-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Tdc2vZSG9febcO5THb7wINs1n54mPot3MX+wrA1YRuKnRKqU9tPDdlKv5V3HgHyl MR+k3acNKG+jWx9l3sjdFw== 0000100493-01-000010.txt : 20010214 0000100493-01-000010.hdr.sgml : 20010214 ACCESSION NUMBER: 0000100493-01-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 10 CONFORMED PERIOD OF REPORT: 20001230 FILED AS OF DATE: 20010213 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TYSON FOODS INC CENTRAL INDEX KEY: 0000100493 STANDARD INDUSTRIAL CLASSIFICATION: POULTRY SLAUGHTERING AND PROCESSING [2015] IRS NUMBER: 710225165 STATE OF INCORPORATION: DE FISCAL YEAR END: 0927 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-14704 FILM NUMBER: 1535801 BUSINESS ADDRESS: STREET 1: 2210 W OAKLAWN DR CITY: SPRINGDALE STATE: AR ZIP: 72762-6999 BUSINESS PHONE: 5012904000 MAIL ADDRESS: STREET 1: P O BOX 2020 STREET 2: P O BOX 2020 CITY: SPRINGDALE STATE: AR ZIP: 72765-2020 10-Q 1 0001.txt 1ST QTR FISCAL 2001 FORM 10Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 30, 2000 ----------------- OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________________to_________________ Commission File Number 0-3400 TYSON FOODS, INC. (Exact name of registrant as specified in its charter) Delaware 71-0225165 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 2210 West Oaklawn Drive, Springdale, Arkansas 72762-6999 (Address of principal executive offices and zip code) (501) 290-4000 (Registrant's telephone number, including area code) 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 the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding January 27, 2001 - ------------------------------------- ----------------------------- Class A Common Stock, $0.10 Par Value 119,663,716 Shares Class B Common Stock, $0.10 Par Value 102,645,048 Shares Page 1 TYSON FOODS, INC. INDEX PAGE ---- PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Condensed Statements of Income for the Three Months Ended December 30, 2000 and January 1, 2000 3 Consolidated Condensed Balance Sheets December 30, 2000 and September 30, 2000 4 Consolidated Condensed Statements of Cash Flows for the Three Months Ended December 30, 2000 and January 1, 2000 5 Notes to Consolidated Condensed Financial Statements 6-14 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 15-19 Item 3. Quantitative and Qualitative Disclosure About Market Risks 19 PART II. OTHER INFORMATION Item 1. Legal Proceedings 20 Item 2. Changes in Securities and Use of Proceeds 20 Item 3. Defaults Upon Senior Securities 20 Item 4. Submission of Matters to a Vote of Security Holders 20 Item 5. Other Information 20 Item 6. Exhibits and Reports on Form 8-K 21 EXHIBIT INDEX 22 SIGNATURES 23 2 PART I. FINANCIAL INFORMATION Item 1. Financial Statements TYSON FOODS, INC. CONSOLIDATED CONDENSED STATEMENTS OF INCOME (In millions except per share amounts) (Unaudited) Three Months Ended __________________ December 30, January 1, 2000 2000 ___________ __________ Sales $1,743 $1,779 Cost of Sales 1,482 1,466 ------ ------ 261 313 Operating Expenses: Selling 141 146 General and administrative 44 36 Amortization 8 8 ------ ------ Operating Income 68 123 Other Expense (Income): Interest 26 29 Foreign currency exchange 1 1 Other - 1 ------ ------ Income Before Taxes on Income and Minority Interest 41 92 Provision for Income Taxes 14 33 Minority Interest - 2 ------ ------ Net Income $ 27 $ 57 ====== ====== Basic Average Shares Outstanding 223 228 ====== ====== Basic Earnings Per Share $ 0.12 $ 0.25 ====== ====== Diluted Average Shares Outstanding 224 228 ====== ====== Diluted Earnings Per Share $ 0.12 $ 0.25 ====== ====== Cash Dividends Per Share: Class A $0.040 $0.040 Class B $0.036 $0.036 See accompanying notes. 3 TYSON FOODS, INC. CONSOLIDATED CONDENSED BALANCE SHEETS (In millions except per share amounts) (Unaudited) December 30, September 30, 2000 2000 ASSETS ___________ ____________ Current Assets: Cash and cash equivalents $ 33 $ 43 Accounts receivable 506 520 Inventories 984 965 Other current assets 43 48 _____ _____ Total Current Assets 1,566 1,576 Net Property, Plant, and Equipment 2,101 2,141 Excess of Investments over Net Assets Acquired 929 937 Other Assets 203 200 ______ ______ Total Assets $4,799 $4,854 ====== ====== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Notes payable $ 50 $ 62 Current portion of long-term debt 73 123 Trade accounts payable 326 346 Accrued compensation and benefits 138 104 Other current liabilities 254 251 _____ _____ Total Current Liabilities 841 886 Long-Term Debt 1,342 1,357 Deferred Income Taxes 389 385 Other Liabilities 51 51 Shareholders' Equity: Common stock ($.10 par value): Class A-Authorized 900 million shares; issued 138 million shares at December 30, 2000 and September 30, 2000 14 14 Class B-Authorized 900 million shares; issued 103 million shares at December 30, 2000 and September 30, 2000 10 10 Capital in excess of par value 735 735 Retained earnings 1,734 1,715 Accumulated other comprehensive loss (6) (5) _______ ______ 2,487 2,469 Less treasury stock, at cost- 18 million shares at December 30, 2000 and 16 million shares at September 30, 2000 303 284 Less unamortized deferred compensation 8 10 ______ ______ Total Shareholders' Equity 2,176 2,175 ______ ______ Total Liabilities and Shareholders' Equity $4,799 $4,854 ====== ====== See accompanying notes. 4 TYSON FOODS, INC. CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (In millions) (Unaudited) Three Months Ended __________________ December 30, January 1, 2000 2000 ___________ _________ Cash Flows from Operating Activities: Net income $ 27 $ 57 Adjustments to reconcile net income to cash provided by operating activities: Depreciation 65 63 Amortization 8 8 Amortization of deferred compensation 2 - Deferred income taxes (2) (3) Minority interest - 2 Foreign currency exchange 1 1 Loss on dispositions of assets - 2 Decrease in accounts receivable 14 23 (Increase)decrease in inventories (19) 19 Decrease in trade accounts payable (20) (29) Increase in accrued compensation and benefits 34 12 Net change in other current assets and other current liabilities 13 50 _____ _____ Cash Provided by Operating Activities 123 205 Cash Flows from Investing Activities: Additions to property, plant and equipment (47) (49) Proceeds from disposition of assets 21 1 Net change in other assets and other liabilities (5) (6) _____ _____ Cash Used for Investing Activities (31) (54) Cash Flows from Financing Activities: Net change in notes payable (12) (2) Repayments of long-term debt (65) (79) Purchases of treasury shares (19) (33) Dividends (8) (8) Other (1) 1 _____ _____ Cash Used for Financing Activities (105) (121) Effect of Exchange Rate Change on Cash 3 (1) _____ _____ (Decrease)Increase in Cash and Cash Equivalents (10) 29 Cash and Cash Equivalents at Beginning of Period 43 30 _____ _____ Cash and Cash Equivalents at End of Period $ 33 $ 59 ===== ===== Supplemental Cash Flow Information Cash paid during the period for: Interest $30 $25 Income taxes $8 $1 See accompanying notes. 5 TYSON FOODS, INC. NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) Note 1: ACCOUNTING POLICIES BASIS OF PRESENTATION The consolidated condensed financial statements have been prepared by Tyson Foods, Inc. (the "Company"), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and accounting policies and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. Although the management of the Company believes that the disclosures are adequate to make the information presented not misleading, these consolidated condensed financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's latest annual report for the fiscal year ended September 30, 2000. The preparation of consolidated condensed financial statements requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Management believes the accompanying consolidated condensed financial statements contain all adjustments, consisting of normal recurring accruals, necessary to present fairly the financial position as of December 30, 2000 and September 30, 2000 and the results of operations and cash flows for the three months ended December 30, 2000 and January 1, 2000. The results of operations and cash flows for the three months ended December 30, 2000 and January 1, 2000 are not necessarily indicative of the results to be expected for the full year. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In December 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin (SAB) No. 101, which provides guidance on the recognition, presentation and disclosure of revenue in financial statements filed with the Commission. SAB 101A was released on March 24, 2000, and delayed for one fiscal quarter the implementation date of SAB 101 for registrants with fiscal years beginning between December 16, 1999, and March 15, 2000. Since the issuance of SAB 101 and SAB 101A, the staff has continued to receive requests from a number of groups asking for additional time to determine the effect, if any, on registrant's revenue recognition practices. SAB 101B issued June 26, 2000 further delayed the implementation date of SAB 101 until no later than the fourth fiscal quarter of fiscal years beginning after December 15, 1999. The Company believes the adoption of SAB 101 in fiscal 2001 will not have a material impact on its financial position or results of operations. 6 In September 2000, the Emerging Issues Task Force (EITF) released Issue 00- 10-Accounting for Shipping and Handling Fees and Costs, which provides guidance on the classification of amounts billed and incurred for shipping and handling in the income statement. The Task Force concluded that all shipping and handling billings to a customer in a sale transaction represent the fees earned for the goods provided and, accordingly, should be classified as revenue. The EITF concluded that significant shipping and handling costs not included in cost of sales should be disclosed as to amount of such costs and where classified on the income statement. The issue requires implementation in the fourth quarter of a registrant's fiscal year beginning after December 15, 1999. RECLASSIFICATIONS Certain reclassifications have been made to prior periods to conform to current presentations. Note 2: ACQUISITIONS On December 4, 2000, the Company announced an offer to acquire all outstanding common stock of IBP, inc. (IBP) through transaction in which IBP shareholders would receive $26.00 for each share of IBP common stock, with 50% of the consideration in cash and 50% in Tyson Class A common stock. On December 12, 2000, the Company commenced a formal cash tender offer for 50.1% of IBP common stock at $26.00 per share. On December 28, 2000, the Company announced that it had increased its offer to acquire IBP to $27.00 per share. The Company also announced that it was prepared to commence an exchange offer for all shares not purchased in the cash tender offer promptly after the Company signed a merger agreement with IBP. The cash tender offer was scheduled to expire on January 10, 2001. On January 1, 2001, the Company announced it had signed a definitive merger agreement with IBP pursuant to which IBP shareholders would receive $30.00 for each share of IBP common stock. The Company also announced that it would commence the exchange offer pursuant to which it would offer to exchange, for each outstanding IBP share not owned by Tyson after completion of the cash tender offer, a number of shares of Tyson Class A common stock having a value of $30.00, so long as the average per share price of Tyson Class A common stock during the fifteen trading day period ending on the second trading day before the expiration date of the exchange offer is at least $12.60 and no more than $15.40. This $30.00 value is subject to change if the average per share price of Tyson Class A common stock is not in that range and the value that an IBP shareholder would receive would be proportionately changed. Assuming the average per share price is less than or equal to $12.60, the Company will issue approximately 126 million shares of Tyson Class A common stock in the transaction. Assuming the average per share price is more than or equal to $15.40, the Company will issue approximately 103 million shares of Tyson Class A common stock in the transaction. The total consideration to be paid to IBP shareholders in cash and Tyson Class A common stock is approximately $3.2 billion with an additional assumption of approximately $1.5 billion in IBP debt. IBP is a leading beef and pork producer headquartered in Dakota Dunes, South Dakota which had sales of approximately $14 billion for the fiscal year ended December 25, 1999 and approximately $12 billion for the nine months ended September 23, 2000. 7 Note 3: DERIVATIVE FINANCIAL INSTRUMENTS On October 1, 2000, the Company adopted Financial Accounting Standards Board Statement (SFAS) No. 133, "Accounting for Derivative Instruments and Hedging Activities," as amended. This Statement requires the Company to recognize all derivatives on the balance sheet at fair value. Derivatives that are not hedges must be adjusted to fair value through income. If the derivative is a hedge, depending on the nature of the hedge, changes in the fair value of derivatives will either be offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings, or recognized in Other Comprehensive Income (OCI) until the hedged item is recognized in earnings. The ineffective portion of a derivative's change in fair value is recognized in earnings. The adoption of SFAS No. 133 on October 1, 2000, resulted in the pretax cumulative effect of an accounting change of approximately $9 million loss being charged to OCI. The Company uses derivatives to moderate the financial and commodity market risks of its business operations. Derivative products, such as futures and option contracts, are considered to be a hedge against changes in the amount of future cash flows related to forward basis contracts to procure grain. The Company also enters into interest rate swap agreements to adjust the proportion of total long-term debt and leveraged equipment loans that are subject to variable interest rates. Under these interest rate swaps, Tyson agrees to pay a fixed rate of interest times a notional principal amount and to receive in return an amount equal to a specified variable-rate of interest times the same notional principal amount. These interest rate swaps are considered to be a hedge against changes in the amount of future cash flows associated with Tyson's variable rate interest payments. All of the Company's derivatives that are designated as hedges at December 30, 2000, are designated as cash flow hedges (i.e., hedging the exposure of variability in expected future cash flows that is attributable to a particular risk). The effective portion of the cumulative gain or loss on the derivative instrument is reported as a component of OCI in shareholders' equity and recognized into earnings in the same period or periods during which the hedged transaction affects earnings (for commodity hedges when the chickens that consumed the hedged grain are sold and for interest rate swaps as the underlying debt is paid down). The remaining cumulative gain or loss on the derivative instrument in excess of the cumulative change in the present value of the future cash flows of the hedged item, if any, is recognized in earnings during the period of change. No ineffectiveness was recognized on cash flow hedges during the first quarter of fiscal 2001. The Company expects that the losses, net of gains, totaling approximately $0.7 million recorded in OCI at December 30, 2000, related to commodity hedges, will be recognized within the next twelve months. The Company expects that the loss totaling approximately $1.7 million recorded in OCI at December 30, 2000, associated with interest rate swaps, that will be recognized within the next twelve months will not be significant, however the amount will be recognized by September 2007, which coincides with when the related debt matures. 8 Derivative liabilities totaling approximately $1.7 million related to interest rate swap agreements, with a notional amount of $106 million, are recorded in other current liabilities on the Consolidated Condensed Balance Sheets at December 30, 2000. The fair value of interest rate swaps is based on individual market values as calculated monthly using a published forward curve for the floating portion and the agreed upon fixed rate for the fixed portion of the interest rate swap agreement. Derivative assets relating to commodity hedges totaling approximately $4.9 million are recorded in other current assets on the Consolidated Condensed Balance Sheets at December 30, 2000. Fair values for these contracts are based on quoted market prices. Fair values of other items recorded as assets at December 30, 2000 totaled approximately $0.2 million. Commodity contracts held by the Company at December 30, 2000 consisted of long positions in corn with a notional amount of 27.6 million bushels and fair value of $3.7 million; short positions in corn with a notional amount of 2 million bushels and fair value that was a liability totaling $0.1 million; long positions in soybean oil with a notional amount of 26.6 million cwt and fair value that was a liability totaling $0.1 million; long positions in soybean meal with a notional amount of 0.1 million tons and fair value of $1.4 million. The hedging positions expire at various dates through September 2001. Commodity contracts held by the Company at September 30, 2000, consisted of long positions in corn with a notional amount of 17.1 million bushels and fair value that was a liability totaling $9 million. The Company had interest rate swap agreements with a notional amount of $110 million and fair value of $0.5 million at September 30, 2000. Note 4: INVENTORIES Inventories, valued at the lower of cost (first-in, first-out) or market, consist of the following: (In millions) December 30, September 30, 2000 2000 ___________ ____________ Dressed and further-processed products $472 $460 Live chickens 303 291 Live swine 73 75 Hatchery eggs and feed 62 67 Supplies 74 72 ____ ____ Total Inventory $984 $965 ==== ==== 9 Note 5: PROPERTY, PLANT AND EQUIPMENT The major categories of property, plant and equipment and accumulated depreciation, at cost, are as follows: (In millions) December 30, September 30, 2000 2000 ___________ ____________ Land $ 61 $ 61 Buildings and leasehold improvements 1,294 1,291 Machinery and equipment 2,244 2,219 Land improvements and other 112 110 Buildings and equipment under construction 85 103 ______ ______ 3,796 3,784 Less accumulated depreciation 1,695 1,643 ______ ______ Net property, plant and equipment $2,101 $2,141 ====== ====== Note 6: LONG-TERM DEBT The major components of long-term debt are as follows: (In millions) December 30, September 30, 2000 2000 ___________ ____________ Commercial paper (7.8% effective rate at December 30, 2000 and 6.7% effective rate at September 30, 2000) $ 234 $ 260 Revolver (7.5% effective rate at December 30, 2000) 20 - Debt securities: 6.75% notes 149 149 6.625% notes 149 149 6% notes 149 149 7% notes 147 147 7% notes 237 237 Institutional notes: 10.84% notes 50 50 11.375% notes - 4 Leveraged equipment loans (rates ranging from 4.7% to 6.0%) 133 138 Other 74 74 ______ ______ Total long-term debt $1,342 $1,357 ====== ====== The revolving credit agreement and notes contain various covenants, the more restrictive of which require maintenance of a minimum net worth, current ratio, cash flow coverage of interest and a maximum total debt-to- capitalization ratio. The Company is in compliance with these covenants at December 30, 2000. 10 Effective January 12, 2001, the Company entered into a new 364-day revolving credit agreement which provides for an aggregate financing commitment of up to $2.5 billion. This new facility, when combined with the Company's existing $1 billion revolving credit facility described above, will support the issuance of a total of up to $3.5 billion in commercial paper. The combined additional financing availability provided by these facilities will be used to fund the approximately $1.8 billion cash purchase price for the Company's acquisition of IBP and to repay certain of IBP's indebtedness. Note 7: CONTINGENCIES The Company is involved in various lawsuits and claims made by third parties on an ongoing basis as a result of its day-to-day operations. Although the outcome of such items cannot be determined with certainty, the Company's general counsel and management are of the opinion that the final outcome should not have a material effect on the Company's results of operations or financial position. On June 22, 1999, 11 current and former employees of the Company filed the case of M.H. Fox, et al. v. Tyson Foods, Inc. (Fox v. Tyson) in the U.S. District Court for the Northern District of Alabama claiming the Company violated requirements of the Fair Labor Standards Act. The suit alleges the Company failed to pay employees for all hours worked and/or improperly paid them for overtime hours. The suit generally alleges that (i) employees should be paid for time taken to put on and take off certain working supplies at the beginning and end of their shifts and breaks and (ii) the use of "mastercard" or "line" time fails to pay employees for all time actually worked. Plaintiffs seek to represent themselves and all similarly situated current and former employees of the Company. At filing 159 current and/or former employees consented to join the lawsuit and, to date, approximately 4,900 consents have been filed with the court. Discovery in this case is ongoing. A hearing was held on March 6, 2000, to consider the plaintiff's request for collective action certification and court- supervised notice. No decision has been rendered. The Company believes it has substantial defenses to the claims made and intends to vigorously defend the case; however, neither the likelihood of unfavorable outcome nor the amount of ultimate liability, if any, with respect to this case can be determined at this time. Substantially similar suits have been filed against other integrated poultry companies. In addition, organizing activity conducted by representatives or affiliates of the United Food and Commercial Workers Union against the poultry industry has encouraged worker participation in Fox v. Tyson and the other lawsuits. On February 9, 2000, the Wage and Hour Division of the U.S. Department of Labor (DOL) began an industry-wide investigation of poultry producers, including the Company, to ascertain compliance with various wage and hour issues. As part of this investigation, the DOL inspected 14 of the Company's processing facilities. The Company is having discussions with the DOL regarding its investigation and the possible resolution of potential claims that might be asserted by the DOL. On August 22, 2000, 7 employees of the Company filed the case of De Asencio v. Tyson Foods, Inc. in the U.S. District Court for the Eastern District of Pennsylvania. This lawsuit is similar to Fox V. Tyson in that the employees 11 claim violations of the Fair Labor Standards Act for allededly failing to pay for time taken to put on, take off, and sanitize certain working supplies. Plaintiffs seek to represent themselves and all similarly situated current and former employees of the poultry processing plants in New Holland, Pennsylvania. Currently, there are 89 additional current or former employees who have filed consents to join the lawsuit. The Court, on January 30, 2001, ordered that notice of the lawsuit be issued to all potential plaintiffs at the New Holland facilities, but the class has not been ordered certified. The Company believes it has substantial defenses to the claims made and intends to defend the case vigorously; however, neither the likelihood of unfavorable outcome nor the amount of ultimate liability, if any, with respect to this case can be determined at this time. The Company has been advised of an investigation by the Immigration and Naturalization Service (INS) and the U.S. Attorney's Office for the Eastern District of Tennessee into possible violations of the Immigration and Naturalization Act at several of the Company's locations. On October 5, 2000, the Company was advised that, in addition to a number of its employees, the Company itself is a subject of the investigation. The outcome of the investigation and any potential liability on the part of the Company cannot be determined at this time. The Company's Sedalia, Mo., facility is currently under investigation by the U.S. Attorney's office of the Western District of Missouri for possible violations of environmental laws or regulations. Neither the likelihood of an unfavorable outcome nor the amount of ultimate liability, if any, with respect to this investigation can be determined at this time. On October 17, 2000, a Washington County (Arkansas) Chancery Court awarded the Company approximately $20 million in its lawsuit alleging trade secret misappropriation by ConAgra, Inc. and ConAgra Poultry Company. Subsequently, on December 4, 2000, as a result of an opinion issued by the Arkansas Supreme Court, the Chancery Court reversed its finding that the Company's nutrient profile was a trade secret and reversed the jury's $20 million verdict against the ConAgra entities. On January 3, 2001, the Company filed a notice of appeal appealing the Chancery Court's reversal of the trade secret determination and of the jury verdict. Note 8: COMPREHENSIVE INCOME The components of comprehensive income are as follows: (In millions) Three Months Ended __________________ December 30, January 1, 2000 2000 ___________ _________ Net Income $ 27 $ 57 Other Comprehensive Income - net of tax of $(0.7) million at December 30, 2000 and $(0.6) million at January 1, 2000 Currency Translation Adjustment 1 (2) Cumulative Effect of SFAS. 133 Adoption (6) - Derivative Unrealized Gain 3 - Derivative Loss Recognized in Cost of Sales 1 - ______ ______ Total Comprehensive Income $ 26 $ 55 ====== ====== 12 Note 9: EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share: (In millions except per share amounts) Three Months Ended __________________ December 30, January 1, 2000 2000 ___________ _________ Numerator: Net Income $ 27 $ 57 ===== ===== Denominator: Denominator for basic earnings per share- weighted average shares 223 228 Effect of dilutive securities: Restricted stock 1 - ____ ____ Denominator for diluted earnings per share- adjusted weighted average shares and assumed conversions 224 228 ===== ===== Basic earnings per share $0.12 $0.25 ===== ===== Diluted earnings per share $0.12 $0.25 ===== ===== The Company had approximately seven million option shares outstanding at December 30, 2000, that were not included in the dilutive earnings per share calculation because they would have been antidilutive. Note 10: SEGMENT REPORTING The Company presently identifies segments based on the products offered and the nature of customers, resulting in four reported business segments: Food Service, Consumer Products, International and Swine. Food Service includes fresh, frozen and value-added chicken products sold through domestic foodservice, specialty and commodity distributors who deliver to restaurants, schools and other accounts. Consumer Products include fresh, frozen and value-added chicken products sold through domestic retail markets for at-home consumption and through wholesale club markets targeted to small foodservice operators, individuals and small businesses. The Company's International segment markets and sells the full line of Tyson chicken products throughout the world. The Company's Swine segment includes feeder pig finishing and marketing of swine to regional and national packers. Other consists primarily of the Specialty Products group, the Prepared Foods group, the chicken breeding stock subsidiary and other corporate operating activities. Sales between reportable segments are recorded at cost. The Company measures segment profit as gross profit less 13 selling expenses. Corporate overhead adjustments were included in the measurement of segment profit at December 30, 2000, but were not included in the measurement of segment profit at January 1, 2000. Total assets for each segment at December 30, 2000 approximate those at September 30, 2000. Information on segments and a reconciliation to income before taxes on income and minority interest are as follows: (In millions) Three Months Ended __________________ December 30, January 1, 2000 2000 Sales: ____________ __________ Food Service $ 802 $ 825 Consumer Products 529 538 International 187 188 Swine 38 32 Other 187 196 ______ ______ Total Sales $1,743 $1,779 ====== ====== Segment Profit: Food Service $ 37 $ 70 Consumer Products 38 53 International 2 24 Swine - (1) Other 43 21 ____ ____ Total Segment Profit 120 167 Other Operating Expenses 52 44 Other Expense (Income) 27 31 _____ _____ Income Before Taxes on Income and Minority Interest $ 41 $ 92 ===== ===== 14 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations RESULTS OF OPERATIONS Earnings for the first quarter of fiscal 2001 were $27 million or $0.12 per share compared to $57 million or $0.25 per share for the first quarter of fiscal 2000. First Quarter Fiscal 2001 vs. First Quarter Fiscal 2000 Sales for the first quarter of fiscal 2001 decreased 2% from the same period of fiscal 2000, with a 4.9% decrease in volume. The decreases in price and volume were partially offset by an improved product mix. The oversupply of chicken in the market has continued to negatively impact sales prices. In November 1999, in response to the oversupply of chicken, the Company initiated a 3% cut in the number of chickens produced and since then has maintained a reduced production level. Breast meat commodity market prices continue to be pressured by an oversupply of chicken and average prices for the quarter ended December 30, 2000, were 12% lower than the same quarter last year. This situation not only continues to adversely affect the average sales prices and margins of many of the Company's core value-added products, but also offsets much of the benefits of the Company's focused shift to value-added products targeted to reduce the amount of raw material being sold to non-integrated further processors. Food Service first quarter sales decreased $23 million or 2.8% from the same period last year, with a 7.9% decrease in volume partially offset by a 5.6% increase in average sales prices due to product mix changes. Segment profit for Food Service, defined as gross profit less selling expenses, decreased $33 million from the same period last year primarily due to lower market prices and product mix changes. Consumer Products first quarter sales decreased $9 million or 1.7% from the same period last year, with a 3.4% decrease in average sales prices partially offset by a 1.8% increase in volume. Consumer Products segment profit decreased $15 million from the same period last year primarily due to lower market prices. International first quarter sales were comparable to the same period last year, with a 15.5% decrease in volume primarily offset by an 18.2% increase in average sales prices. International segment profit decreased $22 million from the same period last year with $9 million related to the lingering effect of Exotic Newcastle disease on Tyson de Mexico and the remainder due to lower volumes and a change in product mix. International sales volume was negatively impacted by severe weather that slowed movement of product to port, the loading and shipment of product at the port and the production of product at Company locations. Swine first quarter sales increased $6 million or 18.8% over the same period last year, with a 17.9% increase in average sales prices and a 0.6% increase in volume. Swine segment profit improved slightly over the same period last year due to the increase in average sales prices. 15 Other first quarter sales decreased $9 million or 4.6% from the same period last year primarily due to a decrease in Prepared Foods sales. Other consists primarily of the Specialty Products group, the Prepared Foods group, the chicken breeding stock subsidiary and other corporate operating activities. Cost of sales increased 1.2% for the first quarter of fiscal 2001 as compared to the same period last year. As a percent of sales, cost of sales was 85.0% for the first quarter of fiscal 2001 compared to 82.4% for the same period last year. The increase in cost of sales, as a percent of sales, is primarily due to lower market prices, product mix changes and higher grain costs. Operating expenses increased 1.3% for the first quarter of fiscal 2001 over the same period last year. Selling expense, as a percent of sales, was 8.1% for the first quarter of fiscal 2001 and 8.2% for the first quarter of fiscal 2000. Total selling expenses have decreased primarily due to decreased storage costs resulting from reduced inventories from the same period last year. General and administrative expense, as a percent of sales, was 2.5% in the first quarter of fiscal 2001 and 2.0% in the first quarter of fiscal 2000. The increase in general and administrative expense is primarily due to litigation costs related to ongoing employee practice matters and other corporate overhead costs. Amortization expense, as a percent of sales, was 0.5% in the first quarter of fiscal 2001 and fiscal 2000. Interest expense decreased 7.6% for the first quarter of fiscal 2001 compared to the same period last year primarily as a result of a 13.6% decrease in the Company's average indebtedness over the same period last year. Short-term rates were slightly higher than last year and the overall weighted average borrowing rate increased to 7.0% compared to 6.6% last year. The effective income tax rate for the first quarter of fiscal 2001 was 34.8% compared to 35.6% for the same period last year primarily due to a decrease in foreign subsidiary earnings effective tax rate. FINANCIAL CONDITION For the three months ended December 30, 2000, net cash totaling $123 million was provided by operating activities. Operations provided $101 million in cash and $22 million was provided by net changes in receivables, inventories, payables and other items. The Company used cash from operations and proceeds of $21 million from asset disposals to fund $47 million of property, plant and equipment additions, to pay down total debt by $77 million and to repurchase $18 million of the Company's Class A common stock in the open market. The expenditures for property, plant and equipment were related to acquiring new equipment and upgrading facilities in order to maintain competitive standing and position the Company for future opportunities. Capital spending for fiscal 2001 is expected to be in the range of $230-250 million. 16 At December 30, 2000, working capital was $725 million compared to $690 million at 2000 fiscal year-end, an increase of $35 million. The current ratio at December 30, 2000 was 1.9 to 1 compared to 1.8 to 1 at September 30, 2000. Working capital and the current ratio have increased since year- end primarily due to a decrease in current portion of long-term debt. At December 30, 2000, total debt was 40.2% of total capitalization compared to 41.5% at September 30, 2000. The Company's foreseeable cash needs for operations and capital expenditures will continue to be met through cash flows from operations and borrowings supported by existing credit facilities as well as additional credit facilities which the Company believes are available. The Company has an unsecured revolving credit agreement totaling $1 billion which supports the Company's commercial paper program. This $1 billion facility expires in May 2002. At December 30, 2000, $234 million in commercial paper and $20 million of revolver was outstanding under this $1 billion facility. Additional outstanding debt at December 30, 2000, consisted of $830 million of public debt, $107 million of institutional notes, $150 million in leveraged equipment loans, $50 million of short-term notes payable and $74 million of other indebtedness. The Company may use funds borrowed under its revolving credit facilities, commercial paper program or through the issuance of additional debt securities from time to time in the future to finance acquisitions as opportunities may arise, to refinance other indebtedness or capital leases of the Company and for other general corporate purposes. The revolving credit agreement and notes contain various covenants, the more restrictive of which require maintenance of a minimum net worth, current ratio, cash flow coverage of interest and a maximum total debt-to-capitalization ratio. The Company is in compliance with these covenants at December 30, 2000. On December 4, 2000, the Company announced an offer to acquire all outstanding common stock of IBP, inc. (IBP) through transaction in which IBP shareholders would receive $26.00 for each share of IBP common stock, with 50% of the consideration in cash and 50% in Tyson Class A common stock. On December 12, 2000, the Company commenced a formal cash tender offer for 50.1% of IBP common stock at $26.00 per share. On December 28, 2000, the Company announced that it had increased its offer to acquire IBP to $27.00 per share. The Company also announced that it was prepared to commence an exchange offer for all shares not purchased in the cash tender offer promptly after the Company signed a merger agreement with IBP. The cash tender offer was scheduled to expire on January 10, 2001. On January 1, 2001, the Company announced it had signed a definitive merger agreement with IBP pursuant to which IBP shareholders would receive $30.00 for each share of IBP common stock. The Company also announced that it would commence the exchange offer pursuant to which it would offer to exchange, for each outstanding IBP share not owned by Tyson after completion of the cash tender offer, a number of shares of Tyson Class A common stock having a value of $30.00, so long as the average per share price of Tyson Class A common stock during the fifteen trading day period ending on the second trading day before the expiration date of the exchange offer is at least $12.60 and no more than $15.40. This $30.00 value is subject to change if the average per share price of Tyson Class A common stock is not in that range and the value that an IBP shareholder would receive would be proportionately changed. Assuming the average per share price is less than or equal to $12.60, the Company will issue approximately 126 million shares of Tyson Class A common stock in the transaction. 17 Assuming the average per share price is more than or equal to $15.40, the Company will issue approximately 103 million shares of Tyson Class A common stock in the transaction. The total consideration to be paid to IBP shareholders in cash and Tyson Class A common stock is approximately $3.2 billion with an additional assumption of approximately $1.5 billion in IBP debt. IBP is a leading beef and pork producer headquartered in Dakota Dunes, South Dakota which had sales of approximately $14 billion for the fiscal year ended December 25, 1999 and approximately $12 billion for the nine months ended September 23, 2000. Effective January 12, 2001, the Company entered into a new 364-day revolving credit agreement which provides for an aggregate financing commitment of up to $2.5 billion. This new facility, when combined with the Company's existing $1 billion revolving credit facility described above, will support the issuance of a total of up to $3.5 billion in commercial paper. The combined additional financing availability provided by these facilities will be used to fund the approximately $1.8 billion cash purchase price for the Company's acquisition of IBP and to repay certain of IBP's indebtedness. It is currently anticipated that the Company will seek to refinance all or a portion of the commercial paper borrowings supported by this facility through the issuance of public debt securities. However, the decision whether or not to effect such refinancing and the timing of such refinancing will depend on a number of factors, including market conditions, interest rates and interest rate spreads and the availability of alternative financing. 18 CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 The Company and its representatives may from time to time make written or oral forward-looking statements, including forward-looking statements made in this report, with respect to their current views and estimates of future economic circumstances, industry conditions, company performance and financial results. These forward-looking statements are subject to a number of factors and uncertainties which could cause the Company's actual results and experiences to differ materially from the anticipated results and expectations, expressed in such forward-looking statements. The Company wishes to caution readers not to place undue reliance on any forward- looking statements, which speak only as of the date made. Among the factors that may affect the operating results of the Company are the following: (i) fluctuations in the cost and availability of raw materials, such as feed grain costs; (ii) changes in the availability and relative costs of labor and contract growers; (iii) market conditions for finished products, including the supply and pricing of alternative proteins; (iv) effectiveness of advertising and marketing programs; (v) the ability of the Company to make effective acquisitions and successfully integrate newly acquired businesses into existing operations; (vi) risks associated with leverage, including cost increases due to rising interest rates; (vii) risks associated with effectively evaluating derivatives and hedging activities; (viii) changes in regulations and laws, including changes in accounting standards, environmental laws, occupational, health and safety laws; (ix) adverse results from ongoing litigation; (x) access to foreign markets together with foreign economic conditions, including currency fluctuations; and (xi) the effect of, or changes in, general economic conditions. Item 3. Quantitative and Qualitative Disclosure About Market Risks There have been no significant changes in market risk or market risk factors since the 2000 annual report to shareholders. 19 PART II. OTHER INFORMATION Item 1. Legal Proceedings Refer to information under Part I., Item 1. Notes to Consolidated Condensed Financial Statements, Note 7: Contingencies. Item 2. Changes in Securities and Use of Proceeds Not Applicable Item 3. Defaults Upon Senior Securities Not Applicable Item 4. Submission of Matters to a Vote of Security Holders The following directors were elected at the annual meeting of shareholders held January 12, 2001: DIRECTORS VOTES FOR VOTES WITHHELD _________ _________ ______________ Barbara Allen 1,125,769,979 4,158,764 Lloyd V. Hackley 1,125,895,965 4,032,778 Gerald M. Johnston 1,125,898,381 4,030,362 David A. Jones 1,125,775,144 4,153,599 Jim Kever 1,125,774,734 4,154,009 Shelby D. Massey 1,120,761,637 9,167,106 Joe F. Starr 1,125,880,546 4,048,197 Leland E. Tollett 1,125,897,039 4,031,704 Barbara A. Tyson 1,120,051,380 9,877,363 Don Tyson 1,121,931,252 7,997,491 John H. Tyson 1,120,035,177 9,893,566 Donald E. Wray 1,125,896,689 4,032,054 A shareholder proposal by the General Board of Pension and Health Benefits of the United Methodist Church was defeated by a vote of 8,395,963 votes for the proposal and 1,086,242,053 votes against the proposal and 4,942,266 abstentions. A Company proposal to approve the 2000 Stock Incentive Plan was passed by a vote of 1,081,335,542 votes for the proposal and 17,828,985 votes against the proposal and 415,755 abstentions. No other items were voted on at the annual meeting of shareholders or during the quarter ended December 30, 2000. Item 5. Other Information Not Applicable 20 Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: The exhibits filed with this report are listed in the exhibit index at the end of this Item 6. (b) Reports on Form 8-K: The Company did not file any Current Reports on Form 8-K for the quarter ended December 30, 2000. 21 EXHIBIT INDEX The following exhibits are filed with this report. Exhibit No. Page - ----------- ---- 2.1 Agreement and Plan of Merger dated as of January 1, 2001 among the Company, IBP, inc. and Lasso Acquisition Corporation. 24-94 3.1 Restated Certificate of Incorporation of the Company (previously filed as Exhibit 3.1 to the Company's Annual Report on Form 10-K for the fiscal year ended October 3, 1998, Commission File No. 0-3400, and incorporated herein by reference). 3.2 Second Amended and Restated Bylaws of the Company (previously filed as Exhibit 3.2 to the Company's Quarterly Report on Form 10-Q for the period ended January 1, 2000, Commission File No. 0-3400, and incorporated herein by reference). 10.1 Credit Agreement, including all exhibits thereto, dated as of January 12, 2001, by and among the Company, as Borrower, The Chase Manhattan Bank N.A., as Administrative Agent, Merrill Lynch Capital Corporation, as Syndication Agent, Suntrust Banks, Inc., as Documentation Agent, and other banks party thereto. 95-194 10.2 Issuing and Paying Agency Agreement dated as of January 12, 2001, between the Company and The Chase Manhattan Bank N.A. 195-203 10.3 Commercial Paper Dealer Agreement dated as of January 12, 2001, between the Company and Banc of America Securities LLC. 204-225 10.4 Commercial Paper Dealer Agreement dated as of January 12, 2001, between the Company and Credit Suisse First Boston Corporation. 226-247 10.5 Commercial Paper Dealer Agreement dated as of January 12, 2001, between the Company and Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days, and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days. 248-270 10.6 Commercial Paper Dealer Agreement dated as of January 12, 2001, between the Company and SunTrust Equitable Securities Corporation. 271-293 10.7 Commercial Paper Dealer Agreement dated as of January 12, 2001, between the Company and J.P. Morgan Securities, Inc. 294-311 10.8 Commercial Paper Dealer Agreement dated as of January 12, 2001, between the Company and Chase Securities Inc. 312-329 22 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. TYSON FOODS, INC. Date: February 13, 2001 /s/ Steven Hankins ----------------- ---------------------------- Steven Hankins Executive Vice President and Chief Financial Officer Date: February 13, 2001 /s/ Rodney S. Pless ----------------- ---------------------------- Rodney S. Pless Vice President, Controller and Chief Accounting Officer 23 EX-2.1 2 0002.txt AGREEMENT AND PLAN OF MERGER DATED 1-1-01 AGREEMENT AND PLAN OF MERGER DATED AS OF January 1, 2001 AMONG IBP, INC., TYSON FOODS, INC. AND LASSO ACQUISITION CORPORATION 24 TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS 2 Section 1.01. Definitions 2 ARTICLE 2 THE OFFER AND THE EXCHANGE OFFER 4 Section 2.01. The offer 4 Section 2.02. Company Action 8 Section 2.03. Company Board Representation; Section 14(f) 10 Section 2.04. Adjustment of the Exchange Offer Ratio 11 ARTICLE 3 THE MERGER 11 Section 3.01. The Merger 11 Section 3.02. Conversions of Shares 11 Section 3.03. Surrender and Payment 12 Section 3.04. Stock Options 13 Section 3.05. Withholding Rights 14 Section 3.06. Terminated Tender Offer 14 Section 3.07. Adjustment of Exchange Ratio 14 ARTICLE 4 THE SURVIVING CORPORTATION 15 Section 4.01. Certificate of Incorporation 15 Section 4.02. Bylaws 15 Section 4.03. Directors and Officers 15 ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF THE COMPANY 15 Section 5.01. Corporate Existence and Power 15 Section 5.02. Corporate Authorization 15 Section 5.03. Governmental Authorization 16 Section 5.04. Non-Contravention 16 Section 5.05. Capitalization 16 Section 5.06. Subsidiaries 17 Section 5.07. SEC Filings 17 Section 5.08. Financial Statements 18 Section 5.09. Disclosure Documents 18 Section 5.10. Absence of Certain Changes 19 Section 5.11. No Undisclosed Material Liabilities 20 Section 5.12. Litigation 21 Section 5.13. Taxes 21 Section 5.14. ERISA 22 Section 5.15. Labor Matters 24 Section 5.16. Compliance with Laws 25 Section 5.17. Licenses and Permits 25 Section 5.18. Intellectual Property 25 Section 5.19. Environmental Matters 26 Section 5.20. Finders' Fees 27 Section 5.21. Inapplicability of Certain Restrictions 27 Section 5.22. Rights Plan 27 25 ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF PARENT 27 Section 6.01. Corporate Existence And Power 27 Section 6.02. Corporate Authorization 28 Section 6.03. Governmental Authorization 28 Section 6.04. Non-Contravention 28 Section 6.05. Capitalization 28 Section 6.06. Parent Subsidiaries 29 Section 6.07. SEC Filings 30 Section 6.08. Parent Financial Statements 30 Section 6.09. Disclosure Documents 30 Section 6.10. Absence of Certain Changes 31 Section 6.11. No Undisclosed Material Liabilities 32 Section 6.12. Adequate Funds 32 Section 6.13. Ownership of Company Common Stock 32 Section 6.14. Finders' Fees 32 Section 6.15. Compliance of Laws 32 ARTICLE 7 COVENANTS OF THE COMPANY 33 Section 7.01. Conduct of the Company 33 Section 7.02. Stockholder Meeting 35 Section 7.03. Access to Information 35 Section 7.04. Other Offers 35 Section 7.05. Notices of Certain Events 37 Section 7.06. Tax Matters 38 Section 7.07. Affiliates 38 Section 7.08. Confidentiality 38 Section 7.09. Other Actions 38 ARTICLE 8 COVENANTS OF PARENT 39 Section 8.01. Parent Stockholder Meeting 39 Section 8.02. Confidentiality 39 Section 8.03. Voting of Shares 39 Section 8.04. Director and Officer Liability 39 Section 8.05. Employee Matters 39 Section 8.06. Obligations of Merger Co. 39 Section 8.07. NYSE Listing 40 Section 8.08. Acquisition of Shares 40 Section 8.09. Notices of Certain Events 40 Section 8.10. Reorganization Matters 40 Section 8.11. Information Relating to Offer 40 Section 8.12. Conduct of Parent 40 Section 8.13. Voting Agreement 41 Section 8.14. Other Actions 41 ARTICLE 9 COVENANTS OF PARENT AND THE COMPANY 41 Section 9.01. Company Proxy Statement and Merger Form S-4 41 Section 9.02. Certain Regulatory Issues 41 Section 9.03. Certain Filings 42 Section 9.04. Public Announcements 42 Section 9.05. Further Assurances 42 ARTICLE 10 CONDITIONS TO THE MERGER 43 Section 10.01. Conditions to the Obligations of Each Party 43 Section 10.02. Conditions to the Obligations of the Company 43 26 ARTICLE 11 TERMINATION 43 Section 11.01. Termination 43 Section 11.02. Effect of Termination 45 Section 11.03. Parent Payment Event 45 ARTICLE 12 MISCELLANEOUS 45 Section 12.01. Notices 45 Section 12.02. Survival of Representations and Warranties 47 Section 12.03. Amendments; No Waivers; Direction of Merger 47 Section 12.04. Expenses 47 Section 12.05. Successors and Assigns; Benefit 47 Section 12.06. Governing Law 47 Section 12.07. Counterparts; Effectiveness 47 Exhibit A Form of Affiliate's Agreement Exhibit B Form of Voting Agreement 27 AGREEMENT AND PLAN OF MERGER AGREEMENT AND PLAN OF MERGER dated as of January 1, 2001 (the "Agreement") among IBP, inc., a Delaware corporation (the "Company"), Tyson Foods, Inc., a Delaware corporation ("Parent"), and Lasso Acquisition Corporation, a Delaware corporation and a wholly-owned subsidiary of Parent ("Merger Co."). W I T N E S S E T H: WHEREAS, (i) on December 12, 2000, Parent and Merger Co. commenced a tender offer (such offer, including any amendments and changes thereto (including those contemplated by this Agreement) the "Offer") to acquire 50.1% (the "Maximum Amount") of the issued and outstanding shares of Common Stock, par value $0.05 per share, of the Company ("Company Common Stock") for $26.00 per share (such amount, or any greater amount per share paid pursuant to the Offer, the "Per Share of Company Common Stock Amount") net to the seller in cash and (ii) on December 12, 2000 Parent and Merger Co. filed with the Securities and Exchange Commission (the "SEC") a Tender Offer Statement on Form TO, (together with all amendments and supplements thereto, the "Form TO") promulgated under the Securities Exchange Act of 1934, as amended (such Act and the rules and regulations promulgated thereunder being referred to herein as the "Exchange Act"), which Form TO included an offer to purchase (the "Offer to Purchase"); WHEREAS, on December 22, 2000, the Company filed with the SEC a Solicitation/Recommendation Statement on Schedule 14D-9 promulgated under the Exchange Act (together with all amendments and supplements thereto, the "Schedule 14D-9") containing the recommendation of the Board of Directors of the Company; WHEREAS, Parent and Merger Co. (i) on December 28, 2000, announced that they were increasing the Per Share of Company Common Stock Amount to $27.00 net to the seller in cash and (ii) on December 29, 2000 filed with the SEC an amendment to the Form TO which incorporated into the Offer, among other things, the Per Share of Company Common Stock Amount of $27.00; WHEREAS, Parent and Merger Co. propose to increase the Per Share of Company Common Stock Amount to $30.00 net to the seller in cash on the terms and subject to the conditions set forth in this Agreement; WHEREAS, it is intended that the Offer, the Exchange Offer (as defined below) and the Merger (as defined below), taken together, shall qualify as a reorganization within the meaning of Section 368(a) of the Code (as defined below) and that this Agreement shall constitute a plan of reorganization for purposes of the Code; WHEREAS, the Boards of Directors of Parent, Merger Co. and the Company have each determined that it is advisable and in the best interests of their respective stockholders to consummate, and have approved, the business combination transaction provided for herein including (i) the Offer, (ii) an offer to exchange (the "Exchange Offer") for each share of Company Common Stock not tendered in the Offer the number of shares of Class A Common Stock, par value $0.10 per share, of Parent ("Parent Common Stock") equal to the Exchange Offer Ratio (as defined in Section 2.01(c)), and (iii) the Merger (as defined in Section 3.01); and WHEREAS, Parent and the Company desire to make certain representations, warranties, covenants and agreements in connection with the transactions contemplated by this Agreement and also to prescribe certain conditions to the consummation of such transactions; NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements herein contained, the parties hereto agree as follows: 28 ARTICLE 1 DEFINITIONS Section 1.01. Definitions Each of the following terms is defined in the Section set forth opposite such term: TERM SECTION Acquisition Proposal 7.04 Amended Offer to Purchase 2.01(a) Average Exchange Offer Price 2.01(c) Average Parent Common Stock Price 3.02 Balance Sheet 5.08 Balance Sheet Date 5.08 Board of Directors 2.02(a) Class B Common Stock 6.05 Code 5.14(a) Company first paragraph Company Common Stock recitals Company Disclosure Documents 5.09(a) Company Option 3.04(a) Company Proxy Statement 5.09(a) Company Securities 5.05 Company Stockholder Meeting 7.02 Company 10-K 5.07(a) Company 10-Qs 5.07(a) Confidentiality Agreements 7.08 Control Date 2.03 Delaware Law 2.02(a) Effective Time 3.01(b) Employee Plans 5.14(a) Environmental Laws 5.19(d) Environmental Permits 5.19(d) ERISA 5.14(a) ERISA Affiliate 5.14(a) Exchange Act recitals Exchange Agent 3.03(a) Exchange Form S-4 2.01(b) Exchange Form TO 2.01(b) Exchange Offer recitals Exchange Offer Documents 2.01(b) Exchange Offer Ratio 2.01(c) Exchange Ratio 3.02(c) Exchange Schedule 14D-9 2.02(c) Failed Tender Offer 3.06 Final Expiration Date 2.01(d) Form TO recitals Form TO/A 2.01(a) Hazardous Substances 5.19 HSR Act 5.03 Independent Directors 2.03(c) Intellectual Property Right 5.18 International Plan 5.14(i) Lien 5.04 Material Adverse Effect 5.01 Maximum Amount recitals Merger 3.01(a) 29 Merger Co. first paragraph Merger Consideration 3.02(c) Merger Form S-4 9.01 Minimum Condition 2.01(a) Multiemployer Plan 5.14(b) NYSE 3.02 Offer recitals Offer Documents 2.01(a) Offer to Exchange 2.01(b) Offer to Purchase recitals Parent first paragraph Parent Balance Sheet 6.08 Parent Balance Sheet Date 6.08 Parent Common Stock recitals Parent Disclosure Documents 6.09(a) Parent Material Adverse Effect 6.01 Parent Option 3.04(a) Parent Payment Event 11.03(b) Parent Securities 6.05 Parent Stockholder Meeting 8.01 Parent Subsidiary 6.06(a) Parent Subsidiary Securities 6.06(b) Parent 10-K 6.07 Payment Date 2.01(a) Payment Event 7.04(b) Permits 5.17 Per Share of Company Common Stock Amount Recitals Person 3.03(c) and 7.04(a) Pre-Closing Tax Period 5.13(a) Preferred Stock 5.05 Preliminary Prospectus 2.01(b) Rawhide Merger Agreement 2.02(a) Reimbursement Payment 7.04(b) Representatives 7.03 Returns 5.13(a) Schedule 14D-9 recitals Schedule 14D-9/A 2.02(b) SEC recitals Securities Act 5.07(c) Special Committee 2.02(a) Straddle Period 5.13(a) Stockholders recitals Subsidiary 5.06(a) Subsidiary Securities 5.06(b) Superior Proposal 7.04 Surviving Corporation 3.01(a) Tax 5.13(b) Tax Asset 5.13(a) 368(a) Reorganization 7.06(c) Title IV Plan 5.14(b) 30 ARTICLE 2 THE OFFER AND THE EXCHANGE OFFER Section 2.01 The Offer. (a) Provided that this Agreement shall not have been terminated in accordance with Section 11.01 and none of the events set forth in Annex I hereto shall have occurred and be continuing, as promptly as practicable, but in no event later than three business days, after the date hereof, Parent shall cause Merger Co. to, and Merger Co. shall, file with the SEC, to the extent required by the Exchange Act, an amended Form TO (the "Form TO/A"), an amended Offer to Purchase (the "Amended Offer to Purchase") and, if necessary, the related letter of transmittal and any related summary advertisement (the Form TO/A, the Amended Offer to Purchase and such other documents, together with all amendments and supplements thereto, the "Offer Documents") to reflect, among other things, an increase in the per share price to be paid in the Offer to $30.00 and, if necessary, an extension of the currently scheduled expiration date to allow the Offer to remain open for ten business days from the date of such increase. The obligation of Merger Co. to consummate the Offer and to accept for payment and to pay for shares of Company Common Stock tendered pursuant to the Offer shall be subject only to (i) the condition that there shall be validly tendered in accordance with the terms of the Offer, prior to the expiration date of the Offer and not withdrawn, a number of shares that, together with the shares of Company Common Stock then owned by Parent and/or Merger Co., represents 50.1% of the shares of Company Common Stock outstanding (the "Minimum Condition") and (ii) the other conditions set forth in Annex I hereto. Merger Co. expressly reserves the right to waive any such condition (other than the Minimum Condition, which shall not be waived without the prior written consent of the Company) or the condition relating to the expiration of the HSR Act and to increase the Per Share of Company Common Stock Amount. Notwithstanding the foregoing, no change may be made which (i) decreases the Per Share of Company Common Stock Amount, (ii) changes the form of consideration to be paid in the Offer, (iii) increases the Maximum Amount or the Minimum Condition, (iv) reduces the number of shares of Company Common Stock sought to be purchased in the Offer, (v) imposes conditions to the Offer in addition to those set forth in Annex I hereto, (vi) except as specifically provided for in this Section 2.01(a), extends the expiration date of the Offer or (vii) otherwise alters or amends any term of the Offer in any manner adverse to the holders of shares of Company Common Stock; provided, however, that the Offer may be extended for any period to the extent required by law or by any rule, regulation, interpretation or position of the SEC or the staff thereof applicable to the Offer. Parent and Merger Co. shall comply with the obligations respecting prompt payment and announcement under the Exchange Act, and, without limiting the generality of the foregoing, subject to the terms and conditions of this Agreement, including but not limited to the conditions of the Offer, Merger Co. shall and Parent shall cause Merger Co. to, accept for payment and pay for shares of Company Common Stock tendered pursuant to the Offer as soon as practicable after expiration thereof. Unless this Agreement has been terminated pursuant to Section 11.01 and subject to Section 2.01(d), Merger Co. shall extend the Offer from time to time in the event that, at a then-scheduled expiration date, all of the conditions to the Offer have not been satisfied or waived as permitted pursuant to this Agreement, each such extension not to exceed (unless otherwise consented to in writing by the Company) the lesser of 10 additional business days or such fewer number of days that Merger Co. reasonably believes are necessary to cause the conditions to the Offer to be satisfied. Except as provided 31 in Section 2.01(d) or 2.01(f), Merger Co. shall not terminate the Offer without purchasing shares of Company Common Stock pursuant to the Offer. If at the expiration of the Offer a number of shares of Company Common Stock has been validly tendered and not withdrawn that, together with the shares of Company Common Stock then owned by Parent and/or Merger Co., exceeds the Maximum Amount, the number of shares of Company Common Stock to be purchased by Merger Co. pursuant to the Offer shall be prorated in accordance with Rule 14d-8 promulgated under the Exchange Act, so that the number of shares of Company Common Stock purchased by Merger Co. pursuant to the Offer, together with the shares of Company Common Stock then owned by Parent and Merger Co., will represent 50.1% of the shares of Company Common Stock outstanding. (b) Provided that this Agreement shall not have been terminated in accordance with Section 11.01 and none of the events set forth in Annex II hereto shall have occurred and be continuing, as promptly as practicable after the date hereof, Parent shall cause Merger Co. to, and Merger Co. shall (i) commence the Exchange Offer pursuant to which Merger Co. shall offer to issue a number of duly authorized, validly issued, fully paid and non-assessable shares of Parent Common Stock equal to the Exchange Offer Ratio (as defined below) for each then issued and outstanding share of Company Common Stock (other than shares of Company Common Stock then owned by Parent or Merger Co.), (ii) file with the SEC, to the extent required by the Exchange Act, a Form TO (the "Exchange Form TO"), an Offer to Exchange (the "Offer to Exchange") and the related letter of transmittal and any related summary advertisement (the Exchange Form TO, the Offer to Exchange and such other documents, together with all amendments and supplements thereto, the "Exchange Offer Documents") and (iii) file with the SEC a Registration Statement on Form S-4 (the "Exchange Form S-4") to register under the Securities Act the securities to be issued in the Exchange Offer. The obligation of Merger Co. to consummate the Exchange Offer and to issue shares of Parent Common Stock in exchange for shares of Company Common Stock tendered pursuant to the Exchange Offer shall be subject only to the conditions set forth in Annex II hereto. Merger Co. expressly reserves the right to waive any such condition (other than the condition that at least five business days have elapsed since the acceptance for payment and payment for a number of shares of Company Common Stock pursuant to the Offer representing, together with shares of Company Common Stock previously owned by Parent, at least 50.1% of the issued and outstanding shares of Company Common Stock and the subsequent delivery of shares of Company Common Stock not purchased in the Offer to the Depositary under the Exchange Offer, which condition shall not be waived without the prior written consent of the Company) and to increase the Exchange Offer Ratio. Notwithstanding the foregoing, no change may be made which (i) decreases, or would have the effect of decreasing, the Exchange Offer Ratio, (ii) changes the form of consideration to be paid in the Exchange Offer, (iii) reduces the number of shares of Company Common Stock sought to be purchased in the Exchange Offer, (iv) imposes conditions to the Exchange Offer in addition to those set forth in Annex II hereto, (v) extends the expiration date of the Exchange Offer or (vi) otherwise alters or amends any term of the Exchange Offer in any manner adverse to the holders of shares of Company Common Stock; provided, however, that the Exchange Offer may be extended (x) for any period to the extent required by law or by any rule, regulation, interpretation or position of the SEC or the staff thereof applicable to the Exchange Offer or (y) if the number of shares of Company 32 Common Stock validly tendered in accordance with the Exchange Offer, together with shares of Company Common Stock owned by Parent as of such date, is less than 90% of the outstanding shares of Company Common Stock, as of the scheduled or extended expiration date. Parent and Merger Co. shall comply with the obligations respecting prompt delivery of shares of Parent Common Stock and announcement under the Exchange Act, and, without limiting the generality of the foregoing, subject to the terms and conditions of this Agreement, including but not limited to the conditions of the Exchange Offer, Merger Co. shall and Parent shall cause Merger Co. to, accept for exchange and issue shares of Parent Common Stock in exchange for shares of Company Common Stock tendered pursuant to the Exchange Offer as soon as practicable after expiration thereof. Unless this Agreement has been terminated pursuant to Section 11.01 and subject to Section 2.01(d), Merger Co. shall extend the Exchange Offer from time to time in the event that, at a then-scheduled expiration date, all of the conditions to the Exchange Offer have not been satisfied or waived as permitted pursuant to this Agreement, each such extension not to exceed (unless otherwise consented to in writing by the Company) the lesser of 10 additional business days or such fewer number of days that Merger Co. reasonably believes are necessary to cause the conditions to the Offer to be satisfied. Except as provided in Section 2.01(d) or 2.01(f), Merger Co. shall not terminate the Exchange Offer without accepting shares of Company Common Stock and issuing shares of Parent Common Stock pursuant to the Exchange Offer. Notwithstanding anything to the contrary set forth herein, no certificates representing fractional shares of Parent Common Stock shall be issued in connection with the Exchange Offer, and in lieu thereof each tendering stockholder who would otherwise be entitled to a fractional share of Parent Common Stock in the Exchange Offer will be paid an amount in cash equal to the product obtained by multiplying (A) the fractional share interest to which such holder would otherwise be entitled by (B) the Average Exchange Offer Price (as defined below). (c) For purposes of this Section 2.01, "Exchange Offer Ratio" means the number of shares of Parent Common Stock determined as set forth below: (i) If the Average Exchange Offer Price is equal to or greater than $15.40, the Exchange Ratio shall be 1.948 shares of Parent Common Stock; (ii) If the Average Exchange Offer Price is less than $15.40 and greater than $12.60, the Exchange Ratio shall be determined by dividing $30.00 by the Average Price; and (iii) If the Average Exchange Offer Price is equal to or less than $12.60, the Exchange Ratio shall be 2.381 shares of Parent Common Stock. For purposes of this Section 2.01, "Average Exchange Offer Price" means the average of the closing price per share of Parent Common Stock on the New York Stock Exchange, Inc. (the "NYSE") at the end of the regular session as reported on the Consolidated Tape, network A for the fifteen consecutive trading days ending on the second trading day immediately preceding the expiration date of the Exchange Offer. (d) If, on February 28, 2001 (the "Final Expiration Date"), Merger Co. has not consummated the Offer in accordance with its terms, Merger Co. shall thereupon terminate the Offer and the Exchange Offer without the acceptance of any shares of Company Common Stock previously tendered. If, at the Final Expiration Date, the Minimum Condition has not been satisfied, Merger Co. shall, unless Parent and the Company otherwise agree, terminate the Offer and the Exchange Offer, and the parties shall, subject to the terms and conditions hereof, seek to consummate the Merger. 33 (e) As soon as practicable following the filing of the Form TO/A with the SEC, Merger Co. shall take such steps as are reasonably necessary to cause the Amended Offer to Purchase to be disseminated to the holders of shares of Company Common Stock as and to the extent required by applicable federal securities laws. Parent, Merger Co. and the Company shall correct promptly any information provided by any of them for use in the Offer Documents which shall have become false or misleading, and Parent and Merger Co. shall take all reasonable steps necessary to cause the Form TO/A as so corrected to be filed with the SEC and the other Offer Documents as so corrected to be disseminated to holders of shares of Company Common Stock, in each case as and to the extent required by applicable federal securities laws. The Company and its counsel shall be given an opportunity to review and comment on the Offer Documents prior to their being filed with the SEC, and Parent and Merger Co. will provide the Company and its counsel in writing with any comments that Parent or Merger Co. receives from the SEC or its staff with respect to the Offer Documents promptly after receipt of any such comments. (f) In the event that this Agreement has been terminated pursuant to Section 11.01, Merger Co. shall, and Parent shall cause Merger Co. to, promptly terminate the Offer and the Exchange Offer without accepting any shares of Company Common Stock for payment or exchange. (g) Parent shall provide or cause to be provided to Merger Co. on a timely basis the funds and shares of Parent Common Stock necessary to accept for payment, and pay for, any shares of Company Common Stock that Merger Co. becomes obligated to accept for payment, and pay for, pursuant to the Offer and the Exchange Offer. (h) Parent and Merger Co. shall promptly prepare and file with the SEC the Exchange Form S-4 to register the offer and sale of shares of Parent Company Stock in the Exchange Offer. The Exchange Form S-4 will include a preliminary prospectus containing the information required under Rule 14d- 4(b) promulgated under the Exchange Act (the "Preliminary Prospectus"). As soon as practicable on the date of commencement of the Exchange Offer, Parent and Merger Co. shall (i) file with the SEC the Exchange Form TO with respect to the Exchange Offer which will contain or incorporate by reference all or part of the Preliminary Prospectus and (ii) cause the Exchange Offer Documents to be disseminated to holders of shares of Company Common Stock. Parent and Merger Co. agree that they shall cause the Exchange Form S-4, the Exchange Form TO, the Offer to Exchange and all amendments or supplements thereto to comply in all material respects with the Exchange Act, the Securities Act and the rules and regulations thereunder and other applicable laws. Each of Parent, Merger Co. and the Company agrees to correct promptly any information provided by it for use in the Offer Documents if and to the extent that such information shall have become false or misleading in any material respect, and Parent and Merger Co. further agree to take all steps necessary to cause the Exchange Offer Documents as so corrected to be filed with the SEC and the other Exchange Offer Documents as so corrected to be disseminated to holders of Shares, in each case as and to the extent required by applicable federal securities laws. The Company, Parent and Merger Co. shall cooperate with each other in the preparation of the Exchange Form S-4, the Exchange Form TO and any amendment or supplement thereto, and Parent shall notify the Company of the receipt of any comments of the SEC with respect to the Exchange Form S-4 and the Exchange Form TO and of any requests by the SEC for any amendment or supplement thereto or for additional information, and shall provide promptly copies of all correspondence between Parent or any of its Representatives and the SEC with respect to the Exchange Form S-4 34 and the Exchange Form TO. Parent shall give the Company and its counsel the opportunity to review the Exchange Form S-4 and the Exchange Form TO and all responses to requests for additional information by and replies to comments of the SEC before their being filed with, or sent to, the SEC. Each of Parent and Merger Co. agrees to use its best efforts, after consultation with the Company, to respond promptly to all such comments of and requests by the SEC. Each of Parent and Merger Co. shall use its reasonable best efforts to cause the Exchange Form S-4 to be declared effective by the SEC as promptly as practicable. Parent shall promptly take any action (other than qualifying as a foreign corporation or taking any action which would subject it to service of process in any jurisdiction where Parent is not now so qualified or subject) required to be taken under foreign or state securities or Blue Sky laws in connection with the issuance of Parent Common Stock in the Exchange Offer. Parent will advise Company, promptly after it receives notice thereof, of (i) the time when the Exchange Form S-4 becomes effective, (ii) the issuance of any stop order with respect to the Exchange Form S-4, (iii) the suspension of the qualification of Parent Common Stock for offering or sale in any jurisdiction, or (iv) any request by the SEC for an amendment of the Exchange Form S-4 or comments thereon and responses thereto or requests by the SEC for additional information. Section 2.02 Company Actions (a) The Company hereby approves and consents to the Offer and the Exchange Offer and represents that (i) the Board of Directors of the Company and acting on the unanimous recommendation of a special committee of the Board of Directors of the Company comprised of all members of the Board of Directors other than Messrs. Bond, Chalsty, Leman and Peterson (the "Special Committee"), at a meeting duly called and held, has unanimously (A) determined that this Agreement and the transactions contemplated hereby, including the Offer, the Exchange Offer and the Merger, taken together, are fair to and in the best interests of the holders of shares of Company Common Stock, (B) approved this Agreement and the transactions contemplated hereby, including the Offer, the Exchange Offer and the Merger, which approval satisfies in full the requirements of Section 203 of the General Corporation Law of the State of Delaware (the "Delaware Law") with respect to the transactions contemplated hereby, (C) resolved to recommend that the stockholders of the Company accept the Offer and the Exchange Offer, tender their shares of Company Common Stock thereunder to Merger Co. and, if required by applicable law in order to consummate the Merger, approve and adopt this Agreement and the transactions contemplated hereby, provided that, subject to Section 7.04, such recommendation may be withdrawn, modified or amended if such recommendation would be reasonably likely to be inconsistent with its fiduciary duties under the applicable law as determined by the Board of Directors of the Company in good faith after consultation with its legal advisors and (ii) the Company has provided the applicable notice of termination to Rawhide Holdings Corporation required by Section 10.01(e) of the Agreement and Plan of Merger, dated as of October 1, 2000 among the Company, Rawhide Holdings Corporation and Rawhide Acquisition Corporation ("Rawhide Merger Agreement"). The Company hereby consents to the inclusion in the Offer Documents and the Exchange Offer Documents of the recommendation of the Board described in the immediately preceding sentence. The Company has been advised by each of its directors and executive officers that they intend either to tender all shares of Company Common Stock beneficially owned by them to Merger Co. pursuant to the Offer and the Exchange Offer or to vote such shares of Company Common Stock in favor of the approval and adoption of the transactions contemplated hereby. 