning set forth in Section
4.1.
"Shares" shall have the meaning set forth in Section 2.1.
"Shelf Registration Statement" shall mean a registration
statement of the Issuer (and any other entity required to be a
registrant with respect to such registration statement pursuant to
the requirements of the Securities Act) that covers all of the Shares
to be offered on a delayed or continuous basis pursuant to Rule 415
under the Securities Act, or any similar rule that may be adopted by
the Commission, and all amendments (including, post-effective
amendments) to such registration statement, and all exhibits thereto
and materials incorporated by reference therein.
Section 1.2 Other Terms. Other terms may be defined
elsewhere in the text of this Agreement and, unless otherwise indicated,
shall have such meaning throughout this Agreement.
Section 1.3 Other Definitional Provisions.
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<PAGE> 5
(a) The words "hereof", "herein", and "hereunder" and words
of similar import, when used in this Agreement, shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.
(b) The terms defined in the singular shall have a comparable
meaning when used in the plural, and vice versa.
(c) The terms "dollars" and "$" shall mean United States
dollars.
ARTICLE II
PURCHASE OF THE COMMON STOCK
Section 2.1 Purchase of the Shares. On the terms and subject to
the conditions set forth herein, at the Closing, the Issuer agrees to issue
and sell to the Purchaser, and the Purchaser agrees to purchase and accept
from the Issuer, 346,570 shares of Common Stock (the "Shares") at a price
per share equal to $17.3125. The "Purchase Price" for the Shares shall be
the deemed repayment by the Issuer of the $6,000,000 in principal payments
due under the Note, the payment of which was deferred under the Option
Agreement until October 20, 1998.
Section 2.2 Closing. The closing of the transactions
contemplated by this Agreement (the "Closing") shall take place at the
offices of Sullivan & Cromwell, 125 Broad Street, New York, New York at
10:00 a.m., New York City time, on March 20, 1996 or at such other time and
place as the parties hereto may mutually agree (the "Closing Date").
Section 2.3 Delivery and Payment. At the Closing, the Issuer
shall deliver to the Purchaser a certificate or certificates (the
"Certificates") representing the Shares in a form suitable for vesting
valid title in the Shares with the Purchaser. The Certificates shall
contain the following legend:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended
(the "Securities Act") and may not be sold or otherwise
transferred except pursuant to (i) an effective
registration statement under the Securities Act or (ii)
an exemption from the
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registration requirements of the Securities Act."
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE ISSUER
The Issuer hereby represents and warrants to the Purchaser as
of the date hereof and as of the Closing Date as follows:
Section 3.1 Corporate Organization. The Issuer is a corporation
duly organized, validly existing, and in good standing under the laws of
the state of New York, with the corporate power and authority to own its
properties and conduct its business as described in the Issuer Reports, and
the Issuer has full power and authority to execute and deliver this
Agreement and to undertake and perform its obligations hereunder.
Section 3.2 Non-Contravention; Authorization. The issuance of
the Shares and their offering and sale on the terms and conditions of this
Agreement and the execution, delivery, and performance by the Issuer of
this Agreement (a) does not conflict with, or result in a breach of any of
the terms or provisions of, or constitute a default under, the Certificate
of Incorporation or Bylaws of the Issuer, any resolutions or directives of
the Board of Directors of the Issuer, any agreement or instrument to which
the Issuer is a party or by which the Issuer is bound or to which any of
the properties of the Issuer is subject, any law, rule or regulation
applicable to or affecting the Issuer or its assets or properties, or any
judgment, order or decree of any government, governmental or regulatory
agency or body, or court applicable to or affecting the Issuer or its
assets or properties, and (b) have been duly authorized by all necessary
corporate action of the Issuer.
Section 3.3 Enforceability. This Agreement and, on the
Closing Date, the Shares have been duly executed and delivered by the
Issuer, and will constitute legal, valid, binding, and enforceable
obligations of the Issuer, subject, as to enforceability, to applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general principles of equity.
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<PAGE> 7
Section 3.4 Investment Company. The Issuer is not and has
no intention to be or become, at any time prior to the expiration of three
years after the Closing Date, an open-end investment company, unit
investment trust or face-amount certificate company that is or is required
to be registered under Section 8 of the Investment Company Act of 1940.
Section 3.5 Reports. Since December 31, 1994, the Issuer has
timely filed (i) all forms, reports, statements and other documents
required to be filed with the Securities and Exchange Commission (the
"Commission"), including without limitation (a) all Annual Reports on Form
10-K, (b) all Quarterly Reports on Form 10-Q, and (c) all proxy statements
relating to meetings of stockholders (whether annual or special), (d) all
Current Reports on Form 8-K (collectively referred to as the "Issuer
Reports"). Except as set forth on Schedule 3.5 hereto, the Issuer Reports
conformed in all material respects to the requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and the rules and regulations of
the Commission promulgated thereunder and did not at the time they were
filed contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make
the statements therein not misleading.
