FIRST AMENDMENT TO PURCHASE AGREEMENT
This First Amendment to Purchase Agreement (this
"Amendment") is entered into as of this 1st day of April, 1997 by
and among Foodbrands America, Inc. ("Foodbrands"), KPR Holdings,
Inc. ("KPR Holdings") on behalf of itself and as attorney in fact
for each of the former shareholders (the "Shareholders") of ▇▇▇.
▇▇▇▇▇▇▇▇▇▇▇ & Sons, Inc., formerly known as RKR-GP, Inc., with
reference to the following circumstances:
A. Foodbrands, KPR Holdings and the Shareholders
previously entered into that certain Purchase Agreement dated
November 14, 1995 (the "Agreement"). Terms not initially
capitalized which are otherwise defined herein have the meaning
set forth in the Agreement, except to the extent otherwise
provided.
B. In connection with Foodbrands entering into that
certain Agreement and Plan of Merger (the "Merger Agreement")
dated March 25, 1997 by and among Foodbrands, IBP, inc. ("IBP")
and IBP Sub, Inc. ("Purchaser"), the parties entered into that
certain letter agreement dated March 24, 1997 (the "Letter
Agreement") and the parties desire to enter into this Amendment
to amplify and clarify agreements reached in the Letter
Agreement.
Accordingly, the parties have entered into this
Amendment for purposes of amending the Agreement and setting
forth the mutual agreements reached as follows:
1. 1997 Contingent Purchase Price Payment. The
portion of the Contingent Purchase Price earned for FFY 1996 was
payable on April 1, 1997 in the amount of $4,308,063.00 (the
"Original Amount"). It is acknowledged by Sellers that the
Original Amount has been paid by Foodbrands and received by
Sellers. The parties acknowledge that Sellers could have elected
to receive the Original Amount in Foodbrands Common Stock and
Foodbrands desire to repurchase this right from Sellers and
Sellers' desire to sell upon consummation of the Offer or the
Merger (as those terms are defined in the Merger Agreement). To
purchase this right to receive Foodbrands Common Stock for the
FFY 1996 payment only, Foodbrands agrees that upon consummation
of the Offer, an additional amount will be paid equal to
$400,000.00 plus the product of (i) 328,233 (the number of shares
of Foodbrands America common stock Sellers could have received on
April 1, 1997) multiplied by (ii) the Share Price (as defined in
the Merger Agreement) payable pursuant to the Merger Agreement
less $13.125 (collectively, the "Additional Amount"). The
parties also acknowledge that at the current Share Price, the
Additional Amount would be $3,772,594.10. In the event the Offer
is not consummated but the Merger is consummated, the Additional
Amount will be paid at the Effective Time (as defined in the
Merger Agreement). In the event that neither the Offer nor the
Merger is consummated as contemplated by the Merger Agreement,
the Sellers will only be entitled to the Original Amount, but,
will have thirty (30) days from written notice of such event to
make an election by delivering written notice to Foodbrands to
receive the Original Amount in cash or in Foodbrands America
Common Stock in accordance with the Agreement prior to this
Amendment. In the event the Sellers elect, pursuant to the
immediately preceding sentence, to receive Foodbrands Common
Stock, they will promptly return the Original Amount in exchange
for such shares. No interest will be payable on the Contingent
Purchase Price.
2. 1997 and 1998 Contingent Purchase Price Payments.
If the Offer or Merger are consummated, with respect to those
portions of the Contingent Purchase Price payable for FFY 1997
and FFY 1998 pursuant to the terms of the Agreement, Sellers, in
accordance with the terms of the Agreement, will have the option
of electing to receive common stock, par value $.05 of IBP (the
"IBP Common Stock") at an exercise price of $22.50 per share,
instead of Foodbrands America Common Stock at an exercise price
of $13.125. In this regard the Agreement will be amended upon
consummation of the Offer or Merger as follows:
(a) In each Section 2.05(b), (c) and (d) of the
Agreement, wherever the term "Foodbrands" appears, "IBP" shall be
substituted. In the Election Notice attached as Exhibit C to the
Agreement, in each instance that "Foodbrands" appears other than
the first sentence, "IBP" will be substituted therefor.
(b) In each instance where the term "Foodbrands"
appears in Section 2.06(b) of the Agreement, "IBP" will be
substituted therefor.
(c) The definition "Option Price" set forth in
Section 11.10 of the Agreement shall be amended to read in its
entirety as follows:
Option Price shall mean $22.50 ($22 1/2)
per share. In case IBP shall at any time
subdivide the outstanding shares of
common stock into a greater number of
shares, the Option Price in effect imme-
diately prior to such subdivision shall
be proportionately reduced, and
conversely, in the case the outstanding
shares of common stock of IBP shall be
combined into a smaller number of shares,
the Option Price in effect immediately
prior to such combination shall be pro-
portionately increased.
3. Additional Agreements.
(a) From and after the Effective Time, IBP agrees
to take all reasonable actions to cause Foodbrands to perform all
obligations of Foodbrands under the Agreement. Without limiting
or expanding the foregoing, it is understood and agreed that IBP
is not guaranteeing performance and will not be required to
expend any of its own funds except for the Contingent Purchase
Price and as contemplated by subparagraph (b) below.
(b) At the Effective Time of the Merger, IBP will
execute and deliver to BAM Corporation a continuing guarantee in
substantially the form of Exhibit A hereto.
4. No Other Amendment. Except as specifically
amended above, the Agreement shall remain in full force and
effect and shall not be otherwise amended by this Amendment.
5. Entirety. The Agreements reflected in this
Amendment constitute the entire understanding of the parties with
respect to the subject matter hereof and supersede all prior
negotiations and discussions including without limitation the
Letter Agreement.
6. Amendment. Subject to applicable law, this
Amendment may be amended only in writing signed by each of the
parties hereto.
7. Counterparts. This Amendment may be executed 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 and shall be effective when two or more
counterparts have been signed by each of the parties hereto and
delivered to the other parties.
IN WITNESS WHEREOF, the parties have executed this
First Amendment to Purchase Agreement as of the day and year
first above written.
FOODBRANDS AMERICA, INC.
By /s/ R. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
R. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman,
President and Chief Executive
Officer
KPR HOLDINGS, INC., for itself
and its agent and attorney-in-
fact for the shareholders
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, President
IBP, inc.
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, Executive Vice
President - Corporate
Development