35 The Company further represents that J.P. Morgan Securities Inc. has delivered to the Company's Board of Directors its written opinion that the consideration to be paid in the Offer, the Exchange Offer and the Merger is fair to the holders of shares of Company Common Stock, from a financial point of view. (b) On the date the Offer Documents are filed with the SEC in accordance with Section 2.01(a), the Company shall file with the SEC an amended Schedule 14D-9 (the "Schedule 14D-9/A") containing the recommendation of the Board of Directors of the Company described in Section 2.02(a)(i), and shall take such steps as are reasonably necessary to cause the Schedule 14D-9/A to be disseminated to the holders of shares of Company Common Stock as and to the extent required by applicable federal securities laws. The Company, Parent and Merger Co. shall correct promptly any information provided by any of them for use in the Schedule 14D-9/A which shall have become false or misleading, and the Company shall take all reasonable steps necessary to cause the Schedule 14D-9/A as so corrected to be filed with the SEC and disseminated to holders of shares of Company Common Stock, in each case as and to the extent required by applicable federal securities laws. Parent and its counsel shall be given an opportunity to review and comment on the Schedule 14D-9/A prior to its being filed with the SEC, and the Company will provide Parent and its counsel in writing with any comments that the Company receives from the SEC or its staff with respect to the Schedule 14D-9/A promptly after receipt of any such comments. (c) On the date the Exchange Offer Documents are filed with the SEC, the Company shall file with the SEC a Solicitation/Recommendation Statement on Schedule 14D-9 promulgated under the Exchange Act (together with all amendments and supplements thereto, the "Exchange Schedule 14D-9") containing the recommendation of the Board of Directors of the Company described in Section 2.02(a)(i), and shall take such steps as are necessary to cause the Exchange Schedule 14D-9 to be disseminated to the holders of shares of Company Common Stock as and to the extent required by applicable federal securities laws. The Company, Parent and Merger Co. shall correct promptly any information provided by any of them for use in the Exchange Schedule 14D-9 which shall have become false or misleading, and the Company shall take all reasonable steps necessary to cause the Exchange Schedule 14D-9 as so corrected to be filed with the SEC and disseminated to holders of shares of Company Common Stock, in each case as and to the extent required by applicable federal securities laws. Parent and its counsel shall be given an opportunity to review and comment on the Exchange Schedule 14D-9 prior to its being filed with the SEC, and the Company will provide Parent and its counsel in writing with any comments that the Company receives from the SEC or its staff with respect to the Exchange Schedule 14D-9 promptly after receipt of any such comments. 36 (d) In connection with the Offer and the Exchange Offer, the Company shall use its reasonable best efforts to cause its transfer agent to furnish Merger Co. promptly with mailing labels containing the names and addresses of all record holders of shares of Company Common Stock and with security position listings of shares of Company Common Stock held in stock depositories, each as of a recent date, together with all other available listings and computer files containing names, addresses and security position listings of record holders and beneficial owners of shares of Company Common Stock. The Company shall furnish Merger Co. with such additional information, including, without limitation, updated listings and files of stockholders, mailing labels and security position listings and such other assistance as Parent, Merger Co. or their Representatives may reasonably request in communicating the Offer and the Exchange Offer to record and beneficial holders of shares of Company Common Stock. Subject to the requirements of applicable law, and except for such steps as are necessary to disseminate the Offer Documents, the Exchange Offer Documents and any other documents necessary to consummate the Offer, the Exchange Offer or the Merger, Parent and Merger Co. shall hold in confidence the information contained in such labels, listings and files, shall use such information only in connection with the Offer, the Exchange Offer and the Merger, and, if this Agreement shall be terminated in accordance with Section 11.01, shall deliver to the Company all copies of, and any extracts or summaries from, such information then in their possession or control. (e) In connection with the Offer and the Exchange Offer, the Company shall, and shall use its reasonable best efforts to cause its Representatives to, cooperate with Parent and Merger Co. in connection with the Offer and the Exchange Offer, including, without limitation, furnishing Parent with such information (which will be treated and held in confidence by Parent), documentation and assistance as Parent or its Representatives may reasonably request in connection with the Offer and the Exchange Offer. Section 2.03 Company Board Representation; Section 14(f). (a) Subject to compliance with Delaware Law, the Company's Certificate of Incorporation and other applicable law, promptly upon the payment by Merger Co. for shares of Company Common Stock purchased pursuant to the Offer representing, together with shares of Company Stock previously owned by Parent, at least 50.1% of the shares of Company Common Stock outstanding, and from time to time thereafter, the Company shall, upon request of Parent, promptly use its reasonable best efforts to take all actions necessary to cause a majority of the directors of the Company to consist of Parent's designees, including by accepting the resignations of those incumbent directors designated by the Company or increasing the size of the Board of Directors and causing Parent's designees to be elected. The date on which Parent's designees constitute at least a majority of the Company's Board of Directors is herein referred to as the "Control Date." (b) The Company's obligations to appoint Parent's designees to the Board of Directors of the Company shall be subject to Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder, if applicable. The Company shall promptly take all actions required pursuant to such Section and Rule in order to fulfill its obligations under this Section, and shall include in the Schedule 14D-9/A such information with respect to the Company and its officers and directors as is required under such Section and Rule to fulfill such obligations. Parent or Merger Co. shall supply to the Company and be solely responsible for any information with respect to either of them and their designees, officers, directors and affiliates required by such Section 14(f) and Rule 14f-1. 37 (c) Prior to the Effective Time, any amendment of this Agreement or the Certificate of Incorporation or Bylaws of the Company, any termination of this Agreement by the Company, any consent given by the Company hereunder, any extension by the Company of the time for the performance of any of the obligations or other acts of Parent or Merger Co., waiver of any of the Company's rights hereunder or any other action by the Company in connection with or relating to the transactions contemplated hereby shall require the concurrence of a majority of the directors of the Company then in office who (i) neither were designated by Parent nor are employees of the Company or any of its Subsidiaries or, if there be just one such director, the concurrence of such director or (ii) were members of the Special Committee (the "Independent Directors"). If the number of Independent Directors shall be reduced below two for any reason whatsoever, the remaining Independent Director shall designate a person to fill such vacancy who shall be deemed to be an Independent Director for purposes of this Agreement or, if no Independent Directors then remain, the other directors shall designate two persons to fill such vacancies who shall not be officers or affiliates of the Company or any of its Subsidiaries, or officers or affiliates of Parent or any of its Subsidiaries, and such persons shall be deemed to be Independent Directors for purposes of this Agreement. The Independent Directors shall have the authority to retain such counsel and other advisors at the expense of the Company as are reasonably appropriate to the exercise of their duties in connection with this Agreement, subject to approval by the Company of the terms of such retention, which approval shall not be unreasonably withheld. In addition, the Independent Directors shall have the authority to institute any action, on behalf of the Company, to enforce performance of this Agreement. Section 2.04. Adjustment of the Exchange Offer Ratio. In the event Parent changes or establishes a record date for changing the number of shares of Parent Common Stock issued and outstanding during or after the determination of the Exchange Offer Ratio pursuant to Section 2.01(c) and prior to the expiration date of the Exchange Offer, as a result of a stock split, stock dividend, recapitalization, subdivision, reclassification, combination or similar transaction with respect to the outstanding shares of Parent Common Stock and the record date therefor shall be prior to the expiration date of the Exchange Offer, the Exchange Offer Ratio, and any other calculations based on or relating to shares of Parent Common Stock shall be appropriately adjusted to reflect such stock split, stock dividend, recapitalization, subdivision, reclassification, combination or similar transaction. ARTICLE 3 THE MERGER Section 3.01. The Merger (a) At the Effective Time (as defined below), the Company shall be merged with (the "Merger") and into Merger Co. in accordance with Section 251 or Section 253 of Delaware Law, as applicable, whereupon the separate existence of the Company shall cease, and Merger Co. shall be the surviving corporation and wholly-owned subsidiary of Parent (the "Surviving Corporation"). 38 (b) As soon as practicable after satisfaction or, to the extent permitted hereunder, waiver of all conditions to the Merger, the Company and Merger Co. will file a certificate of merger with the Secretary of State of the State of Delaware and make all other filings or recordings required by Delaware Law in connection with the Merger. The Merger shall become effective at such time as the certificate of merger is duly filed with the Secretary of State of the State of Delaware or at such later date or time as is specified in the certificate of merger (the "Effective Time"). (c) From and after the Effective Time, the Surviving Corporation shall possess all the property, rights, privileges, immunities, powers and franchises and be subject to all of the debts, liabilities, obligations, restrictions, disabilities and duties of the Company and Merger Co., all as provided under Delaware Law. Section 3.02. Conversion of Shares At the Effective Time: (a) each share of Company Common Stock held by the Company or any Subsidiary as treasury stock or owned by Parent or any subsidiary of Parent immediately prior to the Effective Time shall be canceled, and no payment shall be made with respect thereto; (b) each share of common stock, par value $0.05 per share, of Merger Co. outstanding immediately prior to the Effective Time shall be converted into and become one share of common stock, par value $0.05 per share, of the Surviving Corporation with the same rights, powers and privileges as the shares so converted; and (c) each share of Company Common Stock outstanding immediately prior to the Effective Time shall, except as otherwise provided in Section 3.02(a), be converted into the right to receive from Parent a number of shares (the "Merger Consideration") of Parent Common Stock determined as set forth below (the "Exchange Ratio"): (i) If the Average Parent Common Stock Price is equal to or greater than $15.40, the Exchange Ratio shall be 1.948 shares of Parent Common Stock; (ii) If the Average Parent Common Stock Price is less than $15.40 and greater than $12.60, the Exchange Ratio shall be determined by dividing $30.00 by the Average Parent Common Stock Price; and (iii)If the Average Parent Common Stock Price is equal to or less than $12.60 the Exchange Ratio shall be 2.381 shares of Parent Common Stock. For purposes of this Section 3.02, "Average Parent Common Stock Price" means the average of the closing price per share of Parent Common Stock on the New York Stock Exchange, Inc. (the "NYSE") at the end of the regular session as reported on the Consolidated Tape, Network A for the fifteen consecutive trading days ending on the fifth trading day immediately preceding the Effective Time. Section 3.03. Surrender and Payment (a) Prior to the Effective Time, Parent shall appoint an agent reasonably acceptable to the Company (the "Exchange Agent") for the purpose of exchanging certificates representing shares of Company Common Stock for the Merger Consideration. Parent shall cause Merger Co. to make available to the Exchange Agent, as soon as reasonably practicable as of or after the Effective Time, the Merger Consideration to be delivered in respect of the shares of Company Common Stock. Promptly after the Effective Time, the Surviving Corporation will send, or will cause the Exchange Agent to send, 39 to each holder of shares of Company Common Stock at the Effective Time a letter of transmittal for use in such exchange (which shall specify that the delivery shall be effected, and risk of loss and title shall pass, only upon proper delivery of the certificates representing shares of Company Common Stock to the Exchange Agent). (f) Each holder of shares of Company Common Stock that have been converted into a right to receive the Merger Consideration, upon surrender to the Exchange Agent of a certificate or certificates representing such shares of Company Common Stock, together with a duly executed and properly completed letter of transmittal covering such shares of Company Common Stock, will be entitled to receive the Merger Consideration in exchange for such shares of Company Common Stock. Until so surrendered, each such certificate shall, after the Effective Time, represent for all purposes, only the right to receive such Merger Consideration. (f) If any portion of the Merger Consideration is to be delivered to a Person other than the registered holder of the shares of Company Common Stock represented by the certificate or certificates surrendered in exchange therefor, it shall be a condition to such delivery that the certificate or certificates so surrendered shall be properly endorsed or otherwise be in proper form for transfer and that the Person requesting such delivery shall pay to the Exchange Agent any transfer or other taxes required as a result of such delivery to a Person other than the registered holder of such shares of Company Common Stock or establish to the satisfaction of the Exchange Agent that such tax has been paid or is not payable. For purposes of this Agreement, "Person" means an individual, a corporation, a limited liability company, a partnership, an association, a trust or any other entity or organization, including a government or political subdivision or any agency or instrumentality thereof. (f) After the Effective Time, there shall be no further registration of transfers of shares of Company Common Stock. If, after the Effective Time, certificates representing shares of Company Common Stock are presented to the Surviving Corporation, they shall be canceled and exchanged for the consideration provided for, and in accordance with the procedures set forth, in this Article 3. (f) Any portion of the Merger Consideration made available to the Exchange Agent pursuant to Section 3.03(a) that remains unclaimed by the holders of shares of Company Common Stock six months after the Effective Time shall be returned to the Surviving Corporation, upon demand, and any such holder who has not exchanged his shares of Company Common Stock for the Merger Consideration in accordance with this Section prior to that time shall thereafter look only to the Surviving Corporation for delivery of the Merger Consideration in respect of his shares of Company Common Stock. Notwithstanding the foregoing, the Surviving Corporation shall not be liable to any holder of shares of Company Common Stock for any amount paid to a public official pursuant to applicable abandoned property laws. (f) If any certificate representing shares of Company Common Stock shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, the posting by such person of a bond in such reasonable amount as the Surviving Corporation may direct as indemnity against any claim that may be made against it with respect to such certificate, the Exchange Agent (or the Surviving Corporation) shall exchange the shares of Company Common Stock represented by such lost, stolen or destroyed certificate for the Merger Consideration. 40 Section 3.04. Stock Options (a) At or immediately prior to the Effective Time, each employee stock option or director stock option to purchase Shares outstanding under any Company stock option plans, whether or not vested or exercisable (each, a "Company Option") shall, by virtue of the Merger and without any further action on the part of any holder thereof, be assumed by Parent and deemed to constitute an option (each, a "Parent Option") to acquire, on the same terms and conditions as were applicable under such Company Option (subject to Section 3.04(b)), the same number of shares of Parent Common Stock as the holder of such Company Option would have been entitled to receive pursuant to Section 3.02(c) of this Agreement had such holder exercised such Company Option in full immediately prior to the Effective Time (rounded to the nearest whole number), at a price per share (rounded down to the nearest whole cent) equal to (x) the aggregate exercise price for the share of Company Common Stock otherwise purchasable pursuant to such Company Option divided by (y) the number of whole shares of Parent Common Stock purchasable pursuant to the Parent Option in accordance with the foregoing. The other terms of each such Company Option, and the plans under which they were issued, shall continue to apply in accordance with their terms. (b) Prior to the Effective Time, the Company shall use its reasonable best efforts to (i) obtain any consents from holders of Company Options and (ii) make any amendments to the terms of such Company Options or Company stock option plans that, in the case of either clauses (i) or (ii), are necessary or appropriate to give effect to the transactions contemplated by Section 3.04(a); provided, however, that lack of consent of any holder of a Company Option shall in no way affect the obligations of the parties to consummate the Merger. (c) At or prior to the Effective Time, Parent shall take all corporate action necessary to reserve for issuance a sufficient number of shares of Parent Common Stock for delivery upon exercise of the Parent Options. At or prior to the Effective Time, Parent shall file a registration statement on Form S-8, with respect to the shares of Parent Common Stock subject to such Parent Options and shall use commercially reasonable efforts to maintain the effectiveness of such registration statement (and maintain the current status of the prospectus or prospectuses contained therein) for so long as such Parent Options remaining outstanding. With respect to those individuals who subsequent to the Merger will be subject to the reporting requirements under Section 16(a) of the Exchange Act, Parent shall administer the Company stock option plans in a manner consistent with the exemptions provided by Rule 16(b)(3) promulgated under the Exchange Act. Section 3.05. Withholding Rights Each of the Surviving Corporation and Parent shall be entitled to deduct and withhold from the consideration otherwise deliverable to any Person pursuant to this Article 3 such amount as it is required to deduct and withhold with respect to the making of such delivery under any provision of federal, state, local or foreign tax law. If the Surviving Corporation or Parent, as the case may be, so withholds amounts, such amounts shall be treated for all purposes of this Agreement as having been paid to the holder of the shares of Company Common Stock in respect of which the Surviving Corporation or Parent made such deduction and withholding. 41 Section 3.06. Terminated Tender Offer In the event the Offer is terminated pursuant to Section 2.01(d) ("Terminated Tender Offer") the parties hereto shall complete the Merger consistent with the terms of this Agreement as amended by the terms and provisions contained in Annex III, and this Agreement shall be amended to incorporate the terms contained therein. Section 3.07. Adjustment of Exchange Ratio. In the event Parent changes or establishes a record date for changing the number of shares of Parent Common Stock issued and outstanding during or after the determination of the Exchange Ratio pursuant to Section 3.02(c) and prior to the Effective Time as a result of a stock split, stock dividend, recapitalization, subdivision, reclassification, combination or similar transaction with respect to the outstanding Parent Common Stock and the record date therefor shall be prior to the Effective Time, the Exchange Ratio, and any other calculation based on or relating to shares of Parent Common Stock shall be appropriately adjusted to reflect such stock split, stock dividend, recapitalization, subdivision, reclassification, combination or similar transaction. ARTICLE 4 THE SURVIVING CORPORATION Section 4.01. Certificate of Incorporation The certificate of incorporation of Merger Co. in effect at the Effective Time shall be the certificate of incorporation of the Surviving Corporation until amended in accordance with applicable law. Section 4.02. Bylaws The bylaws of Merger Co. in effect at the Effective Time shall be the bylaws of the Surviving Corporation until amended in accordance with applicable law. Section 4.03. Directors and Officers From and after the Effective Time, until successors are duly elected or appointed and qualified in accordance with applicable law, (a) the directors of Merger Co. at the Effective Time shall be the directors of the Surviving Corporation, and (b) the officers of the Company at the Effective Time shall be the officers of the Surviving Corporation. ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF THE COMPANY The Company represents and warrants to Parent as of the date hereof and as of the Effective Time that: Section 5.01. Corporate Existence and Power The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware, and has all corporate powers and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted. The Company is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where the character of the property owned or leased by it or the nature of its activities makes such qualification necessary, except for those jurisdictions where the failure to be so qualified would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the condition (financial or otherwise), business, assets, liabilities or results of operations of the Company and the Subsidiaries taken as a whole ("Material Adverse Effect"). The Company has heretofore delivered or made available to Parent true and complete copies of the Company's certificate of incorporation and bylaws as currently in effect. 42 Section 5.02. Corporate Authorization The execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the transactions contemplated hereby are within the Company's corporate powers and, except for the approval by the Company's stockholders by a majority vote in connection with the consummation of the Merger (which vote will not be required if Merger Co. owns at least 90% of the issued and outstanding shares of Company Common Stock), have been duly authorized by all necessary corporate and stockholder action under the Company's constituent documents and Delaware Law. This Agreement constitutes a valid and binding agreement of the Company. Section 5.03. Governmental Authorization The execution, delivery and performance by the Company of this Agreement and the consummation of the Merger by the Company require no action by or in respect of, or filing with, any governmental body, agency, official or authority other than (a) the filing of a certificate of merger in accordance with Delaware Law; (b) compliance with any applicable requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the "HSR Act"); (c) compliance with any applicable non-United States laws intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade; and (d) compliance with any applicable requirements of the Exchange Act. Section 5.04. Non-Contravention Except as set forth in Schedule 5.04, the execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the transactions contemplated hereby do not and will not (a) contravene or conflict with the certificate of incorporation or bylaws of the Company, (b) assuming compliance with the matters referred to in Section 5.03, contravene or conflict with or constitute a violation of any provision of any law, regulation, judgment, writ, injunction, order or decree of any court or governmental authority binding upon or applicable to the Company or any Subsidiary or any of their properties or assets, (c) constitute a default under or give rise to a right of termination, cancellation or acceleration of any right or obligation of the Company or any Subsidiary or to a loss of any benefit to which the Company or any Subsidiary is entitled under any provision of any material agreement, contract or other instrument binding upon the Company or any Subsidiary or any license, franchise, permit or other similar authorization held by the Company or any Subsidiary, or (d) result in the creation or imposition of any Lien on any asset of the Company or any Subsidiary, except, in the case of clauses (b), (c) and (d) of this Section 5.04, for any such violation, failure to obtain any such consent or other action, default, right, loss or Lien that would not, individually or in the aggregate, be reasonably expected to have a Material Adverse Effect. For purposes of this Agreement, "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset. The Rawhide Merger Agreement has been terminated in accordance with its terms (subject to payment of the amount described in the following clause), and the Company is obligated to pay, on Tuesday, January 2, 2001, $66,500,000 to Rawhide Holdings Corporation which represents all amounts required to be paid by the Company under the Rawhide Merger Agreement and the Company has no other financial liabilities thereunder. Immediately prior to the execution hereof, Rawhide Holdings Corporation has agreed to waive the three day period to submit a new offer provided for in Section 10.01(e) of the Rawhide Merger Agreement. 43 Section 5.05. Capitalization The authorized capital stock of the Company consists of 200,000,000 shares of Company Common Stock and 25,000,000 shares of preferred stock, par value $1.00 per share (the "Preferred Stock"). As of the close of business on December 28, 2000, there were issued and outstanding 105,644,598 shares of Common Stock and no shares of Preferred Stock. As of the close of business on December 28, 2000, there were outstanding stock options to purchase an aggregate of 4,891,500 shares of Company Common Stock (of which options to purchase an aggregate of 2,697,500 shares of Company Common Stock were exercisable). All outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid and nonassessable. Except as set forth in Schedule 5.05 and this Section and except for changes since December 28, 2000 resulting from the exercise of employee stock options outstanding on such date, there are outstanding (a) no shares of capital stock or other voting securities of the Company, (b) no securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company, and (c) no options or other rights to acquire from the Company or any Subsidiary, and no obligation of the Company or any Subsidiary to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company (the items in clauses (a), (b) and (c) of this Section 5.05 being referred to collectively as the "Company Securities"). There are no outstanding obligations of the Company or any Subsidiary to repurchase, redeem or otherwise acquire any Company Securities. Section 5.06. Subsidiaries (a) Each Subsidiary is a corporation duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation, has all corporate powers and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted and is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where the character of the property owned or leased by it or the nature of its activities makes such qualification necessary, except for those jurisdictions where failure to be so qualified would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. For purposes of this Agreement, "Subsidiary" means any corporation or other entity of which securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are directly or indirectly owned by the Company and/or one or more Subsidiaries. All Subsidiaries and their respective jurisdictions of incorporation are identified in Schedule 5.06. (b) Except as set forth in Schedule 5.06, all of the outstanding capital stock of, or other ownership interests in, each Subsidiary, is owned by the Company, directly or indirectly, free and clear of any Lien and free of any other limitation or restriction (including any restriction on the right to vote, sell or otherwise dispose of such capital stock or other ownership interests). There are no outstanding (i) securities of the Company or any Subsidiary convertible into or exchangeable for shares of capital stock or other voting securities or ownership interests in any Subsidiary, and (ii) options or other rights to acquire from the Company or any Subsidiary, and no other obligation of the Company or any Subsidiary to issue, any capital stock, voting securities or other ownership interests in, or any securities convertible into or exchangeable for any capital stock, voting securities or ownership interests in, any Subsidiary (the 44 items in clauses (i) and (ii) of this Section 5.06(b) being referred to collectively as the "Subsidiary Securities"). There are no outstanding obligations of the Company or any Subsidiary to repurchase, redeem or otherwise acquire any outstanding Subsidiary Securities. Section 5.07. SEC Filings (a) The Company has delivered or made available to Parent (i) the Company's annual report on Form 10-K for the year ended December 25, 1999 (the "Company 10-K"), (ii) its quarterly report on Form 10-Q for its fiscal quarter ended September 23, 2000, its quarterly report on Form 10-Q for its fiscal quarter ended June 24, 2000 (as amended) and its quarterly report on Form 10-Q for its fiscal quarter ended March 25, 2000 (together, the "Company 10-Qs"), (iii) its proxy or information statements relating to meetings of, or actions taken without a meeting by, the stockholders of the Company held since January 1, 1998, and (iv) all of its other reports, statements, schedules and registration statements filed with the SEC since January 1, 1998. (b) As of its filing date, each such report or statement filed pursuant to the Exchange Act did not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. (c) Each such registration statement, as amended or supplemented, if applicable, filed pursuant to the Securities Act of 1933, as amended (the "Securities Act"), as of the date such statement or amendment became effective did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. Section 5.08. Financial Statements The audited consolidated financial statements of the Company included in the Company 10-K and the unaudited consolidated financial statements of the Company included in the Company 10-Qs each fairly present, in all material respects, in conformity with generally accepted accounting principles applied on a consistent basis (except as may be indicated in the notes thereto), the consolidated financial position of the Company and its consolidated subsidiaries as of the dates thereof and their consolidated results of operations and changes in financial position for the periods then ended (subject to normal year-end adjustments in the case of any unaudited interim financial statements). For purposes of this Agreement, "Balance Sheet" means the consolidated balance sheet of the Company as of December 25, 1999 set forth in the Company 10-K and "Balance Sheet Date" means December 25, 1999. Section 5.09. Disclosure Documents (a) Each document required to be filed by the Company with the SEC in connection with the transactions contemplated by this Agreement (the "Company Disclosure Documents"), including, without limitation, (i) the Exchange Schedule 14D-9 (including information required by Rule 14f-1 under the Exchange Act), the Schedule 14D-9/A (including information required by Rule 14f-1 under the Exchange Act) and (iii) the proxy or information statement of the Company containing information required by Regulation 14A under the Exchange Act (the "Company Proxy Statement"), if any, to be filed with the SEC in connection with the Offer or the Merger and any amendments or supplements thereto will, when filed, comply as to form in all material respects with the applicable requirements of the Exchange Act except that no representation or warranty is made hereby with respect to any 45 information furnished to the Company by Parent in writing specifically for inclusion in the Company Disclosure Documents. (b) At the time the Schedule 14D-9/A, the Exchange Schedule 14D-9 and the Company Proxy Statement or any amendment or supplement thereto is first mailed to stockholders of the Company, and, with respect to the Company Proxy Statement only, at the time such stockholders vote on adoption of this Agreement and at the Effective Time, the Schedule 14D-9/A, the Exchange Schedule 14D-9 and the Company Proxy Statement, as supplemented or amended, if applicable, will not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. At the time of the filing of any Company Disclosure Document other than the Company Proxy Statement and at the time of any distribution thereof, such Company Disclosure Document will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The representations and warranties contained in this Section 5.09(b) will not apply to statements or omissions included in the Company Disclosure Documents based upon information furnished to the Company in writing by Parent specifically for use therein. (c) Neither the information with respect to the Company or any Subsidiary that the Company furnishes in writing to Parent specifically for use in the Parent Disclosure Documents (as defined in Section 6.09(a)) nor the information incorporated by reference from documents filed by the Company with the SEC will, at the time of the provision thereof to Parent or at the time of the filing thereof by the Company with the SEC, as the case may be, at the time of the meeting of the Company's stockholders, if any, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. Section 5.10. Absence of Certain Changes Except as set forth in Schedule 5.10 hereto, the Company 10-K or the Company 10-Qs, since the Balance Sheet Date, the Company and the Subsidiaries have conducted their business in the ordinary course consistent with past practice and there has not been: (a) any event, occurrence or development of a state of circumstances or facts which has had or reasonably could be expected to have a Material Adverse Effect; (b) other than regular quarterly dividends in an amount not in excess of $.025 per share per quarter, any declaration, setting aside or payment of any dividend or other distribution with respect to any shares of capital stock of the Company, or any repurchase, redemption or other acquisition by the Company or any Subsidiary of any outstanding shares of capital stock or other securities of, or other ownership interests in, the Company or any Subsidiary; (c) any amendment of any material term of any outstanding security of the Company or any Subsidiary that could reasonably be expected to be materially adverse to the Company; (d) any incurrence, assumption or guarantee by the Company or any Subsidiary of any indebtedness for borrowed money other than in the ordinary course of business and in amounts and on terms consistent with past practices; (e) any creation or assumption by the Company or any Subsidiary of any material Lien on any material asset other than in the ordinary course of business consistent with past practices; 46 (f) any making of any material loan, advance or capital contributions to or investment in any Person other than loans, advances or capital contributions to or investments in wholly-owned Subsidiaries made in the ordinary course of business consistent with past practices; (g) any damage, destruction or other casualty loss (whether or not covered by insurance) affecting the business or assets of the Company or any Subsidiary which, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect; (h) any transaction or commitment made, or any contract or agreement entered into, by the Company or any Subsidiary relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by the Company or any Subsidiary of any contract or other right, in either case, that has had or would reasonably be expected to have a Material Adverse Affect, other than transactions and commitments in the ordinary course of business consistent with past practice and those contemplated by this Agreement; (i) any change in any method of accounting or accounting practice by the Company or any Subsidiary, except for any such change required by reason of a concurrent change in generally accepted accounting principles; (j) any (i) grant of any severance or termination pay to any director or executive officer of the Company or any Subsidiary, (ii) entering into of any employment, deferred compensation or other similar agreement (or any amendment to any such existing agreement) with any director or executive officer of the Company or any Subsidiary, (iii) material increase in benefits payable under any existing severance or termination pay policies or employment agreements or (iv) increase in compensation, bonus or other benefits payable to directors, officers or employees of the Company or any Subsidiary, other than in each case in the ordinary course of business consistent with past practice; (k) any labor dispute, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any Subsidiary, which employees were not subject to a collective bargaining agreement at the Balance Sheet Date, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees which have had or could reasonably be expected to have a Material Adverse Effect; or (l) any cancellation of any licenses, sublicenses, franchises, permits or agreements to which the Company or any Subsidiary is a party, or any notification to the Company or any Subsidiary that any party to any such arrangements intends to cancel or not renew such arrangements beyond its expiration date as in effect on the date hereof, which cancellation or notification, individually or in the aggregate, has had or reasonably could be expected to have a Material Adverse Effect. Section 5.11. No Undisclosed Material Liabilities Except as set forth in Schedule 5.11, the Company 10-K or the Company 10-Qs, there are no liabilities of the Company or any Subsidiary of any kind whatsoever, whether accrued, contingent, absolute, determined, determinable or otherwise, and there is no existing condition, situation or 47 set of circumstances which could reasonably be expected to result in such a liability, other than: (a) liabilities disclosed or provided for in the Balance Sheet; (b) liabilities incurred in the ordinary course of business consistent with past practice since the Balance Sheet Date or as otherwise specifically contemplated by this Agreement; (c) liabilities under this Agreement; and (d) other liabilities which individually or in the aggregate do not and could not reasonably be expected to have a Material Adverse Effect. Section 5.12. Litigation Except as set forth in Schedule 5.12, the Company 10-K or the Company 10-Qs, there is no action, suit, investigation or proceeding (or any basis therefor) pending against, or to the knowledge of the Company threatened against or affecting, the Company or any Subsidiary or any of their respective properties before any court or arbitrator or any governmental body, agency or official which could reasonably be expected to have a Material Adverse Effect, or which as of the date hereof in any manner challenges or seeks to prevent enjoin, alter or materially delay the Merger or any of the other transactions contemplated hereby. Section 5.13. Taxes (a) Except as set forth in Schedule 5.13 or as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect: (i) all Tax returns, statements, reports and forms (including estimated Tax returns and reports and information returns and reports) required to be filed with any taxing authority with respect to any Tax period (or portion thereof) ending on or before the Effective Time (a "Pre-Closing Tax Period") by or on behalf of the Company or any Subsidiary of the Company (collectively, the "Returns"), were filed when due (including any applicable extension periods) in accordance with all applicable laws; as of the time of filing, the Returns were true and complete in all material respects; (ii) the Company and its Subsidiaries have timely paid, or withheld and remitted to the appropriate Taxing authority, all Taxes shown as due and payable on the Returns that have or should have been filed; (iii)the charges, accruals and reserves for Taxes with respect to the Company and any Subsidiary for any Pre- Closing Tax Period or Straddle Period (including any Pre- Closing Tax Period or Straddle Period for which no Return has yet been filed) reflected on the Balance Sheet (in addition to any provision for deferred income Taxes) are adequate to cover such Taxes as of the Balance Sheet Date. " "Straddle Period" is any tax period beginning before the Effective Time but ending after the Effective Time. (iv) there is no claim (including under any indemnification or Tax-sharing agreement), audit, action, suit, proceeding, or investigation now pending or threatened in writing against or in respect of any Tax or "Tax asset" of the Company or any Subsidiary. For purposes of this Section 5.13 and Section 6.13, the term "Tax Asset" shall include any net operating loss, net capital loss, investment Tax credit, foreign Tax credit, charitable deduction or any other credit or Tax attribute which could be carried forward or back to reduce Taxes; 48 (v) there are no Liens for Taxes upon the assets of the Company or its Subsidiaries except for Liens for current Taxes not yet due; and (vi) neither the Company nor any Subsidiary is currently under any obligation to pay any amounts of the type described in clause (ii) or (iii) of the definition of "Tax", regardless of whether such Tax is imposed on the Company or any Subsidiary. (b) For purposes of this Section 5.13, "tax" or "Tax" means (i) any tax, governmental fee or other like assessment or charge of any kind whatsoever (including, but not limited to, withholding on amounts paid to or by any Person), together with any interest, penalty, addition to tax or additional amount imposed by any governmental authority responsible for the imposition of any such tax (domestic or foreign), (ii) in the case of the Company or any Subsidiary, liability for the payment of any amount of the type described in clause (i) as a result of being or having been before the Effective Time a member of an affiliated, consolidated, combined or unitary group (other than such a group of which the Company or any of its Subsidiaries is the common parent), or a party to any agreement or arrangement, as a result of which liability of the Company or any Subsidiary to a taxing authority is determined or taken into account with reference to the liability of any other Person, and (iii) liability of the Company or any Subsidiary for the payment of any amount as a result of being party to any tax sharing agreement or with respect to the payment of any amount of the type described in (i) or (ii) as a result of any existing express obligation (including, but not limited to, an indemnification obligation). Section 5.14. ERISA (a) Schedule 5.14 contains a correct and complete list identifying each material "employee benefit plan", as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974 ("ERISA"), each employment, severance or similar contract, plan, arrangement or policy and each other plan or arrangement (written or oral) providing for compensation, bonuses, profit-sharing, stock option or other stock related rights or other forms of incentive or deferred compensation, vacation benefits, insurance (including any self-insured arrangements), health or medical benefits, employee assistance program, disability or sick leave benefits, workers' compensation, supplemental unemployment benefits, severance benefits and post-employment or retirement benefits (including compensation, pension, health, medical or life insurance benefits) which is maintained, administered or contributed to by the Company or any Subsidiary and covers any employee or former employee of the Company or any Subsidiary, or with respect to which the Company or any Subsidiary has any liability with respect to any employee or former employee of the Company or any Subsidiary (other than any such plan, contract, policy or arrangement that is an International Plan, as defined below). Copies of such plans (and, if applicable, related trust or funding agreements or insurance policies) and all amendments thereto and written interpretations thereof have been made available to Parent together with the most recent annual report (Form 5500 including, if applicable, Schedule B thereto) and tax return (Form 990) prepared in connection with any such plan or trust. Such plans are referred to collectively herein as the "Employee Plans". For purposes of this Section 5.14, "ERISA Affiliate" of any Person means any other Person which, together with such Person, would be treated as a single employer under Section 414 of the Internal Revenue Code of 1986, as amended (the "Code"). 49 (b) Schedule 5.14 separately identifies each material Employee Plan that is subject to Title IV of ERISA (other than a Multiemployer Plan, as defined below) (a "Title IV Plan"). Schedule 5.14 separately identifies each Employee Plan which is a multiemployer plan, as defined in Section 3(37) of ERISA (a "Multiemployer Plan"). Except as would not reasonably be expected to have a Material Adverse Affect, if a "complete withdrawal" by Seller and all of its ERISA Affiliates were to occur as of the Effective Time with respect to all Multiemployer Plans, to the knowledge of the Company, none of the Company, any Subsidiary or any of their ERISA Affiliates would incur any withdrawal liability under Title IV of ERISA. Neither the Company nor any ERISA Affiliate of the Company has incurred any liability under Title IV of ERISA (other than for PBGC Premium not yet due). (c) A current favorable Internal Revenue Service determination letter is in effect with respect to each Employee Plan which is intended to be qualified under Section 401(a) of the Code (or the relevant remedial amendment period has not expired with respect to such Employee Plan), and the Company knows of no circumstance giving rise to a material likelihood that such letter could be revoked by the Internal Revenue Service. The Company has made available to Parent copies of the most recent Internal Revenue Service determination letters with respect to each such Plan. Each Employee Plan has been maintained in compliance with its terms and with the requirements prescribed by any and all statutes, orders, rules and regulations, including but not limited to ERISA and the Code, which are applicable to such Employee Plan, other than any non-compliance which would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. No events have occurred with respect to any Employee Plan that would reasonably be expected to result in payment or assessment of any material excise taxes under Sections 4972, 4975, 4976, 4977, 4979, 4980B, 4980D, 4980E or 5000 of the Code, other than any excise taxes which would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. (d) Except as set forth in Schedule 5.14, the consummation of the transactions contemplated by this Agreement will not (either alone or together with any termination of employment) entitle any employee or independent contractor of the Company or any Subsidiary to severance pay or accelerate the time of payment or vesting or trigger any payment of funding (through a grantor trust or otherwise) of material compensation or benefits under, materially increase the amount payable or trigger any other material obligation pursuant to, any Employee Plan. (e) Neither the Company nor any Subsidiary has any liability in respect of post-retirement health, medical or life insurance benefits for retired, former or current employees of the Company or its Subsidiaries except for coverage under Section 4980B of the Code or coverage the full cost of which is paid for by the retired, former or current employee. (f) There has been no amendment to, written interpretation or announcement (whether or not written) by the Company or any of its Affiliates relating to, or change in employee participation or coverage under, an Employee Plan which would increase the expense of maintaining such Employee Plan above the level of the expense incurred in respect thereof for the fiscal year ended December 25, 1999, except for any such increase which would not reasonably be expected to have a Material Adverse Effect. 50 (g) Except as previously disclosed to Parent, neither the Company nor any Subsidiary is a party to or subject to, or is currently negotiating in connection with entering into, any collective bargaining agreement or other contract or understanding with a labor union or labor organization. (h) Except for any failures which would not be reasonably expected to have a Material Adverse Effect, all contributions and payments accrued under each Employee Plan, determined in accordance with prior funding and accrual practices, as adjusted to include proportional accruals for the period ending as of the date hereof, have been discharged and paid on or prior to the date hereof except to the extent reflected as a liability on the Balance Sheet. (i) Schedule 5.14(i) identifies each International Plan (as defined below) covering 100 employees or more. The Company has furnished to Parent copies of each International Plan. Each International Plan has been maintained in compliance with its terms and with the requirements prescribed by any and all applicable statutes, orders, rules and regulations (including any special provisions relating to qualified plans where such Plan was intended to so qualify) and has been maintained in good standing with applicable regulatory authorities, other than any non- compliance which would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. There has been no amendment to, written interpretation of or announcement (whether or not written) by the Company or any Subsidiary relating to, or change in employee participation or coverage under, any International Plan that would increase the expense of maintaining such International Plan above the level of expense incurred in respect thereof for the most recent fiscal year ended prior to the date hereof, except for any such increase which would not reasonably be expected to have a Material Adverse Effect. For purposes of this Section 5.14, "International Plan" means any employment, severance or similar contract or arrangement (whether or not written) or any plan, policy, fund, program or arrangement or contract providing for severance, insurance coverage (including any self-insured arrangements), workers' compensation, disability benefits, supplemental unemployment benefits, vacation benefits, pension or retirement benefits or for deferred compensation, profit-sharing, bonuses, stock options, stock appreciation rights or other forms of incentive compensation or post-retirement insurance, compensation or benefits that (i) is intended primarily for the benefit of employees or beneficiaries based outside the U.S., (ii) is entered into, maintained, administered or contributed to by the Company or any Subsidiary and (iii) covers any employee or former employee of the Company or any Subsidiary. Section 5.15. Labor Matters Except as set forth in Schedule 5.15 and except for such matters as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, there are no (i) labor strikes, disputes, slowdowns, representation or certification campaigns or work stoppages or other concerted activities with respect to employees of any of the Company or any Subsidiary pending, or to the knowledge of the Company, threatened against or affecting the Company or any Subsidiary, (ii) grievance or arbitration proceedings, decisions, side letters, letter agreements, letters of understanding or settlement agreements arising out of collective bargaining agreements to which the Company or any Subsidiary is a party, (iii) unfair labor practice complaints pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary, or (iv) activities or proceedings of any labor union or employee association to organize any such employees. 51 (b) Except to the extent set forth in Schedule 5.15 and except for such matters as would not, individually or in the aggregate, have a Material Adverse Effect, the Company and its Subsidiaries are in compliance with all applicable laws respecting employment and employment practices, terms and conditions of employment and wages and hours. (c) Except to the extent set forth in Schedule 5.15 and except for such matters as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, there are no pending administrative matters with any federal, provincial, state or local agencies regarding (i) violations or alleged violations of any federal, provincial, state or local wage and hour law or any federal, provincial, state or local law with respect to discrimination on the basis of race, color, creed, national origin, religion or any other basis under such federal, provincial, state or local law, (ii) any claimed violation of Title VII of the 1964 Civil Rights Act, as amended, (iii) any allegation or claim arising out of Executive Order 11246 or any other applicable order relating to governmental contractors or state contractors, or (iv) any violation or alleged violation of the Age Discrimination and Employment Act, as amended, or any other federal, provincial, state or local statute or ordinance, or any other applicable laws with respect to wages, hours, employment practices and terms and conditions of employment. Section 5.16. Compliance with Laws Except to the extent set forth in Schedules 5.11, 5.12 and 5.19, neither the Company nor any Subsidiary is in violation of, or has since January 1, 1999 violated, and to the knowledge of the Company none is under investigation with respect to or has been threatened to be charged with or given notice of any violation of, any applicable law, rule, regulation, judgment, injunction, order or decree, except for violations that have not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. Section 5.17. Licenses and Permits Except as set forth on Schedule 5.17 and except where the failure of the following to be true would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect, (i) the Company or its Subsidiaries own, hold or possess adequate right to use all material licenses, franchises, permits, certificates, approvals or other similar authorizations affecting, or relating in any way to, the assets or business of the Company and its Subsidiaries (the "Permits") required in connection with the operation of the business of the Company and its Subsidiaries, (ii) the Permits are valid and in full force and effect, (iii) neither the Company nor any Subsidiary is in default under, and no condition exists that with notice or lapse of time or both would constitute a default under, the Permits and (iv) none of the Permits will be terminated or impaired or become terminable, in whole or in part, as a result of the transactions contemplated hereby. Section 5.18. Intellectual Property Except as set forth in Schedule 5.18, the Company and the Subsidiaries own or possess adequate licenses or other rights to use all Intellectual Property Rights necessary to conduct the business now operated by them, except where the failure to own or possess such licenses or rights has not had and would not be reasonably likely to have a Material Adverse Effect and, to the knowledge of the Company, the Intellectual Property Rights of the Company and the Subsidiaries do not conflict with or infringe upon any Intellectual Property Rights of others to the extent that, if sustained, such conflict or infringement has had and would be reasonably likely to have a Material Adverse Effect. For purposes of this Agreement, an "Intellectual Property Right' means any trademark, service mark, trade 52 name, mask work, copyright, patent, software license, other data base, invention, trade secret, know-how (including any registrations or applications for registration of any of the foregoing) or any other similar type of proprietary intellectual property right. Section 5.19. Environmental Matters (a) Except for such matters, individually or in the aggregate, as would not be reasonably expected to have a Material Adverse Effect or as set forth in Schedule 5.19, the Company 10-K or the Company 10-Qs: (i) no notice, notification, demand, request for information, citation, summons or order has been received, no complaint has been filed, no penalty has been assessed, and no investigation, action, claim, suit, proceeding or review (or any basis therefor) is pending or, to the knowledge of the Company or any Subsidiary, is threatened by any governmental entity or other Person with respect to any matters relating to the Company or any Subsidiary and relating to or arising out of any Environmental Law; (ii) there are no liabilities of or relating to the Company or any Subsidiary of any kind whatsoever whether accrued, contingent, absolute, determined, determinable or otherwise, arising under or relating to any Environmental Law, and there are no facts, conditions, situations or set of circumstances that could reasonably be expected to result in or be the basis for any such liability; (iii)the Company and its Subsidiaries are and have been in compliance with all Environmental Laws and have obtained and are in compliance with all Environmental Permits; and (iv) no Hazardous Substance has been discharged, disposed of, dumped, injected, pumped, deposited, spilled, leaked, emitted or released at any property now or previously owned, leased or operated by the Company or any Subsidiary. For purposes of this Section 5.19(a), the "Company" and "Subsidiary" shall include any entity which is, in whole or in part, a predecessor of the Company or any Subsidiary. (b) Since January 1, 1997, except as set forth in Schedule 5.19, there has been no written environmental investigation, study, audit, test, review or other analysis conducted of which the Company has knowledge in relation to the current or prior business of the Company or any Subsidiary or any property or facility now or previously owned, leased or operated by the Company or any Subsidiary which has not been delivered (to the extent the Company has possession thereof) to Parent at least five days prior to the date hereof. (c) Except as set forth in Schedule 5.19, neither the Company nor any Subsidiary owns, leases or operates or has owned, leased or operated any real property, or conducts or has since January 1, 1997 conducted any operations, in New Jersey or Connecticut. (d) For purposes of this Section 5.19, the following terms shall have the meanings set forth below: "Environmental Laws" means any federal, state, provincial, local and foreign law (including, without limitation, common law), treaty, judicial decision, regulation, rule, judgment, order, decree, injunction, permit or governmental restriction or requirement or any agreement or contract with any governmental authority or other third party, relating to human health and safety, the environment or to pollutants, contaminants, wastes or chemicals or any toxic, radioactive, ignitable, corrosive, reactive or otherwise hazardous substances, wastes or materials. 53 "Environmental Permits" means all permits, licenses, franchises, certificates, approvals and other similar authorizations of governmental authorities relating to or required by Environmental Laws and affecting the business of the Company or any of its Subsidiaries as currently conducted. "Hazardous Substances" means any pollutant, contaminant, waste or chemical or any toxic, radioactive, ignitable, corrosive, reactive or otherwise hazardous substance, waste or material, or any substance, waste or material having any constituent elements displaying of the foregoing characteristics, including, without limitation, petroleum, its derivatives, by-products and other hydrocarbons, which in any event is regulated under Environmental Laws. Section 5.20. Finders' Fees Except for J.P. Morgan Securities Inc. and Peter J. Solomon Company Limited, a copy of whose engagement agreements have been provided to Parent, there is no investment banker, broker, finder or other intermediary which has been retained by or is authorized to act on behalf of the Company or any Subsidiary who might be entitled to any fee or commission from Parent or any of its affiliates upon consummation of the transactions contemplated by this Agreement. Section 5.21. Inapplicability of Certain Restrictions The Company has taken all action necessary to exempt the Offer, the Exchange Offer, the Merger, this Agreement, and the transactions contemplated hereby from Section 203 of the Delaware Law. Unless Merger Co. owns at least 90% of the issued and outstanding shares of Company Common Stock, the adoption of this Agreement by the affirmative vote of the holders of shares of Company Common Stock entitling such holders to exercise at least a majority of the voting power of the shares of Company Common Stock is the only vote of holders of any class or series of the capital stock of the Company required to adopt this Agreement, or to approve the Merger or any of the other transactions contemplated hereby and no higher or additional vote is required pursuant to the Company's Certificate of Incorporation or otherwise. Section 5.22. Rights Plan The Company has not entered into, and its Board of Directors has not adopted or authorized the adoption of, a shareholder rights or similar agreement. ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF PARENT Parent represents and warrants to the Company as of the date hereof and as of the Effective Time that: Section 6.01. Corporate Existence And Power Parent is a corporation duly incorporated, validly existing and in good standing under the laws of Delaware and has all corporate powers and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted. Parent is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where the character of the property owned or leased by it or the nature of its activities makes such qualification necessary, except for those jurisdictions where the failure to be so qualified would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the condition (financial or otherwise), business, assets, liabilities or results of operations of Parent and the Parent Subsidiaries taken as a whole ("Parent Material Adverse Effect"). Parent has heretofore delivered to the Company true and complete copies of Parent's certificate of incorporation and bylaws as currently in effect. 54 Section 6.02. Corporate Authorization The execution, delivery and performance by Parent and Merger Co. of this Agreement and the consummation by Parent and Merger Co. of the transactions contemplated hereby are within the corporate powers of Parent and Merger Co. and have been duly authorized by all necessary corporate and stockholder action. This Agreement constitutes a valid and binding agreement of each of Parent and Merger Co. Section 6.03. Governmental Authorization The execution, delivery and performance by Parent and Merger Co. of this Agreement and the consummation by Parent and Merger Co. of the transactions contemplated by this Agreement require no action by or in respect of, or filing with, any governmental body, agency, official or authority other than (a) the filing of a certificate of merger in accordance with Delaware Law; (b) compliance with any applicable requirements of the HSR Act; (c) compliance with any applicable non-United States laws intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade; and (d) compliance with any applicable requirements of the Securities Act and the Exchange Act. Section 6.04. Non-Contravention Except as set forth in Schedule 6.04, the execution, delivery and performance by Parent and Merger Co. of this Agreement and the consummation by Parent and Merger Co. of the transactions contemplated hereby do not and will not (a) contravene or conflict with the certificate of incorporation or bylaws of Parent or Merger Co., (b) assuming compliance with the matters referred to in Section 6.03, contravene or conflict with any provision of law, regulation, judgment, writ, injunction, order or decree of any court or governmental authority binding upon or applicable to Parent or Merger Co. or any of their properties or assets, or (c) constitute a default under or give rise to any right of termination, cancellation or acceleration of any right or obligation of Parent or Merger Co. or to a loss of any benefit to which Parent or Merger Co. is entitled under any provision of any material agreement, contract or other instrument binding upon Parent or Merger Co. or any license, franchise, permit or other similar authorization held by the Parent or Merger Co., or (d) result in the creation or imposition of any Lien on any asset of the Parent or Merger Co., except, in the case of clauses (b), (c) and (d) of this Section 6.04, for any such violation, failure to obtain any such consent or other action, default, right, loss or Lien that would not, individually or in the aggregate, be reasonably expected to have a Parent Material Adverse Effect. Section 6.05. Capitalization The authorized capital stock of Parent consists of 900,000,000 shares of Parent Common Stock and 900,000,000 shares of Class B common stock, par value $0.10 per share (the "Class B Common Stock"). As of the close of business on December 28, 2000, there were outstanding 120,429,640 shares of Parent Common Stock and 102,645,048 shares of Class B Common Stock. As of the close of business on December 2, 2000, there were outstanding stock options to purchase an aggregate of 6,739,160 shares of Parent Common Stock (of which options to purchase an aggregate of 3,743,535 shares of Parent Common Stock were exercisable). All outstanding shares of capital stock of Parent have been duly authorized and validly issued and are fully paid and nonassessable. Except for changes since December 2, 2000 resulting from the exercise of employee stock options outstanding on such date, there are outstanding (a) no shares of capital stock or other voting securities of the Company, (b) no securities of the Company convertible into or exchangeable for shares of capital stock or voting 55 securities of the Company, and (c) no options or other rights to acquire from the Company or any Subsidiary, and no obligation of the Company or any Subsidiary to issue, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company (the items in clauses (a), (b) and (c) of this Section 6.05 being referred to collectively as the "Parent Securities"). There are no outstanding obligations of the Parent or any Parent Subsidiary to repurchase, redeem or otherwise acquire any Parent Securities. Section 6.06. Parent Subsidiaries (a) Each Parent Subsidiary is a corporation duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation, has all corporate powers and all material governmental licenses, authorizations, consents and approvals required to carry on its business as now conducted and is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where the character of the property owned or leased by it or the nature of its activities makes such qualification necessary, except for those jurisdictions where failure to be so qualified would not, individually or in the aggregate, reasonably be expected to have a Parent Material Adverse Effect. For purposes of this Agreement, "Parent Subsidiary" means any corporation or other entity of which securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are directly or indirectly owned by Parent and/or one or more Parent Subsidiaries. All Parent Subsidiaries and their respective jurisdictions of incorporation are identified in Schedule 6.06. (b) All of the outstanding capital stock of, or other ownership interests in, each Parent Subsidiary, is owned by Parent, directly or indirectly, free and clear of any Lien and free of any other limitation or restriction (including any restriction on the right to vote, sell or otherwise dispose of such capital stock or other ownership interests). There are no outstanding (i) securities of Parent or any Parent Subsidiary convertible into or exchangeable for shares of capital stock or other voting securities or ownership interests in any Parent Subsidiary, and (ii) options or other rights to acquire from Parent or any Parent Subsidiary, and no other obligation of the Parent or any Parent Subsidiary to issue, any capital stock, voting securities or other ownership interests in, or any securities convertible into or exchangeable for any capital stock, voting securities or ownership interests in, any Parent Subsidiary (the items in clauses (i) and (ii) of this Section 6.06(b) being referred to collectively as the "Parent Subsidiary Securities"). There are no outstanding obligations of Parent or any Parent Subsidiary to repurchase, redeem or otherwise acquire any outstanding Parent Subsidiary Securities. (c) Since the date of its incorporation, Merger Co. has not engaged in any activities other than in connection with or as contemplated by this Agreement. Section 6.07. SEC Filings (a) Parent has delivered or made available to the Company (i) Parent's annual report on Form 10-K for the year ended September 30, 2000 (the "Parent 10-K"), (ii) its proxy or information statements relating to meetings of, or actions taken without a meeting by, the stockholders of the Company held since January 1, 1998, and (iii) all of its other reports, statements, schedules and registration statements filed with the SEC since January 1, 1998. 