Section 3.6 Financial Statements. The audited consolidated
financial statements and unaudited consolidated interim financial
statements (including the related notes and schedules) of the Issuer
included or incorporated by reference in the Issuer Reports (the "Issuer
Financial Statements") were prepared in accordance with generally accepted
accounting principles applied on a consistent basis (except as may be
indicated in the notes thereto), and fairly present the consolidated
financial position of the Issuer as of the dates thereof and their
consolidated results of operations and cash flows for the periods then
ended (subject, in the case of any unaudited interim financial statements,
to normal year-end adjustments, none of which would, individually or in the
aggregate be reasonably likely to have a material adverse effect on the
Issuer and its subsidiaries taken as a whole). Neither the Issuer nor its
subsidiaries has any liabilities, whether or not accrued, contingent or
otherwise, that individually or in the aggregate, are reasonably likely to
have a material adverse effect on the Issuer and its subsidiaries taken as
a whole other than liabilities disclosed in the Issuer Reports or for which
the Issuer has
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<PAGE> 8
made adequate reserves as reflected in the Issuer Financial Statements.
Section 3.7 Consents and Approvals. No consent, approval,
authorization, or order of, or filing with, any governmental agency or body
or any court is required for the consummation of the transactions
contemplated by this Agreement in connection with the issuance and sale of
the Shares, except such as have been or will be obtained and made under the
Securities Act and the Exchange Act and such as may be required under state
securities laws.
ARTICLE IV
COVENANTS
Section 4.1 Rule 144. The Issuer covenants that it will
continue to file the reports required to be filed by it under the
Securities Act of 1933 (the "Securities Act") and the rules and regulations
promulgated thereunder and the Exchange Act and the rules and regulations
promulgated thereunder and it will take such further action as the
Purchaser may reasonably request, all to the extent required from time to
time to enable the Purchaser to sell Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144
under the Securities Act, as such Rule may be amended from time to time.
ARTICLE V
REGISTRATION RIGHTS
Section 5.1 Filing of Shelf Registration Statement. The Issuer
shall cause to be filed within five Business Days following the filing of
the Issuer's Annual Report on Form 10-K for the fiscal year ended March 31,
1996, the Shelf Registration Statement providing for the sale by the
Purchaser of all of the Shares in accordance with the terms hereof and will
use its reasonable efforts to cause such Shelf Registration Statement to be
declared effective by the Commission as soon as practicable thereafter.
The Issuer agrees to use its best efforts to keep the Shelf Registration
Statement continuously effective until the earlier to occur of (i) the time
at which the Purchaser no longer owns, beneficially or otherwise, any
Shares or (ii) the second annual anniversary of the Shelf Registration
Statement (the "Registration Period"). Subject to Sections 5.3(b) and
5.3(i), the Issuer further agrees to
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<PAGE> 9
amend the Shelf Registration Statement if and as required by the rules,
regulations or instructions applicable to the registration form used by the
Issuer for such Shelf Registration Statement or by the Securities Act or
any rules and regulations promulgated thereunder; provided, however, that
the Issuer shall not be deemed to have used its best efforts to keep the
Shelf Registration Statement effective during the Registration Period if it
voluntarily takes any action that would result in the Purchaser not being
able to sell the Shares covered thereby during the Registration Period,
unless such action is required under applicable law or the Issuer has filed
a post-effective amendment to the Shelf Registration Statement and the
Commission has not declared it effective or except as otherwise permitted
by the last three sentences of Section 5.3(b).
Section 5.2 Expenses. (a) The Issuer shall pay and bear, or
cause to be paid, promptly upon request being made therefor, the following
costs and expenses incident to the registration, offering and/or sale of
the Shares pursuant to Section 5.1:
(i) the preparation and filing of the Shelf Registration
Statement (including financial statements and exhibits), as
originally filed and as amended, any preliminary prospectuses and the
Prospectus and any amendments or supplements thereto;
(ii) the (A) preparation, printing and distribution of
certificates representing the Shares, (B) the printing of the Shelf
Registration Statement (including financial statements and exhibits),
as originally filed and as amended, any preliminary prospectuses and
the Prospectus and any amendments or supplements thereto, including
the cost of furnishing copies thereof to the Purchaser and the
underwriters or agents, as the case may be, and (C) the preparation,
printing and distribution of other documents relating to the
performance of and compliance with this Article V; provided, however,
that the Issuer shall not be responsible for paying, bearing or
causing to be paid any printing costs incurred at or with respect to
a financial printer pursuant to subsection (a)(ii)(B) and (a)(ii)(C)
hereof in excess of $2,500;
(iii) the fees and disbursements of the Issuer's counsel and
independent public accountants, including the expenses of any
opinions, "comfort letters" and special audits;
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<PAGE> 10
(iv) the reasonable fees and expenses of any special experts
retained in connection with the Shelf Registration Statement;
(v) the qualification of the Shares under applicable
securities laws in accordance with Section 5.3(d) and any filing for
review of the offering with the NASD, including filing fees; and
(vi) all fees and expenses incurred in connection with the
listing of the Shares on any securities exchange pursuant to
Section 5.3(l).