56 (b) As of its filing date, each such report or statement filed pursuant to the Exchange Act did not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. (c) Each such registration statement, as amended or supplemented, if applicable, filed pursuant to the Securities Act as of the date such statement or amendment became effective did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. Section 6.08. Parent Financial Statements . The audited consolidated financial statements of Parent included in the Parent 10-K fairly present, in all material respects, in conformity with generally accepted accounting principles applied on a consistent basis (except as may be indicated in the notes thereto), the consolidated financial position of Parent and its consolidated subsidiaries as of the dates thereof and their consolidated statements of income, stockholders' equity and cash flows for the periods then ended (subject to normal year- end adjustments in the case of any unaudited interim financial statements). For purposes of this Agreement, "Parent Balance Sheet" means the consolidated balance sheet of Parent as of September 30, 2000 as set forth in the Company 10-K and "Parent Balance Sheet Date" means September 30, 2000. Section 6.09. Disclosure Documents (a) Each document required to be filed by Parent with the SEC in connection with the transactions contemplated by this Agreement (the "Parent Disclosure Documents"), including, without limitation, (i) the Form TO/A, (ii) the Exchange Form TO, (iii) the Exchange Form S-4 and (iv) the Merger Form S-4 (as defined in Section 9.01) to be filed with the SEC in connection with the Offer, the Exchange Offer or the Merger and any amendments or supplements thereto will, when filed, comply as to form in all material respects with the applicable requirements of the Exchange Act except that no representation or warranty is made hereby with respect to any information furnished to Parent by the Company in writing specifically for inclusion in the Company Disclosure Documents. (b) At the time the Form TO/A, the Exchange Form TO, the Exchange Form S-4 and the Merger Form S-4 or any amendment or supplement thereto is first mailed to stockholders of the Company, and, with respect to the Exchange Form S-4 and the Merger Form S-4 only, at the time such Form S-4 is declared effective by the SEC, the Form TO/A, the Exchange Form TO, the Exchange Form S-4 and the Merger Form S-4, as supplemented or amended, if applicable, will not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. At the time of the filing of any Parent Disclosure Document other than the Exchange Form S-4 or the Merger Form S-4 and at the time of any distribution thereof, such Parent Disclosure Document will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The representations and warranties contained in this Section 6.09(b) will not apply to statements or omissions included in the Parent Disclosure Documents based upon information furnished to Parent in writing by the Company specifically for use therein. 57 (c) Neither the information with respect to Parent or any Parent Subsidiary that Parent furnishes in writing to the Company specifically for use in the Company Disclosure Documents nor the information incorporated by reference from documents filed by Parent with the SEC will, at the time of the provision thereof to Parent or at the time of the filing thereof by Parent with the SEC, as the case may be, and at the time of the meeting of the Company's stockholders, if any, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. Section 6.10. Absence of Certain Changes Except as set forth in Schedule 6.10 hereto or the Parent 10-K since the Parent Balance Sheet Date, Parent and the Parent Subsidiaries have conducted their business in the ordinary course consistent with past practice and there has not been: (a) any event, occurrence or development of a state of circumstances or facts which has had or reasonably could be expected to have a Parent Material Adverse Effect; (b) any declaration (other than a quarterly dividend consistent with past practices), setting aside or payment of any dividend or other distribution with respect to any shares of capital stock of Parent, or any repurchase, redemption or other acquisition by Parent or any Parent Subsidiary of any outstanding shares of capital stock or other securities of, or other ownership interests in, Parent or any Parent Subsidiary (other than pursuant to Parent's previously announced repurchase program); (c) any amendment of any material term of any outstanding security of Parent or any Parent Subsidiary that could reasonably be expected to be materially adverse to Parent; (d) any creation or assumption by the Parent or any Parent Subsidiary of any material Lien on any material asset other than in the ordinary course of business consistent with past practices; (e) any damage, destruction or other casualty loss (whether or not covered by insurance) affecting the business or assets of Parent or any Parent Subsidiary which, individually or in the aggregate, has had or would reasonably be expected to have a Parent Material Adverse Effect; (f) any change in any method of accounting or accounting practice by Parent or any Parent Subsidiary, except for any such change required by reason of a concurrent change in generally accepted accounting principles; (g) any labor dispute, other than routine individual grievances, or any activity or proceeding by a labor union or representative thereof to organize any employees of Parent or any Parent Subsidiary, which employees were not subject to a collective bargaining agreement at the Balance Sheet Date, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to such employees which have had or could reasonably be expected to have a Parent Material Adverse Effect; or (h) any cancellation of any licenses, sublicenses, franchises, permits or agreements to which the Parent or any Parent Subsidiary is a party, or any notification to Parent or any Parent Subsidiary that any party to any such arrangements intends to cancel or not renew such arrangements beyond its expiration date as in effect on the date hereof, which cancellation or notification, individually or in the aggregate, has had or reasonably could be expected to have a Parent Material Adverse Effect. 58 Section 6.11. No Undisclosed Material Liabilities Except as set forth in the Parent 10-K, there are no liabilities, commitments or obligations of the Parent or any of its subsidiaries of any kind whatsoever whether accrued, contingent, absolute, determined, determinable or otherwise, and there is no existing condition, situation or set of circumstances that would reasonably be likely to result in such a liability commitment or obligation, other than: (a) liabilities, commitments or obligations disclosed or provided for in the Parent Balance Sheet or in the Parent 10-K; (b) liabilities, commitments or obligations incurred in the ordinary course of business consistent with past practice since the Parent Balance Sheet Date; (c) liabilities, commitments or obligations under this Agreement; and (d) liabilities, commitments or obligations that individually or in the aggregate have not had and are not reasonably likely to have a Parent Material Adverse Effect. Section 6.12. Adequate Funds. Parent will have as of the time of acceptance for payment and purchase of shares of Company Common Stock pursuant to the Offer sufficient funds for the purchase of all shares of Company Common Stock that Parent or Merger Co. becomes obligated to accept for payment pursuant to the Offer and to consummate the transactions contemplated by this Agreement. Section 6.13. Ownership of Company Common Stock. As of the date of this Agreement, Parent owns 574,200 shares of Company Common Stock. Section 6.14. Finders' Fees Except for Merrill Lynch & Co., whose fees will be paid by Parent, there is no investment banker, broker, finder or other intermediary who might be entitled to any fee or commission from the Company or any of its affiliates upon consummation of the transactions contemplated by this Agreement. Section 6.15. Compliance of Laws. Except as disclosed in the Parent 10-K, neither Parent nor any Parent Subsidiary is in violation of, or has since January 1, 1999 violated, and to the knowledge of Parent, is under investigation with respect to or has been threatened to be charged with or given notice of any violation of, any applicable law, rule, regulation, judgment, injunction, order or decree, except for violations that have not had and would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect. ARTICLE 7 COVENANTS OF THE COMPANY Section 7.01. Conduct of the Company From the date hereof until the Control Date, except as contemplated by this Agreement, the Company and the Subsidiaries shall conduct their business in the ordinary course consistent with past practice and shall use their reasonable best efforts to preserve intact their business organizations and relationships with third parties and to keep available the services of their present officers and employees. Without limiting the generality of the foregoing, except as set forth in Schedule 7.01, from the date hereof until the Control Date and unless consented to in writing by Parent, the Company will not and will cause its Subsidiaries not to: (a) adopt or propose any change in its certificate of incorporation or bylaws; 59 (b) except pursuant to existing agreements or arrangements, or as specifically permitted by this Agreement: (i) acquire (by merger, consolidation or acquisition of stock or assets) any corporation, partnership or other business organization or division thereof for an amount in excess of $5 million in the aggregate, or sell, lease or otherwise dispose of a subsidiary or an amount of assets or securities for an amount in excess of $20 million in the aggregate; (ii) make any investment in an amount in excess of $20 million in the aggregate whether by purchase of stock or securities, contributions to capital or any property transfer, or purchase for an amount in excess of $20 million in the aggregate, any property or assets of any other individual or entity; (iii)other than in the ordinary course of business consistent with past practice, waive, release, grant, or transfer any rights of material value; (iv) other than in the ordinary course of business consistent with past practice, modify or change in any material respect any existing material license, lease, contract, or other document; (v) incur, assume or prepay an amount of long-term or short-term debt in excess of $150 million in the aggregate (net of cash and marketable securities); (vi) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person (other than any Subsidiary) which, are in excess of $5 million in the aggregate; (vii)make any loans, advances or capital contributions to, or investments in, any other person which are in excess of $20 million in the aggregate; or (viii)make any new capital expenditures which, individually or in the aggregate, would exceed $200 million in the first six months of the 2001 calendar year. (c) split, combine or reclassify any shares of its capital stock, declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock except regular quarterly dividends, other than cash dividends and distributions by a wholly owned subsidiary of the Company to the Company or to a subsidiary all of the capital stock of which is owned directly or indirectly by the Company, or, other than consistent with its past practice of acquiring shares of Company Common Stock to meet its obligation to reserve and issue shares of Company Common Stock under any stock option or compensation plan or arrangement of the Company, redeem, repurchase or otherwise acquire or offer to redeem, repurchase, or otherwise acquire any of its securities or any securities of its Subsidiaries; (d) except as specifically permitted by this Agreement, adopt or amend any material bonus, profit sharing, compensation, severance, termination, stock option, pension, retirement, deferred compensation, employment or employee benefit plan, agreement, trust, plan, fund or other arrangement for the benefit and welfare of any director, officer or employee, or (except for normal increases in the ordinary course of business that are consistent with past practices and that, in the aggregate, do not result in a material increase in benefits or 60 compensation expense to the Company) increase in any manner the compensation or fringe benefits of any director, officer or employee or pay any benefit not required by any existing plan or arrangement (including, without limitation, the granting of stock options or stock appreciation rights or the removal of existing restrictions in any benefit plans or agreements); (e) except as set forth in Schedule 7.01, pay, discharge or satisfy any material claims, liabilities or obligations (whether absolute, accrued, asserted or unasserted, contingent or otherwise) other than the payment, discharge or satisfaction in the ordinary course of business, consistent with past practices, of liabilities reflected or reserved against in the consolidated financial statements of the Company or incurred in the ordinary course of business, consistent with past practices; (f) except as set forth in Schedule 7.01, approve any new labor agreements; (g) take any action other than in the ordinary course of business and consistent with past practices with respect to accounting policies or procedures; (h) agree or commit to do any of the foregoing; or (i) knowingly take or agree or commit to take any action that would make any representation and warranty of the Company hereunder inaccurate in any material respect at, or as of any time prior to, the Effective Time. Section 7.02. Stockholder Meeting The Company shall cause a meeting of its stockholders (the "Company Stockholder Meeting") to be duly called and held after the purchase of and payment for the shares of Company Common Stock pursuant to the Offer for the purpose of voting on the approval and adoption of this Agreement and the Merger, if such meeting is required. Subject to Section 7.04, the Board of Directors of the Company shall recommend approval and adoption of this Agreement and the Merger by the Company's stockholders and shall not withdraw such recommendation. Section 7.03. Access to Information From the date hereof until the Effective Time, the Company will (a) give Parent and its counsel, financial advisors, auditors and other authorized representatives (collectively, the "Representatives") reasonable access during normal business hours to the offices, properties, books and records of the Company and the Subsidiaries, (b) provide the Representatives reasonable access to and the right to consult with representatives of the Company handling any labor negotiations with any union representing employees of the Company, (c) furnish to Parent and the Representatives such financial and operating data and other information as such Persons may reasonably request in order to complete the transactions contemplated hereby and (d) instruct the Company's employees, counsel and financial advisors to cooperate with Parent in its investigation of the business of the Company and the Subsidiaries; PROVIDED that (i) any information provided to Parent or the Representatives pursuant to this Section shall be subject to the Confidentiality Agreements and (ii) Parent shall inform the Representatives receiving such information of the terms of the Confidentiality Agreements and shall be responsible for any breach by such Representatives of such Confidentiality Agreements; and PROVIDED FURTHER that no investigation pursuant to this Section shall affect any representation or warranty given by the Company to Parent hereunder. 61 Section 7.04. Other Offers (a) Neither the Company nor any of its Subsidiaries shall (whether directly or indirectly through advisors, agents or other intermediaries), nor shall the Company or any of its Subsidiaries authorize or permit any of its or their officers, directors, agents, representatives, advisors or Subsidiaries to (x) solicit, initiate or take any action to facilitate or encourage the submission of inquiries, proposals or offers from any Person (as defined below) (other than Parent) relating to any Acquisition Proposal, or agree to or endorse any Acquisition Proposal, (y) enter into or participate in any discussions or negotiations regarding any Acquisition Proposal, or furnish to any Person any information with respect to its business, properties or assets in connection with any Acquisition Proposal or (z) grant any waiver or release under any standstill or similar agreement with respect to any class of equity securities of the Company or any of its Subsidiaries; PROVIDED, however, that, prior to the acceptance for payment of shares of Company Common Stock pursuant to the Offer representing together with shares of Company Common Stock already owned by Parent at least 50.1% of the shares of Company Common Stock outstanding, the foregoing shall not prohibit the Company (either directly or indirectly through advisors, agents or other intermediaries) from (i) furnishing information pursuant to a confidentiality letter deemed appropriate by the Special Committee (a copy of which shall be provided for informational purposes only to Parent) concerning the Company and its businesses, properties or assets to a Person who in the judgment of the Special Committee has made a bona fide Acquisition Proposal, (ii) engaging in discussions or negotiations with such a Person who in the judgment of the Special Committee has made a bona fide Acquisition Proposal, (iii) following receipt of a bona fide Acquisition Proposal, taking and disclosing to its stockholders a position contemplated by Rule 14e-2(a) under the Exchange Act or otherwise making disclosure to its stockholders, (iv) following receipt of an Acquisition Proposal, failing to make or withdrawing or modifying its recommendation referred to in Section 7.02 and/or (v) taking any non-appealable, final action ordered to be taken by the Company by any court of competent jurisdiction but in each case referred to in the foregoing clauses (i), (ii) and (iv) only if (i) the Company has complied with the terms of this Section 7.04, (ii) the Company has received an unsolicited Acquisition Proposal which the Special Committee determines in good faith is reasonably likely to result in a Superior Proposal, and (iii) the Company shall have delivered to Parent a prior written notice advising Parent that it intends to take such action. The Company will immediately cease and cause its advisors, agents and other intermediaries to cease any and all existing activities, discussions or negotiations with any parties conducted heretofore with respect to any of the foregoing. For purposes of this Section 7.04, the term "Person" means any person, corporation, entity or "group," as defined in Section 13(d) of the Exchange Act, other than Parent or any of its affiliates. "Acquisition Proposal" means any offer or proposal for a merger, reorganization, consolidation, share exchange, business combination or other similar transaction involving the Company or any of its Subsidiaries or any proposal or offer to acquire, directly or indirectly, securities representing more than 50% of the voting power of the Company, or a substantial portion of the assets of the Company and its Subsidiaries taken as a whole, other than the Offer and the Merger contemplated by this Agreement. 62 "Superior Proposal" means any bona fide written Acquisition Proposal which (i) the Special Committee determines in good faith (after consultation with a financial advisor of nationally recognized reputation and taking into account all the terms and conditions of the Acquisition Proposal) is (a) more favorable to the Company and its stockholders from a financial point of view than the transaction contemplated hereunder, and (b) reasonably capable of being completed, including a conclusion that its financing, to the extent required, is then committed or is in the good faith judgment of the Board of Directors of the Company, reasonably capable of being financed by the Person making such Acquisition Proposal. (b) If this Agreement is terminated under circumstances which would constitute a Payment Event (as defined below), the Company will pay to Parent, (i) if pursuant to clause (x) in the definition of "Payment Event", simultaneously with the occurrence of such Payment Event or, if pursuant to clause (y) in the definition of "Payment Event", within two business days following such Payment Event, a fee of $15,000,000 and (ii) a reimbursement payment of the amount advanced to the Company by Parent in order to pay the amount described in the penultimate sentence of Section 5.04 in cash, together with interest thereon, at a rate equal to the London Interbank Offered Rate plus .75%, from the date hereof to the date such payment is due pursuant to this Agreement (collectively, the "Reimbursement Payment), reflecting reimbursement of the amounts advanced by Parent to the Company on the date hereof and used by the Company to pay the termination fee and the out-of-pocket fees and expenses owed to Rawhide Holdings Corporation under the Rawhide Merger Agreement (which advance will be evidenced by a note that, in the event of termination of this Agreement, will be repaid only on the terms set forth in this Section 7.04(b) with respect to the Reimbursement Payment, and that will survive the consummation of the Merger if the Merger is completed). Any payment of the Reimbursement Payment pursuant to this Section 7.04(b) shall be made within one business day after termination of this Agreement. Any payment of the Reimbursement Payment shall be made by wire transfer of immediately available funds. "Payment Event" means (x) the termination of this Agreement by the Company or Parent pursuant to Sections 11.01(d) or (e); or (y) the termination of this Agreement pursuant to Sections 11.01(b), (f) or (h) if at the time of such termination (or, in the case of a termination pursuant to Section 11.01(h), at the time of the stockholders meeting), there shall have been outstanding an Acquisition Proposal pursuant to which stockholders of the Company would receive cash, securities or other consideration having an aggregate value in excess of the Per Share of Company Common Stock Amount, and within six months of any such termination described in clause (y) above the Company enters into a definitive agreement for or consummates such Acquisition Proposal or another Acquisition Proposal with a higher per share of Company Common Stock value than such Acquisition Proposal. (c) Upon the termination of this Agreement under circumstances which would constitute a Payment Event, the Company shall reimburse Parent and its affiliates not later than two business days after demand delivered by Parent to the Company, the amount of $7,500,000 representing Parent's fees and expenses (including, without limitation, the fees and expenses of their counsel and investment banking fees) and Parent shall not be required to submit documentation substantiating such fees and expenses. 63 (d) The Company acknowledges that the agreements contained in this Section 7.04 are an integral part of the transactions contemplated by this Agreement, and that, without these agreements, neither Parent nor Merger Co. would enter into this Agreement; accordingly, if the Company fails to promptly pay any amount due pursuant to this Section 7.04, and, in order to obtain such payment, the other party commences a suit which results in a judgment against the Company for the fee or fees and expenses set forth in this Section 7.04, the Company shall also pay to Parent its costs and expenses incurred in connection with such litigation. (e) This Section 7.04 shall survive any termination of this Agreement, however caused, except a termination pursuant to Sections 11.01(a) or (c). Section 7.05. Notices Of Certain Events The Company shall promptly notify Parent of: (a) any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the transactions contemplated by this Agreement; (b) any notice or other communication from any governmental or regulatory agency or authority in connection with the transactions contemplated by this Agreement; (c) any actions, suits, claims, investigations or proceedings commenced or, to the best of its knowledge threatened against, relating to or involving or otherwise affecting the Company or any Subsidiary which, if pending on the date of this Agreement, would have been required to have been disclosed pursuant to Section 5.12 or which relate to the consummation of the transactions contemplated by this Agreement. Section 7.06. Tax Matters (a) Except as set forth in Schedule 7.06 or as required by law or as is in the ordinary course of business consistent with past practice or as would not have a Material Adverse Effect, without the prior written consent of Parent (such consent not to be unreasonably withheld), neither the Company nor any of its Subsidiaries shall make or change any material Tax election, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Returns or claims for Tax refunds, enter into any closing agreement, surrender any Tax claim, audit or assessment, surrender any right to claim a Tax refund, offset or other reduction in Tax liability surrendered, consent to any extension or waiver of the limitations period applicable to any Tax claim or assessment or take or omit to take any other action, if any such election, action or omission would have the effect of increasing the Tax liability or reducing any Tax asset of the Company or any of its Subsidiaries. (b) The Company and each of its Subsidiaries will establish or cause to be established in accordance with GAAP on or before the Effective Time an adequate accrual for all Taxes due with respect to any Pre-Closing Tax Period or applicable portion of the Straddle Period. (c) Neither the Company nor any of its Subsidiaries shall take any action that would reasonably be likely to prevent the Offer, the Exchange Offer and the Merger, taken together, from qualifying as a reorganization within the meaning of Section 368(a) of the Code ("368(a) Reorganization") and prior to the Effective Time, the Company and its Subsidiaries shall use their reasonable best efforts to cause the Offer, the Exchange Offer and the Merger, taken together, to qualify as a 368(a) Reorganization. The Company shall use its reasonable best efforts to cause Wachtell, Lipton, Rosen & Katz to provide an opinion, on the basis of certain facts, representations and assumptions set forth in such opinion, dated the 64 Effective Time, to the effect that the Offer, the Exchange Offer and the Merger, taken together, will be treated for federal income tax purposes as a 368(a) Reorganization and that each of Parent, Merger Co. and the Company will be a party to the reorganization within the meaning of Section 368(b) of the Code. The Company shall use its reasonable best efforts to provide to Wachtell, Lipton, Rosen & Katz and Milbank, Tweed, Hadley & McCloy LLP a certificate containing representations reasonably requested by such counsel in connection with the opinions to be delivered pursuant to this Section 7.06(c) and Section 8.10 hereof. Section 7.07. Affiliates At least 30 days prior to the Effective Time, the Company shall deliver to Parent a letter identifying all known Persons who may be deemed affiliates of the Company for the purposes of Rule 145 of the Securities Act. The Company shall use reasonable best efforts to obtain a written agreement from each Person who may be so deemed as soon as practicable and, in any event, prior to the Effective Time, substantially in the form of Exhibit A hereto. Section 7.08. Confidentiality The confidentiality agreements dated December 4, 2000 and December 18, 2000 between Parent and the Company (the "Confidentiality Agreements") shall continue in full force and effect prior to the Effective Time and after any termination of this Agreement. Section 7.09. Other Actions. The Company shall not, and shall not permit any of its Subsidiaries to, take any action that would, or that would reasonably be expected to, result in any of the conditions set forth in Article 10 not being satisfied. ARTICLE 8 COVENANTS OF PARENT Parent agrees that: Section 8.01. Parent Stockholder Meeting Parent shall cause a meeting of its stockholders (the "Parent Stockholder Meeting") to be duly called and held as soon as reasonably practicable for the purpose of voting on the issuance of Parent Common Stock in the Exchange Offer, the Merger and pursuant to Parent Options after the Merger. The Board of Directors of Parent shall recommend approval of the issuance of Parent Common Stock in the Exchange Offer and the Merger pursuant to this Agreement and shall not withdraw such recommendation. Section 8.02. Confidentiality The Confidentiality Agreements shall continue in full force and effect prior to the Effective Time and after any termination of this Agreement. Section 8.03. Voting Of Shares Each of Parent and Merger Co. agrees to vote, and to cause any of their subsidiaries to vote, all shares of Company Common Stock beneficially owned by them in favor of adoption of this Agreement at the Company Stockholder Meeting. Section 8.04. Director And Officer Liability For six years after the Effective Time, Parent will cause the Surviving Corporation to indemnify and hold harmless the present and former officers and directors of the Company in respect of acts or omissions occurring prior to the Effective Time to the extent provided under the Company's articles of incorporation and bylaws in effect on the date hereof; PROVIDED that such indemnification shall be subject to any 65 limitation imposed from time to time under applicable law. For six years after the Effective Time, Parent will cause the Surviving Corporation to use its best efforts to provide officers' and directors' liability insurance in respect of acts or omissions occurring prior to the Effective Time covering each such Person currently covered by the Company's officers' and directors' liability insurance policy on terms with respect to coverage and amount no less favorable than those of such policy in effect on the date hereof, PROVIDED that if the aggregate annual premiums for such insurance at any time during such period shall exceed 200% of the per annum rate of premium paid by the Company in its last full fiscal year for such insurance, then Parent shall cause the Surviving Corporation to provide only such coverage as shall then be available at an annual premium equal to 200% of such rate. Section 8.05. Employee Matters Parent agrees that, subject to applicable law, the Surviving Corporation and its Subsidiaries will provide benefits to its employees which will, in the aggregate, be comparable to those currently provided by Parent and its Subsidiaries to their employees; PROVIDED, however, that this Section 8.05 shall not apply to any employees represented for purposes of collective bargaining. Notwithstanding the foregoing, nothing herein shall otherwise limit the Surviving Corporation's right to amend, modify or terminate any Employee Plan. Section 8.06. Obligations of Merger Co Parent will take all action necessary to cause Merger Co. to perform its obligations under this Agreement and to consummate the Merger on the terms and conditions set forth in this Agreement. Section 8.07. NYSE Listing Parent shall use its reasonable best efforts to cause the shares of Parent Common Stock to be issued in connection with the Exchange Offer and the Merger to be listed on the NYSE, subject to official notice of issuance. Section 8.08. Acquisitions of Shares Neither Parent nor Merger Co. will acquire any shares of Company Common Stock prior to the Effective Time or the termination of this Agreement, other than shares of Company Common Stock purchased pursuant to the Offer or the Exchange Offer. Section 8.09. Notices of Certain Events Parent shall promptly notify the Company of: (a) any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the transactions contemplated by this Agreement; (b) any notice or other communication from any governmental or regulatory agency or authority in connection with the transactions contemplated by this Agreement; (c) any actions, suits, claims, investigations or proceedings commenced or, to the best of its knowledge threatened against, relating to or involving or otherwise affecting Parent or any of its subsidiaries which relate to the consummation of the transactions contemplated by this Agreement. Section 8.10. Reorganization Matters Neither Parent nor any Parent Subsidiary shall take any action that would reasonably be likely to prevent the Offer, the Exchange Offer and the Merger, taken together, from qualifying as a 368(a) Reorganization and prior to the Effective Time, Parent and the Parent Subsidiaries shall use their reasonable best efforts to cause the Offer, the Exchange Offer and the Merger, taken together, to qualify as a 368(a) Reorganization. Parent shall use its reasonable best efforts to cause Milbank, Tweed, Hadley & 66 McCloy LLP to provide an opinion, on the basis of certain facts, representations and assumptions set forth in such opinion, dated the Effective Time, to the effect that the Offer, the Exchange Offer and the Merger, taken together, will be treated for federal income tax purposes as a 368(a) Reorganization and that each of Parent, Merger Co. and the Company will be a party to the reorganization within the meaning of Section 368(b) of the Code. Parent shall use its reasonable best efforts to provide to Wachtell, Lipton, Rosen & Katz and Milbank, Tweed, Hadley & McCloy LLP a certificate containing representations reasonably requested by such counsel in connection with the opinions to be delivered pursuant to Section 7.06(c) hereof and this Section 8.10. Section 8.11. Information Relating to Offer Parent shall, and shall use its reasonable best efforts to cause any depository or agent effecting the Offer, to provide to the Company promptly as requested from time to time by the Company current information regarding the status of the Offer and the Exchange Offer and the number of shares tendered and not validly withdrawn. Section 8.12. Conduct of Parent From the date hereof until the Effective Time, Parent and its subsidiaries shall conduct their business in the ordinary course consistent with past practice and shall use their reasonable best efforts to preserve intact their business organizations and relationships with third parties and to keep available the services of their present officers and employees. Section 8.13. Voting Agreement Contemporaneous with the execution hereof, Parent shall cause to be delivered by Tyson Limited Partnership a voting agreement in the form attached hereto as Exhibit B. Section 8.14. Other Actions. Parent shall not, and shall not permit any Parent Subsidiary to, take any action that would, or that would reasonably be expected to, result in any of the conditions set forth in Article 10 not being satisfied. ARTICLE 9 COVENANTS OF PARENT AND THE COMPANY The parties hereto agree that: Section 9.01. Company Proxy Statement and Merger Form S-4 If Merger Co. does not own at least 90% of the issued and outstanding Company Common Stock following the Offer and the Exchange Offer, the Company shall promptly prepare the Company Proxy Statement and Parent shall promptly prepare and file with the SEC the Registration Statement on Form S-4, for shares of Parent Common Stock to be issued in the Merger, containing information required by Regulation S-K under the Exchange Act (the "Merger Form S-4"), in which the Company Proxy Statement will be included. The Company, Parent and Merger Co. shall cooperate with each other in the preparation of the Merger Form S-4 and any amendment or supplement thereto, and each shall notify the other of the receipt of any comments of the SEC with respect to the Merger Form S-4 and of any requests by the SEC for any amendment or supplement thereto or for additional information, and shall provide to the other promptly copies of all correspondence between Parent or the Company, as the case may be, or any of its Representatives and the SEC with respect to the Merger Form S-4. Parent shall give the Company and its counsel the opportunity to review the Merger Form S-4 and all responses to requests for additional information by and replies to comments of the SEC before their being filed with, or sent to, the SEC. Each of the Company, Parent and Merger Co. agrees to use its 67 best efforts, after consultation with the other parties hereto, to respond promptly to all such comments of and requests by the SEC. Each of the Company, Parent and Merger Co. shall use its reasonable best efforts to cause the Merger Form S-4 to be declared effective by the SEC as promptly as practicable. Parent shall promptly take any action (other than qualifying as a foreign corporation or taking any action which would subject it to service of process in any jurisdiction where Parent is not now so qualified or subject) required to be taken under foreign or state securities or Blue Sky laws in connection with the issuance of Parent Common Stock in the Merger. As promptly as practicable after the Merger Form S-4 shall have become effective, Parent and the Company shall fully cooperate with each other to cause the Proxy Statement/Prospectus contained in the Merger Form S-4 to be mailed to stockholders of the Company and Parent. Parent will advise Company, promptly after it receives notice thereof, of (i) the time when the Merger Form S-4 becomes effective, (ii) the issuance of any stop order with respect to the Merger Form S-4, (iii) the suspension of the qualification of Parent Common Stock for offering or sale in any jurisdiction, or (iv) any request by the SEC for an amendment of the Merger Form S-4 or comments thereon and responses thereto or requests by the SEC for additional information. Section 9.02. Certain Regulatory Issues Subject to the terms and conditions of this Agreement, each party will use its reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate the transactions contemplated by this Agreement. Subject to Section 7.04, each party shall also refrain from taking, directly or indirectly, any action contrary to or inconsistent with the provisions of this Agreement, including action which would interfere with the Offer or impair such party's ability to consummate the Merger and the other transactions contemplated hereby. Without limiting the foregoing, the Company and its Board of Directors shall use their reasonable best efforts to (a) take all action necessary so that no state takeover statute or similar statute or regulation is or becomes applicable to the Offer, Exchange Offer, the Merger or any of the other transactions contemplated by this Agreement and (b) if any state takeover statute or similar statute or regulation becomes applicable to any of the foregoing, take all action necessary so that the Offer, the Exchange Offer, the Merger and the other transactions contemplated by this Agreement may be consummated as promptly as practicable on the terms contemplated by this Agreement and otherwise to minimize the effect of such statute or regulation on the Offer, the Exchange Offer, the Merger and the other transactions contemplated by this Agreement. Parent shall take actions as may be necessary to eliminate any impediment under any antitrust, competition or trade regulation laws that may be asserted by any governmental entity with respect to the Offer, the Exchange Offer or the Merger so as to enable the Offer, the Exchange Offer and the Merger to occur as soon as reasonably practicable. Without limiting the generality of the foregoing, Parent shall agree to divest, hold separate, or agree to any conduct restrictions with respect to any Parent or Company assets or as may be required by any governmental entity in order to forego that governmental entity bringing any action to enjoin the Offer, the Exchange Offer or the Merger. 68 Section 9.03. Certain Filings (a) The Company and Parent shall use their respective reasonable best efforts to take or cause to be taken, (i) all actions necessary, proper or advisable by such party with respect to the prompt preparation and filing with the SEC of the Company Disclosure Documents and the Parent Disclosure Documents, and (ii) such actions as may be required to have the Company Proxy Statement cleared and the Merger Form S-4 declared effective by the SEC, in each case as promptly as practicable. (b) The Company and Parent shall cooperate with one another (i) in determining whether any action by or in respect of, or filing with, any governmental body, agency or official, or authority is required, or any actions, consents, approvals or waivers are required to be obtained from parties to any material contracts, in connection with or as a result of the consummation of the transactions contemplated by this Agreement and (ii) in seeking any such actions, consents, approvals or waivers or making any such filings, furnishing information required in connection therewith or with the Company Disclosure Documents and Parent Disclosure Documents and seeking timely to obtain any such actions, consents, approvals or waivers. Section 9.04. Public Announcements Parent and the Company will consult with each other before issuing any press release or making any public statement with respect to this Agreement and the transactions contemplated hereby and, except for any press release or public statement as may be required by applicable law or any listing agreement with any national securities exchange, will not issue any such press release or make any such public statement prior to such consultation. Section 9.05. Further Assurances At and after the Effective Time, the officers and directors of the Surviving Corporation will be authorized to execute and deliver, in the name and on behalf of the Company or Parent, any deeds, bills of sale, assignments or assurances and to take and do, in the name and on behalf of the Company or Parent, any other actions and things to vest, perfect or confirm of record or otherwise in the Surviving Corporation any and all right, title and interest in, to and under any of the rights, properties or assets of the Company acquired or to be acquired by the Surviving Corporation as a result of, or in connection with, the Merger. ARTICLE 10 CONDITIONS TO THE MERGER Section 10.01. Conditions to the Obligations of Each Party The obligations of the Company, Parent and Merger Co. to consummate the Merger are subject to the satisfaction of the following conditions: (a) this Agreement shall have been adopted by the stockholders of the Company and the issuance of Parent Common Stock in the Merger shall have been approved by the stockholders of Parent, each in accordance with Delaware Law; (b) any applicable waiting period under the HSR Act relating to the Offer and the Merger shall have expired or been terminated; (c) no provision of any applicable law or regulation and no judgment, injunction, order or decree shall prohibit or restrain the consummation of the Merger; PROVIDED, HOWEVER, that the Company and Parent shall each use its reasonable efforts to have any such judgment, order, decree or injunction vacated; (d) the Merger Form S-4 shall have been declared effective, no stop order suspending the effectiveness of the Merger Form S-4 shall be in effect and no proceedings for such purpose shall be pending before the SEC; and 69 (e) the shares of Parent Common Stock to be issued in the Merger shall have been approved for listing in the NYSE, subject to official notice of issuance. Section 10.02. Conditions to the Obligation of the Company The obligation of the Company to consummate the Merger is subject to Merger Co. having purchased pursuant to the Offer shares of Company Common Stock representing, together with shares of Company Common Stock previously owned by Parent, no less than 50.1% of the issued and outstanding shares of Company Common Stock. ARTICLE 11 TERMINATION Section 11.01. Termination This Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time prior to the Effective Time (notwithstanding any approval of this Agreement by the stockholders of the Company): (a) by mutual written consent of the Company and Parent; (b) (i) by the Company, if the Offer has not been consummated by February 28, 2001, provided that the Company is not then in breach in any material respect of any of its obligations under this Agreement; or (ii) by either the Company or Parent (but in case of Parent, only if no shares of Company Common Stock were purchased by Merger Co. pursuant to the Offer) if the Merger has not been consummated by May 31, 2001, provided that the party seeking to exercise such right is not then in breach in any material respect of any of its obligations under the Agreement; (c) by either the Company or Parent, if there shall be any law or regulation that makes acceptance for payment of, and payment for, the shares of Company Common Stock pursuant to the Offer, or consummation of the Merger illegal or otherwise prohibited or any judgment, injunction, order or decree enjoining Merger Co. from accepting for payment of, and paying for, the shares of Company Common Stock pursuant to the Offer, or Parent, Merger Co. or the Company from consummating the Merger is entered and such judgment, injunction, order or decree shall become final and nonappealable; (d) by Parent, prior to the purchase of the shares of Company Common Stock pursuant to the Offer, (i) if the Board of Directors of the Company shall have withdrawn, or modified or amended in a manner adverse to Parent, its approval or recommendation of this Agreement, the Offer, the Exchange Offer or the Merger or its recommendation that stockholders of the Company tender their shares of Company Common Stock pursuant to the Offer and the Exchange Offer, adopt and approve this Agreement and the Merger or approved, recommended or endorsed any proposal for a transaction other than the transactions hereunder (including a tender or exchange offer for shares of Company Common Stock) or, (ii) if the Company has failed to call the Company Stockholder Meeting or failed to mail the Company Proxy Statement to its stockholders within 20 days after the Merger Form S-4 is declared effective by the SEC or failed to include in such statement the recommendation referred to above; 70 (e) by the Company, if (i) the Board of Directors of the Company authorizes the Company, subject to complying with the terms of this Agreement, to enter into a binding written agreement concerning a transaction that constitutes a Superior Proposal and the Company notifies Parent in writing at least three business days prior to the proposed effectiveness of such termination that it intends to enter into such an agreement, attaching a description of the material terms and conditions thereof and permits Parent, within such three business day period to submit a new offer, which shall be considered by the Special Committee in good faith (it being understood that the Company shall not enter into any such binding agreement during such three business day period) and (ii) the Company prior to such termination pursuant to this clause (e) pays to Parent in immediately available funds the fees required to be paid pursuant to Section 7.04. The Company agrees to notify Parent promptly if its intention to enter into a written agreement referred to in its notification shall change at any time after giving such notification; (f) by Parent, prior to the acceptance for payment of the shares of Company Common Stock under the Offer, if there has been a breach by the Company of any representation, warranty, covenant or agreement contained in this Agreement that is not curable and such breach would give rise to a failure of the condition set forth in (d) or (e) of Annex I hereof; (g) by the Company, prior to the acceptance for payment of the shares of Company Common Stock under the Offer, if there has been a breach by Parent of any representation, warranty, covenant or agreement contained in this Agreement that is not curable and such breach would give rise to a failure of the condition set forth in (d) or (e) of Annex I hereof (which, for purposes of this Section 11.01(g) only shall apply mutatis mutandis to Parent); or (h) by either the Company or Parent if, at a duly held stockholders meeting of the Company or any adjournment thereof at which this Agreement and the Merger are voted upon, the requisite stockholder adoption and approval shall not have been obtained; PROVIDED, however, that Parent shall not have the right to terminate this Agreement or abandon the transactions contemplated hereby pursuant to this Section 11.01(h) if shares of Company Common Stock were purchased pursuant to the Offer. The party desiring to terminate this Agreement pursuant to Sections 11.01(b)-11.01(h) shall give written notice of such termination to the other party in accordance with Section 12.01. Section 11.02. Effect of Termination If this Agreement is terminated pursuant to Section 11.01, this Agreement shall become void and of no effect with no liability on the part of any party hereto, except that termination of this Agreement shall be without prejudice to any rights any party may have hereunder against any other party for breach of this Agreement; PROVIDED that, in the event of any such termination, no party shall under any circumstances have any monetary liability to any other party based upon a breach of any representation or warranty contained herein. The agreements contained in Sections 7.04, 7.08, 8.02, 11.02, 11.03, 12.04 and 12.06 shall survive the termination hereof. 71 Section 11.03. Parent Payment Event. If a Parent Payment Event (defined below) occurs, Parent shall pay to the Company a fee of $70 million simultaneously with the occurrence of such Parent Payment Event. "Parent Payment Event" means the termination of this Agreement (i) by Parent or the Company pursuant to Section 11.01(c) or (ii) by the Company pursuant to Section 11.01(b) if the inability to close results from the failure of the conditions set forth in clause (a) of Annex I hereto, provided, however, that, in each case, such termination results from any laws, regulation, judgment, injunction, order or decree with respect to any antitrust, competition or trade regulation laws that may be asserted by any governmental entity with respect to the Offer, the Exchange Offer or the Merger. ARTICLE 12 MISCELLANEOUS Section 12.01. Notices All notices, requests and other communications to any party hereunder shall be in writing (including telecopy or similar writing) and shall be given, if to Parent or Merger Co., to: John Tyson, Chairman of the Board, President and Chief Executive Officer Tyson Foods, Inc. 2210 West Oaklawn Drive Springdale, Arkansas 72762 Telecopy: 501-290-4028 with a copy to: Les Baledge, Esq. Tyson Foods, Inc. 2210 West Oaklawn Drive Springdale, Arkansas 72762 Telecopy: 501-290-4028 and with an additional copy to: Mel M. Immergut, Esq. Lawrence Lederman, Esq. Milbank, Tweed, Hadley & McCloy LLP 1 Chase Manhattan Plaza New York, New York 10005 Telecopy: 212-530-5219 if to the Company, to: Robert L. Peterson, Chairman of the Board and Chief Executive Officer, and JoAnn R. Smith, Chairperson of the Special Committee, c/o IBP, inc. 800 Stevens Port Drive Dakota Dunes, South Dakota 57049 Telecopy: 605-235-2427 72 with a copy to: Sheila B. Hagen, Esq. c/o IBP, inc. 800 Stevens Port Drive Dakota Dunes, South Dakota 57049 Telecopy: 605-235-2427 and with an additional copy to: Richard D. Katcher, Esq. Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 Telecopy: 212-403-2222 or such other address or telecopy number as such party may hereafter specify for the purpose by notice to the other parties hereto. Each such notice, request or other communication shall be effective (a) if given by telecopy, when such telecopy is transmitted to the telecopy number specified in this Section and the appropriate telecopy confirmation is received or (b) if given by any other means, when delivered at the address specified in this Section. Section 12.02. Survival of Representations and Warranties The representations and warranties and agreements contained herein and in any certificate or other writing delivered pursuant hereto shall not survive the Effective Time except for the representations, warranties and agreements set forth in Sections 7.04, 7.06(c), 8.04, 8.05, 8.10, 11.03, 12.04 and 12.06. Section 12.03. Amendments; No Waivers; Direction of Merger (a) Any provision of this Agreement may be amended or waived prior to the Effective Time if, and only if, such amendment or waiver is in writing and signed, in the case of an amendment, by each party to this Agreement or in the case of a waiver, by the party against whom the waiver is to be effective; PROVIDED that after the adoption of this Agreement by the stockholders of the Company, no such amendment or waiver shall, without the further approval of such stockholders, alter or change (i) the amount or kind of consideration to be received in exchange for any shares of capital stock of the Company or (ii) any of the terms or conditions of this Agreement if such alteration or change would adversely affect the rights of the holders of any shares of capital stock of the Company. (b) No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. (c) If the Company and Parent so agree at any time prior to the Effective Time, the Merger shall be effected such that Merger Co. will be merged with and into the Company with the Company as the "Surviving Corporation" for all purposes hereunder. In such event, the parties hereto shall execute an appropriate amendment to this Agreement to reflect the foregoing. 73 Section 12.04. Expenses Except as provided in Section 7.04, all costs and expenses incurred in connection with this Agreement shall be paid by the party incurring such cost or expense. Section 12.05. Successors and Assigns; Benefit The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, PROVIDED that no party may assign, delegate or otherwise transfer any of its rights or obligations under this Agreement without the consent of the other parties hereto except that Parent and Merger Co. may make such an assignment to one or more of their affiliates. Nothing in this Agreement, expressed or implied, shall confer on any Person other than the parties hereto, and their respective successors and assigns, any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except that the present and former officers and directors of the Company shall have the rights set forth in Section 8.04 hereof. Section 12.06. Governing Law This Agreement shall be construed in accordance with and governed by the law of the State of New York, except that, insofar as the procedures of the Merger that are subject to Delaware Law because the Parent, Merger Co. and the Company are incorporated in Delaware are concerned, the law of the State of Delaware shall apply. Section 12.07. Counterparts; Effectiveness This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement shall become effective when each party hereto shall have received counterparts hereof signed by all of the other parties hereto. 74 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written. IBP, INC. By: /s/ Jo Ann R. Smith --------------------------------- Name: Jo Ann R. Smith Title: Chairperson of the Special Committee, on behalf of the Special Committee TYSON FOODS, INC. By: /s/ John Tyson -------------------------------- Name: John Tyson Title: Chairman, President & CEO LASSO ACQUISITION CORPORATION By: /s/ John Tyson -------------------------------- Name: John Tyson Title: President 75 ANNEX I CONDITIONS TO THE OFFER The capitalized terms used in this Annex I shall have the meanings ascribed to them in the Agreement and Plan of Merger to which it is attached, except that the term "Merger Agreement" shall be deemed to refer to such Agreement and Plan of Merger. Notwithstanding any other provision of the Offer, Merger Co. shall not be required to accept for payment or, subject to any applicable rules and regulations of the SEC, including Rule 14e-1c under the Exchange Act (relating to Merger Co.'s obligation to pay for or return tendered shares of Company Common Stock promptly after termination or withdrawal of the Offer), pay for, and may (subject to any such rule or regulation) delay the acceptance for payment of any tendered shares of Company Common Stock, and may (except as provided in the Merger Agreement) amend or terminate the Offer as to any shares of Company Common Stock not then paid for, if (i) the condition that shares of Company Common Stock representing at least the Minimum Condition shall have been validly tendered and not properly withdrawn prior to the expiration of the Offer shall not have been satisfied, (ii) any applicable waiting period under the HSR Act shall not have expired or terminated prior to the expiration of the Offer or (iii) at any time on or after the date of the Merger Agreement and before the time of payment for any such shares of Company Common Stock (whether or not any shares of Company Common Stock have theretofore been accepted for payment or paid for pursuant to the Offer), any of the following events shall have occurred and remain in effect other than as a result of any action or inaction of Parent or any of its Subsidiaries that constitutes a breach of this Agreement: (a) there shall have been any law or order promulgated, entered, enforced, enacted, issued or deemed applicable to the Offer or the Merger by any court of competent jurisdiction or other competent governmental or regulatory authority which, directly or indirectly, (1) prohibits, or imposes any material limitations on, Parent's or Merger Co.'s ownership or operation (or that of any of their respective subsidiaries or affiliates) of any portion of their or the Company's businesses or assets which is material to the business of all such entities taken as a whole, or compels Parent or Merger Co. (or their respective subsidiaries or affiliates) to dispose of or hold separate any portion of their or the Company's business or assets which is material to the business of all such entities taken as a whole, (2) prohibits, restrains or makes illegal the acceptance for payment, payment for or purchase of shares of Company Common Stock pursuant to the Offer or the consummation of the Merger, (3) imposes material limitations on the ability of Merger Co. or Parent (or any of their respective subsidiaries or affiliates) effectively to acquire or to hold or to exercise full rights of ownership of the shares of Company Common Stock purchased pursuant to the Offer including, without limitation, the right to vote such shares of Company Common Stock on all matters properly presented to the Company's stockholders, (4) imposes material limitations on the ability of Merger Co. or Parent (or any of their respective subsidiaries or affiliates) effectively to control in any material respect any material portion of the business or assets of the Company and the Subsidiaries taken as a whole, or (5) otherwise materially adversely affects the Company and the Subsidiaries taken as a whole; PROVIDED, however, that actions or inactions agreed to be taken or not taken by Parent and Merger Co. in the Merger Agreement (including, without limitation, the agreements in 76 Section 9.02 of the Merger Agreement) shall not be deemed to be a satisfaction of the conditions set forth in this clause (a); (b) there shall have occurred (1) any general suspension of trading in, or limitation on prices for, securities on the New York Stock Exchange for a period in excess of 24 hours (excluding suspensions of limitations resulting solely from physical damage or interference with such exchange not related to market conditions or suspensions or limitations triggered by price fluctuations on a trading day), (2) a declaration of a banking moratorium or any suspension of payments in respect of banks in the United States (whether or not mandatory), (3) any limitation (whether or not mandatory) by any United States governmental or regulatory authority on the extension of credit by banks or other financial institutions, or (4) in the case of any of the foregoing existing at the time of the execution of the Merger Agreement, a material acceleration or worsening thereof; (c) except as disclosed in Schedule 5.10 of the Merger Agreement or in the Company SEC Reports filed prior to the date of the execution of the Merger Agreement, since such date, there shall have been any change, event or development having, or that could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company and the Subsidiaries taken as a whole; (d) except as affected by actions specifically permitted by this Agreement, the representations and warranties of the Company contained in this Agreement (x) that are qualified by materiality or Material Adverse Effect shall not be true at and as of the scheduled expiration of the Offer as if made at and as of such time (except in respect of representations and warranties made as of a specified date which shall not be true as of such specified date), and (y) that are not qualified by materiality or Material Adverse Effect shall not be true in all material respects at and as of the scheduled expiration date of the Offer as if made at and as of such time (except in respect of representations and warranties made as of a specific date which shall not be true in all material respects as of such specified date); (e) the Company shall not have performed and complied with, in all material respects, each agreement and covenant required by the Merger Agreement to be performed or complied with by it with such exceptions as would not in the aggregate have a Material Adverse Effect; (f) the Merger Agreement shall have been terminated in accordance with its terms; or (g) Parent, Merger Co. and the Company shall have agreed that Merger Co. shall amend the Offer to terminate the Offer or postpone the payment for shares of Company Common Stock thereunder; which in the reasonable good faith judgment of Parent and Merger Co., in any such case, and regardless of the circumstances makes it inadvisable to proceed with the Offer or with such acceptance for payment or payment. The foregoing conditions are for the sole benefit of Parent and Merger Co., may be asserted by Parent and Merger Co. regardless of the circumstances giving rise to any such condition and, subject to the terms and conditions of the Merger Agreement, may be waived by Parent and Merger Co., in whole or in part at any time and from time to time in the sole discretion of Parent and Merger Co. The failure by Parent and Merger Co. at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time. 77 ANNEX II CONDITIONS TO THE EXCHANGE OFFER The capitalized terms used in this Annex II shall have the meanings ascribed to them in the Agreement and Plan of Merger to which it is attached, except that the term "Merger Agreement" shall be deemed to refer to such Agreement and Plan of Merger. Notwithstanding any other provision of the Exchange Offer, Merger Co. shall not be required to accept for payment or, subject to any applicable rules and regulations of the SEC, including Rule 14e-1(c) under the Exchange Act (relating to Merger Co.'s obligation to pay for or return tendered shares of Company Common Stock promptly after termination or withdrawal of the Exchange Offer), pay for, and may (subject to any such rule or regulation) delay the acceptance for payment of any tendered shares of Company Common Stock, and may (except as provided in the Merger Agreement) amend or terminate the Exchange Offer as to any shares of Company Common Stock not then paid for, if (i) at least five business days have not elapsed since Merger Co. accepted for payment and paid for a number of shares of Company Common Stock pursuant to the Offer representing, together with shares of Company Common Stock previously owned by Parent, at least 50.1% of the issued and outstanding shares of Company Common Stock and delivered shares of Company Common Stock not accepted for payment in the Offer to the Depositary under the Exchange Offer or (ii) at any time on or after the date of the Merger Agreement and before the time of payment for any such shares of Company Common Stock (whether or not any shares of Company Common Stock have theretofore been accepted for payment or paid for pursuant to the Exchange Offer), any of the following events shall have occurred and remain in effect other than as a result of any action or inaction of Parent or any Parent Subsidiary that constitutes a breach of this Agreement: (a) there shall have been any law or order promulgated, entered, enforced, enacted, issued or deemed applicable to the Exchange Offer by any court of competent jurisdiction or other competent governmental or regulatory authority which, directly or indirectly, (1) prohibits, or imposes any material limitations on, Parent's or Merger Co.'s ownership or operation (or that of any of their respective subsidiaries or affiliates) of any portion of their or the Company's businesses or assets which is material to the business of all such entities taken as a whole, or compels Parent or Merger Co. (or their respective subsidiaries or affiliates) to dispose of or hold separate any portion of their or the Company's business or assets which is material to the business of all such entities taken as a whole, (2) prohibits, restrains or makes illegal the acceptance for payment, payment for or purchase of shares of Company Common Stock pursuant to the Exchange Offer or the consummation of the Merger, (3) imposes material limitations on the ability of Merger Co. or Parent (or any of their respective subsidiaries or affiliates) effectively to acquire or to hold or to exercise full rights of ownership of the shares of Company Common Stock purchased pursuant to the Exchange Offer including, without limitation, the right to vote such shares of Company Common Stock on all matters properly presented to the Company's stockholders, (4) imposes material limitations on the ability of Merger Co. or Parent (or any of their respective subsidiaries or affiliates) effectively to control in any material respect any material portion of the business or assets of the Company and the Subsidiaries taken as a whole, or (5) otherwise materially adversely affects the Company and the Subsidiaries taken as a whole; PROVIDED, however, that actions or inactions agreed to be taken or not 78 taken by Parent and Merger Co. in the Merger Agreement (including, without limitation, the agreements in Section 9.02 of the Merger Agreement) shall not be deemed to be a satisfaction of the conditions set forth in this clause (a); (b) the issuance of Parent Common Stock in the Exchange Offer and the Merger shall not have been approved by the stockholders of Parent, in accordance with Delaware Law; (c) the shares of Parent Common Stock to be issued in the Exchange Offer and the Merger shall not have been approved for listing on the NYSE, subject to official notice of issuance; (d) the Merger Agreement shall have been terminated in accordance with its terms; (e) Parent, Merger Co. and the Company shall have agreed that Merger Co. shall amend the Exchange Offer to terminate the Exchange Offer or postpone the payment for shares of Company Common Stock thereunder; or (f) the Exchange Form S-4 shall not have been declared effective by the SEC or the SEC has suspended effectiveness of, or issued a stop order with respect to, the Exchange Form S-4 which suspension or stop order has not been lifted; which in the reasonable good faith judgment of Parent and Merger Co., in any such case, and regardless of the circumstances makes it inadvisable to proceed with the Exchange Offer or with such acceptance for payment or payment. The foregoing conditions are for the sole benefit of Parent and Merger Co., may be asserted by Parent and Merger Co. regardless of the circumstances giving rise to any such condition and, subject to the terms and conditions of the Merger Agreement, may be waived by Parent and Merger Co., in whole or in part at any time and from time to time in the sole discretion of Parent and Merger Co. The failure by Parent and Merger Co. at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time. 79 ANNEX III TERMINATED TENDER OFFER/CASH ELECTION MERGER In accordance with Section 3.06 of the Agreement, in the event of a Terminated Tender Offer, the Agreement shall be amended as follows: Section 1. The table of definitions is amended to insert the following defined terms in correct alphabetical order: TERM SECTION Allocation Date 3.03(b) Cash Consideration 3.02(c) Cash Election 3.03(a) Cash Election Shares 3.02(c) Cash Fraction 3.02(d) Dissenting Shares 3.02(e) Election Deadline 3.03(a) Election Form 3.03(a) Exchange Agent 3.03(a) No-Election Shares 3.03(a) Stock Consideration 3.02(c) Stock Election 3.03(a) Stock Fraction 3.02(d) Section 2. Clause (c) of Section 3.02 of the Agreement shall be amended and restated in its entirety as follows: (c) holders of Company Common Stock (other than Parent, Merger Co. and holders who properly perfect appraisal rights under Section 262 of the Delaware Law) outstanding immediately prior to the Effective Time shall have the right to elect to receive from Parent for each share of Company Common Stock either (i) $30.00 in cash (the "Cash Consideration") (such shares for which such election is made to be referred to as the "Cash Election Shares"), (ii) a number of shares (such shares for which such election is made to be referred to as the "Stock Election Shares") of Parent Common Stock (the "Stock Consideration") equal to the Exchange Ratio (as defined below) or (iii) a combination of both. For purposes of this Section 3.02(c), "Exchange Ratio" shall mean a number equal to: (i) If the Average Parent Common Stock Price is equal to or greater than $15.40, the Exchange Ratio shall be 1.948 shares of Parent Common Stock; (ii) If the Average Parent Common Stock Price is less than $15.40 and greater than $12.60, the Exchange Ratio shall be determined by dividing $30.00 by the Average Parent Common Stock Price; and (iii) If the Average Parent Common Stock Price is equal to or less than $12.60 the Exchange Ratio shall be 2.381 shares of Parent Common Stock. For purposes of this Section 3.02, "Average Parent Common Stock Price" means the average of the closing price per share of Parent Common Stock on the New York Stock Exchange, Inc. (the "NYSE") at the end of the regular session as reported on the Consolidated Tape, Network A for the fifteen consecutive trading days ending on the fifth trading day immediately preceding the Effective Time. For purposes of this Agreement, Cash Consideration, Stock Consideration and any combination of the both shall be collectively referred to herein as "Merger Consideration". 80 Section 3. New clauses (d) and (e) shall be inserted in Section 3.02 of the Agreement which states as follows: (d) (i) In the event that holders of shares of Company Common Stock who hold, in the aggregate, a number of shares of Company Common Stock which represents, together with shares of Company Common Stock owned by Parent and Dissenting Shares, if any, more than 50.1% of the issued and outstanding shares of Company Common Stock, have made a Cash Election (as defined in Section 3.03(a)), then (A) each Cash Election Share shall be converted into the right to receive (1) an amount equal to the Cash Consideration multiplied by a fraction the numerator of which shall be 50.1% and the denominator of which shall be the sum of (x) the percentage of outstanding shares of Company Common Stock owned by Parent, (y) the percentage of outstanding shares of Company Common Stock which are Dissenting Shares and (z) the percentage of outstanding shares of Company Common Stock making a Cash Election (such fraction, the "Cash Fraction") and (2) a number of shares of Parent Common Stock equal to the Stock Consideration multiplied by a fraction equal to 1 minus the Cash Fraction and (B) all No Election Shares and Stock Election Shares shall be converted into the right to receive the Stock Consideration. (ii) In the event that holders of shares of Company Common Stock who hold more than 49.9% of the issued and outstanding shares of Company Common Stock have made a Stock Election (as defined in Section 3.03(a)), then (A) each Stock Election Share shall be converted into the right to receive (1) a number of shares of Parent Common Stock equal to the Stock Consideration multiplied by a fraction the numerator of which shall be 49.9% and the denominator of which shall be the percentage of outstanding shares of Company Common Stock making a Stock Election (such fraction, the "Stock Fraction") and (2) an amount in cash equal to the Cash Consideration multiplied by a fraction equal to 1 minus the Stock Fraction and (B) all No Election Shares and Cash Election Shares shall be converted into the right to receive the Cash Consideration. (iii) In the event neither of the foregoing clauses (i) or (ii) is applicable, each holder of shares of Company Common Stock that elects to receive Parent Common Stock will receive the Stock Consideration in the Merger and each holder of shares of Company Common Stock that elects to receive cash will receive the Cash Consideration in the Merger and each No Election Share, if any, shall be converted into the right to receive in the Merger (1) a number of shares of Parent Common Stock equal to the Stock Consideration multiplied by a fraction the numerator of which shall equal the difference between (x) 49.9% and the Stock Fraction and the denominator of which shall equal the percentage of outstanding shares of Company Common Stock which are No Election Shares and (2) an amount in cash equal to the Cash Consideration multiplied by a fraction the numerator of which shall equal the difference between (x) 50.1% and (y) the Cash Fraction and the denominator of which shall equal the percentage of outstanding shares of Company Common Stock which are No Election Shares. 