To the extent that any of the expenses to be paid by the Issuer
under the foregoing provisions are incurred, assumed or paid by the
Purchaser or any underwriter or agent, the Issuer shall reimburse such
person for the full amount of such expenses so incurred, assumed or paid
promptly after receipt of a request therefor.
(b) The Purchaser shall pay and bear, or cause to be paid:
(i) any transfer taxes payable upon the sale of such Shares to
the purchaser thereof;
(ii) the fees and disbursements of the underwriters or agents,
including underwriting discounts and commissions, if any;
(iii) the fees and disbursements of the Purchaser's counsel;
and
(iv) any printing costs incurred at or with respect to a
financial printer pursuant to subsections (a)(ii)(B) and (a)(ii)(C)
above in excess of $2,500.
To the extent that any of the expenses to be paid by the Issuer
pursuant to this subsection (b) are incurred, assumed or paid by the
Purchaser, the Issuer shall reimburse the Purchaser for the full amount of
such expenses so incurred, assumed or paid promptly after receipt of a
request therefor.
Section 5.3 Shelf Registration Procedures. Each
underwriter, agent, selling broker, dealer manager or similar securities
industry professional participating in any offering of the Shares is
referred to as an "underwriter" or "agent" and any agreement entered into
with an underwriter or agent is referred to as an "underwriting
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<PAGE> 11
or agency agreement". In connection with the obligations of the Issuer
with respect to the Shelf Registration Statement contemplated by Section
5.1 hereof, the Issuer covenants with the Purchaser and each underwriter or
agent participating in any such offering that it shall:
(a) prepare and file with the Commission, within the time
period set forth in Section 5.1 hereof, the Shelf Registration Statement,
which Shelf Registration Statement (i) shall be available for the sale of
the Shares in accordance with the intended method or methods of
distribution by the Purchaser and (ii) shall comply as to form in all
material respects with the requirements of the applicable form and include
all financial statements required by the Commission to be filed therewith;
(b) subject to the last three sentences of this Section
5.3(b) and Section 5.3(i) hereof, (i) prepare and file with the Commission
such amendments to such Shelf Registration Statement as may be necessary to
keep such Shelf Registration Statement effective for the Registration
Period; (ii) cause the Prospectus to be amended or supplemented as required
and to be filed as required by Rule 424 or any similar rule that may be
adopted under the Securities Act; (iii) respond as promptly as practicable
to any comments received from the Commission with respect to the Shelf
Registration Statement or any amendment thereto; and (iv) comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such Shelf Registration Statement during the
Registration Period in accordance with the intended method or methods of
distribution by the Purchaser. Notwithstanding anything to the contrary
contained herein, the Issuer shall not be required to take any of the
actions described in clauses (i), (ii) or (iii) in this Section 5.3(b) or
Section 5.3(i) with respect to the Shares to the extent that the Issuer is
in possession of material non-public information that it deems advisable
not to disclose or is engaged in active negotiations or planning for a
merger or acquisition or disposition transaction (a "Black-out Event") and
it delivers written notice to the Purchaser to the effect that the
Purchaser may not make offers or sales under the Shelf Registration
Statement for a period not to exceed thirty (30) days from the date of such
notice; provided, however, that the Issuer may deliver only two such
notices within the one year period from the date hereof and may deliver
only three such notices within any twelve-month period thereafter;
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<PAGE> 12
(c) furnish to the Purchaser and any underwriter or agent,
without charge (except as described in Section 5.2 hereof), as many copies
of each Prospectus and any amendment or supplement thereto as the Purchaser
and any underwriter or agent may request in order to facilitate the public
sale or other disposition of the Shares; the Issuer consents to the use of
the Prospectus and any amendment or supplement thereto by the Purchaser and
any underwriter or agent in connection with the offering and sale of the
Shares;
(d) use its reasonable best efforts to register or qualify
the Shares by the time the Shelf Registration Statement is declared
effective by the Commission under such applicable state securities or blue
sky laws of the various states of the United States and its territories and
possessions as shall be necessary or appropriate in connection with the
offering or sale of the Shares and keep each such registration or
qualification effective during the Registration Period; provided, however,
that in connection therewith, the Issuer shall not be required to (i)
qualify as a foreign corporation to do business or to register as a broker
or dealer in any such jurisdiction where it would not otherwise be required
to qualify or register but for this Section 5.3(d) or (ii) subject itself
to taxation in any such jurisdiction;
(e) notify the Purchaser and any underwriter or agent
promptly and, if requested, confirm in writing, (i) when the Shelf
Registration Statement and any post-effective amendments thereto have
become effective, (ii) when any amendment or supplement to the Prospectus
has been filed with the Commission, (iii) of the receipt of any comments
from the Commission, (iv) of the issuance by the Commission or any state
securities authority of any stop order suspending the effectiveness of the
Shelf Registration Statement or any part thereof or the initiation of any
proceedings for that purpose, (v) if the Issuer receives any notification
with respect to the suspension of the qualification of the Shares for offer
or sale in any jurisdiction or the initiation of any proceeding for such
purpose, and (vi) of the happening of any event during the period the Shelf
Registration Statement is effective as a result of which (A) such Shelf
Registration Statement contains any untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary
to make the statements therein not misleading or (B) the Prospectus as then
amended or supplemented contains any untrue statement of a material fact or
omits to state any material fact necessary in order to make the statements
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<PAGE> 13
therein, in light of the circumstances under which they were made, not
misleading;
(f) make every reasonable effort to prevent the issuance of
any order suspending the effectiveness of the Shelf Registration Statement
or any part thereof and, if any such order is issued, to obtain the lifting
thereof as soon as legally practicable;
(g) furnish to the Purchaser and any underwriter or agent,
without charge, at least one executed copy of the Shelf Registration
Statement and of all amendments thereto, whether filed before or after the
Shelf Registration Statement becomes effective and copies of all exhibits
and documents filed therewith (without documents incorporated therein by
reference, unless requested);
(h) cooperate with the Purchaser to facilitate the timely
preparation and delivery of certificates representing Shares to be sold and
not bearing any Securities Act legend; and enable certificates for such
Shares to be issued for such numbers of shares and registered in such names
as the Purchaser may reasonably request at least two Business Days prior to
any sale of Shares; it being understood that in determining what
constitutes Purchaser's reasonable request hereunder, Purchaser understands
that the Issuer acts as its own registrar and transfer agent and cannot
issue a large volume of certificates within two Business Days;
(i) subject to the last three sentences of Section 5.3(b)
hereof, upon the occurrence of a Black-out Event or an event contemplated
by clause (vi) of Section 5.3(e) hereof, use its reasonable efforts
promptly to prepare and file an amendment or a supplement to the Prospectus
or any document incorporated therein by reference or prepare, file and
obtain effectiveness of a post-effective amendment to the Shelf
Registration Statement, or file any other required document, in any such
case to the extent necessary so that, as thereafter delivered to the
purchasers of the Shares, such Prospectus as then amended or supplemented
will not contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they are made, not misleading;
(j) make available for inspection by the Purchaser and any
counsel, accountants or other representatives retained by the Purchaser and
any underwriters or agents all financial and other records,
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<PAGE> 14
pertinent corporate documents and properties of the Issuer and cause the
officers, directors and employees of the Issuer to supply all such records,
documents or information reasonably requested by the Purchaser, counsel,
accountants, representatives, underwriters or agents in connection with the
Shelf Registration Statement; provided, however, that such records,
documents or information which the Issuer determines in good faith to be
confidential and notifies the Purchaser, counsel, accountants,
representatives, underwriters or agents in writing that such records,
documents or information are confidential shall not be disclosed by the
Purchaser, its employees counsel, accountants, representatives,
underwriters or agents unless (i) such disclosure is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction, or (ii)
such records, documents or information become generally available to the
public other than through a breach of this Agreement;
(k) a reasonable time prior to the filing of any Shelf
Registration Statement or any amendment thereto, or any Prospectus or any
amendment or supplement thereto, provide copies of such document (not
including any documents incorporated by reference therein unless requested)
to the Purchaser and any underwriters or agents, if any, so that the
Purchaser and any underwriter or agent, if any, has a reasonable
opportunity to comment thereon prior to its being used and/or filed with
the Commission;
(l) use its best efforts to cause the Shares to be listed on
any securities exchange or interdealer quotation system on which similar
securities issued by the Issuer are then listed;
(m) provide a CUSIP number for all Shares, not later than the
effective date of the Shelf Registration Statement;
(n) use its reasonable efforts to make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering at least 12 months which shall satisfy the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder;
(o) make such representations and warranties to the Purchaser
and the underwriters and agents, if any, in form, substance and scope as
are customarily made by issuers to underwriters in underwritten public
offerings;
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<PAGE> 15
(p) on the effective date of the Shelf Registration Statement
and, in the case of an underwritten offering, on the date of delivery of