81 (e) Notwithstanding Section 3.02, shares of Company Common Stock which are issued and outstanding immediately prior to the Effective Time and which are held by a holder who has not voted such shares of Company Common Stock in favor of the Merger, who shall have delivered a written demand for appraisal of such Shares in the manner provided by the Delaware Law and who, as of the Effective Time, shall not have effectively withdrawn or lost such right to appraisal (the "Dissenting Shares") shall not be converted into a right to receive the Merger Consideration. The holders thereof shall be entitled only to such rights as are granted by Section 262 of the Delaware Law. Each holder of Dissenting Shares who becomes entitled to payment for such shares of Company Common Stock pursuant to Section 262 of the Delaware Law shall receive payment therefor from the Surviving Corporation in accordance with the Delaware Law; PROVIDED, HOWEVER, that (i) if any such holder of Dissenting Shares shall have failed to establish his entitlement to appraisal rights as provided in Section 262 of the Delaware Law, (ii) if any such holder of Dissenting Shares shall have effectively withdrawn his demand for appraisal of such shares of Company Common Stock or lost his right to appraisal and payment for his shares of Company Common Stock under Section 262 of the Delaware Law or (iii) if neither any holder of Dissenting Shares nor the Surviving Corporation shall have filed a petition demanding a determination of the value of all Dissenting Shares within the time provided in Section 262 of the Delaware Law, such holder shall forfeit the right to appraisal of such shares of Company Common Stock and each such share shall be treated as if it had been converted, as of the Effective Time, into a right to receive the Merger Consideration, without interest thereon, from the Surviving Corporation as provided in Section 3.02 hereof. The Company shall give Parent prompt notice of any demands received by the Company for appraisal of shares of Company Common Stock, and Parent shall have the right to participate in all negotiations and proceedings with respect to such demands. The Company shall not, except with the prior written consent of Parent, make any payment with respect to, or settle or offer to settle, any such demands. Section 4. Section 3.03 of the Agreement shall be amended as follows: (i) clause (a) shall be amended and restated in its entirety as stated below; (ii) new clauses (b) and (c) shall be inserted as stated below; and (iii) current clauses (b), (c), (d) and (e) shall be renamed (d), (e), (f) and (g), respectively. (a) Prior to the Effective Time, Parent shall appoint an agent reasonably acceptable to the Company (the "Exchange Agent") for the Purpose of exchanging certificates representing shares of Company Common Stock for the Merger Consideration. Parent shall cause Merger Co. to make available to the Exchange Agent, as soon as reasonably practicable as of or after the Effective Time, the Merger Consideration to be delivered in respect of the shares of Company Common Stock. At the time of the mailing of the Proxy Statement/Prospectus provided for in Section 9.01, Parent will cause the Exchange Agent to send to each holder of shares of Company Common Stock on the record date for the meeting of stockholders of the Company a letter of transmittal and cash election form (collectively, the "Election Form") and other appropriate materials providing for such holder, subject to the provisions of Section 3.02(d), (i) to elect to receive the Stock Consideration with respect to all or any portion of such holder's shares of Company Common Stock ("Stock 82 Election") or (ii) to elect to receive the Cash Consideration with respect to all or any portion of such holder's shares of Company Common Stock ("Cash Election"). As of the Election Deadline (as hereinafter defined), any shares of Company Common Stock(other than Dissenting Shares and shares owned by Parent) with respect to which there shall not have been made any election by submission to the Exchange Agent of an effective, properly completed Election Form shall be deemed to be "No-Election Shares". (i) Any election to receive the Cash Consideration or the Stock Consideration shall have been validly made only if the Exchange Agent shall have received by 5:00 p.m., New York City time, on the business day preceding the meeting of stockholders of the Company provided for in Section 7.02 (the "Election Deadline"), an Election Form properly completed. An election by a holder of shares of Company Common Stock shall be validly made only if the Exchange Agent shall have received an Election Form properly completed and executed (with the signature or signatures thereon guaranteed if required by the Election Form) by such holder of shares of Company Common Stock. Parent shall have the right to make reasonable determinations and to establish reasonable procedures (not inconsistent with the terms of this Agreement) in guiding the Exchange Agent in its determination as to the validity of Election Forms and of any revision, revocation or withdrawal thereof. (ii) Two or more holders of shares of Company Common Stock who are determined to constructively own such shares owned by each other by virtue of Section 318(a) of the Code and who so certify to Parent's satisfaction, and any single holder of shares of Company Common Stock who holds such shares in two or more different names and who so certifies to Parent's satisfaction, may submit a joint Election Form covering the aggregate shares of Company Common Stock owned by all such holders or by such single holder, as the case may be. For all purposes of this Agreement, each such group of holders which, and each such single holder who, submits a joint Election Form shall be treated as a single holder of shares of Company Common Stock. (iii) Record holders of shares of Company Common Stock who are nominees only may submit a separate Election Form for each beneficial owner for whom such record holder is a nominee; provided, however, that at the request of Parent, such record holder shall certify to the satisfaction of Parent that such record holder holds such shares as nominee for the beneficial owner thereof. For purposes of this Agreement, each beneficial owner for which an Election Form is submitted will be treated as a separate holder of shares of Company Common Stock subject, however, to the immediately preceding paragraph (ii) dealing with joint Election Forms. (iv) Any holder of shares of Company Common Stock who has made an election by submitting an Election Form to the Exchange Agent may at any time prior to the Election Deadline change such holder's election by submitting a revised Election Form, properly completed and signed, that is received by the Exchange Agent prior to the Election Deadline. Any holder of shares of Company Common Stock may at any time prior to the Election Deadline revoke such holder's election by written notice to the Exchange Agent received at any time prior to the Election Deadline. (b) As soon as practicable after the Election Deadline (the "Allocation Date"), the Exchange Agent shall effectuate the allocation among holders of shares of Company Common Stock of rights to receive the Stock Consideration or the Cash Consideration in the Merger in accordance with the terms of this Section 3.03(b). As is more fully 83 set forth above, the number of shares of Company Common Stock to be converted in the Merger into the right to receive cash may not exceed a number of shares of Company Common Stock which, together with shares of Company Common Stock owned by Parent and Dissenting Shares, exceeds 50.1% of the outstanding shares of Company Common Stock. The number of shares of Company Common Stock to be converted in the Merger into the Stock Consideration shall not exceed 49.9% of the total number of outstanding shares of Company Common Stock. The Exchange Agent shall determine the percentages of the Cash Election Shares, the Stock Election Shares and the No Election Shares. (c) No certificates or scrip for fractional shares of Parent Common Stock will be issued, no Parent stock split or dividend shall relate to any fractional share interest, and no such fractional share interest shall entitle the owner thereof to vote or to any rights of or as a stockholder of Parent. In lieu of such fractional shares, any holder of Company Common Stock who would otherwise be entitled to a fraction of a share of Parent Common Stock (or any other person who is the record holder of certificates for shares of Parent Common Stock into which such shares of Company Common Stock have been converted) will, upon surrender of his certificate or certificates, be paid the cash value of such fraction (without interest and rounded to the nearest cent), which shall be equal to the fraction multiplied by the Average Parent Common Stock Price, which shall be deemed to represent the market value of a full share of Parent Common Stock. Section 5. Clause (a) of Section 3.04 of the Agreement shall be amended and restated in its entirety as follows: (a) At or immediately prior to the Effective Time, each employee stock option or director stock option to purchase shares of Company Common Stock outstanding under any Company stock option plans, whether or not vested or exercisable (each, a "Company Option") shall, by virtue of the Merger and without any further action on the part of any holder thereof, be assumed by Parent and deemed to constitute an option (each, a "Parent Option") to acquire, on the same terms and conditions as were applicable under such Company Option (subject to Section 3.04(b)), the same number of shares of Parent Common Stock as the holder of such Company Option would have been entitled to receive pursuant to Section 3.02(c) of this Agreement had such holder exercised such Company Option in full immediately prior to the Effective Time (rounded to the nearest whole number) and received only Stock Consideration in the Merger, at a price per share (rounded down to the nearest whole cent) equal to (x) the aggregate exercise price for the share of Company Common Stock otherwise purchasable pursuant to such Company Option divided by (y) the number of whole shares of Parent Common Stock purchasable pursuant to the Parent Option in accordance with the foregoing. The other terms of each such Company Option, and the plans under which they were issued, shall continue to apply in accordance with their terms. Section 6. The introduction of Section 7.01 of the Agreement shall be amended and restated in its entirety as follows (with clauses (a) through(i) remaining unchanged): From the date hereof until the Effective Time, except as contemplated in this Agreement, the Company and the Subsidiaries shall conduct their business in the ordinary course consistent with past practice and shall use their reasonable best efforts to preserve intact their business organizations and relationships with third 84 parties and to keep available the services of their present officers and employees. Without limiting the generality of the foregoing, except as set forth in Schedule 7.01, from the date hereof until the Effective Time and unless consented to in writing by Parent, the Company will not and will cause its Subsidiaries not to: Section 7. Section 7.02 of the Agreement shall be amended and restated in its entirety as follows: Section 7.02. Stockholder Meeting The Company shall cause a meeting of its stockholders (the "Company Stockholder Meeting") to be duly called and held, as soon as reasonably practicable following the date hereof, for the purpose of voting on the approval and adoption of this Agreement and the Merger. Subject to Section 7.04, the Board of Directors of the Company shall recommend approval and adoption of this Agreement and the Merger by the Company's stockholders and shall not withdraw such recommendation. Section 8. In the first proviso of Section 7.04 of the Agreement, the words "PROVIDED, however, that, prior to the acceptance for payment of shares of Company Common Stock pursuant to the Offer representing together with shares of Company Common Stock already owned by Parent at least 50.1% of the shares of Company Common Stock outstanding" shall be deleted and replaced with "PROVIDED, however, that, prior to the Effective Time", and the remainder of such section shall be unchanged. Section 9. Section 10.01(b) of the Agreement shall be amended and restated in its entirety as follows: (b) any applicable waiting period under the HSR Act relating to the Merger shall have expired or been terminated; Section 10. Section 10.02 of the Agreement shall be amended and restated in its entirety as follows: Section 10.02. Conditions to the Obligation of the Company The obligation of the Company to consummate the Merger is subject to the satisfaction of the following further condition: (a) except as affected by actions specifically permitted by this Agreement, the representations and warranties of Parent contained in this Agreement (x) that are qualified by materiality or Parent Material Adverse Effect shall be true at and as of the Effective Time as if made at and as of such time (except in respect of representations made as of a specified date which shall be required to be true as of such specified date), and (y) that are not qualified by materiality or Parent Material Adverse Effect shall be true in all material respects at and as of the Effective Time as if made at and as of such time (except in respect of representations and warranties made as of a specific date which shall be true in all material respects as of such specified date); and (b) Parent shall have performed and complied with each agreement and covenant required by this Agreement to be performed or complied with by it with such exceptions as would not in the aggregate have a Parent Material Adverse Effect. Section 14. Inserted in the Agreement is a new Section 10.03 which states as follows: Section 10.03. Conditions to the Obligations of Parent and Merger Co. 85 The obligations of Parent and Merger Co. to consummate the Merger are subject to the satisfaction of the following conditions: (a) there shall not have been any law or order promulgated, entered, enforced, enacted, issued or deemed applicable to the Merger by any court of competent jurisdiction or other competent governmental or regulatory authority which, directly or indirectly, (1) prohibits, or imposes any material limitations on, Parent's or Merger Co.'s ownership or operation (or that of any of their respective subsidiaries or affiliates) of any portion of their or the Company's businesses or assets which is material to the business of all such entities taken as a whole, or compels Parent or Merger Co. (or their respective subsidiaries or affiliates) to dispose of or hold separate any portion of their or the Company's business or assets which is material to the business of all such entities taken as a whole, (2) imposes material limitations on the ability of Merger Co. or Parent (or any of their respective subsidiaries or affiliates) effectively to control in any material respect any material portion of the business or assets of the Company and the Subsidiaries taken as a whole, or (3) otherwise materially adversely affects the Company and the Subsidiaries taken as a whole; PROVIDED, however, that actions or inactions agreed to be taken or not taken by Parent and Merger Co. in this Agreement (including, without limitation, the agreements in Section 9.02 of this Agreement) shall not be deemed to be a satisfaction of the conditions set forth in this clause (a); (b) there shall not be in place (1) any general suspension of trading in, or limitation on prices for, securities on the New York Stock Exchange for a period in excess of 24 hours (excluding suspensions of limitations resulting solely from physical damage or interference with such exchange not related to market conditions or suspensions or limitations triggered by price fluctuations on a trading day), (2) a declaration of a banking moratorium or any suspension of payments in respect of banks in the United States (whether or not mandatory), (3) any limitation (whether or not mandatory) by any United States governmental or regulatory authority on the extension of credit by banks or other financial institutions, or (4) in the case of any of the foregoing existing at the time of the execution of this Agreement, a material acceleration or worsening thereof; (c) except as affected by actions specifically permitted by this Agreement, the representations and warranties of the Company contained in this Agreement (x) that are qualified by materiality or Material Adverse Effect shall be true at and as of the Effective Time as if made at and as of such time (except in respect of representations made as of a specified date which shall be required to be true as of such specified date), and (y) that are not qualified by materiality or Material Adverse Effect shall be true in all material respects at and as of the Effective Time as if made at and as of such time (except in respect of representations and warranties made as of a specific date which shall be true in all material respects as of such specified date); and (d) the Company shall have performed and complied with each agreement and covenant required by this Agreement to be performed or complied with by it with such exceptions as would not in the aggregate have a Material Adverse Effect. 86 EXHIBIT A [Form of Affiliate's Agreement] [Date] Tyson Foods, Inc. 2210 West Oaklawn Drive Springdale, Arkansas 72762 Ladies and Gentlemen: I have been advised that as of the date hereof I may be deemed to be an "affiliate" of IBP, inc., a Delaware corporation (the "Company"), as that term is defined for purposes of paragraphs (c) and (d) of Rule 145 of the rules and regulations (the "Rules and Regulations") of the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"). Neither my entering into this agreement, nor anything contained herein, shall be deemed an admission on my part that I am such an "affiliate". Pursuant to the terms of the Agreement and Plan of Merger dated as of January __, 2001 (the "Merger Agreement"), among , Tyson Foods, Inc. a Delaware corporation ("Parent"), Lasso Acquisition Corporation, a Delaware corporation ("Merger Co."), and the Company providing for the merger of the Company with and into Merger Co. (the "Merger"), and as a result of the Merger, I may receive shares of Parent's Class A Common Stock, par value $0.10 per share (the "Parent Securities"), in exchange for the shares of common stock, par value $0.05 per share, of the Company owned by me at the Effective Time (as defined in the Merger Agreement) of the Merger. I represent and warrant to Parent that in such event: A. I shall not make any sale, transfer or other disposition of the Parent Securities in violation of the Act or the Rules and Regulations. B. I have carefully read this letter and the Merger Agreement and discussed its requirements and other applicable limitations upon my ability to sell, transfer or otherwise dispose of Parent Securities, to the extent I felt necessary, with my counsel or counsel for the Company. C. I have been advised that the issuance of Parent Securities to me pursuant to the Merger has been registered with the Commission under the Act on a Registration Statement on Form S-4. However, I have also been advised that, since at the time the Merger was submitted for a vote of the stockholders of the Company I may have been deemed to have been an affiliate of the Company and a distribution by me of Parent Securities has not been registered under the Act, the Parent Securities must be held by me indefinitely unless (i) a distribution of Parent Securities by me has been registered under the Act, (ii) a sale of Parent Securities by me is made in conformity with the volume and other limitations of Rule 145 promulgated by the Commission under the Act or (iii) in the opinion of counsel reasonably acceptable to Parent, some other exemption from registration is available with respect to a proposed sale, transfer or other disposition of the Parent Securities by me. D. I understand that Parent is under no obligation to register the sale, transfer or other disposition of Parent Securities by me or on my behalf or to take any other action necessary in order to make compliance with an exemption from registration available. 87 E. I also understand that stop transfer instructions will be given to Parent's transfer agents with respect to the Parent Securities and that there will be placed on the certificates for the Parent Securities, or any substitutions therefor, a legend stating in substance. "The shares represented by this certificate were issued in a transaction to which Rule 145 promulgated under the Securities Act of 1933, as amended, applies." F. I also understand that unless the transfer by me of my Parent Securities has been registered under the Act or is a sale made in conformity with the provisions of Rule 145, Parent reserves the right to put the following legend on the certificates issued to my transferee: "The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended, and were acquired from a person who received such shares in a transaction to which Rule 145 promulgated under such Act applies. The shares have been acquired by the holder not with a view to, or for resale in connection with, any distribution thereof within the meaning of such Act and may not be sold, pledged or otherwise transferred except in accordance with an exemption from the registration requirements of such Act." 88 It is understood and agreed that the legends set forth in paragraph E and F above shall be removed by delivery of substitute certificates without such legend if the undersigned shall have delivered to Parent a copy of a letter from the staff of the Commission, or an opinion of counsel reasonably acceptable to Parent to the effect that such legend is not required for purposes of the Act. Very truly yours, _______________________________ Name: Accepted this ____ day of __________, ____, by: TYSON FOODS, INC. By____________________________ Name: Title: 89 EXHIBIT B VOTING AGREEMENT In consideration of Tyson Foods, Inc., a Delaware corporation ("Parent"), and Lasso Acquisition Corporation, a Delaware corporation and wholly-owned subsidiary of Parent ("Merger Co."), entering into on the date hereof an Agreement and Plan of Merger (the "Merger Agreement") dated as of the date hereof with IBP, inc., a Delaware corporation (the "Company"), the undersigned holder (the "Stockholder") of shares of Schedule A Securities (as defined below) agrees with the Company as follows: 1. During the period (the "Agreement Period") beginning on the date hereof and ending on the earlier of (i) the date of any substantive amendment to the Merger Agreement which has not been approved in writing by the Stockholder and (ii) the date of termination of the Merger Agreement, the Stockholder hereby agrees to vote all shares of Parent's Class B Common Stock owned by the Stockholder to approve the issuance of Parent's Class A Common Stock with respect to the Exchange Offer and the Merger at the Parent Stockholder Meeting (each as defined in the Merger Agreement), and at any adjournment thereof or pursuant to action by written consent, at or by which such action is submitted for the consideration and vote of the stockholders of Parent. 2. The Stockholder hereby represents and warrants to the Company that as of the date hereof: (a) The Stockholder (i) owns beneficially all of the shares of Parent's Class B Common Stock set forth opposite its name in Schedule A hereto (the "Schedule A Securities"), and no other shares of Parent's Class B Common Stock, (ii) has the full and unrestricted legal power, authority and right to enter into, execute and deliver this Voting Agreement without the consent or approval of any other person and (iii) has not entered into any voting agreement with or granted any person any proxy (revocable or irrevocable) with respect to such shares (other than this Voting Agreement). (b) This Voting Agreement is the valid and binding agreement of the Stockholder. (c) No investment banker, broker or finder is entitled to a commission or fee from the Stockholder or Parent in respect of this Agreement based upon any arrangement or agreement made by or on behalf of the Stockholder. 3. If any provision of this Voting Agreement shall be invalid or unenforceable under applicable law, such provision shall be ineffective to the extent of such invalidity or unenforceability only, without in any way affecting the remaining provisions of this Voting Agreement. 4. This Voting Agreement may be executed in two or more counterparts each of which shall be an original with the same effect as if the signatures hereto and thereto were upon the same instrument. 90 5. The parties hereto agree that if for any reason any party hereto shall have failed to perform its obligations under this Voting Agreement, then the party seeking to enforce this Agreement against such non- performing party shall be entitled to specific performance and injunctive and other equitable relief, and the parties hereto further agree to waive any requirement for the securing or posting of any bond in connection with the obtaining of any such-injunctive or other equitable relief. This provision is without prejudice to any other rights or remedies, whether at law or in equity, that any party hereto may have against any other party hereto for any failure to perform its obligations under this Voting Agreement. 6. This Voting Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. 7. The Stockholder will, upon request, execute and deliver any additional documents deemed by Parent to be necessary or desirable to complete and effectuate the covenants contained herein. 8. This Agreement shall terminate upon the termination of the Agreement Period. 9. The Stockholder hereby agrees that if it sells, transfers, assigns, encumbers or otherwise disposes (each, a "Transfer") of any Schedule A Securities (whether to an affiliate or otherwise) during the Agreement Period, such Stockholder shall require the transferee of such Schedule A Securities to execute and deliver to the Company a voting agreement identical in form to this Voting Agreement except for the identity of the Stockholder prior to or concurrent with the consummation of such Transfer. The Company understands and acknowledges that, subject to the preceding sentence, the Stockholder is free to Transfer any Schedule A Securities at such times and in such manner as it deems appropriate. 10. Nothing in this Agreement, express or implied, shall confer on any person other than the parties hereto, and their respective successors and assigns, any rights, remedies, obligations, or liabilities under or by reason of this Agreement. 11. All notices, requests and other communications to any party hereunder shall be in writing (including telecopy or similar writing) and shall be given, If to the Company, to: Robert L. Peterson, Chairman of the Board and Chief Executive Officer, and JoAnn R. Smith, Chairperson of the Special Committee, c/o IBP, inc. 800 Stevens Port Drive Dakota Dunes, South Dakota 57049 Telecopy: (605) 235-2427 91 with a copy to: Sheila B. Hagen, Esq. c/o IBP, inc. 800 Stevens Port Drive Dakota Dunes, South Dakota 57049 Telecopy: (605) 235-2427 and with an additional copy to: Richard D. Katcher, Esq. Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019 Telecopy: (212) 403-2222 If to the Stockholder: Don Tyson Tyson Limited Partnership 2210 West Oaklawn Drive Springdale, AR 72762-6999 (501) 290-4028 with a copy to: Les Baledge, Esq. Tyson Foods, Inc. 2210 West Oaklawn Drive Springdale, AR 72762-6999 (501) 290-4028 or such other address or telecopy or telephone number as such party may hereafter specify for the purpose by notice to the other parties hereto. Each such notice, request or other communication shall be effective (a) if given by telecopy, when such telecopy is transmitted to the telecopy number specified in this Section and the appropriate telecopy confirmation is received or (b) if given by any other means, when delivered at the address specified in this Section. 92 IN WITNESS WHEREOF, the parties hereto have executed this Voting Agreement as of the [______] day of January, 2001. IBP, inc. By:___________________________ Name: Title: TYSON LIMITED PARTNERSHIP By: /s/ Don Tyson --------------------------- Name: Don Tyson Title: Managing General Partner 93 SCHEDULE A SHARES OF TYSON STOCKHOLDER CLASS B COMMON STOCK Tyson Limited Partnership 102,598,560 94 EX-10.1 3 0003.txt CREDIT AGREEMENT CREDIT AGREEMENT dated as of January 12, 2001 among TYSON FOODS, INC., as Borrower THE BANKS PARTY HERETO THE CHASE MANHATTAN BANK, as Administrative Agent MERRILL LYNCH CAPITAL CORPORATION, as Syndication Agent and SUNTRUST BANKS, INC., as Documentation Agent _______________________________ SUNTRUST EQUITABLE SECURITIES CORPORATION as Arranger JP MORGAN MERRILL LYNCH & CO., as Joint Lead Arrangers and Joint Book Managers 95 ARTICLE I Definitions and Accounting Terms SECTION 1.01. Certain Defined Terms 1 SECTION 1.02. Computation of Time Periods 11 SECTION 1.03. Accounting Matter 11 SECTION 1.04. Certain Terms 11 ARTICLE II Amounts and Terms of the Loans SECTION 2.01. Amounts and Terms of Commitments 11 SECTION 2.02. Procedure for Committed Borrowing 12 SECTION 2.03. Bid Borrowings 12 SECTION 2.04. Procedure for Bid Borrowings 13 SECTION 2.05. Evidence of Indebtedness 14 SECTION 2.06. Termination and Reduction of the Commitments 15 SECTION 2.07. Optional Prepayments 15 SECTION 2.08. Repayment 16 SECTION 2.09. Interest 16 SECTION 2.10. Default Interest 16 SECTION 2.11. Continuation and Conversion Elections for Committed Borrowings 16 ARTICLE III Fees; Payments; Taxes; Changes in Circumstances SECTION 3.01. Fees 17 SECTION 3.02. Computation of Fees and Interest 18 SECTION 3.03. Payments by the Borrower 18 SECTION 3.04. Payments by the Banks to the Administrative Agent 19 SECTION 3.05. Taxes 19 SECTION 3.06. Sharing of Payments, Etc 22 SECTION 3.07. Inability to Determine Rates 22 SECTION 3.08. Increased Costs 23 SECTION 3.09. Illegality 23 SECTION 3.10. Capital Adequacy 23 SECTION 3.11. Funding Losses 24 SECTION 3.12. Additional Interest on Eurodollar Loans 24 SECTION 3.13. Certificates of Banks 24 SECTION 3.14. Change of Lending Office; Replacement Bank 24 ARTICLE IV Representations and Warranties SECTION 4.01. Corporate Existence; Compliance with Law 25 SECTION 4.02. Corporate Authorization; No Contravention; Governmental Authorization 25 SECTION 4.03. Enforceable Obligations 26 SECTION 4.04. Taxes 26 SECTION 4.05. Financial Matters 26 SECTION 4.06. Litigation 27 SECTION 4.07. Subsidiaries 27 SECTION 4.08. Liens 27 SECTION 4.09. No Burdensome Restrictions; No Defaults 27 96 SECTION 4.10. Investment Company Act 27 SECTION 4.11. Use of Proceeds; Margin Regulations 28 SECTION 4.12. Asset 28 SECTION 4.13. Labor Matters 28 SECTION 4.14. Environmental Matters 28 SECTION 4.15. Completeness 29 SECTION 4.16. ERISA 29 SECTION 4.17. Insurance 30 ARTICLE V Conditions Precedent SECTION 5.01. Conditions Precedent to Effectiveness 30 SECTION 5.02. Conditions Precedent to All Borrowings 32 ARTICLE VI Affirmative Covenants SECTION 6.01. Compliance with Laws, Etc 33 SECTION 6.02. Use of Proceeds 33 SECTION 6.03. Payment of Obligations, Etc 33 SECTION 6.04. Insurance 33 SECTION 6.05. Preservation of Corporate Existence, Etc 33 SECTION 6.06. Access 33 SECTION 6.07. Keeping of Books 34 SECTION 6.08. Maintenance of Properties 34 SECTION 6.09. Financial Statements 34 SECTION 6.10. Reporting Requirements 34 SECTION 6.11. Notices Regarding ERISA 35 SECTION 6.12. Employee Plans 36 SECTION 6.13. Environmental Compliance; Notice 36 SECTION 6.14. Acquisition and Merger Agreement 36 SECTION 6.15. Shelf Registration 37 ARTICLE VII Negative Covenants SECTION 7.01. Limitations on Liens 37 SECTION 7.02. Limitation on Indebtedness 39 SECTION 7.03. Lease Obligations 40 SECTION 7.04. Restricted Payments 40 SECTION 7.05. Mergers, Etc 40 SECTION 7.06. Investments in Other Persons 41 SECTION 7.07. Assets 41 SECTION 7.08. Change in Nature of Business 42 SECTION 7.09. Capital Structure 42 SECTION 7.10. Transactions with Affiliates, Etc 42 SECTION 7.11. Accounting Changes 43 SECTION 7.12. Margin Regulations 43 SECTION 7.13. Compliance with ERISA 43 SECTION 7.14. Speculative Transactions 43 SECTION 7.15. Debt Ratio 43 SECTION 7.16. Interest Expense Coverage Ratio 43 97 ARTICLE VIII Events of Default SECTION 8.01. Events of Default 44 SECTION 8.02. Remedies 46 SECTION 8.03. Rights Not Exclusive 47 ARTICLE IX The Administrative Agent SECTION 9.01. Appointment 47 SECTION 9.02. Delegation of Duties 47 SECTION 9.03. Liabilities of Agents 47 SECTION 9.04. Reliance by Administrative Agent 47 SECTION 9.05. Notice of Default 48 SECTION 9.06. Credit Decision 48 SECTION 9.07. Indemnification 48 SECTION 9.08. Administrative Agent in Individual Capacity 49 SECTION 9.09. Successor Administrative Agent 49 ARTICLE X Miscellaneous SECTION 10.01. Notices, Etc 49 SECTION 10.02. Amendments, Etc 49 SECTION 10.03. No Waiver; Remedies 50 SECTION 10.04. Costs and Expenses 50 SECTION 10.05. Indemnity 50 SECTION 10.06. Right of Set-off 51 SECTION 10.07. Binding Effect 51 SECTION 10.08. Assignments, Participations Etc 51 SECTION 10.09. Confidentiality 52 SECTION 10.10. Survival 53 SECTION 10.11. Headings 53 SECTION 10.12. Governing Law and Jurisdiction 53 SECTION 10.13. Execution in Counterparts 53 SECTION 10.14. Entire Agreement 53 SECTION 10.15. Waiver of Jury Trial 53 98 Exhibits Exhibit 1.01 Form of Guarantee Agreement Exhibit 2.02 Form of Notice of Borrowing Exhibit 2.04(a) Form of Competitive Bid Request Exhibit 2.04(b) Form of Competitive Bid Exhibit 2.05(b) Form of Committed Loan Note Exhibit 2.05(c) Form of Bid Note Exhibit 2.11 Form of Notice of Conversion/Continuation Exhibit 5.01 Forms of Opinion Exhibit 6.09 Form of Compliance Certificate Exhibit 10.08 Form of Notice of Assignment Attachment A to Form of Assignment and Assumption Exhibit 10.08 agreement Schedules Schedule 1.01(a) Commitments; Percentage Shares Schedule 1.01(c) Existing Depositories Schedule 4.05 Material Liabilities Schedule 4.06 Pending Litigation Schedule 4.07(a) Subsidiaries Schedule 4.07(d) Joint Ventures/Partnerships Schedule 4.13 Labor Matters Schedule 4.14 Environmental Matters Schedule 4.16 Employee Benefit Plans Schedule 7.01/7.02Existing Liens and Existing Indebtedness 99 CREDIT AGREEMENT dated as of January 12, 2001, among TYSON FOODS, INC., a Delaware corporation (the "Borrower"), the banks which are or may, from time to time hereafter, become parties hereto (the "Banks"), THE CHASE MANHATTAN BANK, as Administrative Agent (the "Administrative Agent"), MERRILL LYNCH CAPITAL CORPORATION, as Syndication Agent, and SUNTRUST BANKS, INC., as Documentation Agent. The Borrower intends to acquire (the "Acquisition") IBP (such term and each other capitalized term used but not defined herein having the meaning given it in Article I) for an aggregate purchase price, together with the assumption and refinancing of Indebtedness, of approximately $4,700,000,000, of which approximately $1,584,300,000 will be the portion of the purchase price paid in cash and approximately $950,000,000 will be the cash amount required to refinance the IBP Credit Agreement and to provide for working capital for IBP. The parties hereto agree as follows: ARTICLE I Definitions and Accounting Terms SECTION 1.01. Certain Defined Terms. As used in this Agreement and in any Schedules and Exhibits to this Agreement, the following terms have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined): "Absolute Rate" means a fixed annual rate, expressed as a percentage. "Absolute Rate Bid Loan" means any Bid Loan that bears interest determined with reference to an Absolute Rate. "Acquisition" has the meaning assigned to such term in the preamble to this Agreement. "Acquisition Date" means the date on which the conditions set forth in paragraphs (h) through (l) of Section 5.01 are satisfied (or waived in accordance with Section 10.02). "Administrative Agent" means The Chase Manhattan Bank, in its capacity as administrative agent for the Banks, together with any successor thereto in such capacity. "Administrative Agent's Letter" means the fee letter dated January 10, 2001, between the Borrower and the Administrative Agent. "Administrative Agent's Payment Office" means the address for payments set forth on the signature pages hereof in relation to the Administrative Agent or such other address as the Administrative Agent may from time to time specify in accordance with Section 10.01. "Affiliate" means, with respect to any Person, any Subsidiary of such Person and any other Person which, directly or indirectly, controls, is controlled by, or is under common control with, such Person, and includes, if such Person is a corporation, each Person who is the beneficial owner of 5% or more of such corporation's outstanding common stock. For purposes of this definition, "control" means the possession of the power to direct or cause the direction of management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. "Agreement" means this Credit Agreement, as from time to time amended, modified or supplemented. "Aggregate Commitments" means the aggregate amount of the Commitments of all the Banks as in effect from time to time. "Assignee" has the meaning specified in Section 10.08(a). "Bank" has the meaning specified in the preamble and includes 100 each Bank listed on the signature pages hereof and each Person which becomes a Bank pursuant to Section 10.08. "Bank Affiliate" means a Person engaged primarily in the business of commercial banking and that is a Subsidiary of a Bank or of a Person of which a Bank is a Subsidiary. "Bid Borrowing" means an extension of credit hereunder consisting of one or more Bid Loans made to the Borrower on the same day by one or more Banks. "Bid Loan" means a Loan made by a Bank to the Borrower pursuant to Section 2.03 and may be a LIBOR Bid Loan or an Absolute Rate Bid Loan. "Borrower" has the meaning specified in the preamble. "Borrowing" means a Committed Borrowing or a Bid Borrowing. "Business Day" means any day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close and, if the applicable Business Day relates to any Eurodollar Loan, means such a day on which dealings are carried on in the London interbank market. "CERCLA" has the meaning specified in the definition of Environmental Law. "COBRA" has the meaning specified in Section 4.16(k). "Code" means the Internal Revenue Code of 1986 (or any successor(s) thereto), as amended from time to time. "Commitment" means, for each Bank, as the context may require (i) the amount in dollars set forth in Schedule 1.01(a) opposite the name of such Bank under the heading "Commitment" or as otherwise set forth in any Notice of Assignment, as such amount may be reduced pursuant to Section 2.06 or as a result of one or more assignments pursuant to Section 10.08 or (j) the obligation of such Bank to extend credit to the Borrower hereunder in the amount specified in the immediately preceding clause (a). The initial aggregate amount of the Banks' Commitments is $2,500,000,000. "Committed Borrowing" means an extension of credit hereunder consisting of Committed Loans made, continued or converted on the same day by the Banks ratably according to their Percentage Shares and, in the case of Eurodollar Loans, having the same Interest Periods. "Committed Loan" means an extension of credit by a Bank to the Borrower pursuant to Section 2.01 and may be a Eurodollar Loan or a Reference Rate Loan. "Competitive Bid" means an offer by a Bank to make a Bid Loan in accordance with Section 2.04(b). "Competitive Bid Request" has the meaning specified in Section 2.04(a). "Consolidated EBITDA" means, for any period, Consolidated Net Income for such period plus (a) without duplication and to the extent deducted in determining such Consolidated Net Income, the sum of (k) Consolidated Interest Expense for such period, (ii) consolidated income tax expense for such period, (iii) all amounts attributable to depreciation and amortization for such period and (iv) extraordinary losses for such period and minus (b) without duplication and to the extent included in determining such Net Income, any extraordinary gains for such period, all determined on a consolidated basis in accordance with GAAP. "Consolidated Interest Expense" means, for any period, the interest expense (including imputed interest expense in respect of capital lease obligations) of the Borrower and its consolidated Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP. 101 "Consolidated Net Income" means, for any period, the consolidated net income (or loss) of the Borrower and its consolidated Subsidiaries for such period (taken as a single accounting period) determined in conformity with GAAP, excluding (to the extent otherwise included therein) any gains or losses, together with any related provision for taxes, realized upon any sale of assets other than in the ordinary course of business; provided, however, that there shall be excluded therefrom the net income (or loss) of any Person accrued prior to the earlier of the date such Person becomes a Subsidiary of the Borrower or is merged into or consolidated with the Borrower or any of its Subsidiaries or such Person's assets are acquired by the Borrower or any of its Subsidiaries. "Contractual Obligation" means, as to any Person, any provision of any security issued by such Person or of any agreement, undertaking, contract, indenture, mortgage, deed of trust or other instrument, document or agreement to which such Person is a party or by which it or any of its property is bound. "Controlled Group" means, with respect to any Person, all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) which are under common control with such Person and which, together with such Person, are treated as a single employer under Section 414(b), (c), (m) or (o) of the Code. "Debt Rating" means the actual or implied rating as most recently assigned to the Index Debt or the Borrower's senior, unsecured, non-credit enhanced short-term debt by Moody's or S&P, as the case may be. "Debt Ratio" means, at any date of determination, the ratio of (a) Indebtedness for Borrowed Money at such date to (b) Total Capitalization as of the last day of the most recent fiscal quarter or fiscal year, as the case may be, of the Borrower for which financial statements have been delivered pursuant to paragraph (a) or (b) of Section 6.09. "Default" means any event or condition which, with the giving of notice or the lapse of time, or both, would become an Event of Default. "Domestic Lending Office" has the meaning specified in the definition of Lending Office. "Effective Date" means the date on which all conditions precedent set forth in paragraphs (a) through (g) of Section 5.01 are satisfied (or waived in accordance with Section 10.02). "Environmental Claim" means any claim, however asserted, by any Governmental Authority or other Person alleging potential liability for violation of any Environmental Law or for release or injury to the environment or threat to public health, personal injury (including sickness, disease or death), property damage, natural resources damage, or otherwise alleging liability for damages, punitive damages, cleanup costs, removal costs, remedial costs, response costs, restitution, civil or criminal penalties, injunctive relief, or other type of relief, resulting from or based upon (a) the presence, placement, discharge, emission or release (including intentional and unintentional, negligent and non-negligent, sudden or non-sudden, accidental or non-accidental placement, spill, leaks, discharges, emissions or releases) of any Hazardous Material at, in or from property, whether or not owned by the Borrower or any of its Subsidiaries, or (b) any other circumstances forming the basis of any violation, or alleged violation, of any Environmental Law. "Environmental Law" means the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. 9601 et seq.) ("CERCLA"), the Hazardous Material Transportation Act (49 U.S.C. 1801 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. 6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.), 102 the Clean Air Act (42 U.S.C. 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. 2601 et seq.) and the Occupational Safety and Health Act (29 U.S.C. 651 et seq.) ("OSHA"), as such laws have been or hereafter may be amended, modified or supplemented, and any and all analogous future federal, or present or future state or local, statutes and the regulations promulgated pursuant thereunder. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time and all regulations promulgated thereunder. "ERISA Event" means, with respect to any Person, (a) a Reportable Event (other than a Reportable Event not subject to the provision for 30-day notice to the PBGC under regulations issued under Section 4043 of ERISA); (b) the withdrawal of such Person or any member of its Controlled Group from a Plan during a plan year in which it was a "substantial employer" as defined in Section 4001(a)(2) of ERISA; (c) the filing of a notice of intent to terminate a Plan or the treatment of a Plan amendment as a termination under Section 4041 of ERISA; (d) the institution of proceedings to terminate a Plan by the PBGC; (e) the failure to make required contributions which would result in the imposition of a Lien under Section 412 of the Code or Section 302 of ERISA; and (f) any other event or condition which might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan or the imposition of any liability under Title IV of ERISA other than PBGC premiums due but not delinquent under Section 4007 of ERISA. "Eurocurrency Liabilities" has the meaning assigned to that term in Regulation D of the Federal Reserve Board, as in effect from time to time. "Eurodollar Lending Office" has the meaning specified in the definition of Lending Office. "Eurodollar Loan" means any Committed Loan that bears interest at a rate determined with reference to LIBOR. "Eurodollar Reserve Percentage" means, with respect to any Interest Period for any Eurodollar Loan made by any Bank, the reserve percentage applicable during such Interest Period (or if more than one such percentage shall be so applicable, the daily average of such percentages for those days in such Interest Period during which any such percentage shall be so applicable) under regulations issued from time to time by the Federal Reserve Board for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) for such Bank with respect to liabilities or assets consisting of or including Eurocurrency Liabilities having a term equal to such Interest Period. "Event of Default" has the meaning specified in Section 8.01. "Excess Margin Stock" means that portion, if any, of the Margin Stock owned by the Borrower and its Subsidiaries that must be excluded from the restrictions imposed by Section 7.01 and Section 7.07 in order for the value (determined in accordance with Regulation U) of the Margin Stock subject to such Sections to account for less than 25% of the aggregate value (as so determined) of all assets subject to such Sections. "Existing Credit Agreement" means the Fourth Amended and Restated Credit Agreement dated as of May 26, 1995, as amended, among the Borrower and the banks and agents party thereto. "Federal Funds Rate" means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published 103 for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by the Administrative Agent. "Federal Reserve Board" means the Board of Governors of the Federal Reserve System. "Form W-8BEN" has the meaning specified in Section 3.05(f)(i)(B). "Form W-8ECI" has the meaning specified in Section 3.05(f)(i)(A). "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board, or in such other statements by such other entity as may be in general use by significant segments of the accounting profession, which are applicable to the circumstances as of the date of determination. "Governmental Authority" means any nation or government, any state or other political subdivision thereof and any central bank (or similar monetary or regulatory authority) thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. "Guarantee Agreement" means the Guarantee Agreement, substantially in the form of Exhibit 1.01, made by IBP for the benefit of the Administrative Agent and the Lenders. "Hazardous Materials" means all those substances which are regulated by, or which may form the basis of liability under, any Environmental Law, including all substances identified under any Environmental Law as a pollutant, contaminant, waste, solid waste, hazardous waste, hazardous constituent, special waste, hazardous substance, hazardous material, or toxic substance, or petroleum or petroleum derived substance or waste. "IBP" means IBP, inc., a Delaware corporation. "IBP Credit Agreement" means the $950,000,000 Nine-Month Credit Agreement among IBP, the banks party thereto, Bank of America, N.A., as Syndication Agent, and U.S. Bank National Association, as Administrative Agent. "Indebtedness" of any Person means, without duplication, (a) all indebtedness for borrowed money or for the deferred purchase price of property or services (including reimbursement and all other obligations with respect to surety bonds, letters of credit and bankers' acceptances, whether or not matured); (b) all obligations evidenced by notes, bonds, debentures or similar instruments; (c) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property); (d) all obligations under leases which have been or should be, in accordance with GAAP, recorded as capital leases; (e) all net obligations with respect to Interest Rate Contracts; (f) all direct or indirect guaranties in respect of any obligations (contingent or otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against loss in respect of, indebtedness or obligations of others of the kinds referred to in clause (a), (b), (c), (d) or (e) above; and (g) all Indebtedness referred to in clause (a), (b), (c), (d) or (e) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property (including accounts and contracts rights) owned by such Person, 104 even though such Person has not assumed or become liable for the payment of such Indebtedness; provided, however, that if any Indebtedness of any type referred to above is supported by another type of Indebtedness referred to above, such Indebtedness shall not be considered more than once for the purposes of this definition; and provided, further, that for the purposes of this definition, Indebtedness shall not include any obligation of the Borrower to make payments to or in respect of the Hogty Limited Partnership or similar programs in connection with live inventory, consistent with past practices, or to make payments to MetLife Leasing or a similar entity under and in respect of a lease guaranty program or any similar live inventory program with Arkansas-California Livestock Company, Inc. or another entity, consistent with past practices. "Indebtedness for Borrowed Money" means the sum of all Indebtedness of the Borrower and its consolidated Subsidiaries of the type referred to in paragraphs (a), (b) and (d) of the definition of Indebtedness. "Indemnified Party" has the meaning specified in Section 10.05(a). "Index Debt" means senior, unsecured, long-term indebtedness for borrowed money of the Borrower that is not guaranteed by any other Person or subject to any other credit enhancement. "Insolvency Proceeding" means (a) any case, action or proceeding before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding- up or relief of debtors or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors or other similar arrangement in respect of the creditors of any Person generally or any substantial portion of the creditors of such Person; in each case undertaken under United States Federal or State law or foreign law. "Interest Payment Date" means (a) with respect to any Eurodollar Loan or Bid Loan, the last day of each Interest Period applicable to such Eurodollar Loan or Bid Loan and (i) with respect to any Interest Period of six months duration for any Eurodollar Loan, the date which falls three months after the beginning of such Interest Period, and (ii) with respect to any Bid Loan, such intervening date prior to the maturity thereof as may be agreed between the Borrower and the applicable Bank and (b) with respect to any Reference Rate Loan, the last day of each calendar quarter. "Interest Period" means, (a) with respect to any Eurodollar Loan, the period commencing on the Business Day such Eurodollar Loan is disbursed or on the date on which a Reference Rate Loan is converted into a Eurodollar Loan and ending on the date one, two, three or six months thereafter, as selected by the Borrower in its Notice of Borrowing or Notice of Conversion/Continuation; and (b) with respect to any Bid Loan, the period specified by the Borrower in the relevant Competitive Bid Request; provided, however, that: (i) in the case of the continuation of a Eurodollar Loan pursuant to Section 2.11(b), the Interest Period applicable after the continuation of such Loan shall commence on the last day of the preceding Interest Period; (ii) if any Interest Period applicable to a Eurodollar Loan 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 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; 105 (iii) any Interest Period applicable to a Eurodollar Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and (iv) no Interest Period for any Loan shall extend beyond the Maturity Date. "Interest Rate Contracts" means interest rate protection, cap or collar agreements, interest rate insurance, and other agreements or arrangements designed to provide protection against fluctuations in interest rates. "IRS" means the Internal Revenue Service of the United States of America. "Lending Office" means, with respect to any Bank, (a) in the case of a Committed Loan, the office or offices of such Bank specified as its "Domestic Lending Office" or "Eurodollar Lending Office", as the case may be, opposite its name in Schedule 1.01(b) or in the applicable Notice of Assignment or such other office or offices of such Bank as such Bank may from time to time specify in writing to the Borrower and the Administrative Agent and (b) in the case of a Bid Loan, the office of such Bank notified by such Bank to the Borrower as its Lending Office with respect to such Bid Loan or, if such Bank fails to so notify the Borrower, such Bank's Domestic Lending Office listed in Schedule 1.01(b). "Level I Status" exists at any date if, at such date (a) the Debt Rating is A- (or the equivalent) or higher by S&P and Baa1 (or the equivalent) or higher by Moody's or (b) BBB+ (or the equivalent) or higher by S&P and A3 (or the equivalent) or higher by Moody's and (c) Level IV Status does not exist. "Level II Status" exists at any date if, at such date (a) the Debt Rating is BBB+ (or the equivalent) or higher by S&P or Baa1 (or the equivalent) or higher by Moody's, (b) Level I Status does not exist and (c) Level IV Status does not exist. "Level III Status" exists at any date if, at such date (a) the Debt Rating is BBB (or the equivalent) by S&P and Baa2 (or the equivalent) by Moody's and (b) Level IV Status does not exist. "Level IV Status" exists at any date if, at such date (a) the Debt Rating is BBB- (or the equivalent) or lower by S&P or Baa3 (or the equivalent) or lower by Moody's, (b) the Index Debt is unrated by either S&P or Moody's or (c) the Borrower's senior, unsecured short-term Indebtedness for borrowed money that is not guaranteed by any other Person or subject to any other credit enhancement is rated less than A2 by Moody's or less than P2 by S&P or is unrated by either S&P or Moody's. "LIBOR" means, with respect to any Eurodollar Loan or LIBOR Bid Loan for any Interest Period, the rate appearing on Page 3750 of the Telerate Service (or on any successor or substitute page of such Service, or any successor to or substitute for such Service, providing rate quotations comparable to those currently provided on such page of such Service, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, two Business days prior to the commencement of such Interest Period, as the rate for dollar deposits with a maturity comparable to such Interest Period. In the event that such rate is not available at such time for any reason, then the "LIBOR" with respect to such Eurodollar Loan or LIBOR Bid Loan for such Interest Period shall be the rate at which dollar deposits of $5,000,000 and for a maturity comparable to such Interest Period are offered by the 106 principal London office of the Administrative Agent in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business days prior to the commencement of such Interest Period. "LIBOR Bid Loan" means any Bid Loan that bears interest at a rate determined with reference to LIBOR. "LIBOR Bid Margin" has the meaning specified in Section 2.04(b)(ii)(B). "Lien" means any lien, charge, security interest or encumbrance or any other type of preferential arrangement (including liens or retained security titles of conditional vendors and capitalized leases but excluding any right of set-off). "Loan" means an extension of credit by a Bank pursuant to Article II and may be a Committed Loan or a Bid Loan. "Loan Documents" means this Agreement, the Guarantee Agreement, any promissory notes delivered pursuant to this Agreement, the account agreement contemplated by the last paragraph of Section 5.01, the Notices of Borrowing, the Notices of Conversion/Continuation and the Competitive Bid Requests. "Majority Banks" means at any time Banks holding at least 51% of the Commitments and, if the Commitments have been terminated, Banks holding at least 51% of the then aggregate unpaid principal amount of the Loans made by the Banks. "Margin Stock" shall have the meaning given such term under Regulation U. "Material Adverse Effect" means (a) an adverse change in, or an adverse effect upon, the financial condition, business, prospects or properties of any of (i) the Borrower or (ii) the Borrower and its Subsidiaries taken as a whole resulting from a single event or a series of events within any 12-month period causing the consolidated Net Worth (calculated as if the Merger had occurred as of the Effective Date) of the Borrower to be reduced by 10% or more; (b) any material adverse change in the rights or remedies of the Banks under the Loan Documents or the ability of the Borrower to perform its obligations under any of the Loan Documents; or (c) any material adverse change in the legality, validity or enforceability of any Loan Document. "Maturity Date" means the first anniversary of the Termination Date. "Merger" means the merger of IBP with and into Merger Co. in accordance with the Merger Agreement. "Merger Agreement" means the Agreement and Plan of Merger dated as of January 1, 2001, among IBP, the Borrower and Merger Co., with no changes therefrom adverse to the Banks. "Merger Co." means Lasso Acquisition Corporation, a Delaware corporation and a wholly-owned Subsidiary of the Borrower. "Moody's" means Moody's Investors Service, Inc. or any successor to the rating agency business thereof. "Multiemployer Plan" means, with respect to any Person, at any time, a "multiemployer plan" within the meaning of Section 4001(a)(3) of ERISA and to which such Person or any member of its Controlled Group is making, or is obligated to make contributions or has made, or been obligated to make, contributions. "Net Proceeds" means, with respect to any sale, lease, transfer, condemnation or other voluntary or involuntary disposition of assets, including a Permitted Disposition, or any sale or issuance of Senior Notes or any Indebtedness or equity of the Borrower sold or issued in lieu of Senior Notes, 107 (a) the aggregate amount of cash proceeds received by the Borrower or any of its Subsidiaries from such disposition or sale or issuance; minus (b) the sum of (i) all fees and expenses, including customary brokerage commissions, appraisal fees, survey charges, legal and investment banking fees and other similar commissions, charges or fees incurred in connection with such disposition or sale or issuance; plus (ii) all taxes, including filing, recording or registration fees, recording taxes and transfer taxes paid (or payable) and income tax paid in connection with such disposition or sale or issuance; plus (iii) the amount of Indebtedness required to be paid in connection with such disposition to satisfy any Lien existing on the property included in such disposition. "Net Worth" means, with respect to any Person, at any date of determination, shareholders' equity as determined in accordance with GAAP. "Notice of Assignment" has the meaning specified in Section 10.08(b). "Notice of Borrowing" has the meaning specified in Section 2.02(a). "Notice of Conversion/Continuation" has the meaning specified in Section 2.11(b). "Obligations" means all Loans, other Indebtedness, advances, debts, liabilities, obligations, covenants and duties owing by the Borrower to any Bank, the Administrative Agent, any Affiliate of any of the foregoing or any Indemnified Party, of any kind or nature, present or future, whether or not evidenced by any note, guaranty or other instrument, arising under this Agreement or under any other Loan Document, whether or not for the payment of money, whether arising by reason of an extension of credit, loan, guaranty, indemnification, or in any other manner, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising and however acquired. The term "Obligations" includes all interest, charges, expenses, fees, attorneys' fees and disbursements (including the allocated cost of in- house counsel) and any other sum chargeable to the Borrower under this Agreement or any other Loan Document. "OSHA" has the meaning specified in the definition of Environmental Laws. "Other Taxes" has the meaning specified in Section 3.05(b). "Participant" has the meaning specified in Section 10.08(d). "PBGC" means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA. "Percentage Share" means, as to any Bank, at any time, such Bank's percentage share of the Aggregate Commitments, as set forth opposite such Bank's name in Schedule 1.01(a) under the heading "Percentage Share" or set forth in any Notice of Assignment delivered pursuant to Section 10.08, as such percentage may be modified from time to time in connection with any assignment of the Commitment of such Bank in accordance with the terms hereof. "Permitted Disposition" means, any disposition (except as otherwise permitted under Section 7.07) made by the Borrower or any of its Subsidiaries of any of its assets if the net income for the most recently completed four fiscal quarter period for which financial statements have been delivered pursuant to Section 6.09(a) or (b) derived from the assets 108 subject to such disposition together with the net income for such period derived from all other assets sold or otherwise disposed of during or after such period does not exceed 10% of Consolidated Net Income (calculated as if the Merger had occurred as of the Effective Date) for such period. "Permitted Investments" means: (a) securities issued or fully guaranteed or insured by the United States Government or any agency thereof and backed by the full faith and credit of the United States of America having maturities of not more than one year from the date of acquisition; (b) certificates of deposit, time deposits, Eurodollar time deposits, overnight bank deposits, repurchase agreements, reverse repurchase agreements or bankers' acceptances, having in each case a tenor of not more than one year issued by any Bank, or by any United States commercial bank or any branch or agency of a non- United States bank licensed to conduct business in the United States of America having a combined capital and surplus of not less than $100,000,000 whose short terms securities are rated at least A-1 by S&P and P-1 by Moody's; (c) commercial paper of an issuer rated at least A-1 by S&P or P-1 by Moody's and in either case having a tenor of not more than 270 days; and (d) money-market funds invested in short-term securities rated at least as provided in clause (b) above. "Permitted Lien Basket" means 10% of Total Capitalization. "Permitted Liens" has the meaning specified in Section 7.01. "Person" means an individual, partnership, corporation, business trust, joint stock company, trust, unincorporated association, joint venture or Governmental Authority. "Plan" means, with respect to the Borrower or any member of its Controlled Group, at any time, an employee pension benefit plan as defined in Section 3(2) of ERISA (including a Multiemployer Plan) that is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Code and is maintained for the employees of such Person or any member of its Controlled Group. "Priority Debt" means (a) any Indebtedness secured by a Lien (including in connection with capital leases or other financing leases) encumbering any asset of the Borrower or any of its Subsidiaries, (b) any Indebtedness of any Subsidiary of the Borrower (other than Indebtedness of IBP under the Guarantee Agreement and Indebtedness of IBP owed to the Borrower), (c) any receivables purchase transaction involving receivables of the Borrower or any of its Subsidiaries or any other securitization of assets of the Borrower or any of its Subsidiaries and (d) any sale-leaseback transaction involving assets of the Borrower or any of its Subsidiaries. "Reference Rate" means the higher of (a) the Federal Funds Rate plus 1/2% and (b) the rate of interest (the "Prime Rate") publicly announced from time to time by the Administrative Agent, as its prime rate in effect at its principal office in New York City. Any change in the Prime Rate shall take effect at the opening of business on the day specified in the public announcement of such change. "Reference Rate Loan" means any Committed Loan that bears interest at a rate determined with reference to the Reference Rate. "Regulation U" shall mean Regulation U of the Board of Governors of the Federal Reserve System of the United States of America as from time to time in effect and all official rulings and interpretations thereunder or thereof. 109 "Reportable Event" means any of the events set forth in Section 4043(b) of ERISA or the regulations thereunder. "Replacement Bank" has the meaning specified in Section 3.14(b). "Requirement of Law" means, with respect to any Person, the charter and by-laws or other organizational or governing documents of such Person, and any law, rule or regulation (including Environmental Laws and ERISA) or order, decree or other determination of an arbitrator or a court or other Governmental Authority applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject. "Responsible Officer" means, with respect to any Person, the Chief Executive Officer, the President, the Chief Financial Officer, the Treasurer, the Assistant Treasurer or the Secretary of such Person. "Senior Notes" means senior unsecured notes of the Borrower intended to be issued in an aggregate principal amount of up to $2,000,000,000, the proceeds of which will be used to repay commercial paper of the Borrower or, if outstanding, Loans and to terminate Commitments hereunder. "S&P" means Standard & Poor's Ratings Group or any successor to the rating agency business thereof. "Solvent" means, with respect to any Person, that the fair value of the assets of such Person (both at fair valuation and at present fair saleable value) is, on the date of determination, greater than the total amount of liabilities (including contingent and unliquidated liabilities) of such Person as of such date and that, as of such date, such Person is able to pay all liabilities of such Person as such liabilities mature and such Person does not have unreasonably small capital with which to carry on its business. In computing the amount of contingent or unliquidated liabilities at any time, such liabilities will be computed at the amount which, in light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability. "Stock" means all shares, options, interests, participations or other equivalents (regardless of how designated) of or in a corporation or other entity, whether voting or non-voting, of any class and includes, common stock, preferred stock or warrants or options for any of the foregoing. "Subsidiary" means, with respect to any Person, any corporation more than 50% of whose stock having by the terms thereof ordinary voting power to elect a majority of the directors of such corporation is at the time owned by such Person, directly or indirectly through one or more Subsidiaries. At all times on and after the Effective Date, IBP and its Subsidiaries will constitute Subsidiaries of the Borrower. "Taxes" has the meaning specified in Section 3.05(a). "Tender Offer" means the Offer (as defined in the Merger Agreement) of the Borrower and Merger Co. to acquire 50.1% of the issued and outstanding shares of IBP common stock. "Termination Date" means January 10, 2002. "Total Capitalization" means, at any date, the sum of (a) the aggregate amount of Indebtedness for Borrowed Money and (b) Net Worth of the Borrower and its consolidated Subsidiaries. "Transactions" means the execution, delivery and performance by the Borrower of this Agreement and the other Loan Documents, the borrowing of Loans and the use of the proceeds thereof, the Acquisition, the Merger and the assumption and refinancing of Indebtedness and the other transactions contemplated by the Borrower to be effected in connection therewith. 