the Shares sold pursuant thereto, the Issuer shall cause to be delivered to
the Purchaser and the underwriters or agents, if any, opinions of counsel
for the Issuer with respect to, among other things, the due incorporation
and good standing of the Issuer; the due authorization, execution and
delivery of this Agreement; the due authorization, execution, issuance and
validity of the Shares; the absence of material legal or governmental
proceedings involving the Issuer; the absence of a breach by the Issuer of,
or a default under, material agreements binding the Issuer; the absence of
governmental approvals required to be obtained in connection with the
registration, offering and sale of the Shares; the compliance as to form of
the Shelf Registration Statement and any documents incorporated by
reference therein with the requirements of the Securities Act and the
Exchange Act; the effectiveness of the Shelf Registration Statement under
the Securities Act; and a statement that, as of the date of the opinion and
of the Shelf Registration Statement or most recent post-effective amendment
thereto, as the case may be, nothing has come to the attention of such
counsel which causes them to believe that either the Shelf Registration
Statement or the Prospectus included therein, as then amended or
supplemented, or the documents incorporated by reference therein (in the
case of such documents, in the light of the circumstances existing at the
time that such documents were filed with the Commission under the Exchange
Act), contained an untrue statement of a material fact or omitted to state
a material fact necessary to make the statements therein not misleading (it
being understood that such counsel need express no opinion as to the
financial statements and other financial data included therein or omitted
therefrom nor shall counsel need to make any special inquiry or
investigation in preparation for furnishing the foregoing opinion except
for inquiry of its own attorneys who are working on legal matters for the
Issuer as of the date of counsel's opinion, inquiry of Issuer's Chairman,
President, Treasurer and Controller and any other inquiry or investigation
that such counsel deems necessary or appropriate under the circumstances);
(q) Immediately prior to the effectiveness of the Shelf
Registration Statement and, in the case of an underwritten offering, at the
time of delivery of any Shares sold pursuant thereto, the Issuer shall
cause to be delivered to the Purchaser and the underwriters or agents, if
any, letters from the Issuer's independent public accountants stating that
such accountants are independent
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<PAGE> 16
public accountants with respect to the Issuer within the meaning of the
Securities Act and the applicable published rules and regulations of the
Commission thereunder, and otherwise in customary form and covering such
financial and accounting matters as are customarily covered by letters of
the independent public accountants delivered in connection with primary
underwritten public offerings;
(r) The Issuer shall deliver such documents and certificates
as may be requested by the Purchaser or the underwriters or agents, if any,
to evidence compliance with Section 5.3(o) and with any customary
conditions contained in the underwriting or agency agreement, if any; and
(s) The Issuer will enter into such customary agreements,
including a customary underwriting or agency agreement with the
underwriters or agents, if any, and take all such other actions in
connection with the offering in order to expedite or facilitate the
disposition of the Shares; provided, however, that any such agreement shall
provide for payment of expenses consistent with Section 5.2 of this
Agreement.
Section 5.4 Covenants of the Purchaser. (a) The Purchaser
shall furnish to the Issuer in writing such information regarding the
proposed distribution by the Purchaser as the Issuer may from time to time
reasonably request in writing.
(b) In connection with and as a condition to the Issuer's
obligations with respect to the Shelf Registration Statement pursuant to
Section 5.1, 5.2 and this Section 5.3, the Purchaser covenants and agrees
that (i) it will not offer or sell any Shares under the Shelf Registration
Statement until it has received copies of the Prospectus as then amended or
supplemented as contemplated by Section 5.3(c) and notice from the Issuer
that the Shelf Registration Statement and any post-effective amendments
thereto have become effective as contemplated by Section 5.3(e); (ii) upon
receipt of any notice from the Issuer contemplated by Section 5.3(b) or
Section 5.3(e) (in respect of the occurrence of an event contemplated by
clause (vi) of Section 5.3(e)), the Purchaser shall not offer or sell any
Shares pursuant to the Shelf Registration Statement until the Purchaser
receives copies of the supplemented or amended Prospectus contemplated by
Section 5.3(i) hereof and receives notice that any post-effective amendment
has become effective, and, if so directed by the Issuer, the Purchaser will
deliver to the Issuer (at the expense of the Issuer) all copies in its
possession, other than permanent file
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<PAGE> 17
copies in the Purchaser's possession, of the Prospectus as amended or
supplemented at the time of receipt of such notice; and (iii) the Purchaser
and any of its officers, directors or affiliates, if any, will comply with
the prospectus delivery requirements of the Securities Act as applicable to
them in connection with sales of Shares pursuant to the Shelf Registration
Statement.