110 "Tyson Limited Partnership" means that certain Delaware limited partnership of the same name of which Mr. Don Tyson is the Managing General Partner. SECTION 1.02. Computation of Time Periods. In this Agreement, in the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including" and the words "to" and "until" each means "to but excluding". SECTION 1.03. Accounting Matters. All accounting terms not specifically defined herein shall be construed in accordance with GAAP; provided, however, all computations determining compliance with Sections 7.15 and 7.16 shall use accounting principles consistent with those applied in the preparation of the financial statements of the Borrower referred to in Section 4.05. IBP and its Subsidiaries will be deemed to be consolidated Subsidiaries of the Borrower at all times on and after the Effective Date. SECTION 1.04. Certain Terms. The words "herein," "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole, including the Exhibits and Schedules hereto, as the same may from time to time be amended, supplemented, amended and restated or otherwise modified and not to any particular Article, Section, paragraph or clause in this Agreement. The word "includes" and "including" when used herein is not intended to be exclusive and means "includes, without limitation" and "including, without limitation." References herein to an Article, Section, paragraph or clause shall refer to the appropriate Article, Section, paragraph or clause in this Agreement. ARTICLE II Amounts and Terms of the Loans SECTION 2.01. Amounts and Terms of Commitments. Each Bank severally agrees, on the terms and subject to the conditions hereinafter set forth, to make Committed Loans to the Borrower (each such Loan, a "Committed Loan") from time to time on any Business Day during the period from the Effective Date to the Termination Date, in an aggregate principal amount not to exceed at any time outstanding such Bank's Commitment; provided, however, that after giving effect to any Borrowing of Committed Loans, (a) the aggregate principal amount of all outstanding Committed Loans plus (b) the aggregate principal amount of all outstanding Bid Loans shall not exceed the Aggregate Commitments; and provided further that no Loan shall be made at any time prior to the Acquisition Date unless there are at such time no unused commitments under the Existing Credit Agreement (and/or any amendment of, supplement to or replacement of the Existing Credit Agreement). Within the limits of each Bank's Commitment, the Borrower may on and prior to the Termination Date borrow under this Section 2.01, prepay pursuant to Section 2.07 and reborrow pursuant to this Section 2.01. Loans repaid or prepaid after the Termination Date may not be reborrowed. SECTION 2.02. Procedure for Committed Borrowing. (a) Each Committed Borrowing shall be made upon the irrevocable notice of the Borrower, received by the Administrative Agent not later than 12:00 noon (New York City time) (i) three Business days prior to the date of the proposed Borrowing, in the case of Eurodollar Loans; and (ii) one Business Day prior to the date of the proposed Borrowing, in the case of Reference Rate Loans; provided, however, that in case of a Committed Borrowing of Reference Rate Loans after the cancellation of a Bid Borrowing pursuant to Section 2.04(c)(i), the Borrower may give such notice to the Administrative Agent not later than 11:00 a.m. (New York City time) on the date of such 111 Committed Borrowing. Each such notice of a Committed Borrowing (a "Notice of Borrowing") shall be in writing (including by facsimile confirmed immediately by telephone), in substantially the form of Exhibit 2.02 specifying: (i) the requested borrowing date, which shall be a Business Day; (ii) the aggregate amount of the Borrowing, which (a) shall not exceed the unused portion of the Aggregate Commitments and (b) shall be a minimum amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof; (iii) whether the Borrowing is to be comprised of Eurodollar Loans or Reference Rate Loans; and (iv) if the Borrowing is to be comprised of Eurodollar Loans, the duration of the initial Interest Period applicable to such Loans. If the Notice of Borrowing shall fail to specify the duration of the initial Interest Period for any Borrowing comprised of Eurodollar Loans, such Interest Period shall be three months. (b) Upon receipt of a Notice of Borrowing, the Administrative Agent shall promptly notify each Bank thereof and of the amount of such Bank's Percentage Share of such Borrowing. (c) Each Bank shall make the amount of its Percentage Share of the Committed Borrowing available to the Administrative Agent for the account of the Borrower at the Administrative Agent's Payment Office by 12:00 noon (New York City time) on the borrowing date requested by the Borrower in funds immediately available to the Administrative Agent. Unless any applicable condition specified in Article V has not been satisfied, the Administrative Agent will make the funds so received from the Banks promptly available to the Borrower by crediting the account of the Borrower on the books of the Administrative Agent (or such other account as shall have been specified by the Borrower) with the aggregate amount made available to the Administrative Agent by the Banks and in like funds as received by the Administrative Agent. (d) After giving effect to any Committed Borrowing, there shall not be more than six different Interest Periods in effect in respect of all Committed Loans together. SECTION 2.03. Bid Borrowings. In addition to Committed Borrowings pursuant to Section 2.01, each Bank severally agrees that the Borrower may, as set forth in Section 2.04, from time to time on any Business Day during the period from the Effective Date to the Termination Date, request the Banks to submit offers to make Bid Loans to the Borrower; provided, however, that the Banks may, but shall have no obligation to, submit such offers and the Borrower may, but shall have no obligation to, accept any such offers; and provided, further, that at no time shall the sum of (a) the aggregate principal amount of all outstanding Bid Loans made by all Banks plus (b) the aggregate principal amount of all outstanding Committed Loans exceed the Aggregate Commitments. SECTION 2.04. Procedure for Bid Borrowings. (a) The Borrower may request a Bid Borrowing hereunder by delivering to the Administrative Agent and each Bank by facsimile not later than 12:00 noon (New York City time) (i) three Business days prior to the date of the proposed Borrowing, in the case of LIBOR Bid Loans; and (ii) one Business Day prior to the date of the proposed Borrowing, in the case of Absolute Rate Bid Loans, a solicitation for Bid Loans (a "Competitive Bid Request"), in substantially the form of Exhibit 2.04(a), specifying: (i) the requested borrowing date, which shall be a Business Day; (ii) the aggregate amount of the Borrowing, which shall be a minimum amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof; 112 (iii) whether the Bid Loans requested are LIBOR Bid Loans or Absolute Rate Bid Loans; (iv) the duration of the Interest Period applicable to such Bid Loans, which shall be not less than five days and not more than 183 days and which shall not extend beyond the Termination Date; and (v) any other terms to be applicable to such Bid Loans. (b) (i) Each Bank may, in response to a Competitive Bid Request, in its discretion, irrevocably submit to the Borrower a Competitive Bid containing an offer or offers to make one or more Bid Loans. Each Competitive Bid must be submitted to the Borrower by facsimile before 10:00 a.m. (New York City time) (i) two Business days prior to the proposed date of Borrowing, in the case of a request for LIBOR Bid Loans and (ii) on the proposed date of Borrowing, in the case of a request for Absolute Rate Bid Loans. (ii) Each Competitive Bid shall be in substantially the form of Exhibit 2.04(b), specifying: (A) the minimum amount of each Bid Loan for which such Competitive Bid is being made, which shall be $5,000,000 or an integral multiple of $1,000,000 in excess thereof, and the maximum amount thereof, which may not exceed the principal amount of Bid Loans for which Competitive Bids were requested (but which may exceed such Bank's Commitment); (B) the rate or rates of interest per annum offered for each Bid Loan, which, in the case of a LIBOR Bid Loan, shall be expressed as a percentage (rounded to the nearest 1/100%) to be added to or subtracted from the applicable LIBOR (the "LIBOR Bid Margin"); (D) the applicable Interest Period for each Bid Loan offered by it; and (E) the identity and the applicable Lending Office of the quoting Bank. A Competitive Bid may contain up to six separate offers by the quoting Bank with respect to each Interest Period specified in the related Competitive Bid Request. (iii) Any Competitive Bid shall be disregarded if it: (A) is not substantially in conformity with Exhibit 2.04(b) or does not specify all of the information required by clause (ii) above; (B) contains qualifying, conditional or similar language; (C) proposes terms other than or in addition to those set forth in the applicable Competitive Bid Request; or (D) arrives after the time set forth in clause (i) above. (c) Not later than 11:00 a.m. (New York City time) (i) two Business days prior to the proposed date of Borrowing, in the case of LIBOR Bid Loans and (ii) on the date of such Bid Borrowing, in the case of Absolute Rate Loans, the Borrower shall either (i) cancel such Borrowing by giving the Administrative Agent and the Banks notice thereof (which notice may be given by telephone, confirmed by facsimile); or (ii) accept one or more of the offers made by any Bank or Banks pursuant to paragraph (b) above, in its sole discretion, by giving notice (which notice may be given by telephone, confirmed by facsimile)(a) to such Bank or Banks of the amount of each Bid Loan (which amount shall be equal to or greater than the minimum amount, and equal to or less than the maximum amount, notified to the Borrower by such Bank for such Bid Loan pursuant to paragraph (b) above) to be made by each such Bank as part of such Bid Borrowing, and reject any remaining offers made by the Banks and give notice to that effect, and (b) to the Administrative Agent of the date of such Borrowing and the 113 aggregate amount thereof (which may not exceed the applicable amount set forth in the related Competitive Bid Request); provided, however, that acceptance by the Borrower of offers may only be made on the basis of ascending LIBOR Bid Margins or Absolute Rates within each Interest Period; and, provided, further, that if offers are made by two or more Banks with the same LIBOR Bid Margins or Absolute Rates for a greater aggregate principal amount than the amount for which such offers are accepted for the related Interest Rate Period, the principal amount of Bid Loans accepted shall be allocated by the Borrower among such Banks as nearly as possible (in multiples not less than $1,000,000) in proportion to the aggregate principal amount of such offers; provided, however, that in the event the Borrower does not, before the time stated above, either cancel the proposed Bid Borrowing pursuant to clause (i) above or accept one or more of the offers pursuant to clause (ii) above, such Bid Borrowing shall be deemed cancelled and provided further, that in the event the Borrower accepts one or more of the offers pursuant to clause (ii) above but does not expressly reject or accept the remaining offers, such remaining offers shall be deemed rejected. (d) (i) If the Borrower accepts one or more of the offers to make Bid Loans made by any Bank or Banks pursuant to paragraph (c)(ii) above, each such Bank shall, subject to the satisfaction of the conditions precedent specified in Section 5.02, before 12:00 noon (New York City time) on the date of the Bid Borrowing, make available to the Borrower at such Bank's Lending Office such Bank's portion of such Bid Borrowing in same day funds. (ii) Not later than 5:00 p.m. (New York City time) on the date of each Bid Borrowing, (A) the Borrower shall notify the Administrative Agent of (1) the aggregate amount of Bid Loans made in connection with such Bid Borrowing (which amount may not exceed the amount requested pursuant to Section 2.04(a)(ii)), (2) each date on which any Bid Loan shall mature, (3) the principal amount of Bid Loans which shall mature on each such date, (4) the highest and the lowest Competitive Bid submitted by the Banks in connection with each Competitive Bid Request, and (5) the highest and the lowest Competitive Bid accepted by the Borrower; and (B) the Administrative Agent will in turn promptly give to each Bank the information received from the Borrower in connection with such Bid Borrowing. (e) Upon being notified by the Borrower of the amount of, and the applicable Interest Period for, any LIBOR Bid Loan, the Administrative Agent shall determine LIBOR (as provided in the definition of LIBOR) and give prompt notice to the Borrower and the relevant Bank or Banks thereof. SECTION 2.05. Evidence of Indebtedness. (a) Each Bank, with respect to amounts payable to it hereunder, and the Administrative Agent, with respect to all amounts payable hereunder, shall maintain on its books in accordance with its usual practice, loan accounts, setting forth each Committed Loan, and, in the case of each Bank having made a Bid Loan, each such Bid Loan, the applicable interest rate and the amounts of principal, interest and other sums paid and payable by the Borrower from time to time hereunder with respect thereto; provided, however, that the failure by any Bank to record any such amount on its books shall not affect the obligations of the Borrower with respect thereto. In the case of any dispute, action or proceeding relating to any amount payable hereunder, the entries in each such account shall be conclusive evidence of such amount absent manifest error. In case of any discrepancy between the entries in the Administrative Agent's books and any Bank's books, such Bank's books shall be considered correct in the absence of manifest error. 114 (b) Notwithstanding the foregoing, if any Bank shall so request for purposes of Section 10.08(e), the obligation to repay the Committed Loans shall also be evidenced by a promissory note in the form of Exhibit 2.05(b). (c) The obligation to repay any Bid Loan shall also, if so requested by the Bank making such Bid Loan, be evidenced by a promissory note in the form of Exhibit 2.05(c). SECTION 2.06. Termination and Reduction of the Commitments. (a) Unless previously terminated, the Commitments shall terminate on the Termination Date. (b) The Borrower may, at any time and from time to time, upon not less than three Business days' prior notice to the Administrative Agent, terminate the Aggregate Commitments or permanently reduce the Aggregate Commitments by an aggregate amount of $5,000,000 or an integral multiple of $1,000,000 in excess thereof; provided, however, that no such termination or reduction shall be permitted if, after giving effect thereto and to any prepayment of Loans made on the effective date thereof, the then outstanding principal amount of Committed Loans and Bid Loans would exceed the Aggregate Commitments then in effect and, provided, further, that once reduced in accordance with this Section 2.06, the Aggregate Commitments may not be increased. Any reduction of the Aggregate Commitments shall be applied to each Bank's Commitment in accordance with such Bank's Percentage Share. (c) In the event that (i) Senior Notes are issued, or any offering of Indebtedness or equity of the Borrower is completed in lieu of, or in addition to, an offering of Senior Notes, or (ii) the Existing Credit Agreement is modified, supplemented or replaced and the result is an increase in the commitments available to the Borrower, the Aggregate Commitments shall be reduced by (x) the Net Proceeds thereof upon the receipt by the Borrower of such Net Proceeds or (y) the aggregate amount of such increase in commitments upon the effectiveness thereof, as the case may be, and if such reduction would result in the aggregate outstanding amount of Loans exceeding the Aggregate Commitments, the Borrower shall immediately prepay Committed Loans in an amount sufficient to eliminate such excess (and in the event an excess remains after the prepayment of all Committed Loans, the Borrower will place in a cash collateral account maintained with the Administrative Agent for the benefit of the Banks cash in an amount equal to the remaining excess for application to outstanding Bid Loans as they mature until such excess is eliminated). Any such reduction of the Aggregate Commitments and prepayment of Committed Loans shall be applied as among the Banks ratably in accordance with each Bank's Percentage Share. Any such application of cash from a cash collateral account to repay Bid Loans maturing on the same date shall be applied as among the Banks holding such Bid Loans on a pro rata basis based upon the respective amounts of such maturing Bid Loans. SECTION 2.07. Optional Prepayments. (a) Subject to Section 3.11, the Borrower may upon notice to the Administrative Agent, stating the proposed date and aggregate principal amount of the prepayment, received by the Administrative Agent (i) not less than three Business days prior to the proposed date of prepayment, in the case of a prepayment of Eurodollar Loans and (ii) not less than one Business Day prior to the proposed date of prepayment, in the case of a prepayment of Reference Rate Loans, prepay ratably among the Banks, the outstanding principal amount of any Committed Loans in whole or in part, together with accrued interest to the date of such prepayment on the principal amount prepaid. Each such partial prepayment shall be in an aggregate principal amount of not less than $5,000,000 or an integral multiple of $1,000,000 in excess thereof; provided, however, that if the aggregate amount of Eurodollar Loans 115 comprised in the same Borrowing shall be reduced as a result of any optional prepayment to an amount less than $5,000,000, the Eurodollar Loans comprised in such Borrowing shall automatically convert into Reference Rate Loans at the end of the then current Interest Period. If any notice of prepayment is given, the principal amount stated therein, together with accrued interest to the date of prepayment, shall be due and payable on the date specified in such notice. (b) The Borrower may not voluntarily prepay any Bid Loan prior to the maturity date thereof. SECTION 2.08. Repayment. (a) The Committed Loans. The outstanding principal amount of all Committed Loans shall be repaid on the Maturity Date. (b) The Bid Loans. Each Bid Loan shall mature, and the principal amount thereof shall be due and payable, on the last day of the Interest Period applicable thereto; provided, however, that the outstanding principal amount of all Bid Loans shall be repaid on the Termination Date. SECTION 2.09. Interest. (a) Subject to Section 2.10, each Committed Loan shall bear interest, at the option of the Borrower, as follows, (i) if such Committed Loan is a Reference Rate Loan, at a rate per annum equal to the Reference Rate; and (ii) if such Committed Loan is a Eurodollar Loan, at a rate per annum equal to the sum of LIBOR plus the applicable margin set forth below: Debt Rating Applicable Margin Level I Status 0.525% Level II Status 0.625% Level III Status 0.725% Level IV Status 1.075% (b) Any change in the Debt Rating shall be effective as of the date on which such change is first publicly announced by S&P or notified to the Borrower by Moody's. Any change in the applicable margin due to a change in the applicable Debt Rating shall be effective on the effective date of such change in the Debt Rating and shall apply to all Eurodollar Loans that are outstanding at any time during the period commencing on the effective date of such change in the Debt Rating and ending on the date immediately preceding the effective date of the next such change in the Debt Rating which results in a change in the applicable margin. (c) Accrued and unpaid interest in respect of each Committed Loan shall be paid on each Interest Payment Date, on the date of any prepayment or repayment of Committed Loans and, in the case of any Reference Rate Loan, on each date such Loan is converted into a Eurodollar Loan. (d) The Borrower shall pay to each Bank which had made a Bid Loan interest on the unpaid principal amount of such Bid Loan from the date when made until paid in full, on each Interest Payment Date, at a rate per annum equal to LIBOR plus (or minus) the LIBOR Bid Margin, or the Absolute Rate, as the case may be, as specified by such Bank in its Competitive Bid pursuant to Section 2.04(b)(ii). SECTION 2.10. Default Interest. During the continuation of any Event of Default pursuant to Section 8.01(a), or after acceleration, the Borrower shall pay, on demand, interest (after as well as before judgment) on the principal amount of all Loans then outstanding, at a rate per annum which is determined by increasing the rate of interest then in effect pursuant to Section 2.09 by 2% per annum; provided, however, that, on and after the expiration of the Interest Period applicable to any Eurodollar Loan on the date of occurrence of such Event of Default or acceleration, the principal amount of such Loan shall, during the continuation of such Event 116 of Default or acceleration, bear interest at a rate per annum equal to the Reference Rate plus 2%; and, provided, further, that if so requested by the Borrower, the Majority Banks may, in their sole discretion, waive the provisions of this Section 2.10. SECTION 2.11. Continuation and Conversion Elections for Committed Borrowings. (a) The Borrower may upon irrevocable written notice to the Administrative Agent in accordance with paragraph (b) below: (i) elect to convert, on any Business Day, any Reference Rate Loans (or any part thereof in an aggregate amount not less than $5,000,000 or an integral multiple of $1,000,000 in excess thereof) into Eurodollar Loans; (ii) elect to convert, on the expiration date of any Interest Period, any Eurodollar Loans maturing on such Interest Payment Date (or any part thereof in an aggregate amount not less than $5,000,000 or an integral multiple of $1,000,000 in excess thereof) into Reference Rate Loans; or (iii) elect to continue, on the expiration date of any Interest Period, any Eurodollar Loans maturing on such Interest Payment Date; provided, however, that if on the expiration date of any Interest Period the aggregate amount of outstanding Eurodollar Loans comprised in the same Committed Borrowing shall have been reduced as a result of the conversion of part thereof to an amount less than $5,000,000, the remaining Eurodollar Loans comprised in such Borrowing shall automatically convert into Reference Rate Loans on such date and on and after such date the right of the Borrower to continue such Loans as Eurodollar Loans shall terminate. (b) The Borrower shall deliver a notice of conversion or continuation (a "Notice of Conversion/Continuation"), in substantially the form of Exhibit 2.11, to the Administrative Agent not later than 12:00 noon (New York City time) (i) three Business days prior to the proposed date of conversion or continuation, if the Committed Loans or any portion thereof are to be converted into or continued as Eurodollar Loans; and (ii) one Business Day prior to the proposed date of conversion, if the Committed Loans or any portion thereof are to be converted into Reference Rate Loans. Each such Notice of Conversion/Continuation shall be by facsimile confirmed immediately by telephone specifying therein: (i) the proposed date of conversion or continuation; (ii) the aggregate amount of Committed Loans to be converted or continued; (iii) the nature of the proposed conversion or continuation; and (iv) he duration of the requested Interest Period. (c) If, upon the expiration of any Interest Period applicable to Eurodollar Loans, the Borrower shall have failed to select a new Interest Period to be applicable to such Eurodollar Loans, or if an Event of Default shall then have occurred and be continuing, the Borrower shall be deemed to have elected to convert such Eurodollar Loans into Reference Rate Loans effective as of the expiration date of such current Interest Period. (d) Upon receipt of a Notice of Conversion/Continuation, the Administrative Agent shall promptly notify each Bank thereof or, if no timely notice is provided, the Administrative Agent shall promptly notify each Bank of the details of any automatic conversion. All conversions and continuations shall be made pro rata among the Banks based on the respective outstanding principal amounts of the Loans with respect to which such notice was given held by each Bank. (e) After giving effect to any conversion or continuation of any Committed Loans, there shall not be more than six different Interest Periods in effect in respect of all Committed Loans together. 117 ARTICLE III Fees; Payments; Taxes; Changes in Circumstances SECTION 3.01. Fees. (a) (i) The Borrower agrees to pay to the Administrative Agent for the account of each Bank a facility fee equal to the percentage per annum set forth below times such Bank's Commitment (regardless of utilization) or, after the Termination Date, times the aggregate daily outstanding amount of such Bank's Loans: Debt Rating Facility Fee Level I Status 0.100% Level II Status 0.125% Level III Status 0.150% Level IV Status 0.175% (ii) Any change in the Debt Rating shall be effective as of the date on which such change is first publicly announced by S&P or notified to the Borrower by Moody's. Any change in the facility fee due to a change in the applicable Debt Rating shall be effective on the effective date of such change in the Debt Rating and shall apply at any time during the period commencing on the effective date of such change in the Debt Rating and ending on the date immediately preceding the effective date of the next such change in the Debt Rating which results in a change in the facility fee. (ii) The facility fee shall accrue from the Effective Date to the Maturity Date and shall be due and payable quarterly in arrears on the last Business Day of each calendar quarter commencing in the calendar quarter ending on March 31, 2001 and on the Maturity Date, provided that if any Loans shall be outstanding after the Maturity Date, then the facility fee shall continue to accrue on the daily outstanding amount of such Loans from and including the Maturity Date to but excluding the date on which such Loans are repaid in full, and such facility fee shall be payable on demand. (b) The Borrower agrees to pay to the Administrative Agent, for the Administrative Agent's own account, fees in the amounts and at the times set forth in the Administrative Agent's Fee Letter. SECTION 3.02. Computation of Fees and Interest. (a) All computations of interest payable in respect of Reference Rate Loans shall be made on the basis of a year of 365 days or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest under this Agreement shall be made on the basis of a year of 360 days and actual days elapsed. Interest and fees shall accrue during each period during which interest or such fees are computed from the first day thereof to the last day thereof. (b) Each determination of an interest rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Banks in the absence of manifest error. SECTION 3.03. Payments by the Borrower. (a) All payments (including prepayments) to be made by the Borrower hereunder shall be made without set-off or counterclaim and shall, except as expressly provided herein, be made to the Administrative Agent for the ratable account of the Banks at the Administrative Agent's Payment Office, in dollars and in immediately available funds, not later than 12:00 noon New York City time on the date specified herein; provided, however, that unless otherwise specified herein, each payment in respect of a Bid Loan shall be made 118 directly to the relevant Bank to the Lending Office of such Bank. The Administrative Agent will promptly after receiving any payment of principal, interest, fees and other amounts from the Borrower distribute to each Bank its Percentage Share (or other applicable share as expressly provided herein) of such payment for the account of its respective Lending Office. Any payment which is received by the Administrative Agent after 12:00 noon (New York City time) shall be deemed to have been received on the immediately succeeding Business Day. (b) Whenever any payment of a Committed Loan (and unless otherwise stated in the relevant Competitive Bid Request, a Bid Loan) shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of interest and fees, as the case may be; provided, however, that if such extension would cause any payment of principal of or interest on Eurodollar Loans to be made in the next calendar month, such payment shall be made on the immediately preceding Business Day. (c) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Banks hereunder that the Borrower will not make such payment in full, the Administrative Agent may assume that the Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent may (but shall not be so required), in reliance upon such assumption, cause to be distributed to each Bank on such due date an amount equal to the amount then due such Bank. If and to the extent the Borrower shall not have so made such payment in full to the Administrative Agent, each Bank shall repay to the Administrative Agent, on demand, the excess of the amount distributed to such Bank over the amount, if any, paid by the Borrower, together with interest thereon at the Federal Funds Rate, for each day from the date such amount is distributed to such Bank to the date such Bank repays such amount to the Administrative Agent; provided, however, that if any Bank shall fail to repay such amount within three Business days after demand therefor, such Bank shall, from and after such third Business Day until payment is made to the Administrative Agent, pay interest thereon at a rate per annum equal to the sum of the Reference Rate plus 1%. SECTION 3.04. Payments by the Banks to the Administrative Agent. (a) Unless the Administrative Agent shall have received notice from a Bank on the Effective Date, or, with respect to each Committed Borrowing after the Effective Date, at least one Business Day prior to the date of such Borrowing that such Bank will not make available to the Administrative Agent for the account of the Borrower the amount of such Bank's Percentage Share of such Borrowing, the Administrative Agent may assume that such Bank has made such amount available to the Administrative Agent on the date of such Borrowing and the Administrative Agent may (but shall not be so required), in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If and to the extent such Bank shall not have so made such full amount available to the Administrative Agent and the Administrative Agent in such circumstances makes available to the Borrower such amount, such Bank shall, within two Business days following the date of such Borrowing, make such amount available to the Administrative Agent, together with interest at the Federal Funds Rate for and determined as of each day during such period. If such amount is so made available, such payment to the Administrative Agent shall constitute such Bank's Committed Loan on the date of the Borrowing for all purposes of this Agreement. If such amount is not made available to the Administrative Agent within two Business days following the date of such Borrowing, the Administrative Agent shall notify the Borrower of such failure to fund and, on the third Business Day following the date of such Borrowing, the Borrower shall pay such amount 119 to the Administrative Agent for the Administrative Agent's account, together with interest thereon for each day elapsed since the date of such Borrowing, at a rate per annum equal to the interest rate applicable at the time to the Loans comprising such Borrowing. Nothing contained in this Section 3.04(a) shall relieve any Bank which has failed to make available its Percentage Share of any Committed Borrowing hereunder from its obligation to do so in accordance with the terms hereof. (b) The failure of any Bank to make any Committed Loan on the date of any Committed Borrowing shall not relieve any other Bank of its obligation hereunder to make a Loan on the date of such Borrowing pursuant to the provisions contained herein, but no Bank shall be responsible for the failure of any other Bank to make the Loan to be made by such other Bank on the date of any Committed Borrowing. SECTION 3.05. Taxes. (a) Subject to Section 3.05(g), any and all payments by or on account of any obligation of the Borrower to each Bank or the Administrative Agent under this Agreement or any other Loan Document shall be made free and clear of, and without deduction or withholding for, any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the case of each Bank and the Administrative Agent, such taxes (including income taxes, franchise taxes or branch profit taxes) as are imposed on or measured by such Bank's or the Administrative Agent's, as the case may be, net income by the jurisdiction under the laws of which such Bank or the Administrative Agent, as the case may be, is organized or maintains a Lending Office or any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings and liabilities being hereinafter referred to as "Taxes"). (b) In addition, the Borrower shall pay any present or future stamp or documentary taxes, intangible taxes, mortgage recording taxes or any other sales, excise or property taxes, charges or similar levies which arise from any payment made hereunder or from the execution, delivery or registration of, or otherwise with respect to, this Agreement or any other Loan Document (hereinafter referred to as "Other Taxes"). (c) Subject to Section 3.05(g), the Borrower shall indemnify and hold harmless each Bank and the Administrative Agent for the full amount of Taxes or Other Taxes (including any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this Section 3.05) paid by such Bank or the Administrative Agent, as the case may be, and any liability (including penalties, interest, additions to tax and expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted. Payment under this indemnification shall be made within 30 days from the date such Bank or the Administrative Agent, as the case may be, makes written demand therefor. (d) If the Borrower shall be required by law to deduct or withhold any Taxes or Other Taxes from or in respect of any sum payable hereunder to any Bank or the Administrative Agent, then, subject to Section 3.05(g), (i) the sum payable shall be increased as may be necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 3.05) such Bank or the Administrative Agent, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made; (ii) the Borrower shall make such deductions; and (iii) the Borrower shall pay the full amount deducted to the relevant taxation authority or other authority in accordance with applicable law. 120 (e) Within 30 days after the date of any payment by the Borrower of Taxes or Other Taxes, the Borrower shall furnish to the Administrative Agent the original or a certified copy of a receipt evidencing such payment, or other evidence of such payment satisfactory to the Administrative Agent. (f) Each Bank which is a foreign Person (i.e., a Person other than a United States Person for United States Federal income tax purposes) hereby agrees that: (i) it shall no later than on the Effective Date (or, in the case of a Bank which becomes a party hereto pursuant to Section 10.08 after the Effective Date, the date upon which such Bank becomes a party hereto) deliver to the Administrative Agent (two originals) and to the Borrower (one original): (A) if any Lending Office is located in the United States of America, accurate and complete signed copies of IRS Form W-8ECI or any successor thereto ("Form W-8ECI"), and/or (B) if any Lending Office is located outside the United States of America, accurate and complete signed copies of IRS Form W-8BEN or any successor thereto ("Form W-8BEN"), in each case indicating that such Bank is on the date of delivery thereof entitled to receive payments of principal, interest and fees for the account of such Lending Office or Lending Offices under this Agreement free from withholding of United States Federal income tax; (ii) if at any time such Bank changes its Lending Office or Lending Offices or selects an additional Lending Office it shall, at the same time, but only to the extent the forms previously delivered by it hereunder are no longer effective, deliver to the Administrative Agent (two originals) and to the Borrower (one original), in replacement for the forms previously delivered by it hereunder: (A) if such changed or additional Lending Office is located in the United States of America, accurate and complete signed originals of Form W-8ECI; or (B) otherwise, accurate and complete signed originals of Form W- 8BEN, in each case indicating that such Bank is on the date of delivery thereof entitled to receive payments of principal, interest and fees for the account of such changed or additional Lending Office under this Agreement free from withholding of United States Federal income tax; (iii) it shall, upon the expiration of the most recent Form W-8ECI or Form W-8BEN previously delivered by such Bank or upon such Form becoming inaccurate, incomplete or obsolete in any respect (in each case, other than as a result of any event mentioned in clause (ii) above), deliver to the Administrative Agent (two originals) and to the Borrower (one original) accurate and complete signed copies of Form W-8ECI or Form W-8BEN in replacement for the forms previously delivered by such Bank; (iv) it shall, promptly upon the request of the Administrative Agent or the Borrower, deliver to the Administrative Agent and the Borrower, such other forms or similar documentation as may be required from time to time by any applicable law, treaty, rule or regulation in order to establish such Bank's tax status for withholding purposes; (v) if such Bank claims exemption from withholding tax under a United States tax treaty by providing a Form 1001 and such Bank sells or grants a participation of all or part of its rights under this Agreement, it shall notify the Administrative Agent of the percentage amount in which it is no longer the beneficial owner under this Agreement. To the extent of this percentage amount, the Administrative Agent shall treat such Bank's Form 1001 as no longer in compliance with 121 this Section 3.05(f). In the event a Bank claiming exemption from United States withholding tax by filing Form W-8ECI with the Administrative Agent, sells or grants a participation in its rights under this Agreement, such Bank agrees to undertake sole responsibility for complying with the withholding tax requirements imposed by Sections 1441 and 1442 of the Code; and (vi) if the IRS or any authority of the United States of America or other jurisdiction asserts a claim that the Administrative Agent or the Borrower did not properly withhold tax from amounts paid to or for the account of any Bank (but only to the extent such claim arises because the appropriate form was not delivered, was not properly executed, because such Bank failed to notify the Administrative Agent of a change in circumstances which rendered the exemption from withholding tax ineffective or because of such Bank's sale of a participating interest in a Loan), such Bank shall indemnify the Administrative Agent and/or the Borrower, as applicable, fully for all amounts paid, directly or indirectly, by the Administrative Agent and/or the Borrower, as tax or otherwise, including penalties and interest, and including any taxes imposed by any jurisdiction on the amounts payable to the Administrative Agent or the Borrower under this Section 3.05(f), together with all costs, expenses and attorneys' fees (including the allocated cost of in-house counsel). Without limiting or restricting any Bank's right to increased amounts under Section 3.05(d) from the Borrower subject to satisfaction of such Bank's obligations under the provisions of this Section 3.05(f), if such Bank is entitled to a reduction in the applicable withholding tax, the Administrative Agent may withhold from any interest payment to such Bank an amount equivalent to the applicable withholding tax after taking into account such reduction. If the forms or other documentation required by clause (i) above are not delivered to the Administrative Agent, then the Administrative Agent may withhold from any interest payment to the Bank not providing such forms or other documentation, an amount equivalent to the applicable withholding tax. In addition, the Administrative Agent may also withhold against periodic payments other than interest payments to the extent United States withholding tax is not eliminated by obtaining Form W- 8ECI or Form W-8BEN. (g) The Borrower shall not be required to pay any additional amounts in respect of United States Federal income tax pursuant to Section 3.05(d) to any Bank that is a foreign Person for the account of any Lending Office of such Bank: (i) if the obligation to pay such additional amounts would not have arisen but for a failure by such Bank to comply with its obligations under Section 3.05(f) in respect of such Lending Office; (ii) if such Bank shall have delivered to the Administrative Agent and the Borrower a Form W-8ECI in respect of such Lending Office pursuant to Sections 3.05(f)(i)(A), 3.05(f)(ii)(a) or 3.05(f)(iii) and such Bank shall not at any time be entitled to exemption from deduction or withholding of United States Federal income tax in respect of payments by the Borrower hereunder for the account of such Lending Office for any reason other than a change in United States law or regulations or in the official interpretation of such law or regulations by any Governmental Authority charged with the interpretation or administration thereof (whether or not having the force of law) after the date of delivery of such Form W-8ECI; or 122 (iii) if such Bank shall have delivered to the Administrative Agent and the Borrower a Form 1001 in respect of such Lending Office pursuant to Sections 3.05(f)(i)(B), 3.05(f)(ii)(b) or 3.05(f)(iii) and such Bank shall not at any time be entitled to exemption from deduction or withholding of United States Federal income tax in respect of payments by the Borrower hereunder for the account of such Lending Office for any reason other than a change in United States law or regulations or any applicable tax treaty or regulations or in the official interpretation of any such law, treaty or regulations by any Governmental Authority charged with the interpretation or administration thereof (whether or not having the force of law) after the date of delivery of such Form W-8BEN. (h) Any and all present or future Taxes, Other Taxes and related liabilities (including penalties, interest, additions to tax and expenses) which are not paid by the Borrower pursuant to and as required by this Section 3.05 shall be paid by the Bank which received the principal, interest or fees in respect of which such Taxes, Other Taxes or related liabilities are payable. Any and all present or future Taxes or Other Taxes which are required by law to be deducted or withheld from or in respect of any sum payable hereunder to any Bank and which are not paid by the Borrower pursuant to and as required by this Section 3.05 will be deducted or withheld by the Administrative Agent without any increase in the sum payable as provided in Section 3.05(d). Each Bank agrees to indemnify the Administrative Agent and hold the Administrative Agent harmless for the full amount of any and all present or future Taxes, Other Taxes and related liabilities (including penalties, interest, additions to tax and expenses, and any Taxes or Other Taxes imposed by any jurisdiction on amounts payable to the Administrative Agent under this Section 3.05(h)) which are imposed on or with respect to principal, interest or fees payable to such Bank hereunder and which are not paid by the Borrower pursuant to this Section 3.05, whether or not such Taxes, Other Taxes or related liabilities were correctly or legally asserted. This indemnification shall be made within 30 days from the date the Administrative Agent makes written demand therefor. SECTION 3.06. Sharing of Payments, Etc. If other than as provided in Section 3.05, 3.08, 3.09, 3.10, 3.11 or 3.12, any Bank shall obtain any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise) on account of any Committed Loan made by it and, after acceleration of all Obligations pursuant to Section 8.02(b), in respect of any Obligation owing to it (including with respect to any Bid Loan), in the case of the Committed Loan, in excess of its Percentage Share of payments on account of the Committed Loans obtained by all the Banks and, after acceleration, in excess of its pro rata share of all Obligations, such Bank shall forthwith (a) notify the Administrative Agent of such fact and (b) purchase from the other Banks such participations in the Committed Loans made by them or, after acceleration, in all Obligations owing to them, as shall be necessary to cause such purchasing Bank to share the excess payment ratably with each of the other Banks according to their respective Percentage Shares or, after acceleration, their pro rata shares of all Obligations then owing to them; provided, however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Bank, such purchase shall to the extent of such recovery be rescinded and each other Bank shall repay to the purchasing Bank the purchase price thereto together with an amount equal to such paying Bank's ratable share (according to the proportion of (i) the amount of such paying Bank's required repayment to (ii) the total amount so recovered from the purchasing Bank) of any interest or other amount paid or payable by the purchasing Bank 123 in respect of the total amount so recovered. The Borrower agrees that any Bank so purchasing a participation from another Bank pursuant to the provisions of this Section 3.06 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off) with respect to such participation as fully as if such Bank were the direct creditor of the Borrower in the amount of such participation. The Administrative Agent will keep records (which shall be conclusive and binding in the absence of manifest error), of participations purchased pursuant to this Section 3.06 and will in each case notify the Banks following any such purchases. SECTION 3.07. Inability to Determine Rates. If with respect to any Interest Period for Eurodollar Loans, the Administrative Agent shall determine, or Majority Banks shall notify the Administrative Agent, that LIBOR for such Interest Period will not adequately and fairly reflect the cost to Banks of making, funding or maintaining their Eurodollar Loans for such Interest Period (after giving effect to any event giving rise to additional interest on such Loans pursuant to Section 3.12), the Administrative Agent shall forthwith so notify the Borrower and the Banks, whereupon the obligations of the Banks to make or continue Committed Loans as Eurodollar Loans or to convert Committed Loans into Eurodollar Loans at the end of the then current Interest Period shall be suspended until the Administrative Agent upon the instruction of the Majority Banks revokes such notice. Upon receipt of such notice, the Borrower may revoke its Notice of Borrowing or Notice of Conversion/Continuation then submitted by it. If the Borrower does not revoke such notice, the Banks shall make, convert or continue the Committed Loans, as proposed by the Borrower, in the amount specified in the applicable notice submitted by the Borrower, but such Loans shall be made, converted or continued as Reference Rate Loans instead of Eurodollar Loans. SECTION 3.08. Increased Costs. If any Bank shall determine that, due to either (a) the introduction of any Requirement of Law or any change (other than any change by way of imposition of or increase in reserve requirements included in the Eurodollar Reserve Percentage) in or in the interpretation thereof or (b) the compliance with any guideline or request from any central bank or other Governmental Authority (whether or not having the force of law), there shall be any increase in the cost to such Bank of agreeing to make or making, funding or maintaining any Committed Loan, the Borrower shall be liable for, and shall from time to time, upon demand by such Bank (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Bank, additional amounts sufficient to compensate such Bank for such increased costs. SECTION 3.09. Illegality. (a) If any Bank shall determine that the introduction of any Requirement of Law, or any change in or in the interpretation thereof has made it unlawful, or any central bank or other Governmental Authority shall assert that it is unlawful, for such Bank or its Lending Office to make or continue to fund Loans as Eurodollar Loans or to convert Loans into Eurodollar Loans, then, on notice thereof by such Bank to the Borrower through the Administrative Agent, the obligation of such Bank to make or to continue to fund Loans as Eurodollar Loans or to convert any Loans into Eurodollar Loans shall be suspended until such Bank shall have notified the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. (b) If a Bank shall determine that it is unlawful to maintain any Eurodollar Loan made by such Bank, the Borrower shall prepay in full all Eurodollar Loans of such Bank then outstanding, together with interest accrued thereon, either on the last day of the then current Interest Period applicable to each such Eurodollar Loan if such Bank may lawfully continue 124 to maintain such Eurodollar Loan to such day, or immediately, together with any amounts required to be paid pursuant to Section 3.11, if such Bank may not lawfully continue to maintain such Eurodollar Loan to such day, unless the Borrower, on or prior to the date on which it would otherwise be required to prepay such Eurodollar Loan, converts all Eurodollar Loans of such Bank then outstanding into Reference Rate Loans. (c) Notwithstanding the foregoing, if the obligation of any Bank to make or maintain Eurodollar Loans has been suspended, the Borrower may elect by giving notice to such Bank through the Administrative Agent that all Loans which would otherwise be made or maintained by such Bank as Eurodollar Loans shall be instead Reference Rate Loans. SECTION 3.10. Capital Adequacy. If any Bank shall have determined that the compliance with any Requirement of Law regarding capital adequacy, or any change therein or in the interpretation or application thereof or compliance by such Bank (or its Lending Office) or any corporation controlling such Bank with any request or directive regarding capital adequacy (whether or not having the force of law) from any central bank or other Governmental Authority, affects or would affect the amount of capital required or expected to be maintained by such Bank or any corporation controlling such Bank and such Bank (taking into consideration such Bank's or such corporation's policies with respect to capital adequacy and such Bank's desired return on capital) determines that the amount of such capital is increased as a consequence of such Bank's Commitment, loans or obligations under this Agreement with respect to any Committed Borrowing then from time to time, upon demand of such Bank (with a copy of such demand to the Administrative Agent), the Borrower shall be liable for, and shall pay to the Administrative Agent for the account of such Bank, as specified by such Bank, additional amounts sufficient to compensate such Bank for such increase. SECTION 3.11. Funding Losses. The Borrower agrees to reimburse each Bank and to hold each Bank harmless from any loss, cost or expense which such Bank may sustain or incur as a consequence of: (a) any failure of the Borrower to borrow, continue or convert a Eurodollar Loan after the Borrower has given (or is deemed to have given) a Notice of Borrowing or a Notice of Conversion/Continuation; (b) any prepayment or payment of a Eurodollar Loan on a day which is not the last day of the Interest Period with respect thereto; (c) any failure of the Borrower to make any prepayment after the Borrower has given a notice in accordance with Section 2.07; or (d) the conversion of any Eurodollar Loan to a Reference Rate Loan on a day that is not the last day of the respective Interest Period pursuant to Section 2.11; including any such loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain its Eurodollar Loans hereunder or from fees payable to terminate the deposits from which such funds were obtained. SECTION 3.12. Additional Interest on Eurodollar Loans. The Borrower shall pay to each Bank, at the request of such Bank (but not more frequently than once in each calendar quarter), as long as such Bank shall be required under regulations of the Federal Reserve Board to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency Liabilities, additional interest on the unpaid principal amount of each Eurodollar Loan of such Bank from the date such Eurodollar Loan is made until such principal amount is paid in full, at a rate per annum equal at all times to the remainder obtained by subtracting (a) LIBOR for the Interest Period for such Eurodollar Loan from (b) the rate obtained by dividing such LIBOR by a percentage equal to 100% minus the Eurodollar 125 Reserve Percentage of such Bank for such Interest Period, payable on each date interest in respect of such Eurodollar Loan is payable. Notwithstanding the provisions of the previous sentence, the Borrower shall not be obligated to pay to any Bank any additional interest in respect of Eurodollar Loans made by such Bank for any period commencing more than three months prior to the date on which such Bank notifies the Borrower by delivering a certificate from a financial officer of such Bank, that such Bank is required to maintain reserves with respect to Eurocurrency Liabilities. SECTION 3.13. Certificates of Banks. Any Bank claiming reimbursement or compensation pursuant to Section 3.05, 3.08, 3.10, 3.11 and/or 3.12 shall deliver to the Borrower (with a copy to the Administrative Agent) a certificate setting forth in reasonable detail the basis for computing the amount payable to such Bank hereunder and such certificate shall be conclusive and binding on the Borrower in the absence of manifest error. Unless otherwise specifically provided herein, the Borrower shall pay to any Bank claiming compensation or reimbursement from the Borrower pursuant to Section 3.08, 3.10, 3.11 or 3.12, the amount requested by such Bank no later than five Business days after such demand. SECTION 3.14. Change of Lending Office; Replacement Bank. (a) Each Bank agrees that upon the occurrence of any event giving rise to the operation of Section 3.05(c) or (d) or Section 3.08 or 3.09 with respect to such Bank, it will if so requested by the Borrower, use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to designate a different Lending Office for any Loans affected by such event with the object of avoiding the consequence of the event giving rise to the operation of such Section; provided, however, that such designation would not, in the judgment of such Bank, be otherwise disadvantageous to such Bank. Nothing in this Section 3.14 shall affect or postpone any of the obligations of the Borrower or the right of any Bank provided in Section 3.05(c) or (d) or Section 3.08 or 3.09. (b) In the event the Borrower becomes obligated to pay additional amounts to any Bank pursuant to Sections 3.05(c) or (d) or 3.08, or if it becomes illegal for any Bank to continue to fund or to make Eurodollar Loans pursuant to Section 3.09, as a result of any condition described in any such Section, then, unless such Bank has theretofore taken steps to remove or cure, and has removed or cured, the conditions creating the cause for such obligation to pay such additional amounts or for such illegality, the Borrower may designate another Bank which is reasonably acceptable to the Administrative Agent and the Majority Banks (such Bank being herein called a "Replacement Bank") to purchase the Committed Loans of such Bank and such Bank's rights hereunder, without recourse to or warranty by, or expense to, such Bank for a purchase price equal to the outstanding principal amount of the Committed Loans payable to such Bank plus any accrued but unpaid interest on such Loans and accrued but unpaid fees in respect of such Bank's Commitment and any other amounts payable to such Bank under this Agreement, and to assume all the obligations of such Bank hereunder (except for such rights as survive repayment of the Loans), and, upon such purchase, such Bank shall no longer be a party hereto or have any rights hereunder (except those related to any Bid Loans of such Bank which remain outstanding and those that survive full payment hereunder) and shall be relieved from all obligations to the Borrower hereunder, and the Replacement Bank shall succeed to the rights and obligations of such Bank hereunder. 126 ARTICLE IV Representations and Warranties The Borrower represents and warrants to the Administrative Agent and each Bank that: SECTION 4.01. Corporate Existence; Compliance with Law. The Borrower and each of its Subsidiaries: (a) is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation; (b) is duly qualified as a foreign corporation and in good standing under the laws of each jurisdiction where its ownership, lease or operation of property or the conduct of its business requires such qualification except where the failure to so qualify has no reasonable likelihood of having a Material Adverse Effect; (c) has all requisite corporate power and authority to own, pledge, mortgage, hold under lease and operate its properties, and to conduct its business as now or currently proposed to be conducted; (d) is in compliance with its certificate of incorporation and by- laws; and (e) is in compliance with all other Requirements of Law except such non-compliance as has no reasonable likelihood of having a Material Adverse Effect. SECTION 4.02. Corporate Authorization; No Contravention; Governmental Authorization. The execution, delivery and performance by the Borrower of the Loan Documents, the borrowing of the Loans, the Acquisition, the Merger and the other Transactions: (a) are within the corporate powers of the Borrower; (b) have been duly authorized by all necessary corporate action, including the consent of shareholders where required; (c) do not and will not: (i) contravene the certificate of incorporation or by-laws of the Borrower; (ii) violate any other Requirement of Law (including the Securities Exchange Act of 1934, Regulations T, U and X of the Federal Reserve Board or any order or decree of any court or other Governmental Authority); (iii) conflict with or result in the breach of, or constitute a default under, any Contractual Obligation binding on or affecting the Borrower or any of its properties, if such breach or default has any reasonable likelihood of having a Material Adverse Effect, or any order, injunction, writ or decree of any Governmental Authority to which the Borrower or any of its properties is subject; or (iv) result in the creation or imposition of any Lien upon any of the property of the Borrower; and (d) do not require the consent, authorization by or approval of or notice to or filing or registration with any Governmental Authority or any other Person other than those which have been duly obtained, made or given. SECTION 4.03. Enforceable Obligations. This Agreement and the other Loan Documents have been duly executed and delivered by the Borrower. This Agreement and each other Loan Document are legal, valid and binding obligations of the Borrower, enforceable against the Borrower in accordance with their respective terms except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws or equitable principles relating to or limiting creditors' rights generally. 127 SECTION 4.04. Taxes. The Borrower and its Subsidiaries have filed all Federal and other material tax returns and reports required to be filed, and have paid all Federal and other material taxes and assessments payable by them, to the extent the same have become due and payable and before they have become delinquent, except those which are currently being contested in good faith by appropriate proceedings and for which adequate reserves have been provided in accordance with GAAP, provided the non- payment thereof has no reasonable likelihood of having a Material Adverse Effect. The Borrower does not know of any proposed material tax assessment against the Borrower or any of its Subsidiaries and in the opinion of the Borrower, all potential tax liabilities are adequately provided for on the books of the Borrower and its Subsidiaries. The statute of limitations for assessment or collection of Federal income tax has expired for all federal income tax returns filed by the Borrower for all tax years up to and including the tax year ended in March 1992. SECTION 4.05. Financial Matters. (a) The consolidated balance sheet of the Borrower and its Subsidiaries as of the last day of the fiscal year of the Borrower ended on September 30, 2000, and the related consolidated statements of income, shareholders' equity and cash flows of the Borrower and its Subsidiaries for such fiscal year, with reports thereon by Ernst & Young LLP: (i) are complete, accurate and fairly present the financial condition of the Borrower and its Subsidiaries as of the date thereof and for the period covered thereby; (ii) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as set forth in the notes thereto; and (iii) except as specifically disclosed in Schedule 4.05, show all material indebtedness and other liabilities, direct or contingent, of the Borrower and its consolidated Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and long-term leases. (b) The consolidated balance sheet of IBP and its Subsidiaries as of the last day of the fiscal year of IBP ended on December 25, 1999, and as of the last day of the fiscal quarter of IBP ended on September 23, 2000, and the related consolidated statements of earnings, changes in stockholders' equity and comprehensive income, and of cash flows of IBP and its Subsidiaries for such fiscal year and quarter, with, in the case of said fiscal year, reports thereon by PriceWaterhouseCoopers LLP: (i) except as disclosed on Schedule 4.05, are complete, accurate and fairly present the financial condition of IBP and its Subsidiaries as of the respective dates thereof and for the periods covered thereby; (ii) except as disclosed on Schedule 4.05, were prepared in accordance with GAAP consistently applied throughout the periods covered thereby, except as set forth in the notes thereto; and (iii) except as specifically disclosed in Schedule 4.05, show all material indebtedness and other liabilities, direct or contingent, of IBP and its consolidated Subsidiaries as of the dates thereof, including liabilities for taxes, material commitments and long-term leases. (c) The Borrower has heretofore furnished to the Lenders its pro forma consolidated balance sheet as of March 31, 2001, prepared giving effect to the Transactions as if the Transactions had occurred on such date and included in the model delivered by the Borrower to the Banks prior to the date hereof. Such pro forma consolidated balance sheet (i) has been prepared in good faith based on assumptions believed by the Borrower to be reasonable, (ii) is based on the best information available to the Borrower 128 after due inquiry, (iii) accurately reflects all adjustments necessary to give effect to the Transactions and (iv) presents fairly, in all material respects, the pro forma financial position of the Borrower and its consolidated Subsidiaries as of March 31, 2001, as if the Transactions had occurred on such date. (d) Since September 30, 2000, with respect to the Borrower and its Subsidiaries (other than IBP and its Subsidiaries), and December 25, 1999, with respect to IBP and its Subsidiaries, there has been no Material Adverse Effect and no development which has any reasonable likelihood of having a Material Adverse Effect. (e) The Borrower is, and the Borrower and its Subsidiaries are, on a consolidated basis, Solvent. SECTION 4.06. Litigation. There are no actions, suits, proceedings, claims or disputes pending, or to the best knowledge of the Borrower, threatened, against the Borrower or any of its Subsidiaries before any court or other Governmental Authority or any arbitrator that have a reasonable likelihood of having a Material Adverse Effect. All pending actions or proceedings affecting the Borrower or any of its Subsidiaries as of the date hereof and involving claims in excess of $10,000,000 are described in Schedule 4.06. SECTION 4.07. Subsidiaries. (a) A complete and correct list of all Subsidiaries of the Borrower after giving effect to the transactions to occur on the Acquisition Date, showing, as to each Subsidiary, the correct name thereof, the jurisdiction of its incorporation and the percentage of shares of each class outstanding owned by the Borrower and each other Subsidiary of the Borrower is set forth in Schedule 4.07(a). (a) All of the outstanding shares of each of the Subsidiaries listed on Schedule 4.07(a) have been validly issued, are fully paid and non- assessable and (other than the shares of IBP) are owned by the Borrower or another Subsidiary of the Borrower, free and clear of any Lien. (b) The Borrower has no obligation to capitalize any of its Subsidiaries. (c) A complete and correct list of all joint ventures in which the Borrower or any of its Subsidiaries is a partner is set forth in Schedule 4.07(d). SECTION 4.08. Liens. There are no Liens of any nature whatsoever on any properties of the Borrower or any of its Subsidiaries other than Permitted Liens. SECTION 4.09. No Burdensome Restrictions; No Defaults. (a) Neither the Borrower nor any of its Subsidiaries is a party to or bound by any Contractual Obligation, or subject to any charter or corporate restriction or any Requirement of Law, which has any reasonable likelihood of having a Material Adverse Effect. (b) Neither the Borrower nor any of its Subsidiaries is in default under or with respect to any Contractual Obligation in any respect which, individually or together with all such defaults, has a reasonable likelihood of having a Material Adverse Effect. (c) No Default or Event of Default exists or would result from the incurring of any Obligations by the Borrower or any of its Subsidiaries. SECTION 4.10. Investment Company Act. Neither the Borrower nor any of its Subsidiaries is an "investment company" or an "affiliated person" of, or "promoter" or "principal underwriter" for, an "investment company", as such terms are defined in the Investment Company Act of 1940, as amended. The making of the Loans by the Banks and the application of the proceeds and repayment thereof by the Borrower and the consummation of the transactions contemplated by the Loan Documents will not violate any provision of such 129 Act or any rule, regulation or order issued by the Securities and Exchange Commission thereunder. SECTION 4.11. Use of Proceeds; Margin Regulations. No part of the proceeds of any Loan will be used, and no Loan will otherwise be, in violation of Regulation T, U or X of the Federal Reserve Board. SECTION 4.12. Assets. (a) The Borrower and each of its Subsidiaries has good record and marketable title to all real property necessary or used in the ordinary conduct of its business, except for Permitted Liens and such defects in title as have no reasonable likelihood, individually or in the aggregate, of having a Material Adverse Effect. (b) The Borrower and each of its Subsidiaries owns or licenses or otherwise has the right to use all material licenses, permits, patents, trademarks, service marks, trade names, copyrights, franchises, authorizations and other intellectual property rights that are necessary for the operation of its business, without infringement of or conflict with the rights of any other Person with respect thereto, except for such infringements or conflicts as have no reasonable likelihood of having a Material Adverse Effect. No material slogan or other advertising device, product, process, method or other material now employed, or now contemplated to be employed, by the Borrower or any of its Subsidiaries infringes upon or conflicts with any rights owned by any other Person except for such infringements or conflicts as have no reasonable likelihood, individually or in the aggregate, of having a Material Adverse Effect. SECTION 4.13. Labor Matters. There are no strikes or other labor disputes pending or, to the knowledge of the Borrower, threatened against the Borrower or any of its Subsidiaries which have any reasonable likelihood of having a Material Adverse Effect. Except as disclosed in Schedule 4.13, no significant unfair labor practice complaint is pending or, to the knowledge of the Borrower, threatened, against the Borrower or any of its Subsidiaries before any Governmental Authority. SECTION 4.14. Environmental Matters. Except as disclosed in Schedule 4.14: (a) the on-going operations of the Borrower and each of its Subsidiaries comply in all respects with all Environmental Laws except such non-compliance as has no reasonable likelihood of having a Material Adverse Effect; (b) the Borrower and each of its Subsidiaries have obtained all environmental, health and safety permits necessary or required for its operations, all such permits are in good standing, and the Borrower and each of its Subsidiaries is in compliance with all material terms and conditions of such permits; (c) none of the Borrower, any of its Subsidiaries or any of their present property or operations (or past property or operations) is subject to any outstanding written order from or agreement with any Governmental Authority nor subject to any judicial or docketed administrative proceeding, respecting any Environmental Claim or Hazardous Material which, in each case, has any reasonable likelihood of having a Material Adverse Effect; (d) there are no conditions or circumstances associated with any property of the Borrower or any of its Subsidiaries formerly owned and operated by the Borrower or any of its Subsidiaries or any of their predecessors or with the former operations, including off-site disposal practices, of the Borrower or its Subsidiaries or their predecessors which may give rise to Environmental Claims which in the aggregate have any reasonable likelihood of having a Material Adverse Effect; and (e) there are no conditions or circumstances which may give rise to any Environmental Claim arising from the operations of the Borrower or its Subsidiaries, including Environmental Claims associated with any 130 operations of the Borrower or its Subsidiaries, which have any reasonable likelihood of having a Material Adverse Effect. In addition, (i) neither the Borrower nor any of its Subsidiaries has any underground storage tanks (a) that are not properly permitted under applicable Environmental Laws or (b) that to the best of the Borrower's knowledge, are leaking or dispose of Hazardous Materials off-site and (ii) the Borrower and each of its Subsidiaries has notified all of its employees of the existence, if any, of any health hazard arising from the conditions of their employment and have met all notification requirements under Title III of CERCLA and under OSHA and all other Environmental Laws. SECTION 4.15. Completeness. None of the representations or warranties of the Borrower contained herein or in any other Loan Document or in any certificate or written statement furnished by or on behalf of the Borrower pursuant to the provisions of this Agreement or any other Loan Document contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements contained herein or therein, in light of the circumstances under which they are made, not misleading. There is no fact known to the Borrower which the Borrower has not disclosed to the Banks which may have a Material Adverse Effect. SECTION 4.16. ERISA. (a) Neither the Borrower nor any member of its Controlled Group contributes to any Plan other than those set forth in Schedule 4.16. (b) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and any other applicable Federal or state law and rules and regulations promulgated thereunder. With respect to each Plan (other than a Multiemployer Plan) all material reports required under ERISA or any other applicable law or regulation to be filed with the relevant Governmental Authority, the failure of which to file could reasonably result in liability of the Borrower or any member of its Controlled Group in excess of $500,000 have been duly filed and all such reports are true and correct in all material respects as of the date given. (c) Except as set forth in Schedule 4.16, no Plan has been terminated nor has any accumulated funding deficiency (as defined in Section 412(a) of the Code) been incurred (without regard to any waiver granted under Section 412 of the Code) nor has any funding waiver from the IRS been received or requested. (d) Neither the Borrower nor any member of its Controlled Group has failed to make any contribution or pay any amount due or owing as required by Section 412 of the Code or Section 302 of ERISA or the terms of any such Plan prior to the due date (including permissible extensions thereof) under Section 412 of the Code and Section 302 of ERISA. (e) There has been no ERISA Event or any event requiring disclosure under Section 4041(c)(3)(C), 4068(f), 4063(a) or 4043(b) of ERISA with respect to any Plan or trust of the Borrower or any member of its Controlled Group. (f) Except as set forth in Schedule 4.16, the value of the assets of each Plan (other than a Multiemployer Plan) equalled or exceeded the present value of the benefit liabilities, as defined in Title IV of ERISA, of each such Plan as of the most recent valuation date using Plan actuarial assumptions at such date. (g) There are no pending claims, lawsuits or actions (other than routine claims for benefits in the ordinary course) asserted or instituted against, and neither the Borrower nor any member of its Controlled Group has knowledge of any threatened litigation or claims against, (i) the assets of any Plan or trust or against any fiduciary of a Plan with respect to the operation of such Plan which has any reasonable likelihood of having a Material Adverse Effect or (ii) the assets of any employee welfare benefit 131 plan maintained by the Borrower or any member of its Controlled Group within the meaning of Section 3(1) of ERISA or against any fiduciary thereof with respect to the operation of any such Plan which has any reasonable likelihood of having a Material Adverse Effect. (h) Neither the Borrower nor any member of its Controlled Group has engaged in any prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, in connection with any Plan. (i) Neither the Borrower nor any member of its Controlled Group (i) has incurred or reasonably expects to incur (a) any liability under Title IV of ERISA (other than premiums due under Section 4007 of ERISA to the PBGC) or (b) any withdrawal liability (and no event has occurred which with the giving of notice under Section 4219 of ERISA would result in such liability) under Section 4201 of ERISA as a result of a complete or partial withdrawal (within the meaning of Section 4203 or 4205 of ERISA) from a Multiemployer Plan or (c) any liability under Section 4062 of ERISA to the PBGC or to a trustee appointed under Section 4042 of ERISA, or (ii) has withdrawn from any Multiemployer Plan. (j) Neither the Borrower nor any member of its Controlled Group nor any organization to which the Borrower or any member of its Controlled Group is a successor or parent corporation within the meaning of Section 4069(b) of ERISA has engaged in a transaction within the meaning of Section 4069 of ERISA. (k) Except as set forth in Schedule 4.16, neither the Borrower nor any member of its Controlled Group maintains or has established any welfare benefit plan within the meaning of Section 3(1) of ERISA which provides for (i) continuing benefits or coverage for any participant or any beneficiary of any participant after such participant's termination of employment except as may be required by the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA") and the regulations thereunder, and at the expense of the participant or the beneficiary of the participant, or (ii) retiree medical liabilities. The Borrower and each member of its Controlled Group which maintains a welfare benefit plan within the meaning of Section 3(1) of ERISA has complied with any applicable notice and continuation requirements of COBRA and the regulations thereunder, except where the failure to so comply could not result in the loss of a tax deduction or imposition of a tax or other penalty on the Borrower or any member of its Controlled Group. SECTION 4.17. Insurance. The properties of the Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies, in such amounts, with such deductibles and covering such risks as are customarily carried by companies engaged in similar business and owning similar properties in localities where the Borrower and its Subsidiaries operate. ARTICLE V Conditions Precedent SECTION 5.01. Conditions Precedent to Effectiveness. The obligation of each Bank to make Loans hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 10.02): (a) Credit Agreement and Notes. The Administrative Agent shall have received (i) counterparts of this Agreement executed by the Borrower, the Administrative Agent and each of the Banks and of any promissory notes requested by the Banks pursuant to Section 2.05 executed by the Borrower, or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of signed counterparts) that such parties have signed such counterparts; 132 (b) Board Resolutions; Approvals; Incumbency Certificates. The Administrative Agent shall have received (i) copies of the resolutions of the Board of Directors of the Borrower approving and authorizing the execution, delivery and performance by the Borrower of this Agreement and of each of the other Loan Documents to be delivered hereunder by it, and authorizing the borrowing of the Loans, the Acquisition, the Merger and the other Transactions, certified as of the Effective Date by the Secretary or an Assistant Secretary of the Borrower; and (ii) a certificate of the Secretary or Assistant Secretary of the Borrower certifying the names and true signatures of the officers of the Borrower authorized to execute and deliver this Agreement and all other Loan Documents to be delivered hereunder by it; (c) Articles of Incorporation; By-laws and Good Standing. The Administrative Agent shall have received each of the following documents: (i) the articles or certificate of incorporation of the Borrower as in effect on the Effective Date, certified by the Secretary of State of Delaware as of a recent date and by the Secretary or Assistant Secretary of the Borrower as of the Effective Date and the by- laws of the Borrower and IBP as in effect on the Effective Date, certified by the Secretary or Assistant Secretary of the Borrower as of the Effective Date; and (ii) good standing certificates as of a recent date for the Borrower from the Secretaries of State of such states as the Administrative Agent may request; (d) Legal Opinion. The Administrative Agent shall have received a favorable opinion, dated the Effective Date and addressed to the Administrative Agent and the Banks of Corporate Counsel of the Borrower and its Subsidiaries to substantially the effect set forth on Exhibit 5.01 and as to such other matters as any Bank through the Administrative Agent may reasonably request (and the Borrower hereby instructs such counsel to deliver such opinion); (e) Certificate. The Administrative Agent shall have received a certificate signed by a Responsible Officer of the Borrower, (accompanied, if applicable, by a supporting certificate signed by a Responsible Officer of IBP) dated as of the Effective Date, stating that: (i) the representations and warranties contained in Article IV are true and correct on and as of such date, as though made on and as of such date (which statement may be qualified as required in the event the supporting certificate from IBP is not available); (ii) no Default or Event of Default exists or would result from the initial Borrowing hereunder; and (iii) there has not occurred or become known since September 30, 2000, any condition or change that has affected or could reasonably be expected to affect materially and adversely the business, assets, liabilities, financial condition or material agreements of the Borrower and its Subsidiaries, including IBP and its Subsidiaries, taken as a whole; (f) Other Documents. The Administrative Agent shall have received such other approvals, opinions or documents as the Administrative Agent or any Bank may request. (g) Fees, Costs and Expenses. The Borrower shall have paid all costs and expenses referred to in Section 10.04 (including legal fees and expenses and the allocated cost of in-house counsel) for which the Borrower has been invoiced prior to the Effective Date. The Administrative Agent shall notify the Borrower and the Banks of the Effective Date, and such notice shall be conclusive and binding. Notwithstanding the foregoing, the obligations of the Banks to make Loans 133 hereunder shall not become effective unless each of the foregoing conditions is satisfied (or waived pursuant to Section 10.02) at or prior to 3:00 p.m., New York City time, on March 30, 2001 (and, in the event such conditions are not so satisfied or waived, the Commitments shall terminate at such time). The effectiveness of the obligations to make Loans hereunder shall terminate (other than Loans made solely for the purpose of repaying commercial paper issued on or after the Effective Date but prior to the date of such termination, to the extent the proceeds of such commercial paper shall have been deposited in the account referred to in the last paragraph of this Section 5.01), and any outstanding Obligations shall become immediately due and payable at 3:00 p.m. on March 30, 2001 (or, in the case of Obligations incurred after such time shall become due and payable immediately following their incurrence), unless each of the following conditions is satisfied (or waived in accordance with Section 10.02): (h) IBP Guarantee. The Administrative Agent shall have received (i) a counterpart of the Guarantee Agreement executed by IBP or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed counterpart) that IBP has signed such counterpart, together with (a) a favorable opinion, dated the date of the Guarantee Agreement and addressed to the Administrative Agent and the Banks of counsel to IBP, to substantially the effect set forth on Exhibit 5.01 and as to such other matters as any Bank through the Administrative Agent may reasonably request, (b) such documents and certificates as the Administrative Agent, (b) such documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization, existence and good standing of IBP, the authorization of the Transactions to which IBP is party and (c) if not provided on the Effective Date, the supporting certificate referenced to in paragraph (e) above together with a revised certificate. (i) Tender Offer. The Tender Offer shall have been completed (after giving effect to the application of funds made available pursuant to clause (A)(ii) in the last paragraph of this Section 5.01) in accordance with applicable law and the terms of the Merger Agreement and the other documentation related to the Acquisition approved by the Banks prior to the date hereof, without modification or waiver of any material term or condition thereof not approved by the Administrative Agent, and the assets and liabilities of IBP and its Subsidiaries shall be consistent with the pro forma consolidated balance sheet referred to in Section 4.05(c). (j) Indebtedness. All credit exposures outstanding under the IBP Credit Agreement shall have been simultaneously repaid, prepaid, defeased or refinanced and all commitments thereunder shall have been terminated (or irrevocable notice of termination shall have been given by IBP), and after giving effect thereto and to the other transactions contemplated to occur in connection with the completion of the Tender Offer, the Borrower and its Subsidiaries (including IBP and its Subsidiaries) shall have outstanding no Indebtedness other than commitments and Indebtedness under or permitted by this Agreement and the Existing Credit Agreement, Indebtedness under the Borrower's commercial paper program and the Senior Notes, if any. (k) Approvals and Consents. All requisite governmental authorities and third parties shall have approved or consented to the Acquisition to the extent such approvals or consents are required under applicable laws or agreements or otherwise; all applicable appeal periods shall have expired; and there shall be no governmental or judicial action, actual or threatened, that could reasonably be expected to restrain, prevent or impose materially burdensome conditions on the Acquisition or the Transactions. There shall be no litigation or administrative action that could reasonably be expected to have a material adverse effect on the 134 business, assets, liabilities or financial condition of the Borrower and its Subsidiaries, including IBP and its Subsidiaries, taken as a whole. (l) Existing Credit Agreement. Any amendment, waiver or other modification of the Existing Credit Agreement required in connection with this Agreement, the Acquisition, the Merger or any other Transaction shall have become effective and shall be satisfactory in all respects to the Banks. The Administrative Agent shall notify the Borrower and the Banks of the Acquisition Date, and such notice shall be conclusive and binding. All proceeds of any commercial paper issued by the Borrower on or after the Effective Date but prior to the Acquisition Date shall to the extent that after giving effect to the issuance of such commercial paper (and to any repayment of commercial paper of the Borrower on the date of such issuance) the aggregate outstanding principal amount of commercial paper of the Borrower is in excess of the difference between the aggregate commitments under the Existing Credit Agreement (and/or any amendment of, supplement to or replacement of the Existing Credit Agreement) and the aggregate outstanding principal amount of the loans outstanding thereunder be held in an account of the Borrower maintained with the Administrative Agent pursuant to an account agreement satisfactory to the Borrower and the Administrative Agent and shall (a) be made available to the Borrower solely to finance (i) the refinancing of the IBP Credit Agreement and other Indebtedness of IBP on or after the date when the condition set forth in paragraph (h) shall have been satisfied and (ii) the consummation of the Tender Offer and the related Transactions on the date on which all the conditions set forth in paragraphs (h) through (l) are satisfied, or (b) if all such conditions are not satisfied on or prior to March 30, 2001, or any earlier date on which the Commitments shall have terminated, be applied solely to repay such commercial paper as it matures and all Obligations that may from time to time be outstanding on or after March 30, 2001, or any earlier date on which the Commitments shall have terminated. SECTION 5.02. Conditions Precedent to All Borrowings. The obligation of each Bank to make any Loan on or after the Effective Date shall be subject to the further conditions precedent that: (a) Notice of Borrowing. In the case of a Committed Borrowing, the Administrative Agent shall have received a Notice of Borrowing as required by Section 2.02. (b) Continuation of Representations and Warranties. The representations and warranties contained in Article IV and in each other Loan Document shall be true and correct on and as of the date of borrowing with the same effect as if made on and as of such date (except for representations and warranties expressly relating to an earlier date, in which case they shall be true and correct as of such earlier date). (c) No Existing Default. No Default or Event of Default shall exist and be continuing or shall result from the Loan being made on such date. (d) Other Assurances. The Administrative Agent shall have received such other approvals, opinions or documents as any Bank through the Administrative Agent may reasonably request related to the transactions contemplated hereby. Each Notice of Borrowing and Competitive Bid Request submitted by the Borrower hereunder shall constitute a representation and warranty by the Borrower hereunder, as of the date of each such notice, application or request and as of the date of each Borrowing relating thereto, that the conditions in this Section 5.02 are satisfied. 135 ARTICLE VI Affirmative Covenants The Borrower covenants and agrees that as long as any Bank shall have any Commitment hereunder or any Loan or other Obligation shall remain unpaid or unsatisfied, unless the Majority Banks waive compliance in writing: SECTION 6.01. Compliance with Laws, Etc. The Borrower shall comply, and cause each of its Subsidiaries to comply, with all applicable Requirements of Law, except such as may be contested in good faith by appropriate proceedings and which has no reasonable likelihood of having a Material Adverse Effect. SECTION 6.02. Use of Proceeds. The Borrower shall use the proceeds of any Loan hereunder made on or after the Effective Date to finance the Acquisition, to refinance the IBP Credit Agreement and other Indebtedness of IBP, to refinance the Borrower's commercial paper and for working capital and other general corporate purposes (including capital expenditures and acquisitions and to support the issuance of commercial paper) not in contravention of any Requirement of Law and consistent with the representations and warranties contained herein; provided, however, that the proceeds of any Loan hereunder may not be used to finance the purchase or other acquisition of Stock in any Person if such purchase or acquisition is opposed by the board of directors of such Person. SECTION 6.03. Payment of Obligations, Etc. The Borrower shall pay and discharge, and cause each of its Subsidiaries to pay and discharge, before the same shall become delinquent, all lawful claims and all taxes, assessments and governmental charges or levies unless the same are being contested in good faith by appropriate proceedings and adequate reserves therefor have been established on the books of the Borrower or one of its Subsidiaries in accordance with GAAP, provided all such non-payments, individually or in the aggregate, have no reasonable likelihood of having a Material Adverse Effect. SECTION 6.04. Insurance. The Borrower shall maintain, and cause each of its Subsidiaries to maintain, with financially sound and reputable independent insurers, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, of such types and in such amounts as are customarily carried under similar circumstances by such other Persons. SECTION 6.05. Preservation of Corporate Existence, Etc. The Borrower shall preserve and maintain, and cause each of its Subsidiaries to preserve and maintain, its corporate existence, rights (charter and statutory) and franchises, except as permitted under Sections 7.05 and 7.07. SECTION 6.06. Access. The Borrower shall permit, and cause each of its Subsidiaries to permit, representatives of the Administrative Agent or any Bank to examine and make copies of and abstracts from the records and books of account of, and visit the properties of, the Borrower and any of its Subsidiaries, and to discuss the affairs, finances and accounts of the Borrower and any of its Subsidiaries with any of their directors, officers and independent public accountants and authorize those accountants to disclose to such Person any and all financial statements and other information of any kind, including copies of any management letter or the substance of any oral information that such accountants may have with respect to the business, financial and other affairs of the Borrower or any of its Subsidiaries, all at the expense of the Borrower and at such times during normal business hours and as often as may be reasonably desired, upon 136 reasonable advance notice to the Borrower; provided, however, that when an Event of Default exists, the Administrative Agent or any Bank may visit and inspect, at the expense of the Borrower, its records and properties at any time during business hours and without advance notice. SECTION 6.07. Keeping of Books. The Borrower shall maintain, and cause each of its Subsidiaries to maintain, proper books of record and account, in which full and correct entries shall be made of all financial transactions and matters involving the assets and business of the Borrower and each of its Subsidiaries in accordance with GAAP. SECTION 6.08. Maintenance of Properties. The Borrower shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, all of its properties in good repair, working order and condition, and from time to time make or cause to be made all necessary and proper repairs, renewals, replacements and improvements so that the business carried on in connection therewith may be properly and advantageously conducted at all times; provided, however, that nothing in this Section 6.08 shall prevent the Borrower or any of its Subsidiaries from discontinuing the operation and the maintenance of any of its properties if such discontinuance is, in the opinion of the Borrower, desirable in the conduct of its business and has no reasonable likelihood of having a Material Adverse Effect. SECTION 6.09. Financial Statements. The Borrower shall deliver to each Bank with a copy to the Administrative Agent, in form and details satisfactory to the Banks and the Administrative Agent: (a) as soon as available, but not later than 45 days after the end of each of the first three quarters of each fiscal year of the Borrower, a copy of the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as of the end of such quarter and the related consolidated statements of income, shareholders' equity and cash flows for such quarter and for the period commencing at the end of the previous fiscal year and ending on the last day of such quarter, which statements shall be certified by the Chief Financial Officer of the Borrower as being complete and correct and fairly presenting, in accordance with GAAP, the financial position and results of operation of the Borrower and its Subsidiaries; (b) as soon as available, but not later than 90 days after the end of each fiscal year of the Borrower, a copy of the audited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such year and the related consolidated statements of income, shareholders' equity and cash flows for the period commencing at the end of the previous fiscal year and ending with the end of such fiscal year, which statements shall be certified without qualification as to the scope of the audit by a nationally recognized independent public accounting firm and be accompanied by (i) a certificate of such accounting firm stating that such accounting firm has obtained no knowledge that a Default or an Event of Default has occurred and is continuing, or if such accounting firm has obtained such knowledge that a Default or an Event of Default has occurred and is continuing, a statement as to the nature thereof and (ii) copies of any letters to the management of the Borrower from such accounting firm; and (c) at the same time it furnishes each set of financial statements pursuant to paragraph (a) or (b) above, a certificate of the Chief Financial Officer of the Borrower (i) to the effect that no Default or Event of Default has occurred and is continuing (or, if any Default or Event of Default has occurred and is continuing, describing the same in reasonable detail and the action which the Borrower proposes to take with respect thereto) and (ii) a compliance certificate, in substantially the form of Exhibit 6.09, setting forth in reasonable detail the computations necessary 137 to determine whether the Borrower was in compliance with the financial covenant set forth in Section 7.15, in each case reconciling any differences between the numbers used in such calculations and those used in the preparation of such financial statements. SECTION 6.10. Reporting Requirements. The Borrower shall furnish to the Administrative Agent (and the Administrative Agent shall promptly furnish to the Banks): (a) promptly after the commencement thereof, notice of all actions, suits and proceedings before any court or other Governmental Authority affecting the Borrower or any of its Subsidiaries which, individually or in the aggregate, has any reasonable likelihood of having a Material Adverse Effect; (b) promptly but not later than three Business days after the Borrower becomes aware of the existence of (i) any Default or Event of Default, (ii) any breach or non-performance of, or any default under, any Contractual Obligation to which the Borrower or any of its Subsidiaries is a party which has any reasonable likelihood of having a Material Adverse Effect, or (iii) any Material Adverse Effect or any event or other development which has a reasonable likelihood of having a Material Adverse Effect, notice by telephone or facsimile specifying the nature of such Default, Event of Default, breach, non-performance, default, Material Adverse Effect, event or development, including the anticipated effect thereof; (c) promptly after the sending or filing thereof, copies of all reports which the Borrower or any of its Subsidiaries sends to its security holders generally, and copies of all reports and registration statements which the Borrower or any of its Subsidiaries files with the Securities and Exchange Commission or any national securities exchange; (d) promptly after the creation or acquisition thereof, the name and jurisdiction of incorporation of each new Subsidiary of the Borrower; (e) promptly, but not later than five Business days after the Borrower becomes aware of any change by Moody's or S&P in its Debt Rating, notice by telephone or facsimile of such change; and (f) such other information respecting the business, prospects, properties, operations or the condition, financial or otherwise, of the Borrower or any of its Subsidiaries as any Bank through the Administrative Agent may from time to time reasonably request. SECTION 6.11. Notices Regarding ERISA. Without limiting the generality of the notice provisions contained in Section 6.10, the Borrower shall furnish to the Administrative Agent: (a) promptly and in any event (i) within 30 days after the Borrower or any member of its Controlled Group knows or has reason to know that any ERISA Event described in clause (a) of the definition of ERISA Event or any event described in Section 4063(a) of ERISA with respect to any Plan, and (ii) within ten days after the Borrower or any member of its Controlled Group knows or has reason to know that any other ERISA Event with respect to any Plan has occurred or a request for a minimum funding waiver under Section 412 of the Code with respect to any Plan has been made, a statement of the Chief Financial Officer of the Borrower describing such ERISA Event and the action, if any, which the Borrower or such member of its Controlled Group proposes to take with respect thereto together with a copy of the notice of such ERISA Event or other event, if required by the applicable regulations under ERISA, given to the PBGC; 138 (b) promptly and in any event within five Business days after receipt thereof by the Borrower or any member of its Controlled Group from the PBGC, copies of each notice received by the Borrower or any such member of its Controlled Group of the PBGC's intention to terminate any Plan or to have a trustee appointed to administer any Plan; (c) promptly and in any event within ten Business days after receipt thereof, a copy of any correspondence the Borrower or any member of its Controlled Group receives from the Plan Sponsor (as defined by Section 4001(a)(10) of ERISA) of any Multiemployer Plan concerning potential withdrawal liability of the Borrower or any member of its Controlled Group pursuant to Section 4219 or 4202 of ERISA, and a statement from the Chief Financial Officer of the Borrower or such member of its Controlled Group setting forth details as to the events giving rise to such potential withdrawal liability and the action which the Borrower or such member of its Controlled Group proposes to take with respect thereto; (d) notification within 30 days of any material increase in the benefits under any existing Plan which is not a Multiemployer Plan, or the establishment of any new Plans, or the commencement of contributions to any Plan to which the Borrower or any member of its Controlled Group was not previously contributing; (e) notification within five Business days after the Borrower or any member of its Controlled Group knows or has reason to know that the Borrower or any such member of its Controlled Group has or intends to file a notice of intent to terminate any Plan under a distress termination within the meaning of Section 4041(c) of ERISA and a copy of such notice; and (f) promptly after receipt of written notice of commencement thereof, notice of any action, suit and proceeding before any Governmental Authority affecting the Borrower or any member of its Controlled Group with respect to any Plan, except those which, in the aggregate, if adversely determined, could not have a Material Adverse Effect. SECTION 6.12. Employee Plans. (a) With respect to Plans other than a Multiemployer Plan, for each Plan intended to be qualified under Section 401(a) of the Code which is hereafter adopted or maintained by the Borrower or by any member of its Controlled Group, the Borrower shall or shall cause any such member of its Controlled Group to (i) seek and receive determination letters from the IRS to the effect that such Plan is qualified within the meaning of Section 401(a) of the Code; (ii) from and after the adoption of any such Plan, cause such Plan to be qualified within the meaning of Section 401(a) of the Code and to be administered in all material respects in accordance with the requirements of ERISA and Section 401(a) of the Code; (iii) make all required contributions by the due date (including permissible extensions) under Section 412 of the Code and Section 302 of ERISA; and (iv) not take any action which could reasonably be expected to cause such Plan not to be qualified within the meaning of Section 401(a) of the Code or not to be administered in all material respects in accordance with the requirements of ERISA and Section 401(a) of the Code. (b) With respect to each Multiemployer Plan, the Borrower and each member of its Controlled Group will make any contributions required by such Multiemployer Plan. SECTION 6.13. Environmental Compliance; Notice. The Borrower shall, and cause each of its Subsidiaries to: (a) use and operate all of its facilities and properties in substantial compliance with all Environmental Laws, keep all necessary permits, approvals, certificates, license and other authorizations relating to environmental matters in effect and remain in substantial compliance therewith, and handle all Hazardous Materials in substantial compliance with all applicable Environmental Laws; 139 (b) promptly upon receipt of all written claims, complaints, notices or inquiries relating to the condition of its facilities and properties or compliance with Environmental Laws, evaluate such claims, complaints, notices and inquiries and forward copies of (i) all such claims, complaints, notices and inquiries which individually have any reasonable likelihood of having a Material Adverse Effect and (ii) all such claims, complaints, notices and inquiries, arising from a single occurrence which together have any reasonable likelihood of having a Material Adverse Effect, and endeavor to promptly resolve all such actions and proceedings relating to compliance with Environmental Laws; and (c) provide such information and certifications which the Administrative Agent may reasonably request from time to time to evidence compliance with this Section 6.13. SECTION 6.14. Acquisition and Merger Agreement. The Borrower will use its best efforts to complete the Acquisition and consummate the Merger as soon as practicable and will not amend or waive without the approval of the Administrative Agent any material term or condition of the Merger Agreement or any other documentation related to the Acquisition delivered to the Banks prior to the date of this Agreement. SECTION 6.15. Shelf Registration. The Borrower shall no later than March 16, 2001, file with the Securities and Exchange Commission a shelf registration pursuant to Rule 415 of the Securities Act in respect of up to $2,000,000,000 of the Company's debt securities. ARTICLE VII Negative Covenants The Borrower hereby covenants and agrees that so as long as any Bank shall have any Commitment hereunder or any Loan or other Obligation shall remain unpaid or unsatisfied, unless the Majority Banks shall waive compliance in writing: SECTION 7.01. Limitations on Liens. The Borrower shall not create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Lien upon or with respect to any of its properties, whether now owned or hereafter acquired, other than (subject to the final sentence of this Section 7.01) the following ("Permitted Liens"): (a) any Lien existing on the property of the Borrower or any of its Subsidiaries on the Effective Date and set forth in Schedule 7.01 and any extension, renewal and replacement of any such Lien; provided any such extension, renewal or replacement Lien is limited to the property or assets covered by the Lien extended, renewed or replaced and does not secure any Indebtedness in addition to that secured immediately prior to such extension, renewal and replacement; (b) any Lien created pursuant to any Loan Document; (c) Liens imposed by law, such as materialmen's, mechanics', warehousemen's, carriers', lessors' or vendors' Liens incurred by the Borrower or any of its Subsidiaries in the ordinary course of business which secure its payment obligations to any Person, provided (i) neither the Borrower nor any of its Subsidiaries is in default with respect to any payment obligation to such Person or the Borrower or the applicable Subsidiary is in good faith and by appropriate proceedings diligently contesting such obligation for which adequate reserves shall have been set aside on its books and (ii) such Liens have no reasonable likelihood of having, individually or in the aggregate, a Material Adverse Effect; 140 (d) Liens for taxes, assessments or governmental charges or levies either not yet due and payable or to the extent that non-payment thereof shall be permitted by Section 6.03; (e) Liens on the property of the Borrower or any of its Subsidiaries incurred, or pledges and deposits made, in the ordinary course of business in connection with worker's compensation, unemployment insurance, old-age pensions and other social security benefits, other than in respect of employee plans subject to ERISA; (f) Liens on the property of the Borrower or any of its Subsidiaries securing (i) the performance of bids, tenders, statutory obligations, leases and contracts (other than for the repayment of borrowed money), (ii) obligations on surety and appeal bonds not exceeding in the aggregate $5,000,000 and (iii) other obligations of like nature incurred as an incident to and in the ordinary course of business, provided all such Liens in the aggregate have no reasonable likelihood (even if enforced) of having a Material Adverse Effect; (g) zoning restrictions, easements, licenses, reservations, restrictions on the use of real property or minor irregularities incident thereto which do not impair the value of any parcel of property material to the operation of the business of the Borrower and its Subsidiaries taken as a whole or the value of such property for the purpose of such business; (h) (i) purchase money liens or purchase money security interests (including in connection with capital leases) upon or in any property acquired or held by the Borrower or any of its Subsidiaries in the ordinary course of business to secure the purchase price of such property or to secure Indebtedness incurred solely for the purpose of financing the acquisition of such property and Liens existing on such property at the time of its acquisition (other than any such Lien created in contemplation of such acquisition) which Liens do not extend to any other property and do not secure Indebtedness exceeding the purchase price of such property; (ii) Liens (including in connection with capital leases) securing Indebtedness of the Borrower or any of its Subsidiaries incurred to finance all or some of the cost of construction of property (or to refinance Indebtedness so incurred upon completion of such construction) which Liens do not extend to any other property except to the unimproved real property upon which such construction will occur; provided the Indebtedness secured by such Liens is not incurred more than 90 days after the later of the completion of construction or the commencement of full operation of such property; (iii) Liens on property in favor of any Governmental Authority to secure partial, progress, advance or other payments, or performance of any other obligations, pursuant to any contract or statute or to secure any Indebtedness of the Borrower or any of its Subsidiaries incurred for the purpose of financing all or any part of the purchase price or the cost of construction of property subject to Liens (including in connection with capital leases) securing Indebtedness of the pollution control or industrial or other revenue bond type and which Liens do not extend to any other property; and (iv) in addition to Liens permitted under clauses (i) and (ii) above, Liens in connection with capital leases entered into by the Borrower or any of its Subsidiaries in connection with sale-leaseback transactions. provided, however, that the aggregate amount of Indebtedness secured by all Liens referred to in clauses (i), (ii), (iii) and (iv) of this paragraph (h) at any time outstanding, together with the Indebtedness secured by Liens permitted pursuant to paragraphs (i) and (l) below (and any extensions, renewals and refinancings of such Indebtedness) 141 shall not, subject to the second proviso of paragraph (i) below, at any time exceed the Permitted Lien Basket; (i) Liens on assets of any corporation existing at the time such corporation becomes a Subsidiary of the Borrower or merges into or consolidates with the Borrower or any of its Subsidiaries, if such Liens (a) do not extend to any other property, (b) do not secure Indebtedness exceeding the fair market value of such property at the time such corporation becomes a Subsidiary of the Borrower or at the time of such merger or consolidation, and (c) were not created in contemplation of such corporation becoming a Subsidiary of the Borrower or of such merger or consolidation; provided, however, that the aggregate amount of Indebtedness secured by Liens referred to in this paragraph (i), together with the Indebtedness secured by Liens permitted pursuant to paragraph (h) above and paragraph (l) below (and any extensions, renewals and refinancings of such Indebtedness) shall not at any time exceed the Permitted Lien Basket; provided, further, however, that notwithstanding the foregoing limitation, the Borrower may incur, and permit its Subsidiaries to incur, Indebtedness secured by Liens referred to in this paragraph (i) which, when aggregated with the Indebtedness secured by Liens permitted pursuant to paragraph (h) above and paragraph (l) below, exceed the Permitted Lien Basket if, and only if, (x) such Indebtedness remains outstanding for a period of less than six months from the date on which such Indebtedness first exceeded the Permitted Lien Basket or (y) such Liens are released within six months; (j) the filing of financing statements in respect of accounts sold by the Borrower and its Subsidiaries pursuant to a receivables purchase transaction by the purchaser or purchasers from the Borrower and its Subsidiaries of such accounts; (k) judgment Liens created by or resulting from any litigation or legal proceeding if released or bonded within 60 days of the date of creation thereof (or such earlier date as may be required by Section 8.01(h)), unless such litigation shall have had a Material Adverse Effect; (l) Liens securing other Indebtedness of the Borrower or any of its Subsidiaries not expressly permitted by paragraphs (a) through (k); provided, however, that the aggregate amount of Indebtedness secured by Liens permitted pursuant to paragraphs (h) and (i) above and pursuant to this paragraph (l) (and any extensions, renewals and refinancings of such Indebtedness) shall not, subject to the second proviso of paragraph (i) above, at any time exceed the Permitted Lien Basket; and (m) any Lien on Excess Margin Stock Notwithstanding anything contained in this Agreement to the contrary, the Borrower shall not create, incur or assume, or permit any of its Subsidiaries to create, incur or assume, any Priority Debt (other than Priority Debt resulting from the securing of existing Indebtedness with Excess Margin Stock), if after giving effect to such creation, incurrence or assumption the aggregate outstanding amount of Priority Debt at the time of such creation, incurrence or assumption would exceed 15% of the total consolidated assets (calculated as if the Merger had occurred as of the Effective Date) of the Borrower and its Subsidiaries at the most recent fiscal quarter end of the Borrower for which financial statements have been delivered under Section 6.09(a) or (b) (or prior to the first delivery of such financial statements, at the respective dates of the most recent financial statements for the Borrower and IBP referred to in Section 4.05(a) and (b)). 142 SECTION 7.02. Limitation on Indebtedness. The Borrower shall not create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any Indebtedness except (subject to the final sentence of this Section 7.02): (a) the Loans and any other Indebtedness under this Agreement or any other Loan Document; (b) Indebtedness existing on the Effective Date and set forth in Schedule 7.02, and any extension, renewal, refunding and refinancing thereof, provided that after giving effect to such extension, renewal, refunding or refinancing, (a) the principal amount thereof is not increased, (b) neither the tenor nor the remaining average life thereof is reduced and (c) the interest rate thereon is not increased; provided, however, that the industrial revenue bonds identified by an asterisk in Schedule 7.02 may be refinanced at an interest rate higher than the rate in effect immediately prior to such refinancing if such rate is not in excess of any rate of interest then payable in respect of the Loans (without taking into account any interest payable pursuant to Section 2.10); (c) Indebtedness of the Borrower to any of its wholly-owned Subsidiaries, of any Subsidiary of the Borrower to the Borrower or of any Subsidiary of the Borrower to another Subsidiary of the Borrower; (d) surety bonds and appeal bonds required in the ordinary course of business or in connection with the enforcement of rights or claims of the Borrower or its Subsidiaries or in connection with judgments that do not result in a Default or an Event of Default; (e) trade debt (including Indebtedness for the purchase of farm products from contract growers and other similar suppliers but excluding Indebtedness for Borrowed Money) incurred by the Borrower or any of its Subsidiaries in the ordinary course of business in a manner and to an extent consistent with their past practices and necessary or desirable for the prudent operation of its businesses; (f) Indebtedness secured by Liens permitted pursuant to Section 7.01 subject to the limitations contained therein; (g) Indebtedness incurred in connection with the issuance of commercial paper; and (h) other present and future unsecured Indebtedness provided at the time of, and immediately after giving effect to, the incurrence of such Indebtedness, no condition or event shall exist which constitutes an Event of Default. Notwithstanding anything contained in this Agreement to the contrary, the Borrower shall not create, incur or assume, or permit any of its Subsidiaries to create, incur or assume, any Priority Debt (other than Priority Debt resulting from the securing of existing Indebtedness with Excess Margin Stock), if after giving effect to such creation, incurrence or assumption the aggregate outstanding amount of Priority Debt at the time of such creation, incurrence or assumption would exceed 15% of the total consolidated assets (calculated as if the Merger had occurred as of the Effective Date) of the Borrower and its Subsidiaries at the most recent fiscal quarter end of the Borrower for which financial statements have been delivered under Section 6.09(a) or (b) (or prior to the first delivery of such financial statements, at the respective dates of the most recent financial statements for the Borrower and IBP referred to in Section 4.05(a) and (b)). SECTION 7.03. Lease Obligations. The Borrower shall not create, incur, assume or suffer to exist, or permit any of its Subsidiaries to create, incur, assume or suffer to exist, any obligation for the payment of rent for any property under lease or agreement to lease having a term of one year or more, except (subject to the final sentence of this Section 7.03): 143 (a) leases of the Borrower and its Subsidiaries in existence on the Effective Date and any renewal or extension thereof; (b) operating leases in the ordinary course of business; and (c) subject to the limitations set forth in Section 7.01(h) capital leases entered into by the Borrower or any of its Subsidiaries after the Effective Date in connection with sale-leaseback transactions; provided (i) immediately prior to giving effect to such lease, the property subject to such lease was sold by the Borrower or any such Subsidiary to the lessor pursuant to a transaction permitted under Section 7.07 and (ii) no Event of Default exists or would occur as a result of such sale and subsequent lease. Notwithstanding anything contained in this Agreement to the contrary, the Borrower shall not create, incur or assume, or permit any of its Subsidiaries to create, incur or assume, any Priority Debt (other than Priority Debt resulting from the securing of existing Indebtedness with Excess Margin Stock), if after giving effect to such creation, incurrence or assumption the aggregate outstanding amount of Priority Debt at the time of such creation, incurrence or assumption would exceed 15% of the total consolidated assets (calculated as if the Merger had occurred as of the Effective Date) of the Borrower and its Subsidiaries at the most recent fiscal quarter end of the Borrower for which financial statements have been delivered under Section 6.09(a) or (b) (or prior to the first delivery of such financial statements, at the respective dates of the most recent financial statements for the Borrower and IBP referred to in Section 4.05(a) and (b)). SECTION 7.04. Restricted Payments. The Borrower shall not: (a) declare or make, or permit any of its Subsidiaries to declare or make, any dividend payment or other distribution of assets, properties, cash, rights, obligations or securities on account of its Stock other than (i) dividends paid by any wholly-owned Subsidiary of the Borrower to the Borrower or any other wholly-owned Subsidiary of the Borrower; (ii) distributions of shares of common stock of the Borrower to its management as executive compensation and in connection with management incentive plans; (iii) dividends or distributions payable solely in additional common Stock of the Borrower; and (iv) other dividends to the shareholders of the Borrower, provided at the time of, and immediately after giving effect to, the payment of such dividends pursuant to this paragraph (a)(iv), no condition or event shall exist which constitutes an Event of Default; or (b) purchase, redeem, or otherwise acquire for value or make any payment in respect of any of its Stock now or hereafter outstanding (or permit any of its Subsidiaries to do so) except (i) purchases in the open market to fund the Borrower's stock option plans, employee stock purchase plans, 401(k) plans and other similar plans consistent with the past practices of the Borrower; (ii) the redemption or purchase by any wholly- owned Subsidiary of the Borrower of any of its Stock owned by another wholly- owned Subsidiary of the Borrower and (iii) the purchase, redemption and other acquisition of any of its or such Subsidiary's Stock, provided at the time of, and immediately after giving effect to, such purchase, redemption or other acquisition pursuant to this paragraph (b)(iii), no condition or event shall exist which constitutes an Event of Default. SECTION 7.05. Mergers, Etc. The Borrower shall not merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to any Person, or, except as permitted pursuant to Section 7.06 or Section 7.09, acquire all or substantially all of the Stock of any Person, or acquire all or substantially all of the assets of any Person (other than 144 live inventory) or enter into any joint venture or partnership with, any Person, or permit any of its Subsidiaries to do so; provided, however, that: (a) the Borrower may merge with a wholly-owned Subsidiary of the Borrower so long as (i) the Borrower is the surviving corporation and (ii) at the time of, and immediately after giving effect to, such merger, no condition or event shall exist which constitutes an Event of Default; (b) any wholly-owned direct or indirect Subsidiary of the Borrower may merge with or into any other wholly-owned direct or indirect Subsidiary of the Borrower or acquire Stock of any other wholly-owned direct or indirect Subsidiary of the Borrower; (c) the Borrower or any Subsidiary of the Borrower may acquire all or substantially all of the Stock or all or substantially all of the assets of any Person, provided at the time of, and immediately after giving effect to such acquisition, no condition or event shall exist which constitutes an Event of Default; and (d) any Subsidiary of the Borrower may merge with any other corporation permitted to be acquired pursuant to paragraph (c) above, provided (i) at the time of, and immediately after giving effect to, such merger, no condition or event shall exist which constitutes an Event of Default and (ii) and after such merger, the surviving corporation is a Subsidiary of the Borrower. SECTION 7.06. Investments in Other Persons. The Borrower shall not make, or permit any of its Subsidiaries to make, any loan or advance to any Person (other than accounts receivable created in the ordinary course of business); or, except as permitted under Section 7.04 or 7.05, purchase or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any Stock or other equity interest or Indebtedness of any Person, or make, or permit any of its Subsidiaries to make, any capital contribution to, or otherwise invest in, any Person, except: (a) Permitted Investments; (b) loans or advances made by the Borrower or any of its Subsidiaries to (i) employees of the Borrower or any of such Subsidiaries in the ordinary course of business in a manner consistent with past practices and (ii) joint ventures and partnerships in which the Borrower is a partner, provided at the time of, and immediately after giving effect to, such loans or advances, no condition or event shall exist which constitutes an Event of Default; (c) loans or advances or other credit support, including the procurement of letters of credit for its account, made by the Borrower or any of its Subsidiaries (in addition to those permitted under paragraph (b) above) to any Person; provided, however, that the aggregate amount of all investments pursuant to this paragraph (c) shall not at any time exceed 15% of the consolidated Net Worth (calculated as if the Merger had occurred as of the Effective Date) of the Borrower; (d) investments in Stock or other joint ventures and partnerships (including through mergers and consolidations), provided at the time of, and immediately after giving effect to, such investments, no condition or event shall exist which constitutes an Event of Default; (e) the organization or acquisition by the Borrower or any of its wholly-owned Subsidiaries of one or more wholly-owned Subsidiaries; (f) the acquisition by the Borrower or any of its wholly-owned Subsidiaries of Stock permitted to be issued pursuant to Section 7.09; and (g) intercompany Indebtedness permitted pursuant to Section 7.02(d). 145 SECTION 7.07. Assets. The Borrower shall not sell, assign, transfer or otherwise dispose of any of its assets, or permit any of its Subsidiaries to sell, assign, transfer or otherwise dispose of any of its assets, except: (a) the sale or disposition of inventory and farm products in the ordinary course of business; (b) the sale or disposition in the ordinary course of business of any assets which have become obsolete or surplus to the business of the Borrower or any of its Subsidiaries, or has no remaining useful life, in each case as reasonably determined in good faith by the Borrower or such Subsidiary, as the case may be; (c) he periodic sales to third parties of live inventory and related products and services under grow out contracts; (d) Permitted Dispositions; (e) the sale or disposition of Permitted Investments; (f) the sale of accounts or other receivables for not less than the fair value thereof by the Borrower and its Subsidiaries, without recourse, in connection with a receivables purchase transaction; and (g) the sale or disposition of Excess Margin Stock for not less than the fair value thereof. SECTION 7.08. Change in Nature of Business. The Borrower shall not: (a) engage in any business other than the production, marketing and distribution of food products and any related food or agricultural products, processes or business; or (b) permit any of its Subsidiaries to make any material change in the nature of its business as carried on at the date hereof except as permitted under Section 7.05 or enter into any new business. SECTION 7.09. Capital Structure. The Borrower shall not: (a) make, or, except as permitted by Section 7.05, permit any of its Subsidiaries to make, any changes in its capital structure (including in the terms of its outstanding Stock), amend their certificate of incorporation or by-laws, or make any changes in any of its business objectives, purposes or operations if such change has a reasonable likelihood of having a Material Adverse Effect; or (b) permit any of its Subsidiaries to issue any Stock (other than directors' qualifying shares) other than to the Borrower or any wholly-owned Subsidiary of the Borrower, except if (i) after giving effect to such issuance, such Subsidiary is still a Subsidiary of the Borrower; (ii) such issuance has no reasonable likelihood of having a Material Adverse Effect; and (iii) at the time of, and immediately after giving effect to such issuance, there shall exist no condition or event which constitutes an Event of Default. SECTION 7.10. Transactions with Affiliates, Etc. The Borrower shall not: (a) enter into or be a party to, or permit any of its Subsidiaries to enter into or be a party to, any transaction with any Affiliate of the Borrower or any such Subsidiary except (i) as otherwise expressly permitted herein or (ii) in the ordinary course of business, to the extent consistent with past practices, so long as any such transaction individually and in the aggregate with other such transactions has no reasonable likelihood of having a Material Adverse Effect; (b) enter into, or permit any of its Subsidiaries to enter into, any contract or other agreement or arrangement for employment of an executive officer other than in the ordinary course of business, or enter into, or permit any of its Subsidiaries to enter into, any contract or other obligation for the payment of management fees by the Borrower or any of its 146 Subsidiaries, except for the intercompany allocation of general administrative costs and other expenses consistent with past practices; or (c) enter into, or permit any of its Subsidiaries to enter into, any agreement that prohibits, limits or restricts any repayment of loans or advances or other distributions to the Borrower by any of its respective Subsidiaries, or that restricts any such Subsidiary's ability to declare or make any dividend payment or other distribution on account of any shares of any class of its capital stock or on its ability to acquire or make a payment in respect thereof. SECTION 7.11. Accounting Changes. The Borrower shall not make, or permit any of its Subsidiaries to make, any significant change in accounting treatment and reporting practices except as required by GAAP, the IRS or the Securities and Exchange Commission; provided, however, that if any such changes are so required to be made within a certain period of time only, such changes may, in the discretion of the Borrower, be made at any time during such period. SECTION 7.12. Margin Regulations. (a) The Borrower shall not use the proceeds of any Loan in violation of Regulation T, U or X of the Board of Governors of the Federal Reserve System. (b) The Borrower will not, and will not permit any of its Subsidiaries to, (other than in connection with the Acquisition) purchase or otherwise acquire Margin Stock if, after giving effect to any such purchase or acquisition, Margin Stock owned by the Borrower and its Subsidiaries would represent more than 25% of the assets of the Borrower and its Subsidiaries on a consolidated basis (valued in accordance with Regulation U). SECTION 7.13. Compliance with ERISA. The Borrower shall not, directly or indirectly, permit any member of the Controlled Group of the Borrower to, directly or indirectly: (a) terminate any Plan so as to result in any material liability (in the opinion of the Majority Banks exercised reasonably) to the Borrower or any member of its Controlled Group; (b) permit to exist any ERISA Event, or any other event or condition which presents the risk of a material liability (in the opinion of the Majority Banks exercised reasonably) of the Borrower or any member of its Controlled Group; (c) make a complete or partial withdrawal (within the meaning of Section 4201 of ERISA) from any Multiemployer Plan so as to result in any material liability (in the opinion of the Majority Banks exercised reasonably) to the Borrower or any member of its Controlled Group; (d) enter into any new Plan or modify any existing Plan so as to increase its obligations thereunder except in the ordinary course of business consistent with past practice which has any reasonable likelihood of resulting in material liability to the Borrower or any member of its Controlled Group; or (e) permit the present value of all benefit liabilities, as defined in Title IV of ERISA, under each Plan of the Borrower or any member of its Controlled Group (using each Plan's actuarial assumptions upon termination of such Plan) to materially (in the opinion of the Majority Banks exercised reasonably) exceed the fair market value of Plan assets allocable to such benefits all determined as of the most recent valuation date for each such Plan. SECTION 7.14. Speculative Transactions. The Borrower shall not engage or permit any of its Subsidiaries to engage in any transaction involving commodity options or futures contracts other than in the ordinary course of business consistent with past transactions. 147 SECTION 7.15. Debt Ratio. The Borrower shall not permit at any time the Debt Ratio to be greater than .65 to 1. SECTION 7.16. Interest Expense Coverage Ratio. At any time when the Index Debt (a) is rated BBB or lower or is unrated by S&P and (b) is rated Baa2 or lower or is unrated by Moody's, the Company will not permit the ratio of (I Consolidated EBITDA to (ii) Consolidated Interest Expense, in each case for the period of four consecutive fiscal quarters (or shorter period referred to in the next sentence) for which financial statements have most recently been delivered under Section 6.09(a) or (b) at such time, to be less than 3.0 to 1.0. If at any such time less than four full fiscal quarters have been completed since the Acquisition Date, compliance with this Section 7.16 will be calculated based upon Consolidated EBITDA and Consolidated Interest Expense for the period commencing on the first day of the first quarter to begin after the Acquisition Date and ending on the last day of the most recently completed fiscal quarter for which financial statements have most recently been delivered under Section 6.09(a) or (b). ARTICLE VIII Events of Default SECTION 8.01. Events of Default. The term "Event of Default" shall mean any of the events set forth in this Section 8.01. (a) Non-Payment. The Borrower shall (i) fail to pay when and as required to be paid herein, any amount of principal of any Loan or any amount of interest on any Bid Loan; or (ii) fail to pay within three Business days after the same shall become due and payable, any other interest or any fee or other amount payable hereunder or under any other Loan Document or any other Obligation; (b) Representations and Warranties. Any representation or warranty made by the Borrower in this Agreement or in any other Loan Document, or which is contained in any certificate, document or financial or other statement delivered at any time under or in connection with this Agreement or any other Loan Document shall prove to have been incorrect or untrue in any material respect when made or deemed made; (c) Specific Defaults. The Borrower shall fail to perform or observe any term, covenant or agreement contained in Article VII or Section 6.02, 6.04 (but only to the extent such failure could have a Material Adverse Effect), 6.05, 6.06, 6.10(b) or 6.10(e); (d) Other Defaults. The Borrower shall fail to perform or observe any other term or covenant contained in this Agreement (including Section 6.04 to the extent not covered by paragraph (c) above) or any other Loan Document, and such Default shall continue unremedied for a period of 30 days after the date upon which written notice thereof shall have been given to the Borrower by the Administrative Agent; (e) Default under Other Agreements. Any default shall occur under the Existing Credit Agreement or under any other Indebtedness of the Borrower (other than under this Agreement and other than any default under any agreement to which the Borrower and one or more Banks are party to the extent such default results from the transfer or pledge of Excess Margin Stock) or any of its Subsidiaries (other than Tyson de Mexico, S.A. de C.V., a Mexican Subsidiary of the Borrower) having an aggregate outstanding principal amount of $10,000,000 or more or under one or more Interest Rate Contracts of the Borrower or any of its Subsidiaries resulting in aggregate net obligations of $10,000,000 or more and such default shall: 148 (i) consist of the failure to pay any Indebtedness when due (whether at scheduled maturity, by required prepayment, acceleration, demand or otherwise) after giving effect to any applicable grace or notice period; or (ii) result in, or continue unremedied for a period of time sufficient to permit, the acceleration of such Indebtedness or the early termination of such Interest Rate Contract; (f) Bankruptcy or Insolvency. The Borrower or any of its Subsidiaries shall: (i) cease to be Solvent or generally fail to pay, or admit in writing its inability to pay, its debts as they become due; (ii) commence an Insolvency Proceeding; (iii) voluntarily cease to conduct its business in the ordinary course; or (iv) take any action to effectuate or authorize any of the foregoing; (g) Involuntary Proceedings. (i) An involuntary Insolvency Proceeding shall be commenced against the Borrower or any of its Subsidiaries or any writ, judgment, warrant of attachment, execution or similar process shall be issued or levied against a substantial part of the Borrower's, or any of its Subsidiaries' properties, and any such proceeding or petition shall not be dismissed, or such writ, judgment, warrant of attachment, execution or similar process shall not be released, vacated or fully bonded within 60 days after commencement, filing or levy; (ii) the Borrower or any of its Subsidiaries shall admit in writing the material allegations of a petition against it in any Insolvency Proceeding, or an order for relief (or similar order under non-United States law) against the Borrower or such Subsidiary is ordered in any Insolvency Proceeding; or (iii) the Borrower or any of its Subsidiaries shall acquiesce in the appointment of a receiver, trustee, custodian, conservator, liquidator, mortgagee in possession (or agent therefor) or other similar Person for itself or a substantial portion of its property or business; (h) Monetary Judgments. One or more judgments, orders or decrees for the payment of money exceeding in the aggregate $10,000,000 (not fully covered by insurance) shall be rendered against the Borrower or any of its Subsidiaries and either (i) enforcement proceedings shall have been initiated by any creditor upon such judgment or order or (ii) such judgment or order shall continue unsatisfied, unvacated or unstayed for a period of 20 days; (i) Non-Monetary Judgments. Any non-monetary judgment, order or decree shall be rendered against the Borrower or any of its Subsidiaries which does or has a reasonable likelihood of having a Material Adverse Effect and either (a) enforcement proceedings shall have been initiated by any Person upon such judgment or order or (b) there shall be any period of ten consecutive days during which a stay of enforcement of such judgment, order or decree, by reason of a pending appeal or otherwise, shall not be in effect; (j) ERISA. With respect to any Plan: (i) the Borrower, any member of its Controlled Group or any other party-in-interest or disqualified Person shall engage in transactions which in the aggregate have a reasonable likelihood of resulting in a direct or indirect liability to the Borrower or any member of its Controlled Group in excess of $10,000,000 under Section 409 or 502 of ERISA or Section 4975 of the Code; 149 (ii) the Borrower or any member of its Controlled Group shall incur any accumulated funding deficiency, as defined in Section 412 of the Code, in the aggregate in excess of $10,000,000, or request a funding waiver from the IRS for contributions in the aggregate in excess of $10,000,000; (iii) the Borrower or any member of its Controlled Group shall incur any withdrawal liability in the aggregate in excess of $10,000,000 as a result of a complete or partial withdrawal from a Multiemployer Plan within the meaning of Section 4203 or 4205 of ERISA; (iv) the Borrower or any member of its Controlled Group shall fail to make a required contribution by the due date (including any permissible extensions) under Section 412 of the Code or Section 302 of ERISA which would result in the imposition of a Lien under Section 412 of the Code or Section 302 of ERISA; (v) the Borrower, any member of its Controlled Group or any Plan sponsor shall notify the PBGC of an intent to terminate in a distressed termination, or the PBGC shall institute proceedings to terminate, a Plan; (vi) a Reportable Event shall occur with respect to a Plan, and within 15 days after the reporting of such Reportable Event to the Majority Banks, the Majority Banks shall have notified the Borrower in writing that (a) they have made a determination that, on the basis of such Reportable Event, there are reasonable grounds for the termination of such Plan by the PBGC or for the appointment by the appropriate United States District Court of a trustee to administer such Plan and (b) as a result thereof a Default or an Event of Default shall occur hereunder; (vii) a trustee shall be appointed by a court of competent jurisdiction to administer any Plan or the assets thereof; (viii) the benefits of any Plan shall be increased (other than in the ordinary course of business consistent with past practice), or the Borrower or any member of its Controlled Group shall begin to maintain, or begin to contribute to, any Plan, without the prior written consent of the Majority Banks; (ix) any ERISA Event with respect to a Plan shall have occurred, and 30 days thereafter (a) such ERISA Event shall not have been corrected and (b) the then present value of such Plan's benefit liabilities, as defined in Title IV of ERISA, shall exceed the then current value of assets accumulated in such Plan; or provided, however, that the events listed in clauses (v)-(ix) of this paragraph (j) shall constitute Events of Default only if, as of the date thereof or any subsequent date, the maximum amount of liability the Borrower or any member of its Controlled Group could incur in the aggregate under Section 4062, 4063, 4064, 4219 or 4243 of ERISA or any other provision of law with respect to all such Plans, computed by the actuary of the Plan taking into account any applicable rules and regulations of the PBGC at such time, and based on the actuarial assumptions used by the Plan, resulting from or otherwise associated with such event exceeds $10,000,000; or (k) Change in Control. Mr. Don Tyson, the Tyson Limited Partnership and "members of the same family" of Mr. Don Tyson as defined in Section 447(e) of the Code shall cease to have at least 51% of the total combined voting power of the outstanding Stock of the Borrower; or 150 (j) at any time after the delivery of the Guarantee Agreement and prior to the completion of the Merger, the Guarantee Agreement shall not for any reason be, or shall be asserted by the Borrower or IBP not to be, in full force and effect and enforceable against IBP in all material respects in accordance with its terms. SECTION 8.02. Remedies. If any Event of Default shall have occurred and be continuing, the Administrative Agent shall at the request of, or may with the consent of, the Majority Banks: (a) declare the Commitment of each Bank to be terminated, whereupon such Commitment shall forthwith be terminated; and/or (b) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon and all other Obligations payable hereunder or under any other Loan Document to be immediately due and payable, whereupon the Loans, all such interest and all such Obligations shall become and be forthwith due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower; provided, however, that upon the occurrence of any event specified in Section 8.01(f) or (g) with respect to the Borrower, the Commitment of each Bank to make Loans shall automatically terminate and the unpaid principal amount of all outstanding Loans and all interest accrued thereon and all other Obligations shall automatically become due and payable without further action of the Administrative Agent or any Bank. If any Event of Default shall occur and be continuing under Section 8.01(a) due to the Borrower's failure to pay any amount of principal on or interest of any Bid Loan, the Bank having made such Bid Loan may send a written request to the Administrative Agent to obtain approval of the Majority Banks to terminate the Commitments and, if such approval is not obtained within ten Business days after the date such request is received, the affected Bank (or assignee) may commence enforcement of such default by any and all legal means. SECTION 8.03. Rights Not Exclusive. The rights provided for in this Agreement and the other Loan Documents are cumulative and are not exclusive of any other rights, powers, privileges or remedies provided by law or in equity, or under any other instrument, document or agreement now existing or hereafter arising. ARTICLE IX The Administrative Agent SECTION 9.01. Appointment. Each Bank hereby irrevocably appoints, designates and authorizes the Administrative Agent to take such action on its behalf under the provisions of this Agreement or any other Loan Document and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement or in any other Loan Document, the Administrative Agent shall not have any duties or responsibilities except those expressly set forth herein or any fiduciary relationship with any Bank, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent. 151 SECTION 9.02. Delegation of Duties. The Administrative Agent may execute any of its duties under this Agreement and any other Loan Document by or through employees, agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of any agent or attorney-in-fact that it selects with reasonable care. SECTION 9.03. Liabilities of Agents. (a) Neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be (a) liable for any action taken or omitted to be taken by any of them under or in connection with this Agreement or any other Loan Document (except for its own gross negligence or willful misconduct), or (b) responsible in any manner to any of the Banks for any recital, statement, representation or warranty made by the Borrower or any officer thereof contained in this Agreement or any other Loan Document or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or any other Loan Document or for the value of any collateral or the validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document or for any failure of the Borrower to perform its obligations hereunder or thereunder. The Administrative Agent shall not be under any obligation to any Bank to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of the Borrower or any of its Subsidiaries. (b) Each party to this Agreement acknowledges that neither the Syndication Agent nor the Documentation Agent shall have any separate duties, responsibilities, obligations or authority under this Agreement or any other Loan Document in such capacity. SECTION 9.04. Reliance by Administrative Agent. (a) The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, facsimile or telex message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon any advice and statements of legal counsel (including counsel to the Borrower), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Majority Banks as it deems appropriate or it shall first be indemnified to its satisfaction by the Banks against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request from or the consent of the Majority Banks and such request or consent and any action taken or failure to act pursuant thereto shall be binding upon all the Banks and all future holders of the Loans or any portion thereof. (b) For purposes of determining compliance with the conditions specified in Section 5.01, each Bank shall be deemed to have consented to, approved or accepted or to be satisfied with each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to the Banks unless an officer of the Administrative Agent responsible for the transactions contemplated by the Loan Documents shall have received notice from such Bank prior to the Effective Date specifying 152 its objection thereto and either such objection shall not have been withdrawn by notice to the Administrative Agent to that effect or such Bank shall not have made available to the Administrative Agent such Bank's Percentage Share of such Borrowing. SECTION 9.05. Notice of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to payment defaults, unless the Administrative Agent shall have received notice from a Bank or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a "notice of default". In the event that the Administrative Agent receives such a notice, the Administrative Agent shall give prompt notice thereof to the Banks. The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be requested by the Majority Banks in accordance with Article VIII; provided however, that unless and until the Administrative Agent shall have received any such request from the Majority Banks, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Banks. SECTION 9.06. Credit Decision. Each Bank expressly acknowledges that neither the Administrative Agent nor any of its Affiliates nor any officer, director, employee, agent, attorney-in-fact of any of them has made any representation or warranty to it and that no act by the Administrative Agent hereinafter taken, including any review of the affairs of the Borrower and its Subsidiaries, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Bank. Each Bank represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Bank, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, properties, operations or condition, financial or otherwise, and creditworthiness of the Borrower and made its own decision to enter into this Agreement and extend credit to the Borrower hereunder. Each Bank also represents that it will, independently and without reliance upon the Administrative 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 analysis, appraisals and decisions in taking or not taking action under this Agreement, and to make such investigations as it deems necessary to inform itself as to the business, prospects, properties, operations or condition, financial or otherwise, and creditworthiness of the Borrower. Except for notices, reports and other documents expressly required to be furnished to the Banks by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Bank with any credit or other information concerning the business, prospects, properties, operations or condition, financial or otherwise, and creditworthiness of the Borrower which may come into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates. SECTION 9.07. Indemnification. The Banks agree to indemnify the Administrative Agent (to the extent not reimbursed by or on behalf of the Borrower and without limiting the obligation of the Borrower to do so), ratably according to their respective Percentage Shares, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including at any time after the repayment of the Loans and all other Obligations) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of this Agreement or any other Loan Document or any documents contemplated by 153 or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the Administrative Agent under or in connection with any of the foregoing; provided however, that no Bank shall be liable for the payment to the Administrative Agent of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from the Administrative Agent's gross negligence or willful misconduct. Without limitation of the foregoing, each Bank agrees to reimburse the Administrative Agent promptly upon demand for its ratable share of any out- of-pocket expenses (including fees and expenses of counsel and the allocated cost of in-house counsel) incurred by the Administrative Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiation, legal proceedings or otherwise) of, or legal advice in respect of its or the Banks' rights or responsibilities under, this Agreement, any other Loan Document or any document contemplated by or referred to herein or therein to the extent that the Administrative Agent is not reimbursed for such expenses by or on behalf of the Borrower. SECTION 9.08. Administrative Agent in Individual Capacity. The Chase Manhattan Bank and its Affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower and its Subsidiaries as though The Chase Manhattan Bank were not the Administrative Agent hereunder. With respect to its Loans, The Chase Manhattan Bank shall have the same rights and powers under this Agreement as any Bank and may exercise the same as though it were not the Administrative Agent, and the terms "Bank" and "Banks" shall include The Chase Manhattan Bank in its individual capacity. SECTION 9.09. Successor Administrative Agent. The Administrative Agent may resign at any time by giving written notice thereof to the Banks and the Borrower. Upon any such resignation, the Majority Banks shall have the right to appoint a successor Administrative Agent which shall be a commercial bank organized or chartered under the laws of the United States of America or of any State thereof and having combined capital and surplus of at least $500,000,000. If no successor Administrative Agent shall have been so appointed by the Majority Banks, and shall have accepted such appointment, within 30 days after the notice of resignation of the retiring Administrative Agent, then the retiring Administrative Agent may, on behalf of the Banks, with the consent of the Borrower, which shall not be unreasonably withheld, appoint a successor Administrative Agent which shall be a commercial bank organized or chartered under the laws of the United States of America or of any State thereof and having a combined capital and surplus of at least $500,000,000. Upon the acceptance of any appointment as Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. After any retiring Administrative Agent's resignation as Administrative Agent, the provisions of this Article IX and Sections 10.04 and 10.05 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement and the other Loan Documents. 