(c) The Purchaser agrees to make customary representations
and warranties to the Issuer and the underwriters and agents, if any, in
form, substance and scope as are customarily made by selling holders in
underwritten public offerings, but the Purchaser shall not be required to
make any representation or warranty as to the accuracy or completeness of
the Shelf Registration Statement (except as to written information
furnished to the Issuer by the Purchaser expressly for use therein).
Section 5.5 Underwriters and Agents. (a) The Purchaser
shall determine the method of distribution of the Shares pursuant to the
Shelf Registration Statement. If the Purchaser shall determines to
distribute the Shares through an underwritten offering, the Purchaser shall
select the managing underwriter for such offering; provided that such
managing underwriter shall be reasonably satisfactory to the Issuer.
Section 5.6 Lock-up. The Issuer will not offer, sell,
contract to sell, pledge or otherwise dispose of, directly or indirectly,
or file with the Commission a registration statement under the Securities
Act relating to its Common Stock or publicly disclose the intention to make
any such offer, sale, pledge, disposal or filing, without the prior written
consent of the Purchaser for a period of one year from the date hereof (the
"Lock-Up Period") other than the conversion of convertible securities or
exercise of warrants outstanding on the date of this Agreement; provided,
however, that, notwithstanding the provisions of this Section 5.6, any
person who is (A) the parent, child, grandchild or sibling (or spouse of
any such person) of either (i) Arthur S. Wolcott or (ii) Kraig H. Kayser
and who is not an officer of the Issuer, or (B) any trust for the benefit
of any such person referred to in (A), above, may, without the prior
written consent of the Purchaser, offer, sell, contract to sell, pledge or
otherwise dispose of, directly or indirectly, during the Lock-Up Period, an
amount of the Issuer's Common Stock not in excess of 10,000 shares.
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Section 5.7 Legend. The legend referred to in Section 2.3
of this Agreement shall be removed by the Issuer by delivery of substitute
certificate(s) (i) on the effective date of the Shelf Registration
Statement and/or (ii) within two Business Days following the time the
Purchaser provides notice to the Issuer that it intends to sell or
otherwise transfer any Shares pursuant to an exemption from the
registration requirements of the Securities Act.
Section 5.8 Indemnification. (a) In connection with the Shelf
Registration Statement, the Issuer agrees to indemnify and hold harmless
the Purchaser and any underwriter or agent and each person, if any, who
controls the Purchaser or any such underwriter or agent within the meaning
of Section 15 of the Securities Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of an untrue statement
or alleged untrue statement of a material fact contained in the Shelf
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of an untrue statement of a material fact included in any
preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of
a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of
the Issuer, which shall not be unreasonably withheld; and
(iii) against any and all expense whatsoever, as incurred
(including reasonable fees and disbursements of counsel chosen by the
Purchaser and by the underwriters or agents), reasonably incurred in
investigating, preparing or defending against any litigation, or
investigation or proceeding by any
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governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any
such expense is not paid under subparagraph (i) or (ii) above;
provided, however, that, with respect to the Purchaser or any underwriter
or agent, this indemnity does not apply to any loss, liability, claim,
damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and
in conformity with written information furnished to the Issuer by the
Purchaser or any such underwriter or agent, respectively, expressly for use
in the Shelf Registration Statement (or any amendment thereto), or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) The Purchaser agrees to indemnify and hold harmless the
Issuer, its directors, each of its officers who signed the Shelf
Registration Statement, each underwriter or agent participating in any
offering thereunder, and each person, if any, who controls the Issuer and
any such underwriter or agent within the meaning of Section 15 of the
Securities Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of an untrue statement
or alleged untrue statement of a material fact contained in the Shelf
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of an untrue statement of a material fact included in any
preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of
a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue
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<PAGE> 20
statement or omission, if such settlement is effected with the
written consent of the Purchaser, which shall not be unreasonably
withheld; and
(iii) against any and all expense whatsoever, as incurred
(including reasonable fees and disbursements of counsel chosen by the
Issuer and by the underwriters or agents), reasonably incurred in
investigating, preparing or defending against any litigation, or
investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under
subparagraph (i) or (ii) above;
provided, however, that, with respect to the Issuer, its directors, each of
its officers who signed the Shelf Registration Statement, each underwriter
or agent participating in any offering thereunder, and each person, if any,
who controls the Issuer and any such underwriter or agent within the
meaning of Section 15 of the Securities Act, this indemnity only applies to
any loss, liability, claim, damage or expense to the extent arising out of
an untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with written information furnished
to the Issuer by the Purchaser or any such underwriter or agent,
respectively, expressly for use in the Shelf Registration Statement (or any