154 ARTICLE X Miscellaneous SECTION 10.01. Notices, Etc. All notices, requests and other communications provided to any party under this Agreement shall, unless otherwise expressly specified herein, be in writing (including by telex or by facsimile) and mailed by overnight delivery, telexed, transmitted by facsimile or delivered: if to the Borrower, to its address specified on the signature pages hereof; if to any Bank, to its Domestic Lending Office; and if to the Administrative Agent, to its address specified on the signature pages hereof; or, as to the Borrower or the Administrative Agent, at such other address as shall be designated by such party in a written notice to the other parties and, as to each other party, at such other address as shall be designated by such party in a written notice to the Borrower and the Administrative Agent. All such notices and communications shall be effective, if telexed, when confirmed by telex answerback, if transmitted by facsimile, when transmitted by facsimile and confirmed by telephone or facsimile, or, if mailed by overnight delivery or delivered, upon delivery, except that notices and communications to the Administrative Agent pursuant to Article II or IX shall not be effective until received by the Administrative Agent. SECTION 10.02. Amendments, Etc. No amendment or waiver of any provision of this Agreement or of any other Loan Document, and no consent to any departure by the Borrower herefrom or therefrom, shall in any event be effective unless the same shall be in writing, acknowledged by the Administrative Agent and signed or consented to by the Majority Banks, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that no amendment, waiver or consent shall, unless in writing and signed by all the Banks, do any of the following: (a) increase the Commitments of the Banks (other than by assignment) or subject the Banks to any additional monetary obligation; (b) reduce the principal of, or interest (other than any default interest payable pursuant to Section 2.10) on, the Committed Loans or any fees payable hereunder; (c) extend the Termination Date or the Maturity Date or any date fixed for any payment of interest on, the Committed Loans or any fees payable hereunder; (d) change the percentage of the Commitments or the percentage of the aggregate unpaid principal amount of the Loans which shall be required for the Banks or any of them to take any action hereunder; or (e) amend this Section 10.02. SECTION 10.03. No Waiver; Remedies. No failure on the part of any Bank or the Administrative Agent to exercise, and no delay in exercising, any right, remedy, power or privilege hereunder or under any other Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any such right, remedy, power or privilege preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. SECTION 10.04. Costs and Expenses. The Borrower agrees to pay on demand: 155 (a) all costs and expenses incurred by the Administrative Agent in connection with the preparation, execution, delivery, administration, modification and amendment of this Agreement or any other Loan Document or any other document to be delivered hereunder or thereunder or in connection with the transactions contemplated hereby or thereby, or with respect to advising the Administrative Agent as to its rights and responsibilities under the Loan Documents, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent (including the allocated cost of in-house counsel); (b) all costs and expenses incurred by the Administrative Agent or any Bank in connection with the enforcement or preservation of any rights under this Agreement or any other Loan Document or in connection with any restructuring or "work-out" (whether through negotiations, legal proceedings or otherwise), including the reasonable fees, charges and disbursements of counsel for the Administrative Agent or such Bank (including the allocated cost of in-house counsel); and (c) all costs and expenses of the Administrative Agent incurred in connection with due diligence, transportation, use of computers, duplication, appraisals, surveys, audits, insurance, consultants and search reports and all filing and recording fees and title insurance premiums. SECTION 10.05. Indemnity. (a) The Borrower agrees to indemnify, defend, reimburse and hold harmless the Administrative Agent, the Syndication Agent, the Documentation Agent, each Bank and each of their Affiliates, and each of their respective directors, officers, employees, agents and advisors (each, an "Indemnified Party") from and against all claims, actions, proceedings, suits, damages, losses, liabilities, costs and expenses, including the reasonable fees, charges and disbursements of counsel (including the allocated cost of in-house counsel) which may be incurred by or asserted against any Indemnified Party in connection with, or arising out of, or relating to (i) any transaction or proposed transaction (whether or not consummated) financed or to be financed, in whole or in part, directly or indirectly, with the proceeds of any Borrowing or otherwise contemplated in this Agreement; (ii) the entering into and performance of this Agreement and any other Loan Document by the Administrative Agent, the Syndication Agent, the Documentation Agent or any Bank or any action or omission of the Borrower in connection therewith; or (iii) any investigation, litigation, suit, action or proceeding (regardless of whether an Indemnified Party is a party thereto) which relates to any of the foregoing or to any Environmental Claim, unless and to the extent such claim, action, proceeding, suit, damage, loss, liability, cost or expense was solely attributable to such Indemnified Party's gross negligence or willful misconduct as determined by a final judgment of a court of competent jurisdiction. (a) The Administrative Agent, the Syndication Agent, the Documentation Agent and each Bank agree that in the event that any investigation, litigation, suit, action or proceeding is asserted or threatened in writing or instituted against it or any other Indemnified Party, or any remedial, removal or response action is requested of it or any other Indemnified Party, for which the Administrative Agent, the Syndication Agent, the Documentation Agent or any Bank may desire indemnity or defense hereunder, the Administrative Agent, the Syndication Agent, the Documentation Agent or such Bank shall promptly notify the Borrower in writing. 156 (b) The Borrower at the request of the Administrative Agent, the Syndication Agent, the Documentation Agent or any Bank shall have the obligation to defend against such investigation, litigation, suit, action or proceeding or requested remedial, removal or response action, and the Administrative Agent, the Syndication Agent and the Documentation Agent, in any event, may participate in the defense thereof with legal counsel of the Administrative Agent's choice. In the event that the Administrative Agent, the Syndication Agent, the Documentation or any Bank requests the Borrower to defend against such investigation, litigation, suit, action or proceeding or requested remedial, removal or response action, the Borrower shall promptly do so and the Administrative Agent, the Syndication Agent, the Documentation Agent or the affected Bank shall have the right to have legal counsel of its choice participate in such defense. No action taken by legal counsel chosen by the Administrative Agent or any Bank in defending against any such investigation, litigation, suit, action or proceeding or requested remedial, removal or response action shall vitiate or any way impair the Borrower's obligations and duties hereunder to indemnify and hold harmless any Indemnified Party. SECTION 10.06. Right of Set-off. Upon the occurrence and during the continuation of any Event of Default, each Bank is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by such Bank to or for the credit or the account of the Borrower against any and all of the Obligations, whether or not such Bank shall have made any demand under this Agreement. Each Bank agrees promptly to notify the Borrower after any such set-off and application made by such Bank; provided, however, that the failure to give such notice shall not affect the validity of such set-off and application. The rights of each Bank under this Section 10.06 are in addition to any other rights and remedies (including other rights of set-off) which such Bank may have. SECTION 10.07. Binding Effect. The provisions of this Agreement shall be binding upon and inure to the benefit of the Borrower, the Administrative Agent and each Bank and their respective successors and assigns, except that the Borrower shall not have the right to assign or transfer its rights or obligations hereunder or any interest herein without the prior written consent of all the Banks. SECTION 10.08. Assignments, Participations Etc. (a) (i) Each Bank may, with the prior written approval of the Borrower and the Administrative Agent, assign to one or more assignees, which approvals will not be unreasonably withheld, and (ii) each Bank may, without the consent of the Borrower or the Administrative Agent, assign to any of its Affiliates or to any other Bank, other than a Bank replaced pursuant to Section 3.14(b), (each such Person, an "Assignee"), all or any fraction of its Committed Loans, if any, owed to it and its Commitment in a minimum amount of $10,000,000; provided, however, that the Borrower shall not, as a result of an assignment by any Bank to any of its wholly-owned Subsidiaries incur any increased liability for Taxes and Other Taxes pursuant to Section 3.05. (b) No assignment shall become effective, and the Borrower and the Administrative Agent shall be entitled to continue to deal solely and directly with each Bank in connection with the interests so assigned by such Bank to an Assignee, until (i) written notice of such assignment, together with an agreement to be bound, payment instructions, addresses and related information with respect to such Assignee, shall have been given to the Borrower and the Administrative Agent by such Bank and such Assignee, in substantially the form of Exhibit 10.08 (a "Notice of Assignment"), and such Bank and such Assignee shall have executed in connection therewith an 157 Assignment and Assumption Agreement in substantially the form of Attachment A to such Notice of Assignment, (ii) a processing fee in the amount of $1,000 shall have been paid to the Administrative Agent by the assignor Bank or the Assignee, and (iii) either (a) five Business days shall have elapsed after receipt by the Administrative Agent of the items referred to in clauses (i) and (ii) or (b) if earlier, the Administrative Agent shall have notified the assignor Bank and the Assignee of its receipt of the items mentioned in clauses (i) and (ii) and that it has acknowledged the assignment by countersigning the Notice of Assignment. (c) From and after the effective date of any assignment, (i) the Assignee thereunder shall be deemed automatically to have become a party hereto and, to the extent that rights and obligations hereunder have been assigned to such Assignee by the assignor Bank, shall have the rights and obligations of a Bank hereunder and under each other Loan Document, and (ii) the assignor Bank, to the extent that rights and obligations hereunder have been assigned by it to the Assignee, shall be released from its obligations hereunder and under the each other Loan Document. (d) Any Bank may at any time sell to one or more banks or other Persons (each of such Persons being herein called a "Participant") participating interests in any of the Loans, its Commitment or any other interest of such Bank hereunder; provided, however, that (i) no participation contemplated in this Section 10.08(d) shall relieve such Bank from its Commitment or its other obligations hereunder or under any other Loan Document; (ii) such Bank shall remain solely responsible for the performance of its Commitment and such other obligations; (iii) the Borrower and the Administrative Agent shall continue to deal solely and directly with such Bank in connection with such Bank's rights and obligations under this Agreement; and (iv) no Participant, unless such Participant is itself a Bank, shall be entitled to require such Bank to take or refrain from taking any action hereunder or under any other Loan Document, except that such Bank may agree with any Participant that such Bank will not, without such Participant's consent, approve any amendment to, or any consent or waiver with respect to, this Agreement or any other Loan Document, to the extent such amendment, consent or waiver would require unanimous consent of the Banks as described in the proviso to Section 10.02. The Borrower acknowledges and agrees that each Participant, for purposes of Sections 3.05 (other than 3.05(f)), 3.06, 3.08, 3.10, 3.11 or 10.06 shall be considered a Bank; provided, however, that (a) for purposes of Sections 3.05, 3.08, 3.10 and 3.11, no Participant shall be entitled to receive any payment or compensation in excess of that to which such Participant's selling Bank would be entitled with respect to the amount of such Participant's participation interests if such Bank had not sold such participation interests and (b) a Participant that is a foreign Person shall not be considered a Bank for purposes of Section 3.05 unless the Borrower is notified in writing of the participation sold to such Participant and such Participant agrees in writing for the benefit of the Borrower, to comply with Section 3.05(f) as though it were a Bank. (e) Notwithstanding any other provision of this Agreement, nothing contained in this Agreement shall prevent any Bank from pledging or assigning its interest in the Loans to a Federal Reserve Bank in the Federal Reserve System of the United States of America in accordance with applicable law; provided, however, that no such pledge or assignment shall release any Bank from its obligations hereunder. 158 SECTION 10.09. Confidentiality. Each Bank agrees to take normal and reasonable precautions and exercise due care to maintain the confidentiality of all non-public information provided to it by the Borrower or by the Administrative Agent on the Borrower's behalf in connection with this Agreement or any other Loan Document and agrees and undertakes that neither it nor any of its Affiliates shall use any such information for any purpose or in any manner other than pursuant to the terms contemplated by this Agreement. Any Bank may disclose such information (a) at the request of any bank regulatory authority or in connection with an examination of such Bank by any such authority; (b) pursuant to subpoena or other court process; (c) when required to do so in accordance with the provisions of any applicable law; (d) at the express direction of any agency of any State of the United States of America or of any other jurisdiction in which such Bank conducts its business; and (e) to such Bank's affiliates, independent auditors, counsel and other professional advisors. Notwithstanding the foregoing, the Borrower authorizes each Bank to disclose to any Participant or Assignee and any prospective Participant and Assignee such financial and other information in such Bank's possession concerning the Borrower or its Subsidiaries which has been delivered to the Banks pursuant to this Agreement or any other Loan Document or which has been delivered to the Banks by the Borrower in connection with the Banks' credit evaluation of the Borrower prior to entering into this Agreement; provided, however, that such Participant or Assignee or prospective Participant or Assignee agrees in writing to such Bank to keep such information confidential to the same extent required of the Banks hereunder. SECTION 10.10. Survival. The obligations of the Borrower under Sections 3.05, 3.08, 3.10, 3.11, 3.12, 10.04 and 10.05, and the obligations of the Banks under Sections 3.05(h) and 9.07, shall in each case survive repayment or purchase of the Loans or any termination of this Agreement and the Commitments. The representations and warranties made by the Borrower in this Agreement and in each other Loan Document shall survive the execution and delivery of this Agreement and each other Loan Document. SECTION 10.11. Headings. The various headings of this Agreement are inserted for convenience only and shall not affect the meaning or interpretation of this Agreement or any provisions hereof or thereof. SECTION 10.12. Governing Law and Jurisdiction. (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; and (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER HEREBY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. SECTION 10.13. Execution in Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. 159 SECTION 10.14. Entire Agreement. THIS AGREEMENT EMBODIES THE ENTIRE AGREEMENT AND UNDERSTANDING AMONG THE BORROWER, THE BANKS AND THE ADMINISTRATIVE AGENT, AND SUPERSEDES ALL PRIOR AGREEMENTS AND UNDERSTANDINGS OF SUCH PERSONS RELATING TO THE SUBJECT MATTER HEREOF EXCEPT FOR THE FEE LETTER AND ANY PRIOR ARRANGEMENTS MADE WITH RESPECT TO THE PAYMENT BY THE BORROWER OF (OR ANY INDEMNIFICATION FOR) ANY FEES, COSTS OR EXPENSES PAYABLE TO OR INCURRED (OR TO BE INCURRED) BY OR ON BEHALF OF THE ADMINISTRATIVE AGENT OR THE BANKS. SECTION 10.15. Waiver of Jury Trial. THE ADMINISTRATIVE AGENT, THE BANKS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE ADMINISTRATIVE AGENT, THE BANKS OR THE BORROWER. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND THE BANKS TO ENTER INTO THIS AGREEMENT. 160 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written. TYSON FOODS, INC., by ________________________________ Name: Title: Address for notices: 2210 West Oaklawn Drive Springdale, Arkansas 72764 Attention: Facsimile No.: THE CHASE MANHATTAN BANK, individually and as Administrative Agent, by ________________________________ Name: Title: Address for notices: Loan and Agency Services Group One Chase Manhattan Plaza 8th Floor New York NY 10081 Attention: Rocky Chan Facsimile No.: (212) 552-7490 Address for payments: ABA # 021000021 Attention: Rocky Chan Chase Plaza, 8th Floor New York, NY 10081 Credit to Account number: 323219551 Reference: Tyson Foods, Inc. With a copy to: The Chase Manhattan Bank 270 Park Avenue New York NY 10017 Attention of.: Facsimile No.: MERRILL LYNCH CAPITAL CORPORATION., individually and as Syndication Agent, by ________________________________ Name: Title: MERRILL LYNCH BANK USA, individually as a Bank, by ________________________________ Name: Title: SUNTRUST BANK, individually and as Documentation Agent, by ________________________________ Name: Title: 161 EXHIBIT 1.01 [FORM OF] GUARANTEE AGREEMENT dated as of [__________], 2001, between IBP, INC., a Delaware corporation (the "Subsidiary Guarantor"), and THE CHASE MANHATTAN BANK, as administrative agent (the "Administrative Agent") for the Banks (as defined in the Credit Agreement referred to below). Reference is made to the Credit Agreement dated as of January 12, 2001 (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement"), among Tyson Foods, Inc., a Delaware corporation (the "Borrower"), the banks from time to time party thereto (the "Banks"), The Chase Manhattan Bank, as Administrative Agent, Merrill Lynch Capital Corporation, as Syndication Agent, and SunTrust Banks, Inc., as Documentation Agent. Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Credit Agreement. The Banks have agreed to make Loans to the Borrower pursuant to, and upon the terms and subject to the conditions specified in, the Credit Agreement. Among other uses, the Loans are expected to be used to acquire the Subsidiary Guarantor and to repay or refinance the Subsidiary Guarantor's indebtedness outstanding pursuant to IBP Credit Agreement. The Subsidiary Guarantor acknowledges that it will derive the foregoing and other substantial benefits pursuant to the Credit Agreement and from the making of the Loans by the Banks to the Borrower. The obligations of the Banks to make Loans are conditioned on, among other things, the execution and delivery by the Subsidiary Guarantor of this Guarantee Agreement. In order to induce the Banks to make Loans, the Subsidiary Guarantor is willing to execute this Agreement. Accordingly, the parties hereto agree as follows: SECTION 1. Guarantee. Upon the effectiveness of this Guarantee pursuant to the terms of Section 6, and subject to the limitations contained in Section 5, the Subsidiary Guarantor hereby irrevocably and unconditionally guarantees, as a guarantee of payment and not merely of collection, all Loans, other Indebtedness, advances, debts, liabilities, obligations, covenants and duties owing by the Borrower to any Bank, the Administrative Agent, any Affiliate of any of the foregoing or any Indemnified Party, of any kind or nature, present or future, whether or not evidenced by any note, guaranty or other instrument, arising under the Credit Agreement or under any other Loan Document, whether or not for the payment of money, whether arising by reason of an extension of credit, loan, guaranty, indemnification, or in any other manner, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising and however acquired (including all interest, charges, expenses, fees, attorneys' fees and disbursements (including the allocated cost of in-house counsel) and any other sum chargeable to the Borrower under the Credit Agreement or any other Loan Document and all interest and other monetary obligations accruing during the pendency of any bankruptcy, insolvency, receivership or similar proceeding, regardless of whether allowed or allowable in such proceeding) (collectively, the "Obligations"). The Subsidiary Guarantor further agrees that the due and punctual payment of the Obligations may be extended or renewed, in whole or in part, without notice to or further assent from it, and that it will remain bound upon its Guarantee hereunder notwithstanding any such extension or renewal of any Obligation. Each and every default in payment of the principal of and premium, if any, or interest on any Obligation shall give rise to a separate cause of action hereunder, and separate suits may be brought hereunder as each cause of action arises. 162 The Subsidiary Guarantor waives presentment to, demand of payment from and protest to the Borrower of any of the Obligations, and also waives notice of acceptance of its obligations and notice of protest for nonpayment. The obligations of the Subsidiary Guarantor hereunder shall not be affected by (a) the failure of any Bank, the Administrative Agent, any beneficiary of any indemnification, fee or expense obligation undertaken by the Borrower under any Loan Document or the successors and assigns of each of the foregoing (each, a "Beneficiary" and, collectively, the "Beneficiaries") to assert any claim or demand or to enforce any right or remedy under any Loan Document, any guarantee or any other agreement or instrument against the Borrower under the provisions of this Agreement, any other Loan Document or otherwise; (b) any extension or renewal of any of the Obligations; (c) any rescission, waiver, amendment or modification of, or release from, any of the terms or provisions of this Agreement or any other Loan Document or agreement; provided, however, that without the prior written consent of the Subsidiary Guarantor, there shall be no modification or amendment to the commencement date of Subsidiary Guarantor's obligations under this Agreement, nor any modifications to Section 5 or Section 6, including the termination provisions hereof; (d) the release of (or the failure to perfect a security interest in) any security held by any Beneficiary for the performance of the Obligations or any of them; (e) the failure or delay of any Beneficiary to exercise any right or remedy against any other guarantor of the Obligations; (f) any default, failure or delay, wilful or otherwise, in the performance of the Obligations; or (g) any other act, omission or delay to do any other act which may or might in any manner or to any extent vary the risk of the Subsidiary Guarantor or otherwise operate as a discharge of the Subsidiary Guarantor as a matter of law or equity or which would impair or eliminate any right of the Subsidiary Guarantor to subrogation; provided, however, that without the prior written consent of the Subsidiary Guarantor, there shall be no modification or amendment to this Guarantee Agreement (or to any defined term incorporated by reference into this Guarantee Agreement from any other agreement) that changes the commencement date of Subsidiary Guarantor's obligations under this Agreement, nor any modifications to Section 5 or Section 6, including the termination provisions hereof.. The Subsidiary Guarantor further agrees that its agreement hereunder constitutes a promise of payment when due (whether or not any bankruptcy or similar proceeding shall have stayed the accrual or collection of any of the Obligations or operated as a discharge thereof) and not merely of collection, and waives any right to require that any resort be had by any Beneficiary to any balance of any deposit account or credit on the books of any Beneficiary in favor of the Borrower or any other Person. Except as expressly provided in this Agreement, the obligations of the Subsidiary Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, and shall not be subject to any defense or setoff, counterclaim, recoupment or termination whatsoever, by reason of the invalidity, illegality or unenforceability of the Obligations, or any impossibility in the performance of the Obligations or otherwise. Except as expressly provided in this Agreement, the Subsidiary Guarantor further agrees that its obligations hereunder shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of any Obligation is rescinded or must otherwise be restored by any Beneficiary upon the bankruptcy or reorganization of the Borrower or otherwise. 163 In furtherance of the foregoing and not in limitation of any other right which any Beneficiary may have at law or in equity against the Subsidiary Guarantor by virtue hereof, upon the failure of the Borrower to pay any Obligation when and as the same shall become due, whether at maturity, by acceleration, after notice of prepayment or otherwise, and subject to the terms of this Agreement, the Subsidiary Guarantor hereby promises to and will, upon receipt of written demand by the Administrative Agent, forthwith pay, or cause to be paid, to the Administrative Agent for distribution to the Beneficiaries in cash an amount equal to the sum of (i) the unpaid principal amount of such Obligations then due, (ii) accrued and unpaid interest and fees on such Obligations and (iii) all other monetary Obligations then due. Upon payment in full by the Subsidiary Guarantor of any Obligation, the repaid Bank shall, in a reasonable manner, assign to the Subsidiary Guarantor the Obligation owed to it and so paid by the Subsidiary Guarantor to such Bank, such assignment to be pro tanto to the extent to which the Obligation in question was discharged by the Subsidiary Guarantor, or make such disposition thereof as the Subsidiary Guarantor shall direct (all without recourse to any Beneficiary and without any representation or warranty by any Beneficiary). Upon payment by the Subsidiary Guarantor of any sums as provided above, all rights of the Subsidiary Guarantor against the Borrower arising as a result thereof by way of right of subrogation or otherwise shall in all respects be subordinated and junior in right of payment to the prior indefeasible payment in full of all the Obligations owed by the Borrower to the Beneficiaries. Except as expressly provided in this Agreement, nothing shall discharge or satisfy the liability of the Subsidiary Guarantor hereunder except the full performance and payment of the Obligations. SECTION 2. Defenses of the Borrower Waived. The Administrative Agent and the Banks may, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the Obligations, make any other accommodation with the Borrower, the Subsidiary Guarantor or any other guarantor or exercise any other right or remedy available to them against the Borrower, the Subsidiary Guarantor or any other guarantor, without affecting or impairing in any way the liability of the Subsidiary Guarantor hereunder except to the extent the Obligations have been fully, finally and indefeasibly paid in cash. Pursuant to applicable law, the Subsidiary Guarantor waives any defense arising out of any such election even though such election operates, pursuant to applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of the Subsidiary Guarantor against the Borrower or any guarantor, as the case may be, or any security. SECTION 3. Information. The Subsidiary Guarantor assumes all responsibility for being and keeping itself informed of the Borrower's financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent of the risks that the Subsidiary Guarantor assumes and incurs hereunder, and agrees that none of the Administrative Agent and the Banks will have any duty to advise the Subsidiary Guarantor of information known to it or any of them regarding such circumstances or risks. 164 SECTION 4. Representations and Warranties; Agreements. The Subsidiary Guarantor represents and warrants as to itself that all representations and warranties relating to the Subsidiary Guarantor contained in any Loan Document are true and correct in all material respects. The Subsidiary Guarantor agrees that the provisions of Section 3.05 of the Credit Agreement shall apply equally to the Subsidiary Guarantor with respect to payments made by it hereunder. SECTION 5. Termination; Limitation of Guarantee Amount. (a) The Guarantees made hereunder (A) shall terminate upon the completion of the Merger or (B) in the event the Merger does not occur prior thereto, shall (i) subject to clause (ii) below, terminate when all the Obligations have been paid in full and the Banks have no further commitment to lend under the Credit Agreement and (ii) shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of any Obligation is rescinded or must otherwise be restored by the Administrative Agent or any Bank upon the bankruptcy or reorganization of the Borrower, the Subsidiary Guarantor or otherwise. Notwithstanding any other provision in this Guarantee Agreement, in the event and after the Subsidiary Guarantor and/or the Borrower terminate(s) the Merger Agreement in accordance with its terms as in effect on the Effective Date, the Subsidiary Guarantor's obligations hereunder shall be limited to an amount equal to $1,250,000,000. (b) Notwithstanding anything in this Guarantee Agreement to the contrary, the Subsidiary Guarantor's liability under this Guarantee Agreement shall be limited to an amount not to exceed as of any date of determination the greater of: (A) the amount of Indebtedness of the Subsidiary Guarantor (including the IBP Credit Agreement) refinanced by funds obtained from the Borrower; and (B) the amount which could be claimed by the Administrative Agent and the Banks from the Subsidiary Guarantor under this Guarantee Agreement without rendering such claim voidable or avoidable under Section 548 of Chapter 11 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or state corporate law or common law (such highest amount determined hereunder being the Subsidiary Guarantor's "Maximum Liability"). The Subsidiary Guarantor agrees that the Obligations may at any time and from time to time exceed the Maximum Liability without impairing this Guarantee Agreement or affecting the rights and remedies of the Administrative Agent hereunder provided nothing in this Section 5 shall be construed to increase the Subsidiary Guarantor's obligations hereunder beyond its Maximum Liability. SECTION 6. Binding Agreement; Assignments. Whenever in this Agreement any Bank or the Administrative Agent is referred to, such reference shall be deemed to include the successors and assigns of such party; and all covenants, promises and agreements by or on behalf of the Subsidiary Guarantor that are contained in this Agreement shall bind and inure to the benefit of each such party and their respective successors and assigns. This Agreement shall become effective as to the Subsidiary Guarantor as of the date on which the debt outstanding under the IBP Credit Agreement is repaid or refinanced (it being understood that the Subsidiary Guarantor's obligations under this Guarantee Agreement on any date prior to the Acquisition Date shall be limited to $950,000,000) and when a counterpart hereof executed on behalf of the Subsidiary Guarantor shall have been delivered to the Administrative Agent, and a counterpart hereof shall have been executed on behalf of the Administrative Agent, and thereafter shall be binding upon the Subsidiary Guarantor and the Administrative Agent and their respective successors and assigns, and shall inure to the benefit of the Subsidiary Guarantor, the Administrative Agent and the Banks, and their respective successors and assigns, except that the Subsidiary Guarantor 165 shall not have the right to assign its rights or obligations hereunder or any interest herein, and any such attempted assignment shall be void. SECTION 7. Waivers; Amendment. (a) No failure or delay of the Administrative Agent or any Bank in exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent or any Bank hereunder or under the Credit Agreement or any other Loan Document are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or any other Loan Document or consent to any departure by the Subsidiary Guarantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice or demand on the Subsidiary Guarantor in any case shall entitle the Subsidiary Guarantor to any other or further notice or demand in similar or other circumstances. (b) Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to a written agreement entered into between the Subsidiary Guarantor and the Administrative Agent (with the prior written consent of the Banks if required under the Credit Agreement). SECTION 8. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. SECTION 9. Notices. All communications and notices hereunder shall be in writing and given as provided in Section 10.01 of the Credit Agreement. All communications and notices hereunder to the Subsidiary Guarantor shall be given to the address set forth below, with a copy to the Borrower: IBP, inc. 800 Stevens Port Drive Dakota Dunes, South Dakota 57049 Attention: Treasurer SECTION 10. Survival of Agreement; Severability. (a) Subject to the provisions of Section 5, all covenants, agreements, representations and warranties made by the Subsidiary Guarantor herein and in the certificates or other instruments prepared or delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the Administrative Agent and the Banks and shall survive the making by the Banks of the Loans, regardless of any investigation made by any of them or on their behalf, and shall continue in full force and effect until the earlier of (a) the date of the completion of the Merger and (b) the date the principal or any accrued interest on any Loan or any other fee or amount payable under this Agreement or any other Loan Document is no longer outstanding and unpaid and the Commitments have been terminated. (b) In the event any one or more of the provisions contained in this Agreement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby (it being understood that the invalidity of a particular provision in a particular jurisdiction shall not in and of itself affect the validity of such provision in any other jurisdiction). The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions. 166 SECTION 11. Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which when taken together shall constitute a single contract, and shall become effective as provided in Section 6. Delivery of an executed signature page to this Agreement by facsimile transmission shall be as effective as delivery of a manually executed counterpart of this Agreement. SECTION 12. Rules of Interpretation. The rules of interpretation specified in Sections 1.03 and 1.04 of the Credit Agreement shall be applicable to this Agreement. SECTION 13. Jurisdiction; Consent to Service of Process. (a) The Subsidiary Guarantor hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or Federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State court or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent or any Bank may otherwise have to bring any action or proceeding relating to this Agreement against the Subsidiary Guarantor or its properties in the courts of any jurisdiction. (b) The Subsidiary Guarantor hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any New York State or Federal court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. (c) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law. SECTION 14. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE BANKS, THE ADMINISTRATIVE AGENT, THE Borrower OR THE SUBSIDIARY GUARANTOR. EACH PARTY HERETO ACKNOWLEDGES THAT IT AND THE OTHER PARTY HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. 167 SECTION 15. Right of Setoff. Upon the occurrence and during the continuation of any Event of Default, each of the Administrative Agent and the Banks is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other Indebtedness at any time owing by such Person to or for the credit or the account of the Subsidiary Guarantor against any or all the obligations of the Subsidiary Guarantor now or hereafter existing under this Agreement held by such Person, irrespective of whether or not such Person shall have made any demand under this Agreement. The rights of each Person under this Section are in addition to other rights and remedies (including other rights of setoff) which such Person may have. 168 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written. IBP, INC., By: Name: Title: THE CHASE MANHATTAN BANK, as Administrative Agent, By: Name: Title: 169 EXHIBIT 2.02 [FORM OF] NOTICE OF BORROWING Date:_________, 200__ The Chase Manhattan Bank, as Administrative Agent 270 Park Avenue New York, New York 10017 Attention: Loan and Agency Services Group Re: Credit Agreement dated as of January 12, 2001 (as from time to amended, modified or supplemented, the "Credit Agreement"), among Tyson Foods, Inc., the Banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent __________________________________________________ Ladies and Gentlemen: The undersigned, Tyson Foods, Inc., refers to the Credit Agreement, the terms defined in the Credit Agreement being used in this Notice of Borrowing as defined in the Credit Agreement, and hereby gives you notice, irrevocably, pursuant to Section 2.02(a) of the Credit Agreement of the Committed Borrowing specified below: (a) The Business Day of the proposed Committed Borrowing is__________. (b) The aggregate amount of the proposed Committed Borrowing is $__________. (c) The proposed Committed Borrowing is to be comprised of [Eurodollar Loans] [Reference Rate Loans]. (d) [If any Eurodollar Loans:] The duration of the first Interest Period for the Eurodollar Loans included in the proposed Committed Borrowing is ___ months. The undersigned hereby certifies that the following statements are true on the date hereof, and will be true on the date of the proposed Committed Borrowing, before and after giving effect thereto and to the application of the proceeds therefrom: (i) [Except for representations and warranties expressly relating to an earlier date] the representations and warranties contained its Article IV of the Credit Agreement and in each other Loan Document are true and correct with the same effect as if made on and as of such date; and (ii) No event has occurred and is continuing, or will result from the proposed Committed Borrowing, which constitutes a Default or an Event of Default. Very truly yours, TYSON FOODS, INC. By:________________________ Title: 170 EXHIBIT 2.04(a) [FORM OF] COMPETITIVE BID REQUEST Date:_________, 200_ The Chase Manhattan Bank, as Administrative Agent, and each of the Banks parties to the Credit Agreement Re: Credit Agreement dated as of January 12, 2001 (as from time to time amended, modified or supplemented, the "Credit Agreement"), among Tyson Foods, Inc., the Banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent Ladies and Gentlemen: This is a Competitive Bid Request pursuant to Section 2.04(a) of the Credit Agreement: Borrowing Date: ________________ Aggregate Amount of Bid Borrowing: $________________ Rate Basis: [LIBOR Bid Loans] [Absolute Rate Bid Loans] Principal Interest [Interest Amount Period Payment Date[s]] _____________ _____________ _____________ _____________ _____________ _____________ _____________ _____________ _____________ The undersigned hereby certifies that the conditions precedent specified in Section 5.02 of the Credit Agreement will be satisfied on the date of the proposed Bid Borrowing. 171 All bids are to be sent to Tyson Foods, Inc. by 10:00 a.m. (New York City time) on__________. Our primary fax number to be used for these purposes is (501) 750-7915, and our secondary fax number is (501) 756-4061. If you have any questions, please call Dennis Leatherby at (501) 756-7194. Very truly yours, TYSON FOODS, INC, By: Title: 172 EXHIBIT 2.04(b) [FORM OF] COMPETITIVE BID Date:_________, 200__ Tyson Foods, Inc. 2210 West Oaklawn Drive Springdale, Arkansas 72764 Attention: Dennis Leatherby Re: Credit Agreement dated as of January 12, 2001 (as from time to time amended, modified or supplemented, the "Credit Agreement"), among Tyson Foods, Inc., the Banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent Ladies and Gentlemen: This Competitive Bid is delivered pursuant to Section 2.04(b) of the Credit Agreement. The undersigned Bank offers to make Bid Loan(s) thereunder in the following principal amount(s) at the following interest rate(s) for the following Interest Period(s): Date of Bid Borrowing: _____________ Offer 1: (Maximum Amount $__________) (Minimum Amount $__________). Principal Interest Interest [Interest Amount Rate* Period Payment Date[s]] __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ ___________ *Insert LIBOR Bid Margin or Absolute Rate. 173 Offer 2: (Maximum Amount $__________) (Minimum Amount $__________). Principal Interest Interest [Interest Amount Rate* Period Payment Date[s]] __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ Offer 3: (Maximum Amount $__________) (Minimum Amount $__________). Principal Interest Interest [Interest Amount Rate* Period Payment Date[s]] __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ Offer 4: (Maximum Amount $__________) (Minimum Amount $__________). Principal Interest Interest [Interest Amount Rate* Period Payment Date[s]] __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ Offer 5: (Maximum Amount $__________) (Minimum Amount $__________). Principal Interest Interest [Interest Amount Rate* Period Payment Date[s]] __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ Offer 6: (Maximum Amount $__________) (Minimum Amount $__________). 174 Principal Interest Interest [Interest Amount Rate* Period Payment Date[s]] __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ The applicable Lending Office for payments and notices is __________. Subject to Section 2.04(c) of the Credit Agreement, the Borrower may accept any combination of Interest Periods from one or more offers for the principal amounts indicated; provided that the aggregate principal amount accepted from one offer does not exceed the maximum amount specified for such offer. Dated: __________, 200__ [Name of Bidding Bank] By:_____________________ Title:____________________ [Address] [Facsimile No.] [Telephone] [Contact Person] 175 EXHIBIT 2.05(b) [FORM OF] PROMISSORY NOTE (Committed Loans) FOR VALUE RECEIVED, on the Maturity Date, the undersigned, TYSON FOODS, INC., a Delaware corporation (the "Borrower") hereby promises to pay to the order of __________ (the "Bank") $___________ or, if less, the aggregate principal amount of all Committed Loans made by the Bank to the Borrower pursuant to the Credit Agreement dated as of January 12, 2001 (as from time to time amended, modified or supplemented, the "Credit Agreement"), among the Borrower, the Bank, the other banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent. The Borrower also promises to pay interest on the unpaid principal amount hereof from time to time outstanding from the date hereof until paid in full at the rates and at the times which shall be determined in accordance with the provisions of the Credit Agreement. The Bank shall endorse on the schedule annexed to this Note, the date, amount and maturity of each Committed Loan made by it and the amount of each payment of principal and interest made by the Borrower with respect thereto; provided that the failure to make, or an error in making, a notation thereon shall not limit or otherwise affect the obligation of the Borrower hereunder with respect to payments of principal or interest on this promissory note (this "Note"). This Note is one of the Borrower's promissory notes issued pursuant to and entitled to the benefits of the Credit Agreement to which reference is hereby made for a more complete statement of the rights of prepayment and the terms and conditions under which the Committed Loans evidenced hereby are made and are to be repaid. Capitalized terms used in this Note without definition shall have the meanings specified in the Credit Agreement. All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in immediately available funds at the of _____________________________, or at such other place as shall be designated in writing for such purpose in accordance with the terms of the Credit Agreement. Each of the Bank and any subsequent holder of this Note agrees that before disposing of this Note or any part hereof it will make a notation hereon of all principal payments previously made hereunder and of the date to which interest hereon has been paid. Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement. The Borrower promises to pay all costs and expenses, including reasonable attorneys' fees and the allocated cost of in-house counsel, incurred in the collection and enforcement of this Note in accordance with the terms of the Credit Agreement. The Borrower hereby waives diligence, presentment, protest, demand and notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder. THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. 176 IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer, as of this day and year and the place first above written. TYSON FOODS, INC. By: Title: 177 TRANSACTIONS ON NOTE AMOUNT OF OUTSTANDING TYPE OF AMOUNT END OF PRINCIPAL PRINCIPAL LOAN OF LOAN INTEREST OR INTEREST BALANCE NOTATION MADE MADE PERIOD PAID THIS DATE MADE BY THIS THIS THIS DATE DATE DATE 178 EXHIBIT 2.05(c) [FORM OF] PROMISSORY NOTE (Bid Loans) FOR VALUE RECEIVED, the undersigned, TYSON FOODS, INC., a Delaware corporation (the "Borrower") hereby promises to pay to the order of ___________________ (the "Bank") the principal sum of each Bid Loan made by the Bank to the Borrower pursuant to the Credit Agreement dated as of January 12, 2001 (as from time to time amended, modified or supplemented, the "Credit Agreement"), among the Borrower, the Bank, the other banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent, on the maturity date, which shall be no later than the Termination Date, for such Bid Loan as determined in accordance with the Credit Agreement. The Borrower also promises to pay interest on the unpaid principal amount of each Bid Loan from time to time outstanding from the date of disbursement thereof until paid in full at the rates and at the times which shall be determined in accordance with the provisions of the Credit Agreement. The Bank shall endorse on the schedule annexed to this Note, the date, amount and maturity of each Bid Loan made by it and the amount of each payment of principal and interest made by the Borrower with respect thereto; provided that the failure to make, or an error in making, a notation thereon shall not limit or otherwise affect the obligation of the Borrower hereunder with respect to payments of principal or interest on this promissory note (this "Note"). This Note is one of the Borrower's promissory notes issued pursuant to and entitled to the benefits of the Credit Agreement to which reference is hereby made for a more complete statement of the terms and conditions under which the Bid Loans evidenced hereby are made and are to be repaid. Capitalized terms used in this Note without definition shall have the meanings specified in the Credit Agreement. All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in immediately available funds at the office of the Bank at __________ or at such other place as shall be designated in writing for such purpose in accordance with the terms of the Credit Agreement. Each of the Bank and any subsequent holder of this Note agrees that before disposing of this Note or any part hereof it will make a notation hereon of all principal payments previously made hereunder and of the date to which interest hereon has been paid. No Bid Loan evidenced by this Note may be prepaid prior to the maturity date thereof. Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement. The Borrower promises to pay all costs and expenses, including reasonable attorneys' fees and the allocated cost of in-house counsel, incurred in the collection and enforcement of this Note. The Borrower hereby waives diligence, presentment, protest, demand and notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder. THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. 179 IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by its duly authorized officer, as of this day and year and the place first above written. TYSON FOODS, INC. By:_______________________ Title:______________________ 180 TRANSACTIONS ON NOTE AMOUNT OF TYPE OF AMOUNT OF END OF PRINCIPAL OUTSTANDING LOAN LOAN MADE INTEREST OR PRINCIPAL NOTATION MADE THIS DATE PERIOD INTEREST BALANCE MADE BY THIS PAID THIS DATE DATE THIS DATE 181 EXHIBIT 2.11 [FORM OF] NOTICE OF CONVERSION/CONTINUATION Date:_________, 200__ The Chase Manhattan Bank, as Administrative Agent 270 Park Avenue New York, New York 10017 Attention: Loan and Agency Services Group Re:Credit Agreement dated as of January 12, 2001 (as from time to amended, modified or supplemented, the "Credit Agreement"), among Tyson Foods, Inc., the Banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent Ladies and Gentlemen: The undersigned, Tyson Foods, Inc., refers to the Credit Agreement, the terms defined in the Credit Agreement being used in this Notice of Conversion/Continuation as defined in the Credit Agreement, and hereby gives you notice, irrevocably, pursuant to Section 2.11 of the Credit Agreement of the Committed Loans specified below: (1) The date of the [conversion] [continuation] is __________, 200_. (2) The aggregate amount of the Committed Loans to be [converted] [continued] is $__________. (3) The Loans are to be [converted into] [continued as] [Eurodollar] [Reference Rate] Loans. (4) [If applicable:] The duration of the Interest Period for the Loans included in the [conversion] [continuation] shall be ________ [months]. Very truly yours, TYSON FOODS, INC. By:_______________________ Title:______________________ 182 EXHIBIT 5.01 [FORM OF OPINION OF CORPORATE COUNSEL] [Effective Date] To: The Chase Manhattan Bank, as Administrative Agent, and each of the Banks party to the Credit Agreement Ladies and Gentlemen: I am corporate counsel to TYSON FOODS, INC., a Delaware corporation, and I have advised Tyson in connection with the preparation, execution and delivery of the Credit Agreement dated as of January 12, 2001 (the "Credit Agreement"), among Tyson, the Banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent (collectively, the "Bank Parties"). This opinion is being delivered pursuant to Section 5.01(d) of the Credit Agreement. Terms defined in the Credit Agreement are used in this opinion as defined in the Credit Agreement. In that connection, I have examined originals or copies, certified or otherwise identified to my satisfaction, of the following: (i) an executed copy of the Credit Agreement; (ii)an executed copy of the Account Agreement dated as of January 12, 2001 (the "Account Agreement"), between Tyson and The Chase Manhattan Bank, as Administrative Agent; (iii) certified copies of the Certificate of Incorporation, all amendments thereto and the By-Laws of Tyson; (iv) a certified copy of resolutions of the Board of Directors of Tyson; and (v) a certificate from the Secretary of State of Delaware attesting to the continued corporate existence and good standing of Tyson in such state. In addition, I have examined and am familiar with originals or copies, certified or otherwise identified to my satisfaction, of such other documents, and have made such other investigations, as I have deemed necessary or appropriate as a basis for the opinions set forth below. In my examination I have assumed the genuineness of all signatures (other than the signature of the Company for the Credit Agreement and the Account Agreement) including endorsements, the legal capacity of natural persons, the authenticity of all documents submitted to me as originals, the conformity to original documents of all documents submitted to me as certified or photostatic copies, and the authenticity of the originals of such copies. As to any facts material to this opinion which I did not independently establish or verify, I have relied upon statements and representations of Tyson and its officers and other representatives and of public officials. Based upon the foregoing and subject to the limitations, qualifications, exceptions and assumptions set forth herein, I am of the opinion that: 1. Tyson (a) has been duly incorporated and organized and is validly existing and in good standing under the laws of the State of Delaware and is qualified to do business and is in good standing as a foreign corporation under the laws of each jurisdiction where the failure to so qualify would have a Material Adverse Effect, (b) has all requisite corporate power and authority to execute, deliver and perform the Credit Agreement and the Account Agreement and to consummate the Transactions (as defined below) and (c) has all requisite corporate power and authority and the legal right to own, pledge, mortgage, hold under lease and operate its properties and to conduct its business as now and currently proposed to be conducted. 183 2. The execution, delivery and performance by Tyson of the Credit Agreement, the other Loan Documents and the Account Agreement, the borrowings under the Credit Agreement, the Acquisition, the Merger and the assumption and refinancing of Indebtedness of IBP, inc. (collectively, the "Transactions") have been duly authorized by all necessary corporate action on the part of Tyson, and each of the Credit Agreement and Account Agreement has been duly executed and delivered by Tyson. The Board of Directors of Tyson has the authority to approve the Credit Agreement and the Account Agreement, and the transactions contemplated thereby, and the Transactions. 3. The execution, delivery and performance by Tyson of the Credit Agreement and the Account Agreement, and the consummation of the Transactions by Tyson do not and will not violate, contravene or conflict with (a) any provision of its Certificate of Incorporation or By-laws or (b) any other Requirement of Law. 4. The execution, delivery and performance by Tyson of the Credit Agreement and the Account Agreement and the consummation of the Transactions by Tyson do not and will not conflict with or result in the breach of, or constitute a default under, any Contractual Obligations binding on or affecting Tyson or its property or result in the creation or imposition of any Lien upon any property of Tyson. 5. (i) To my knowledge, there is no pending action or proceeding against Tyson before any court or other Governmental Authority which purports to affect the legality, validity or enforceability of the Credit Agreement, any other Loan Document or the Account Agreement; or the performance by Tyson of the Credit Agreement, any other Loan Document or the Account Agreement; or the consummation of the Transactions by Tyson and (ii) there are no actions, suits, proceedings, claims or disputes pending against Tyson or any of its Subsidiaries (other than IBP, inc.) that have a reasonable likelihood of having a Material Adverse Effect. 6. No authorization, consent or other approval of, notice to or filing with any court or other Governmental Authority is required to authorize or is required in connection with the execution, delivery or performance by Tyson of the Credit Agreement or the Account Agreement, or the transactions contemplated thereby, or the consummation of the Transactions by Tyson, except for (a) the filing of a certificate of merger in accordance with the General Corporation Law of the State of Delaware, (b) compliance with the applicable requirements of the Hart- Scott-Rodino Antitrust Improvements Act of 1976, the waiting period under which will have expired or terminated prior to the refinancing of the IBP Credit Agreement, (c) compliance with any applicable non-United States laws intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade, and (d) compliance with any applicable requirements of the Securities Act of 1933 and the Securities Exchange Act of 1934. 7. Each of the Credit Agreement and the Account Agreement has been duly executed and delivered and constitutes the legal, valid and binding obligation of Tyson, enforceable against Tyson in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally or by equitable principles relating to enforceability. 184 8. The Company is not an "investment company" as defined in, or subject to regulation under, the Investment Company Act of 1940. The Company is not a "holding company" as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935. I am admitted to the Bar in the State of Arkansas. I express no opinion as to the laws of any jurisdiction other than (i) the laws of the State of Arkansas, (ii) the general corporation law of the State of Delaware and (iii) the federal laws of the United States of America to the extent specifically referred to herein; however, if the Loan Documents and/or the Account Agreement were stated to be governed by and construed in accordance with the law of the State of Arkansas, or if an Arkansas court were to apply the law of the State of Arkansas to the Loan Documents and/or the Account Agreement, each Loan Document and/or the Account Agreement, as appropriate, would constitute the legal, valid and binding obligation of Tyson, enforceable against Tyson in accordance with its terms. This opinion is solely for the benefit of, and may only be relied upon by, the addressees, provided that any Person that becomes a Bank pursuant to the assignment provisions of Section 10.08 of the Credit Agreement may rely on this opinion as if it were addressed to such Person and delivered on the date hereof. Very truly yours, 185 EXHIBIT 6.09 [FORM OF] COMPLIANCE CERTIFICATE Date: ____________, 200__ The Chase Manhattan Bank, as Administrative Agent 270 Park Avenue New York, New York 10017 Attention: Loan and Agency Services Group Re: Credit Agreement dated as of January [ ], 2001 (as from time to time amended, modified or supplemented, the "Credit Agreement") among Tyson Foods, Inc. (the "Borrower"), the Banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent Ladies and Gentlemen: This Compliance Certificate is delivered pursuant to Section 6.09(c) of the Credit Agreement. Any terms defined in the Credit Agreement and not defined in this Compliance Certificate are used herein as defined in the Credit Agreement. The Borrower hereby certifies and warrants that, as of the dates set forth below: (a) on , (the "Computation Date"), the Debt Ratio was approximately (and in any event not greater than) to ; and (b) as of each of the Computation Date and the date hereof, no Default or Event of Default has occurred and is continuing or will have occurred and be continuing. The undersigned Responsible Officer of the Borrower executing this Certificate on behalf of the Borrower is, and at all pertinent times mentioned herein has been, the Chief Financial Officer of the Borrower and in such capacity has been responsible for the management of the financial affairs of the Borrower and the preparation of financial statements of the Borrower and its Subsidiaries on a consolidated basis. IN WITNESS WHEREOF, the Borrower has caused this Certificate to be executed and delivered, and the certification and warranties contained herein to be made, this day of TYSON FOODS, INC. By: _____________________ Title:________________________ 186 EXHIBIT 10.08 [FORM OF] NOTICE OF ASSIGNMENT Date: , 200__ The Chase Manhattan Bank, as Administrative Agent 270 Park Avenue New York, New York 10017 Attention: Loan and Agency Services Group Tyson Foods, Inc. 2210 West Oaklawn Drive Springdale, Arkansas 72764 Attention: Re: Credit Agreement dated as of January 12, 2001 (as from time to time amended, modified or supplemented, the "Credit Agreement"), among Tyson Foods, Inc. (the "Borrower"), the Banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent Ladies and Gentlemen: We refer to Section 10.08(b) of the Credit Agreement. All defined terms used in this Notice of Assignment and not defined herein have the meanings assigned to such terms in the Credit Agreement. This Notice of Assignment is delivered to you pursuant to Section 10.08(b) of the Credit Agreement and also constitutes notice to each of you, pursuant to clause (i) of Section 10.08(b) of the Credit Agreement, of the assignment to (the "Assignee") of [___%] of all rights, title and interest of (the "Assignor") in and to the Credit Agreement, including the Commitment of the Assignor and all outstanding Committed Loans made by the Assignor but excluding any Bid Loans made by the Assignor, which assignment was undertaken pursuant to an Assignment and Assumption Agreement, substantially in the form attached hereto as Attachment A, duly executed and delivered by the Assignor and the Assignee on , 200_. After giving effect to the foregoing assignment, the Assignor's and the Assignee's Commitments for the purposes of the Credit Agreement as set forth opposite such Person's name on the signature pages hereof. [If applicable: The Assignee hereby represents and warrants that it has obtained from the Borrower and the Administrative Agent the prior consent to the assignment required pursuant to Section 10.08(a).] The Assignee hereby acknowledges and confirms that it has received a copy of the Credit Agreement and the Schedules and Exhibits thereto, together with copies of the financial statements referred to in Section 6.09 of the Credit Agreement and such other documents and information as it has deemed appropriate to make its own credit and legal analysis and decision to enter into the Assignment and Assumption Agreement. The Assignee further confirms and agrees that in becoming a Bank and in extending its Commitment and making its Committed Loans under the Credit Agreement, such actions have and will be made without recourse to, or representation or warranty by, the Administrative Agent. Effective as of the date contemplated by Section 10.08(b)(iii) of the Credit Agreement for the effectiveness of the assignment which is the subject of this Notice of Assignment (the "Effective Date"): (a) the Assignee 187 (i) shall be deemed automatically to have become a party to the Credit Agreement and have all the rights and obligations of a "Bank" under the Credit Agreement and the other Loan Documents as if it were an original signatory thereto to the extent specified in paragraph (a)(ii) hereof; and (ii) agrees to be bound by the terms and conditions set forth in the Credit Agreement and the other Loan Documents as if it were an original signatory thereto; and (b) the Assignor shall be released from its obligations under the Credit Agreement and the other Loan Documents to the extent specified in paragraph (a)(ii) hereof. The Assignor and the Assignee hereby agree that the [Assignor] [Assignee] will pay to the Administrative Agent the processing fee referred to in clause (ii) of Section 10.08(b) of the Credit Agreement upon the delivery hereof. The Assignee hereby advises each of you of the following administrative details with respect to the assigned Loans and Commitments and requests the Administrative Agent to acknowledge receipt of this document: The following administrative details apply to the Assignee: (A) Domestic Lending Office: Assignee name: Address: Attention: Telephone: ( ) Facsimile: ( ) Telex (Answerback): (B) Eurodollar Lending Office: Assignee name: Address: Attention: Telephone: ( ) Facsimile: ( ) Telex (Answerback): (C) Notice Address: Assignee name: Address: Attention: Telephone: ( ) Facsimile: ( ) Telex (Answerback): (D) Payment Instructions: Account No.: At: Reference: Attention: The Assignee agrees to furnish to the Administrative Agent and the Borrower on or before the Effective Date the tax form[s] required by Section 3.05(f) (if so required) of the Credit Agreement. 188 This Notice of Assignment may be executed by the Assignor and the Assignee in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute one and the same notice and agreement. [ASSIGNOR] Adjusted Commitment: By: $ Title: Commitment: [ASSIGNEE] $ By: Title: ACKNOWLEDGED this _____ day of , 200__: THE CHASE MANHATTAN BANK, as Administrative Agent By: Title: 189 Attachment A to EXHIBIT 10.08 [Form of] Assignment and Assumption Agreement This ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement") dated as of , 200_ is made between _______________ (the "Assignor") and _____________ (the "Assignee"). RECITALS WHEREAS, the Assignor is party to that certain Credit Agreement dated as of January 12, 2001, among TYSON FOODS, INC., a Delaware corporation (the "Borrower"), the banks parties thereto, Merrill Lynch Capital Corporation, as Syndication Agent, SunTrust Banks, Inc., as Documentation Agent, and The Chase Manhattan Bank, as Administrative Agent (including the Assignor, the "Banks"), (as from time to time amended, modified or supplemented, the "Credit Agreement"). Any terms defined in the Credit Agreement and not defined in this Agreement are used herein as defined in the Credit Agreement; WHEREAS, as provided under the Credit Agreement, the Assignor has committed to make committed loans (the "Committed Loans") to the Company in an aggregate amount not to exceed $ (the "Commitment"); WHEREAS, [the Assignor has made Committed Loans in the aggregate principal amount of $ to the Borrower] [no Committed Loans are outstanding under the Credit Agreement]; WHEREAS, the Assignor wishes to assign to the Assignee [part of the] [all] rights and obligations of the Assignor under the Credit Agreement in respect of its Commitment, [together with a corresponding portion of each of its outstanding Committed Loans,] in an amount equal to $ (the "Assigned Amount") on the terms and subject to the conditions set forth herein, and the Assignee wishes to accept assignment of such rights and to assume such obligations from the Assignor on such terms and subject to such conditions; and WHEREAS, the Assignee will have no interest in any Bid Loans made by the Assignor; NOW, THEREFORE, in consideration of the foregoing and the mutual agreements contained herein, the parties hereto agree as follows: 1. Assignment and Assumption. (a) Subject to the terms and conditions of this Agreement, (i) the Assignor hereby sells, transfers and assigns to the Assignee, and (ii) the Assignee hereby purchases, assumes and undertakes from the Assignor, without recourse and without representation or warranty (except as provided in this Agreement) [_____%] (the "Assignee's Percentage Share") of (A) the Commitment [and the Committed Loans] of the Assignor and (B) all related rights, benefits, obligations, liabilities and indemnities under and in connection with the Credit Agreement and each other Loan Document (other than any such rights, benefits, obligations, liabilities or indemnities with respect to any Bid Loans made by the Assignor). [If appropriate, add paragraph specifying payment to Assignor by Assignee of outstanding principal of, accrued interest on, and fees with respect to, Committed Loans assigned.] 190 (b) With effect on and after the Effective Date (as defined in the Notice of Assignment), the Assignee shall be a party to the Credit Agreement and succeed to all of the rights and be obligated to perform all of the obligations of a Bank under the Credit Agreement, including the requirements concerning confidentiality, with a Commitment in an amount equal to the Assigned Amount. The Assignee agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Bank. It is the intent of the parties hereto that the Commitment of the Assignor shall, as of the Effective Date, be reduced by an amount equal to the Assigned Amount and the Assignor shall relinquish its rights and be released from its obligations under the Credit Agreement to the extent such obligations have been assumed by the Assignee. (c) After giving effect to the assignment and assumption, on the Effective Date the Assignee's Commitment will be $ . 2. Payments. (a) As consideration for the sale, assignment and transfer contemplated in Section 1, the Assignee shall pay to the Assignor on the Transfer Date (as defined in Section 5) in immediately available funds an amount equal to $ , representing the Assignee's Percentage Share of the principal amount of all Committed Loans previously made, and currently owned, by the Assignor to the Borrower under the Credit Agreement and outstanding on the Effective Date. (b) The [Assignor] [Assignee] further agrees to pay to the Administration Agent a recordation fee in the amount of $1,000. 3. Reallocation of Payments. Any interest, commissions, fees and other payments accrued to the Transfer Date with respect to the Committed Loans and the Commitment shall be for the account of the Assignor. Any interest, fees and other payments accrued on and after the Transfer Date with respect to the Assigned Amount shall be for the account of the Assignee. Each of the Assignor and the Assignee agrees that it will hold in trust for the other party any interest, fees and other amounts which it may receive to which the other party is entitled pursuant to the preceding sentence and pay to the other party any such amounts which it may receive promptly upon receipt. 