amendment thereto), or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(c) The obligations of the Issuer under Section 5.7(a) and of
the Purchaser under Section 5.7(b) to indemnify any underwriter or agent
who participates in an offering pursuant to the Shelf Registration
Statement (or any person, if any, controlling such underwriter or agent
within the meaning of Section 15 of the Securities Act) shall be
conditioned upon the underwriting or agency agreement with such underwriter
or agent containing an agreement by such underwriter or agent to indemnify
and hold harmless the Issuer, its directors, each of its officers who
signed the Shelf Registration Statement, and each person, if any, who
controls the Issuer within the meaning of Section 15 of the Securities Act,
against any and all loss, liability, claim, damage and expense described in
the indemnity contained in Section 5.7(a), as incurred, but only with
respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Shelf Registration Statement (or any amendment
thereto), or any
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<PAGE> 21
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information
furnished to the Issuer by such underwriter or agent expressly for use in
the Shelf Registration Statement (or any amendment thereto), or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(d) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve the indemnifying party from any liability it may
have under this Agreement, except to the extent that the indemnifying party
is materially prejudiced thereby. If it so elects, after receipt of such
notice, an indemnifying party, jointly with any other indemnifying parties
receiving such notice, may assume the defense of such action with counsel
chosen by it, provided that the indemnified party shall be entitled to
participate in the defense of such action with counsel chosen by it, the
fees and expenses of which, subject to the next sentence, shall be paid by
the indemnifying party. In no event shall the indemnifying party or
parties be liable for the fees and expenses of more than one counsel for
(i) the Issuer, its officers, directors and controlling persons as a group,
(ii) the Purchaser, its officers, directors and controlling persons as a
group and (iii) the underwriters or agents and their controlling persons as
a group, in each case, in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances.
5.9. Contribution. (a) In order to provide for just and
equitable contribution in circumstances under which the indemnity provided
for in Section 5.7 is for any reason held to be unenforceable by the
indemnified parties although applicable in accordance with its terms, the
Issuer, the Purchaser and the underwriters or agents shall contribute to
the aggregate losses, liabilities, claims, damages and expenses of the
nature contemplated by such indemnity incurred by the Issuer, the Purchaser
and one or more of the underwriters or agents, as incurred, in such
proportion as is appropriate to reflect the relative fault of, and benefits
derived by, each such party, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact
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<PAGE> 22
relates to information supplied by such indemnifying party or by such
indemnified party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The relative benefit derived by the parties shall be determined
by, among other relevant considerations, the facts set forth in the
Recitals to this Agreement. The parties hereto agree that it would not be
just and equitable if contribution pursuant to this section were determined
(a) by pro rata allocation, or (b) by any other method of allocation which
does not take into account the equitable considerations referred to in this
section. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) referred to above shall be deemed to include any legal or
other fees or expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action, proceeding or
claim.
(b) No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 5.8, each person, if any,
who controls an underwriter or agent within the meaning of Section 15 of
the Securities Act shall have the same rights to contribution as such
underwriter or agent, and each director of the Issuer, each officer of the
Issuer who signed the Shelf Registration Statement, and each person, if
any, who controls the Issuer or the Purchaser within the meaning of
Section 15 of the Securities Act shall have the same rights to contribution
as the Issuer or the Purchaser, as the case may be.
5.10. Indemnities to Survive. The indemnity and contribution
agreements contained in Sections 5.7 and 5.8 shall remain operative and in
full force and effect regardless of (i) any termination of any underwriting
or agency agreement, (ii) any investigation made by or on behalf of the
Purchaser, the Issuer or any underwriter or agent or controlling person or
(iii) the consummation of the sale or successive resales of the Shares.
ARTICLE VI
MISCELLANEOUS
6.1 Conditions to the Obligations of the Purchaser. The
obligation of the Purchaser to effect the
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<PAGE> 23
Closing is subject to the satisfaction (or waiver) prior to the Closing of
the following conditions:
(a) The representations and warranties of the Issuer
contained herein shall have been true and correct in all material respects
when made and shall be true and correct in all material respects as of the
Closing, as if made as of the Closing, and the Purchaser shall have
received a certificate to such effect dated the Closing Date and executed
by a duly authorized officer of the Issuer.
(b) The covenants and agreements of the Issuer to be
performed on or prior to the Closing shall have been duly performed in all
material respects, and the Purchaser shall have received a certificate to
such effect dated the Closing Date and executed by a duly authorized
officer of the Issuer.
(c) The Purchaser shall have received from Jaeckle,
Fleischmann & Mugel, counsel to the Issuer, their opinion, dated the
Closing Date, in a form mutually agreed upon between the parties.
Section 6.2 Termination. This Agreement may be terminated
at any time prior to the Closing;
(a) by written agreement of the Purchaser and the Issuer;
(b) by either the Purchaser or the Issuer, by giving written
notice of such termination to the other party, if the Closing shall not
have occurred on or prior to 11:59 P.M., New York City time, on April 31,
1996; or
(c) by the Purchaser if the Issuer has materially breached
any representation, warranty, covenant or agreement contained in this
Agreement and such breach is either not capable of being cured prior to the
Closing or if such breach is capable of being cured, is not so cured within
a reasonable amount of time.
Section 6.3 Effect of Termination. In the event of termination
of this Agreement pursuant to Section 6.2, no party hereto (or any of its
directors or officers) shall have any liability or further obligation to
any other party to this Agreement pursuant to this Agreement, except that
nothing herein will relieve any party from liability for any breach of this
Agreement.
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<PAGE> 24
Section 6.4 Survival. The representations and warranties set
out in Article III shall survive the Closing. The agreements of the
Purchaser and the Issuer contained in Articles IV and V shall survive the
Closing. The agreements of the Purchaser and the Issuer contained in
Section 6.3 shall survive the termination of this Agreement. All other
agreements and covenants in this Agreement shall not survive the Closing or
the termination of this Agreement.
Section 6.5 Modification or Amendment. The parties hereto
may modify or amend this Agreement, by written agreement executed and
delivered by duly authorized officers of the respective parties.
Section 6.6 Counterparts. For the convenience of the
parties hereto, this Agreement may be executed in any number of
counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts shall together constitute the same
agreement.
Section 6.7 Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York.
Section 6.8 Notices. Any notice, request, instruction or
other document to be given hereunder by any party to the others shall be in
writing and delivered personally or sent by registered or certified mail,
postage prepaid, if to the Purchaser, addressed to the Purchaser at
Pillsbury Center, 200 South Sixth Street, Minneapolis, Minnesota 55402,
Attention: Jerome J. Jenko (with a copy to Francis J. Aquila, Esq.,
Sullivan & Cromwell, 125 Broad Street, New York, New York 10004); if to the
Issuer, addressed to the Issuer at 1162 Pittsford-Victor Road, Pittsford,
New York 14534, Attention: Kraig H. Kayser, President (with a copy to
William I. Schapiro, Esq., Jaeckle, Fleischmann & Mugel, Fleet Bank
Building, 12 Fountain Plaza, Buffalo, New York 14202), or to such other
persons or addresses as may be designated in writing by the party to
receive such notice.
Section 6.9 Entire Agreement, etc. This Agreement (a)
constitutes the entire agreement, and supersedes all other prior
agreements, understandings, representations and warranties both written and
oral, among the parties, with respect to the subject matter hereof, and (b)
shall not be assignable by operation of law or otherwise and is not
intended to create any obligations to, or rights in respect of, any persons
other than the parties hereto; provided, however, that the Purchaser may
designate, by
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<PAGE> 25
written notice to the Issuer, an affiliate of the Purchaser to be the
purchaser entity in lieu of the Purchaser, in the event of which, all
references herein to the Purchaser shall be deemed references to such other
affiliate.
Section 6.10 Parties in Interest. This Agreement shall be
binding upon and inure solely to the benefit of the parties hereto, and
nothing in this Agreement, express or implied, is intended to confer upon
any other person any rights or remedies of any nature whatsoever under or
by reason of this Agreement except pursuant to Article 5 hereof (which is
intended to be for the benefit of the persons described therein and may be
enforced by such persons).
Section 6.11 Specific Performance. The parties hereto
acknowledge that there may be no adequate remedy at law if any party fails
to perform any of its obligations hereunder and that each party may be
irreparably harmed by any such failure, and accordingly agree that each
party, in addition to any other remedy to which it may be entitled at law
or in equity, shall be entitled to compel specific performance of the
obligations of any other party under this Agreement in accordance with the
terms and conditions of this Agreement, in any court of the United States
or any State thereof having jurisdiction.
Section 6.12 Captions. The Article and Section captions
herein are for convenience of reference only, do not constitute part of
this Agreement and shall not be deemed to limit or otherwise affect any of
the provisions hereof.
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<PAGE> 26
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the parties hereto on the date
first hereinabove written.
THE PILLSBURY COMPANY
By /s/ JEROME J. JENKO
Name: Jerome J. Jenko
Title: Senior Vice President,
General Counsel and
Secretary
SENECA FOODS CORPORATION
By /s/ KRAIG H. KAYSER
Name: Kraig H. Kayser
Title: President and Chief
Executive Officer