4. Independent Credit Decision. The Assignee (a) acknowledges that it has received a copy of the Credit Agreement and the Schedules and Exhibits thereto, together with copies of the financial statements referred to in Section 6.09 of the Credit Agreement, and such other documents and information as it has deemed appropriate to make its own credit and legal analysis and decision to enter into this Agreement; and (b) agrees that it will, independently and without reliance upon the Assignor, the Administrative 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 and legal decisions in taking or not taking action under the Credit Agreement. 5. Transfer Date; Notices. (a) As between the Assignor and the Assignee (but without affecting the Effective Date of the assignment being made hereby for purposes of the Credit Agreement), the effective date for this Agreement shall be_________ (the "Transfer Date"); provided that the following conditions precedent have been satisfied on or before the Transfer Date: 191 (i) this Agreement shall be executed and delivered by the Assignor and the Assignee; (ii) the consent of the Borrower and the Administrative Agent required for an effective assignment of the Assigned Amount by the Assignor to the Assignee shall have been duly obtained and shall be in full force and effect as of the Transfer Date; (iii) the Assignee shall pay to the Assignor all amounts due to the Assignor under this Agreement; and (iv) the recordation fee referred to in Section 2(b) and in Section 10.08(b) of the Credit Agreement shall have been paid to the Administrative Agent. (b) Promptly following the execution of this Agreement, the Assignor shall deliver to the Administrative Agent for acknowledgment by the Administrative Agent, the Notice of Assignment required under the Credit Agreement. [6. Administrative Agent [INCLUDE ONLY IF ASSIGNOR IS ADMINISTRATIVE AGENT]. (a) The Assignee hereby appoints and authorizes the Assignor to take such action as administrative agent on its behalf and to exercise such powers under the Credit Agreement as are delegated to the Administrative Agent by the Banks pursuant to the terms of the Credit Agreement. (b) The Assignee shall assume no duties or obligations held by the Assignor in its capacity as Administrative Agent under the Credit Agreement.] 7. Withholding Tax. The Assignee agrees to comply with Section 3.05(f) of the Credit Agreement as if the date of this Agreement were the Effective Date of the Credit Agreement. 8. Representations and Warranties. (a) The Assignor represents and warrants that (i) it is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any lien, security interest or other adverse claim; (ii) it is duly organized and existing and it has the full power and authority to take, and has taken, all action necessary to execute and deliver this Agreement and any other documents required or permitted to be executed or delivered by it in connection with this Agreement and to fulfill its obligations hereunder; (iii) no notices to, or consents, authorizations or approvals of, any Person are required (other than any already given or obtained) for its due execution, delivery and performance of this Agreement, and apart from any agreements or undertaking or filings required by the Credit Agreement, no further action by, or notice to, or filing with, any Person is required of it for such execution, delivery or performance; and (iv) this Agreement has been duly executed and delivered by it and constitutes the legal, valid and binding obligation of the Assignor, enforceable against the Assignor in accordance with the terms hereof, subject, as to enforcement, to bankruptcy, insolvency, moratorium, reorganization and other laws of general application relating to or affecting creditors' rights and to general equitable principles. 192 (b) The Assignor makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Credit Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or any other instrument or document furnished pursuant thereto. The Assignor makes no representation or warranty in connection with, and assumes no responsibility with respect to, the solvency, financial condition or statements of the Borrower, or the performance or observance by the Borrower, of any of its respective obligations under the Credit Agreement or any other instrument or document furnished in connection therewith. (c) The Assignee represents and warrants that (i) it is duly organized and existing and it has full power and authority to take, and has taken, all action necessary to execute and deliver this Agreement and any other documents required or permitted to be executed or delivered by it in connection with this Agreement, and to fulfill its obligations hereunder; (ii) no notices to, or consents, authorizations or approvals of, any Person are required (other than any already given or obtained) for its due execution, delivery and performance of this Agreement; and apart from any agreements or undertaking or filings required by the Credit Agreement, no further action by, or notice to, or filing with, any Person is required of it for such execution, delivery or performance; and (iii) this Agreement has been duly executed and delivered by it and constitutes the legal, valid and binding obligation of the Assignee, enforceable against the Assignee in accordance with the terms hereof, except subject, as to enforcement, to bankruptcy, insolvency, moratorium, reorganization and other laws of general application relating to or affecting creditors' rights and to general equitable principles. 9. Further Assurances. The Assignor and the Assignee each hereby agrees to execute and deliver such other instruments, and take such other action, as either party may reasonably request in connection with the transactions contemplated by this Agreement, including the delivery of any notices or other documents or instruments to the Borrower or the Administrative Agent, which may be required in connection with the assignment and assumption contemplated hereby. 10. Miscellaneous. (a) Any amendment or waiver of any provision of this Agreement shall be in writing signed by the parties hereto. No failure or delay by either party hereto in exercising any right, power or privilege hereunder shall operate as a waiver thereof and any waiver of any breach of the provisions of this Agreement shall be without prejudice to any rights with respect to any other or further breach hereof. (b) All payments made hereunder shall be made without any set-off or counterclaim. (c) The Assignor and the Assignee shall each pay its own costs and expenses incurred in connection with the negotiation, preparation, execution and performance of this Agreement. (d) This Agreement may be executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute one and the same instrument. 193 (e) This Agreement shall be governed by and construed in accordance with the law of the State of New York. The Assignor and the Assignee each irrevocably submits to the non-exclusive jurisdiction of any New York State or Federal court sitting in The City of New York over any suit, action or proceeding arising out of or relating to this Agreement and irrevocably agrees that all claims in respect of such action or proceeding may be heard and determined in such New York State or Federal court. Each party to this Agreement hereby irrevocably waives, to the fullest extent it may effectively do so, the defense of an inconvenient forum to the maintenance of such action or proceeding. (f) The Assignor and the Assignee each hereby knowingly, voluntarily and intentionally waive any rights they may have to a trial by jury in respect of any litigation based hereon, or arising out of, under, or in connection with this Agreement, the Credit Agreement, any related documents and agreements or any course of conduct, course of dealing, statements (whether oral or written). [Other provisions to be added as may be negotiated between the Assignor and the Assignee, provided that such provisions are not inconsistent with the Credit Agreement.] IN WITNESS WHEREOF, the Assignor and the Assignee have caused this Agreement to be executed and delivered by their duly authorized officers as of the date first above written. [ ] Assignor By: Title: Address: [ ] Assignee By: Title: Address: 194 EX-10.2 4 0004.txt ISSUING AND PAYING AGENCY AGREEMENT ISSUING AND PAYING AGENCY AGREEMENT This Agreement, dated as of January 12, 2001, is by and between Tyson Foods, Inc. (the "Issuer") and The Chase Manhattan Bank ("Chase"). 1. APPOINTMENT AND ACCEPTANCE The Issuer hereby appoints Chase as its issuing and paying agent in connection with the issuance and payment of certain short-term promissory notes of the Issuer (the "Notes"), as further described herein, and Chase agrees to act as such agent upon the terms and conditions contained in this Agreement. 2. COMMERCIAL PAPER PROGRAMS The Issuer may establish one or more commercial paper programs under this Agreement by delivering to Chase a completed program schedule (the "Program Schedule"), with respect to each such program. Chase has given the Issuer a copy of the current form of Program Schedule and the Issuer shall complete and return its first Program Schedule to Chase prior to or simultaneously with the execution of this Agreement. In the event that any of the information provided in, or attached to, a Program Schedule shall change, the Issuer shall promptly inform Chase of such change in writing. 3. NOTES All Notes issued by the Issuer under this Agreement shall be short- term promissory notes, exempt from the registration requirements of the Securities Act of 1933, as amended, as indicated on the Program Schedules, and from applicable state securities laws. The Notes may be placed by dealers (the "Dealers") pursuant to Section 4 hereof. Notes shall be issued in either certificated or book-entry form. 4. AUTHORIZED REPRESENTATIVES The Issuer shall deliver to Chase a duly adopted corporate resolution from the Issuer's Board of Directors (or other governing body) authorizing the issuance of Notes under each program established pursuant to this Agreement and a certificate of incumbency, with specimen signatures attached, of those officers, employees and agents of the Issuer authorized to take certain actions with respect to the Notes as provided in this Agreement (each such person is hereinafter referred to as an "Authorized Representative"). Until Chase receives any subsequent incumbency certificates of the Issuer, Chase shall be entitled to rely on the last incumbency certificate delivered to it for the purpose of determining the Authorized Representatives. The Issuer represents and warrants that each Authorized Representative may appoint other officers, employees and agents of the Issuer (the "Delegates"), including without limitation any Dealers, to issue instructions to Chase under this Agreement, and take other actions on the Issuer's behalf hereunder, provided that notice of the appointment of each Delegate is delivered to Chase in writing. Each such appointment shall remain in effect unless and until revoked by the Issuer in a written notice to Chase. 195 5. CERTIFICATED NOTES If and when the Issuer intends to issue certificated notes ("Certificated Notes"), the Issuer and Chase shall agree upon the form of such Notes. Thereafter, the Issuer shall from time to time deliver to Chase adequate supplies of Certificated Notes which will be in bearer form, serially numbered, and shall be executed by the manual or facsimile signature of an Authorized Representative. Chase will acknowledge receipt of any supply of Certificated Notes received from the Issuer, noting any exceptions to the shipping manifest or transmittal letter (if any), and will hold the Certificated Notes in safekeeping for the Issuer in accordance with Chase's customary practices. Chase shall not have any liability to the Issuer to determine by whom or by what means a facsimile signature may have been affixed on Certificated Notes, or to determine whether any facsimile or manual signature is genuine, if such facsimile or manual signature resembles the specimen signature attached to the Issuer's certificate of incumbency with respect to such Authorized Representative. Any Certificated Note bearing the manual or facsimile signature of a person who is an Authorized Representative on the date such signature was affixed shall bind the Issuer after completion thereof by Chase, notwithstanding that such person shall have ceased to hold his or her office on the date such Note is countersigned or delivered by Chase. 6. BOOK-ENTRY NOTES The Issuer's book-entry notes ("Book-Entry Notes") shall not be issued in physical form, but their aggregate face amount shall be represented by a master note (the "Master Note") in the form of Exhibit A executed by the Issuer pursuant to the book-entry commercial paper program of The Depository Trust Company ("DTC"). Chase shall maintain the Master Note in safekeeping, in accordance with its customary practices, on behalf of Cede & Co., the registered owner thereof and nominee of DTC. As long as Cede & Co. is the registered owner of the Master Note, the beneficial ownership interest therein shall be shown on, and the transfer of ownership thereof shall be effected through, entries on the books maintained by DTC and the books of its direct and indirect participants. The Master Note and the Book-Entry Notes shall be subject to DTC's rules and procedures, as amended from time to time. Chase shall not be liable or responsible for sending transaction statements of any kind to DTC's participants or the beneficial owners of the Book-Entry Notes, or for maintaining, supervising or reviewing the records of DTC or its participants with respect to such Notes. In connection with DTC's program, the Issuer understands that as one of the conditions of its participation therein, it shall be necessary for the Issuer and Chase to enter into a Letter of Representations, in the form of Exhibit B hereto, and for DTC to receive and accept such Letter of Representations. In accordance with DTC's program, Chase shall obtain from the CUSIP Service Bureau a written list of CUSIP numbers for Issuer's Book- Entry Notes, and Chase shall deliver such list to DTC. The CUSIP Service Bureau shall bill the Issuer directly for the fee or fees payable for the list of CUSIP numbers for the Issuer's Book-Entry Notes. 196 7. ISSUANCE INSTRUCTIONS TO CHASE; PURCHASE PAYMENTS The Issuer understands that all instructions under this Agreement are to be directed to Chase's Commercial Paper Operations Department. Chase shall provide the Issuer, or, if applicable, the Issuer's Dealers, with access to Chase's Money Market Issuance System or other electronic means (collectively, the "System") in order that Chase may receive electronic instructions for the issuance of Notes. Electronic instructions must be transmitted in accordance with the procedures furnished by Chase to the Issuer or its Dealers in connection with the System. These transmissions shall be the equivalent to the giving of a duly authorized written and signed instruction which Chase may act upon without liability. In the event that the System is inoperable at any time, an Authorized Representative or a Delegate may deliver written, telephone or facsimile instructions to Chase, which instructions shall be verified in accordance with any security procedures agreed upon by the parties. Chase shall incur no liability to the Issuer in acting upon instructions believed by Chase in good faith to have been given by an Authorized Representative or a Delegate. In the event that a discrepancy exists between a telephonic instruction and a written confirmation, the telephonic instruction will be deemed the controlling and proper instruction. Chase may electronically record any conversations made pursuant to this Agreement, and the Issuer hereby consents to such recordings. All issuance instructions regarding the Notes must be received by 1:00 P.M. New York time in order for the Notes to be issued or delivered on the same day. (a) Issuance and Purchase of Book-Entry Notes. Upon receipt of issuance instructions from the Issuer or its Dealers with respect to Book-Entry Notes, Chase shall transmit such instructions to DTC and direct DTC to cause appropriate entries of the Book-Entry Notes to be made in accordance with DTC's applicable rules, regulations and procedures for book-entry commercial paper programs. Chase shall assign CUSIP numbers to the Issuer's Book-Entry Notes to identify the Issuer's aggregate principal amount of outstanding Book-Entry Notes in DTC's system, together with the aggregate unpaid interest (if any) on such Notes. Promptly following DTC's established settlement time on each issuance date, Chase shall access DTC's system to verify whether settlement has occurred with respect to the Issuer's Book- Entry Notes. Prior to the close of business on such business day, Chase shall deposit immediately available funds in the amount of the proceeds due the Issuer (if any) to the Issuer's account at Chase and designated in the applicable Program Schedule (the "Account"), provided that Chase has received DTC's confirmation that the Book-Entry Notes have settled in accordance with DTC's applicable rules, regulations and procedures. Chase shall have no liability to the Issuer whatsoever if any DTC participant purchasing a Book-Entry Note fails to settle or delays in settling its balance with DTC or if DTC fails to perform in any respect. 197 (b) Issuance and Purchase of Certificated Notes. Upon receipt of issuance instructions with respect to Certificated Notes, Chase shall: (a) complete each Certificated Note as to principal amount, date of issue, maturity date, place of payment, and rate or amount of interest (if such Note is interest bearing) in accordance with such instructions; (b) countersign each Certificated Note; and (c) deliver each Certificated Note in accordance with the Issuer's instructions, except as otherwise set forth below. Whenever Chase is instructed to deliver any Certificated Note by mail, Chase shall strike from the Certificated Note the word "Bearer," insert as payee the name of the person so designated by the Issuer and effect delivery by mail to such payee or to such other person as is specified in such instructions to receive the Certificated Note. The Issuer understands that, in accordance with the custom prevailing in the commercial paper market, delivery of Certificated Notes shall be made before the actual receipt of payment for such Notes in immediately available funds, even if the Issuer instructs Chase to deliver a Certificated Note against payment. Therefore, once Chase has delivered a Certificated Note to the designated recipient, the Issuer shall bear the risk that such recipient may fail to remit payment of such Note or return such Note to Chase. Delivery of Certificated Notes shall be subject to the rules of the New York Clearing House in effect at the time of such delivery. Funds received in payment of Certificated Notes shall be credited to the Account. 8. USE OF SALES PROCEEDS IN ADVANCE OF PAYMENT Chase shall not be obligated to credit the Issuer's Account unless and until payment of the purchase price of each Note is received by Chase. From time to time, Chase, in its sole discretion, may permit the Issuer to have use of funds payable with respect to a Note prior to Chase's receipt of the sales proceeds of such Note. If Chase makes a deposit, payment or transfer of funds on behalf of the Issuer before Chase receives payment for any Note, such deposit, payment or transfer of funds shall represent an advance by Chase to the Issuer to be repaid promptly, and in any event on the same day as it is made, from the proceeds of the sale of such Note, or by the Issuer if such proceeds are not received by Chase. 9. PAYMENT OF MATURED NOTES On any day when a Note matures or is prepaid, the Issuer shall transmit, or cause to be transmitted, to the Account, prior to 2:30 P.M. New York time on the same day, an amount of immediately available funds sufficient to pay the aggregate principal amount of such Note and any applicable interest due. Chase shall pay the interest (if any) and principal on a Book-Entry Note to DTC in immediately available funds, which payment shall be by net settlement of Chase's account at DTC. Chase shall pay Certificated Notes upon presentment. Chase shall have no obligation under the Agreement to make any payment for which there is not sufficient, available and collected funds in the Account, and Chase may, without liability to the Issuer, refuse to pay any Note that would result in an overdraft to the Account. 198 10. OVERDRAFTS (a) Intraday overdrafts with respect to each Account shall be subject to Chase's policies as in effect from time to time. (b) An overdraft will exist in an Account if Chase, in its sole discretion, (i) permits an advance to be made pursuant to Section 8 and, notwithstanding the provisions of Section 8, such advance is not repaid in full on the same day as it is made, or (ii) pays a Note pursuant to Section 9 in excess of the available collected balance in such Account. Overdrafts shall be subject to Chase's established banking practices, including, without limitation, the imposition of interest, funds usage charges and administrative fees. The Issuer shall repay any such overdraft, fees and charges no later than the next business day, together with interest on the overdraft at the rate established by Chase for the Account, computed from and including the date of the overdraft to the date of repayment. 11. NO PRIOR COURSE OF DEALING No prior action or course of dealing on the part of Chase with respect to advances of the purchase price or payments of matured Notes shall give rise to any claim or cause of action by the Issuer against Chase in the event that Chase refuses to pay or settle any Notes for which the Issuer has not timely provided funds as required by this Agreement. 12. RETURN OF CERTIFICATED NOTES Chase will in due course cancel any Certificated Note presented for payment and return such Note to the Issuer. Chase shall also cancel and return to the Issuer any spoiled or voided Certificated Notes. Promptly upon written request of the Issuer or at the termination of this Agreement, Chase shall destroy all blank, unissued Certificated Notes in its possession and furnish a certificate to the Issuer certifying such actions. 13. INFORMATION FURNISHED BY CHASE Upon the reasonable request of the Issuer, Chase shall promptly provide the Issuer with information with respect to any Note issued and paid hereunder, provided, that the Issuer delivers such request in writing and, to the extent applicable, includes the serial number or note number, principal amount, payee, date of issue, maturity date, amount of interest (if any) and place of payment of such Note. 14. REPRESENTATIONS AND WARRANTIES The Issuer represents and warrants that: (i) it has the right, capacity and authority to enter into this Agreement; and (ii) it will comply with all of its obligations and duties under this Agreement. The Issuer further represents and agrees that each Note issued and distributed upon its instruction pursuant to this Agreement shall constitute the Issuer's representation and warranty to Chase that such Note is a legal, valid and binding obligation of the Issuer, and that such Note is being issued in a transaction which is exempt from registration under the Securities Act of 1933, as amended, and any applicable state securities law. 199 15. DISCLAIMERS Neither Chase nor its directors, officers, employees or agents shall be liable for any act or omission under this Agreement except in the case of gross negligence or willful misconduct. IN NO EVENT SHALL CHASE BE LIABLE FOR SPECIAL, INDIRECT OR CONSEQUENTIAL LOSS OR DAMAGE OF ANY KIND WHATSOEVER (INCLUDING BUT NOT LIMITED TO LOST PROFITS), EVEN IF CHASE HAS BEEN ADVISED OF THE LIKELIHOOD OF SUCH LOSS OR DAMAGE AND REGARDLESS OF THE FORM OF ACTION. In no event shall Chase be considered negligent in consequence of complying with DTC's rules, regulations and procedures. The duties and obligations of Chase, its directors, officers, employees or agents shall be determined by the express provisions of this Agreement and they shall not be liable except for the performance of such duties and obligations as are specifically set forth herein and no implied covenants shall be read into this Agreement against them. Neither Chase nor its directors, officers, employees or agents shall be required to ascertain whether any issuance or sale of any Notes (or any amendment or termination of this Agreement) has been duly authorized or is in compliance with any other agreement to which the Issuer is a party (whether or not Chase is also a party to such agreement). 16. INDEMNIFICATION The Issuer agrees to indemnify and hold harmless Chase, its directors, officers, employees and agents from and against any and all liabilities, claims, losses, damages, penalties, costs and expenses (including reasonable attorneys' fees and disbursements) suffered or incurred by or asserted or assessed against Chase or any of them arising out of Chase or any of them acting as the Issuer's agent under this Agreement, except for such liability, claim, loss, damage, penalty, cost or expense resulting from the negligence or willful misconduct of Chase, its directors, officers, employees or agents. This indemnity will survive the termination of this Agreement. 17. OPINION OF COUNSEL The Issuer shall deliver to Chase all documents it may reasonably request relating to the existence of the Issuer and authority of the Issuer for this Agreement, including, without limitation, an opinion of counsel satisfactory to Chase. 18. NOTICES All notices, confirmations and other communications hereunder shall (except to the extent otherwise expressly provided) be in writing and shall be sent by first-class mail, postage prepaid, by telecopier or by hand, addressed as follows, or to such other address as the party receiving such notice shall have previously specified to the party sending such notice: If to the Issuer: Tyson Foods, Inc. 2210 West Oaklawn Drive Springdale, Arkansas 72762-6999 Attention: Dennis Leatherby Telephone: (501) 290-4000 Facsimile: (501) 290-4061 200 If to Chase concerning the daily issuance and redemption of Notes: Attention: Commercial Paper Operations 55 Water Street, 2nd Floor New York NY 10041-2413 Telephone: (212) 638-0441 Facsimile: (212) 638-7881 All other: Attention: Commercial Paper Service Delivery Unit 450 West 33rd Street, 15th Floor New York NY 10001-2697 Telephone: (212) 946-3108 Facsimile: (212) 946-8181 19. COMPENSATION The Issuer shall pay compensation for services pursuant to this Agreement in accordance with the pricing schedules furnished by Chase to the Issuer from time to time and upon such payment terms as the parties shall determine. The Issuer shall also reimburse Chase for any fees and charges imposed by DTC with respect to services provided in connection with the Book-Entry Notes. 20. BENEFIT OF AGREEMENT This Agreement is solely for the benefit of the parties hereto and no other person shall acquire or have any right under or by virtue hereof. 21. TERMINATION This Agreement may be terminated at any time by either party by written notice to the other, but such termination shall not affect the respective liabilities of the parties hereunder arising prior to such termination. 22. FORCE MAJEURE In no event shall Chase be liable for any failure or delay in the performance of its obligations hereunder because of circumstances beyond Chase's control, including, but not limited to, acts of God, flood, war (whether declared or undeclared), terrorism, fire, riot, strikes or work stoppages for any reason, embargo, government action, including any laws, ordinances, regulations or the like which restrict or prohibit the providing of the services contemplated by this Agreement, inability to obtain material, equipment, or communications or computer facilities, or the failure of equipment or interruption of communications or computer facilities, and other causes beyond Chase's control whether or not of the same class or kind as specifically named above. 23. ENTIRE AGREEMENT This Agreement, together with the exhibits attached hereto, constitutes the entire agreement between Chase and the Issuer with respect to the subject matter hereof and supersedes in all respects all prior proposals, negotiations, communications, discussions and agreements between the parties concerning the subject matter of this Agreement. 201 24. WAIVERS AND AMENDMENTS No failure or delay on the part of any party in exercising any power or right under this Agreement shall operate as a waiver, nor does any single or partial exercise of any power or right preclude any other or further exercise, or the exercise of any other power or right. Any such waiver shall be effective only in the specific instance and for the purpose for which it is given. No amendment, modification or waiver of any provision of this Agreement shall be effective unless the same shall be in writing and signed by the Issuer and Chase. 25. BUSINESS DAY Whenever any payment to be made hereunder shall be due on a day which is not a business day for Chase, then such payment shall be made on Chase's next succeeding business day. 26. COUNTERPARTS This Agreement may be executed in counterparts, each of which shall be deemed an original and such counterparts together shall constitute but one instrument. 27. HEADINGS The headings in this Agreement are for purposes of reference only and shall not in any way limit or otherwise affect the meaning or interpretation of any of the terms of this Agreement. 28. GOVERNING LAW This Agreement and the Notes shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to the conflict of laws provisions thereof. 29. JURISDICTION AND VENUE Each party hereby irrevocably and unconditionally submits to the jurisdiction of the United States District Court for the Southern District of New York and any New York State court located in the Borough of Manhattan in New York City and of any appellate court from any thereof for the purposes of any legal suit, action or proceeding arising out of or relating to this Agreement (a "Proceeding"). Each party hereby irrevocably agrees that all claims in respect of any Proceeding may be heard and determined in such Federal or New York State court and irrevocably waives, to the fullest extent it may effectively do so, any objection it may now or hereafter have to the laying of venue of any Proceeding in any of the aforementioned courts and the defense of an inconvenient forum to the maintenance of any Proceeding. 30. WAIVER OF TRIAL BY JURY EACH PARTY HEREBY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDING ARISING OUT OF OR RELATING TO ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. 202 31. ACCOUNT CONDITIONS Each Account shall be subject to Chase's account conditions, as in effect from time to time. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on their behalf by duly authorized officers as of the day and year first-above written. THE CHASE MANHATTAN BANK TYSON FOODS, INC. By: By: Name: Name: Title: Title: Date: January 12, 2001 Date: January 12, 2001 203 EX-10.3 5 0005.txt COMMERCIAL PAPER DEALER AGREEMENT COMMERCIAL PAPER DEALER AGREEMENT 4(2) PROGRAM between TYSON FOODS, INC., as Issuer and Banc of America Securities LLC, as Dealer Concerning Notes to be issued pursuant to an Issuing and Paying Agency Agreement dated as of January 12, 2001 between the Issuer and The Chase Manhattan Bank, as Issuing and Paying Agent Dated As of January 12, 2001 204 COMMERCIAL PAPER DEALER AGREEMENT 4(2) Program This agreement ("Agreement") sets forth the understandings between the Issuer and the Dealer in connection with the issuance and sale by the Issuer of its short-term promissory notes through the Dealer (the "Notes"). Certain terms used in this Agreement are defined in Section 6 hereof. The Addendum to this Agreement, and any Annexes or Exhibits described in this Agreement or such Addendum, are hereby incorporated into this Agreement and made fully a part hereof. Section 1. Offers, Sales and Resales of Notes 1.1 While (i) the Issuer has and shall have no obligation to sell the Notes to the Dealer or to permit the Dealer to arrange any sale of the Notes for the account of the Issuer, and (ii) the Dealer has and shall have no obligation to purchase the Notes from the Issuer or to arrange any sale of the Notes for the account of the Issuer, the parties hereto agree that in any case where the Dealer purchases Notes from the Issuer, or arranges for the sale of Notes by the Issuer, such Notes will be purchased or sold by the Dealer in reliance on the representations, warranties, covenants and agreements of the Issuer contained herein or made pursuant hereto and on the terms and conditions and in the manner provided herein. 1.2 So long as this Agreement shall remain in effect, and in addition to the limitations contained in Section 1.7 hereof, the Issuer shall not, without the consent of the Dealer, offer, solicit or accept offers to purchase, or sell, any Notes except (a) in transactions with one or more dealers which may from time to time after the date hereof become dealers with respect to the Notes by executing with the Issuer one or more agreements which contain provisions substantially identical to Section 1 of this Agreement, of which the Issuer hereby undertakes to provide the Dealer prompt notice or (b) in transactions with the other dealers listed on the Addendum hereto, which are executing agreements with the Issuer which contain provisions substantially identical to Section 1 of this Agreement contemporaneously herewith. In no event shall the Issuer offer, solicit or accept offers to purchase, or sell, any Notes directly on its own behalf in transactions with persons other than broker-dealers as specifically permitted in this Section 1.2. 1.3 The Notes shall be in a minimum denomination or minimum amount, whichever is applicable, of $250,000 or integral multiples of $1,000 in excess thereof, will bear such interest rates, if interest bearing, or will be sold at such discount from their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a maturity not exceeding 365 days from the date of issuance (exclusive of days of grace) and shall not contain any provision for extension, renewal or automatic "rollover." 1.4 The authentication, delivery and payment of the Notes shall be effected in accordance with the Issuing and Paying Agency Agreement and the Notes shall be either individual bearer physical certificates or represented by book-entry Notes registered in the name of DTC or its nominee in the form or forms annexed to the Issuing and Paying Agency Agreement. 205 1.5 If the Issuer and the Dealer shall agree on the terms of the purchase of any Note by the Dealer or the sale of any Note arranged by the Dealer (including, but not limited to, agreement with respect to the date of issue, purchase price, principal amount, maturity and interest rate (in the case of interest-bearing Notes) or discount thereof (in the case of Notes issued on a discount basis), and appropriate compensation for the Dealer's services hereunder) pursuant to this Agreement, the Issuer shall cause such Note to be issued and delivered in accordance with the terms of the Issuing and Paying Agency Agreement and payment for such Note shall be made by the purchaser thereof, either directly or through the Dealer, to the Issuer. Except as otherwise agreed, in the event that the Dealer is acting as an agent and a purchaser shall either fail to accept delivery of or make payment for a Note on the date fixed for settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has theretofore paid the Issuer for the Note, the Issuer will promptly return such funds to the Dealer against its return of the Note to the Issuer, in the case of a certificated Note, and upon notice of such failure in the case of a book- entry Note. 1.6 The Dealer and the Issuer hereby establish and agree to observe the following procedures in connection with offers, sales and subsequent resales or other transfers of the Notes: (a) Offers and sales of the Notes shall be made only to investors reasonably believed by the Dealer to be: (i) Institutional Accredited Investors or Sophisticated Individual Accredited Investors, (ii) non-bank fiduciaries or agents that will be purchasing Notes for one or more accounts, each of which is an Institutional Accredited Investor or Sophisticated Individual Accredited Investor, and (iii) Qualified Institutional Buyers. (b) Resales and other transfers of the Notes by or through the Dealer or by other holders thereof shall be made only in accordance with the restrictions in the legends described in clause (e) below. (c) No general solicitation or general advertising shall be used in connection with the offering of the Notes. Without limiting the generality of the foregoing, without the prior written approval of Dealer, the Issuer shall not issue any press release or place or publish any "tombstone" or other advertisement relating to the Notes. (d) No sale of Notes to any one purchaser shall be for less than $250,000 principal or face amount, and no Note shall be issued in a smaller principal or face amount. If the purchaser is a non-bank fiduciary acting on behalf of others, each person for whom such purchaser is acting must purchase at least $250,000 principal or face amount of Notes. (e) Offers and sales of the Notes by the Issuer through the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506 under the Securities Act, and shall be subject to the restrictions described in the legend appearing on Exhibit A hereto. A legend substantially to the effect of such Exhibit A shall appear as part of the Private Placement Memorandum used in connection with offers and sales of Notes hereunder, as well as on each Note offered and sold pursuant to this Agreement. 206 (f) Dealer shall furnish or shall have furnished to each purchaser of Notes being sold to an ultimate purchaser for the first time a copy of the then-current Private Placement Memorandum unless such purchaser has previously received a copy of the Private Placement Memorandum as then in effect. The Private Placement Memorandum shall expressly state that any person to whom Notes are offered shall have an opportunity to ask questions of, and receive information from, the Issuer and the Dealer and shall provide the names, addresses and telephone numbers of the persons from whom information regarding the Issuer may be obtained. (g) The Issuer agrees, for the benefit of the Dealer and each of the holders and prospective purchasers from time to time of the Notes that, if at any time the Issuer shall not be subject to Section 13 or 15(d) of the Exchange Act, the Issuer will furnish, upon request and at its expense, to the Dealer and to holders and prospective purchasers of Notes information required by Rule 144A(d)(4)(i) in compliance with Rule 144A(d). (h) In the event that any Note offered or to be offered by Dealer would be ineligible for resale under Rule 144A, the Issuer shall immediately notify Dealer (by telephone, confirmed in writing) of such fact and shall promptly prepare and deliver to Dealer an amendment or supplement to the Private Placement Memorandum describing the Notes that are ineligible, the reason for such ineligibility and any other relevant information relating thereto. (i) The Issuer represents that it has outstanding issuances of commercial paper in the United States market in reliance upon, and in compliance with, the exemption provided by Section 3(a)(3) of the Securities Act. In that connection, the Issuer agrees that (a) the proceeds from the sale of the Notes will be segregated from the proceeds of the sale of any such commercial paper by being placed in a separate account; (b) the Issuer will institute appropriate corporate procedures to ensure that the offers and sales of notes issued by the Issuer pursuant to the Section 3(a)(3) exemption are not integrated with offerings and sales of Notes hereunder; and (c) the Issuer will comply with each of the requirements of Section 3(a)(3) of the Act in selling commercial paper or other short-term debt securities other than the Notes in the United States. 1.7 The Issuer hereby represents and warrants to the Dealer, in connection with offers, sales and resales of Notes, as follows: (a) Issuer hereby confirms to the Dealer that (except as permitted by Section 1.6(i)) within the preceding six months neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof acting on behalf of the Issuer has offered or sold any Notes, or any substantially similar security of the Issuer (including, without limitation, medium-term notes issued by the Issuer), to, or solicited offers to buy any such security from, any person other than the Dealer or the other dealers referred to in Section 1.2 hereof. The Issuer also agrees that, as long as the Notes are being offered for sale by the Dealer and the other dealers referred to in Section 1.2 hereof as contemplated hereby and until at least six months after the offer of Notes hereunder has been terminated, neither the Issuer nor any person other than the Dealer or the other dealers 207 referred to in Section 1.2 hereof (except as contemplated by Section 1.2 hereof) will offer the Notes or any substantially similar security of the Issuer for sale to, or solicit offers to buy any such security from, any person other than the Dealer and the other dealers referred to in Section 1.2 hereof (except to the extent any of the foregoing would not cause the offer and sale of the Notes by the Issuer to be integrated with other offers and sales so as no longer to come within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder), it being understood that such agreement is made with a view to bringing the offer and sale of the Notes within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder and shall survive any termination of this Agreement. The Issuer hereby represents and warrants that it has not taken or omitted to take, and will not take or omit to take, any action that would cause the offering and sale of Notes hereunder to be integrated with any other offering of securities, whether such offering is made by the Issuer or some other party or parties, under circumstances that would cause the offering and sale of the Notes by the Issuer to fail to be exempt under Section 4(2) of the Securities Act. (b) Except as described in Section 1.7(c) below, the Issuer represents and agrees that the proceeds of the sale of the Notes are not currently contemplated to be used for the purpose of buying, carrying or trading securities within the meaning of Regulation T and the interpretations thereunder by the Board of Governors of the Federal Reserve System. Except as described in Section 1.7(c) below, in the event that the Issuer determines to use such proceeds for the purpose of buying, carrying or trading securities, whether in connection with an acquisition of another company or otherwise, the Issuer shall give the Dealer at least five business days' prior written notice to that effect. The Issuer shall also give the Dealer prompt notice of the actual date that it commences to purchase securities with the proceeds of the Notes. Thereafter, in the event that the Dealer purchases Notes as principal and does not resell such Notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. (c) The Dealer acknowledges that proceeds from the sale of Notes prior to the consummation of the merger of IBP, inc. ("IBP") into Lasso Acquisition Corporation ("Lasso"), a wholly-owned subsidiary of the Issuer, pursuant to an Agreement and Plan of Merger dated as of January 1, 2001 among the Issuer, Lasso and IBP, as amended from time to time (the "Merger Agreement") are contemplated to be used, in part, for the purpose of purchasing shares of common stock of IBP pursuant to the terms of the offer to purchase up to 50.1% of the common stock of IBP contemplated by the Merger Agreement. In the event the Dealer purchases Notes as principal and does not resell such notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. 208 Section 2. Representations and Warranties of Issuer The Issuer represents and warrants that: 2.1 The Issuer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, this Agreement and the Issuing and Paying Agency Agreement. 2.2 This Agreement and the Issuing and Paying Agency Agreement have been duly authorized, executed and delivered by the Issuer and constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.3 The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.4 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, the offer and sale of Notes in the manner contemplated hereby do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and no indenture in respect of the Notes is required to be qualified under the Trust Indenture Act of 1939, as amended. 2.5 The Notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness of the Issuer. 2.6 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, no consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the SEC, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, this Agreement, the Notes or the Issuing and Paying Agency Agreement, except (i)as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes, and (ii) for the requirement that the Issuer file with the SEC a notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. 209 2.7 Neither the execution and delivery of this Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions hereof or thereof by the Issuer, will (i) result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Issuer, or (ii) violate or result in a breach or an event of default under any of the terms of the Issuer's charter documents or by-laws, any contract or instrument to which the Issuer is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality, to which the Issuer is subject or by which it or its property is bound, which breach or event of default could reasonably be expected to have a material adverse effect on the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.8 There is no litigation or governmental proceeding pending, or to the knowledge of the Issuer threatened, against or affecting the Issuer or any of its subsidiaries which could reasonably be expected to have a material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.9 The Issuer is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. 2.10 Neither the Private Placement Memorandum nor the Company Information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, provided, that the Issuer make no representation or warranty as to the Dealer Information. 2.11 Each (a) issuance of Notes by the Issuer hereunder and (b) amendment or supplement of the Private Placement Memorandum shall be deemed a representation and warranty by the Issuer to the Dealer, as of the date thereof, that, both before and after giving effect to such issuance and after giving effect to such amendment or supplement, (i) the representations and warranties given by the Issuer set forth above in this Section 2 remain true and correct on and as of such date as if made on and as of such date, (ii) in the case of an issuance of Notes, the Notes being issued on such date have been duly and validly issued and constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations on rights to indemnity and contribution imposed by applicable law, and (iii) in the case of an issuance of Notes, since the date of the most recent Private Placement Memorandum, there has been no material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole which has not been disclosed to the Dealer in writing. 210 Section 3. Covenants and Agreements of Issuer The Issuer covenants and agrees that: 3.1 The Issuer will give the Dealer prompt notice (but in any event prior to any subsequent issuance of Notes hereunder) of any amendment to, modification of, or waiver with respect to, the Notes or the Issuing and Paying Agency Agreement, including a complete copy of any such amendment, modification or waiver. 3.2 The Issuer shall, whenever there shall occur any event that could reasonably be expected to have a material adverse effect on the financial condition or results of operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement or the Notes, notify the Dealer (by telephone, confirmed in writing) of such event prior to any subsequent issuances of Notes hereunder. The Issuer shall, whenever it receives notice of any downgrading or intended downgrading or any review for potential change in the rating accorded any of the Issuer's securities by any nationally recognized statistical rating organization which has published a rating of the Notes, promptly, and in any event prior to any subsequent issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in writing) of such occurrence. 3.3 The Issuer shall from time to time upon the request of the Dealer furnish to the Dealer copies of all materials provided by the Issuer to any national securities exchange regarding (i) the Issuer's operations and financial condition, and (ii) the Issuer's ability to pay the Notes as they mature. 3.4 The Issuer will take all such action as the Dealer may reasonably request to ensure that each offer and each sale of the Notes will comply with any applicable state Blue Sky laws; provided, that the Issuer shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. 3.5 The Issuer shall not issue Notes hereunder until the Dealer shall have received (a) an opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance to the Dealer, (b) a copy of the executed Issuing and Paying Agency Agreement as then in effect, (c) a copy of resolutions adopted by the Board of Directors of the Issuer, satisfactory in form and substance to the Dealer and certified by the Secretary or similar officer of the Issuer, authorizing execution and delivery by the Issuer of this Agreement the Issuing and Paying Agency Agreement and the Notes and consummation by the Issuer of the transactions contemplated hereby and thereby, (d) prior to the issuance of any Notes represented by a book-entry note registered in the name of DTC or its nominee, a copy of the executed Letter of Representations among the Issuer, the Issuing and Paying Agent and DTC, and (e) such other certificates, opinions, letters and documents as the Dealer shall have reasonably requested. 211 3.6 The Issuer shall reimburse the Dealer for all of the Dealer's reasonable out-of-pocket expenses related to this Agreement, including expenses incurred in connection with its preparation and negotiation, and the transactions contemplated hereby (including, but not limited to, the printing and distribution of the Private Placement Memorandum), and, if applicable, for the reasonable fees and out-of-pocket expenses of the Dealer's counsel. 3.7 Without limiting any obligation of the Issuer pursuant to this Agreement to provide the Dealer with credit and financial information, the Issuer hereby acknowledges and agrees that the Dealer may share the Company Information and any other information or matters relating to the Issuer or the transactions contemplated hereby with affiliates of the Dealer, including, but not limited to, Bank of America, N.A., and that such affiliates may likewise share information relating to the Issuer or such transactions with the Dealer. Section 4. Disclosure 4.1 The Private Placement Memorandum and its contents (other than the Dealer Information) shall be the sole responsibility of the Issuer. The Private Placement Memorandum shall contain a statement expressly offering an opportunity for each prospective purchaser to ask questions of, and receive answers from, the Issuer concerning the offering of Notes and to obtain relevant additional information which the Issuer possesses or can acquire without unreasonable effort or expense. 4.2 The Issuer agrees promptly to furnish the Dealer the Company Information as it becomes available. 4.3 (a) The Issuer further agrees to notify the Dealer promptly upon the occurrence of any event relating to or affecting the Issuer that would cause the Company Information then in existence to include an untrue statement of material fact or to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they are made, not misleading. (b) In the event that the Issuer gives the Dealer notice pursuant to Section 4.3(a) and the Dealer notifies the Issuer that it then has Notes it is holding in inventory, the Issuer agrees promptly to supplement or amend the Private Placement Memorandum so that such Private Placement Memorandum, as amended or supplemented, shall not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and the Issuer shall make such supplement or amendment available to the Dealer. (c) In the event that (i) the Issuer gives the Dealer notice pursuant to Section 4.3(a) and (ii) the Dealer does not notify the Issuer that it is then holding Notes in inventory and (iii) the Issuer chooses not to promptly amend or supplement the Private Placement Memorandum in the manner described in clause (b) above, then all solicitations and sales of Notes shall be suspended until such time as the Issuer has so amended or supplemented the Private Placement Memorandum, and made such amendment or supplement available to the Dealer. 212 Section 5. Indemnification and Contribution 5.1 The Issuer will indemnify and hold harmless the Dealer, each individual, corporation, partnership, trust, association or other entity controlling the Dealer, within the meaning of Section 15 of the Securities Act (hereinafter the "Indemnitees") against any and all liabilities, penalties, suits, causes of action, losses, damages, claims, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) or judgments of whatever kind or nature (each a "Claim"), imposed upon, incurred by or asserted against the Indemnitees arising out of or based upon (i) any allegation that the Private Placement Memorandum, the Company Information or any information provided by the Issuer to the Dealer included (as of any relevant time of offer and sale of the Notes by the Issuer) or includes an untrue statement of a material fact or omitted (as of any relevant time of offer and sale of the Notes by the Issuer) or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or (ii) arising out of or based upon the breach by the Issuer of any agreement, covenant or representation made in or pursuant to this Agreement; provided, however, that the foregoing indemnity shall not extend to any Claims to the extent they arise out of or are based upon (A) the gross negligence or willful misconduct of the Dealer in the performance or failure to perform its obligations hereunder, or (B) an untrue statement by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes or an omission by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes necessary to make any statement, in light of the circumstances in which such statement was made, not misleading if such statement or omission relates to the Dealer in its capacity as dealer of the Notes or such statement or omission relates to other matters and has not been approved by the Issuer (whether through approval of the Private Placement Memorandum or otherwise). 5.2 Provisions relating to claims made for indemnification under this Section 5 are set forth on Exhibit B to this Agreement. 5.3 In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in clause (i) of Section 5.1 is held to be unavailable or insufficient to hold harmless the Indemnitees, although applicable in accordance with the terms of this Section 5, the Issuer shall contribute to the aggregate costs incurred by the Dealer in connection with any Claim in the proportion of the respective economic interests of the Issuer and the Dealer; provided, however, that such contribution by the Issuer shall be in an amount such that the aggregate costs incurred by the Dealer do not exceed the aggregate of the commissions and fees earned by the Dealer hereunder with respect to the issue or issues of Notes to which such Claim relates. The respective economic interests shall be calculated by reference to the aggregate proceeds to the Issuer of the Notes issued hereunder and the aggregate commissions and fees earned by the Dealer hereunder. 213 Section 6. Definitions 6.1 "Claim" shall have the meaning set forth in Section 5.1. 6.2 "Company Information" at any given time shall mean the Private Placement Memorandum together with, to the extent applicable, (i) the Issuer's most recent report on Form 10-K filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most recent Form 10-K, (ii) the Issuer's most recent annual audited financial statements and each interim financial statement or report prepared subsequent thereto, if not included in item (i) above, (iii) the Issuer's and its affiliates' other publicly available recent reports, including, but not limited to, any publicly available filings or reports provided to their respective shareholders, (iv) any other information or disclosure prepared pursuant to Section 4.3 hereof and (v) any information prepared or approved by the Issuer for dissemination to investors or potential investors in the Notes. 6.3 "Dealer" shall mean Banc of America Securities LLC. 6.4 "Dealer Information" shall mean material concerning the Dealer and provided by the Dealer in writing expressly for inclusion in the Private Placement Memorandum. 6.5 "DTC" shall mean The Depository Trust Company. 6.6 "Exchange Act" shall mean the U.S. Securities Exchange Act of 1934, as amended. 6.7 "Indemnitee" shall have the meaning set forth in Section 5.1. 6.8 "Institutional Accredited Investor" shall mean an institutional investor that is an accredited investor within the meaning of Rule 501 under the Securities Act and that has such knowledge and experience in financial and business matters that it is capable of evaluating and bearing the economic risk of an investment in the Notes, including, but not limited to, a bank, as defined in Section 3(a)(2) of the Securities Act, or a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity. 6.9 "Issuing and Paying Agency Agreement" shall mean the issuing and paying agency agreement described on the cover page of this Agreement, as such agreement may be amended or supplemented from time to time. 6.10 "Issuing and Paying Agent" shall mean the party designated as such on the cover page of this Agreement, as issuing and paying agent under the Issuing and Paying Agency Agreement. 6.11 "Non-bank fiduciary or agent" shall mean a fiduciary or agent other than (a) a bank, as defined in Section 3(a)(2) of the Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A) of the Securities Act. 214 6.12 "Private Placement Memorandum" shall mean offering materials prepared in accordance with Section 4 (including materials referred to therein or incorporated by reference therein) provided to purchasers and prospective purchasers of the Notes, and shall include amendments and supplements thereto which may be prepared from time to time in accordance with this Agreement (other than any amendment or supplement that has been completely superseded by a later amendment or supplement). 6.13 "Qualified Institutional Buyer" shall have the meaning assigned to that term in Rule 144A under the Securities Act. 6.14 "Rule 144A" shall mean Rule 144A under the Securities Act. 6.15 "SEC" shall mean the U.S. Securities and Exchange Commission. 6.16 "Securities Act" shall mean the U.S. Securities Act of 1933, as amended. 6.17 "Sophisticated Individual Accredited Investor" shall mean an individual who (a) is an accredited investor within the meaning of Regulation D under the Securities Act and (b) based on his or her pre- existing relationship with the Dealer, is reasonably believed by the Dealer to be a sophisticated investor (i) possessing such knowledge and experience (or represented by a fiduciary or agent possessing such knowledge and experience) in financial and business matters that he or she is capable of evaluating and bearing the economic risk of an investment in the Notes and (ii) having a net worth of at least $5 million. Section 7. General 7.1 Unless otherwise expressly provided herein, all notices under this Agreement to parties hereto shall be in writing and shall be effective when received at the address of the respective party set forth in the Addendum to this Agreement. 7.2 This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws provisions. 7.3 EACH OF THE DEALER AND THE ISSUER WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 7.4 This Agreement may be terminated, at any time, by the Issuer, upon one business day's prior notice to such effect to the Dealer, or by the Dealer upon one business day's prior notice to such effect to the Issuer. Any such termination, however, shall not affect the obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations, warranties, agreements, covenants, rights or responsibilities of the parties made or arising prior to the termination of this Agreement. 215 7.5 This Agreement is not assignable by either party hereto without the written consent of the other party; provided, however, that the Dealer may assign its rights and obligations under this Agreement to any wholly- owned direct or indirect subsidiary of the Dealer or of its ultimate parent. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto and their respective permitted assigns. 7.6 This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 7.7 This Agreement constitutes the entire agreement between the parties hereto and supercedes any prior understandings, agreements or representations by or between the parties hereto, written or oral, to the extent they relate to the subject matter hereof. 7.8 Any payments to the Dealer hereunder, whether pursuant to Sections 3.6, 5.1 or otherwise, shall be in US dollars and shall be free of all withholding, stamp and other similar taxes and of all other governmental charges of any nature whatsoever. In the event any withholding is required by law, the Issuer agrees to (i) pay the same and (ii) pay such additional amounts to the Dealer which, after deduction of any such withholding, stamp or other taxes or governmental charges of any nature whatsoever imposed with respect to the payment of such additional amount, shall equal the amount withheld pursuant to clause (i). 216 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date and year first above written. TYSON FOODS, INC., as Issuer By: Name: Title: Banc of America Securities LLC, as Dealer By: Name: Title: 217 ADDENDUM 1. The other dealers referred to in clause (b) of Section 1.2 of the Agreement are: Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days J.P. Morgan Securities Inc. Chase Securities Inc. Credit Suisse First Boston Corporation SunTrust Equitable Securities Corp. 2. The addresses of the respective parties for purposes of notices under Section 7.1 are as follows: For the Issuer: Address: 2210 West Oakland Drive Springdale, Arkansas 72762-6999 Attention: General Counsel Telephone number: (501) 290-4000 Fax number: (501) 290-6776 For as Dealer: Address: 1455 Market Street CA5-701-13-03 San Francisco, California 94103-1399 Attention: Robert Porter Telephone number: (415) 953-7881 Fax number: (415) 622-3429 218 EXHIBIT A FORM OF LEGEND FOR PRIVATE PLACEMENT MEMORANDUM AND NOTES THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER AND THE NOTES, THAT IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND THAT IT IS EITHER (A) AN INSTITUTIONAL INVESTOR OR HIGHLY SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL, (i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE NOTES AND (ii) HAS A NET WORTH OF AT LEAST $5 MILLION (AN "INSTITUTIONAL ACCREDITED INVESTOR" OR "SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR", RESPECTIVELY) AND THAT EITHER IS PURCHASING NOTES FOR ITS OWN ACCOUNT, IS A U.S. BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR IS A FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN) PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH IS SUCH AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR (i) WHICH ITSELF POSSESSES SUCH KNOWLEDGE AND EXPERIENCE OR (ii) WITH RESPECT TO WHICH SUCH PURCHASER HAS SOLE INVESTMENT DISCRETION; OR (B) A QUALIFIED INSTITUTIONAL BUYER ("QIB") WITHIN THE MEANING OF RULE 144A UNDER THE ACT WHICH IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH IS A QIB AND WITH RESPECT TO EACH OF WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO BANC OF AMERICA SECURITIES LLC OR ANOTHER PERSON DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES (COLLECTIVELY, THE "PLACEMENT AGENTS"), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR OR A QIB BY A PLACEMENT AGENT, OR (3) TO A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000. 219 EXHIBIT B FURTHER PROVISIONS RELATING TO INDEMNIFICATION (a) The Issuer agrees to reimburse each Indemnitee for all expenses (including reasonable fees and disbursements of internal and external counsel) as they are incurred by it in connection with investigating or defending any loss, claim, damage, liability or action in respect of which indemnification may be sought under clause (i) of Section 5.1 of the Agreement (whether or not it is a party to any such proceedings). (b) Promptly after receipt by an Indemnitee of notice of the existence of a Claim arising under clause (i) of Section 5.1 of the Agreement, such Indemnitee will, if a claim in respect thereof is to be made against the Issuer, notify the Issuer in writing of the existence thereof; provided that (i) the omission so to notify the Issuer will not relieve it from any liability which it may have hereunder unless and except to the extent it did not otherwise learn of such Claim and the issuer is materially prejudiced thereby, and (ii) the omission so to notify the Issuer will not relieve it from liability which it may have to an Indemnitee otherwise than on account of this indemnity agreement. In case any such Claim is made against any Indemnitee and it notifies the Issuer of the existence thereof, the Issuer will be entitled to participate therein, and to the extent that it may elect by written notice delivered to the Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee; provided that if the defendants in any such Claim include both the Indemnitee and the Issuer and the Indemnitee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, the Issuer shall not have the right to direct the defense of such Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to select separate counsel to assert such legal defenses on behalf of such Indemnitee. Upon receipt of notice from the Issuer to such Indemnitee of the Issuer's election so to assume the defense of such Claim and approval by the Indemnitee of counsel, the Issuer will not be liable to such Indemnitee for expenses incurred thereafter by the Indemnitee in connection with the defense thereof (other than reasonable costs of investigation) unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next preceding sentence (it being understood, however, that the Issuer shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel in the jurisdiction in which any Claim is brought), approved by the Dealer, representing the Indemnitee who is party to such Claim), (ii) the Issuer shall not have employed counsel reasonably satisfactory to the Indemnitee to represent the Indemnitee within a reasonable time after notice of existence of the Claim or (iii) the Issuer has authorized in writing the employment of counsel for the Indemnitee. The indemnity, reimbursement and contribution obligations of the Issuer hereunder shall be in addition to any other liability the Issuer may otherwise have to an Indemnitee and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer and any Indemnitee. The Issuer agrees that without the Dealer's prior written consent, it will not settle, compromise or consent to the entry of any judgment in any Claim in respect of which indemnification may be sought under the indemnification provision of the Agreement (whether or not the Dealer or any other Indemnitee is an actual or potential party to such Claim), unless such settlement, compromise or consent includes an unconditional release of each Indemnitee from all liability arising out of such Claim. 220 MODEL OPINION OF COUNSEL TO ISSUER [Date] [Name and Address of Dealer] Ladies and Gentlemen: We have acted as special counsel to Tyson Foods, Inc., a Delaware corporation (the "Company"), in connection with the proposed offering and sale by the Company in the United States of commercial paper in the form of short-term promissory notes (the "Notes") in the manner contemplated by the Commercial Paper Dealer Agreement dated as of January 12, 2001 by and between the Company and you (the "Agreement"). We are delivering this letter to you in order to satisfy the condition set forth in Section 3.5 of the Dealer Agreement. Each term used but not defined in this letter has the meaning ascribed to it in the Dealer Agreement. In our capacity as such counsel, we have examined a specimen form of Note, an executed copy of the Agreement, and the Issuing and Paying Agency Agreement dated January 12, 2001 (the "Issuing and Paying Agency Agreement") between the Company and The Chase Manhattan Bank, N.A., as issuing and paying agent (the "Issuing and Paying Agent") as well as originals, or copies certified or otherwise identified to our satisfaction, of such other records and documents as we have deemed necessary as a basis for the opinions expressed below. For purposes of this opinion, we have, with your permission, assumed without independent investigation or inquiry that: (i) all signatures of the parties on the Dealer Agreement and the Issuing and Paying Agency Agreement (other than the Company) that we examined are genuine, the agreement submitted to us as originals are authentic, and the agreements submitted to us as copies conform to the original agreements executed by the parties thereto; and (ii) the Dealer Agreement and the Issuing and Paying Agency Agreement have been duly and validly authorized, executed, delivered and accepted by all parties thereto (other than the Company) and all parties thereto (other than the Company) have all requisite power and authority to make and enter into the agreements and perform their obligations thereunder pursuant to the laws of all relevant jurisdictions. Based upon the foregoing, it is our opinion that: 1. The Company is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, the Agreement and the Issuing and Paying Agency Agreement. 221 2. Each of the Agreement and the Issuing and Paying Agency Agreement has been duly authorized, executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law), and except as rights under the Agreement to indemnity and contribution may be limited by federal or state laws. 3. The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and except as rights to indemnity and contribution may be limited by federal or state laws. 4. The issuance and sale of Notes under the circumstances contemplated by the Agreement and the Issuing and Paying Agency Agreement do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and do not require compliance with any provision of the Trust Indenture Act of 1939, as amended. 5. No consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the Securities and Exchange Commission, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, the Agreement, the Notes, or the Issuing and Paying Agency Agreement, except as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes. 6. Neither the execution and delivery of the Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions of either thereof by the Company, will violate or result in an event of default under any of the terms of the Company's charter documents or by-laws, any contract or instrument known to us to which the Company is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality known to us, to which the Company is subject or by which it or its property is bound. 7. Except as disclosed in reports and other information filed by the Company with the Securities and Exchange Commission, to our knowledge there is no litigation or governmental proceeding pending or threatened against the Company which in any way may prevent or interfere with or materially and adversely affect the Company's executing and delivering the Agreement, the Issuing and Paying Agency Agreement or the Notes, or materially and adversely affecting the Company carrying out its obligations thereunder. 222 8. The Company is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. The opinions hereinafter expressed are subject to the following qualifications and limitations: (a) The opinions set forth herein are subject to the qualification that we are members of the bar of the State of Arkansas only and we express no opinion as to the laws of any jurisdiction other than the United States of America, the State of Arkansas and the General Corporate Laws of the State of Delaware. We call your attention to the fact that each of the Dealer Agreement and the Issuing and Paying Agency Agreement, as well as the Notes issued thereunder, provides that it is to be governed and construed in accordance with the laws of the State of New York. For purposes of our opinions expressed above, we have assumed, with your approval, that the Dealer Agreement, the Issuing and Paying Agency Agreement and the Notes would be governed by and construed in accordance with the domestic substantive laws of the State of Arkansas without giving effect to any choice or conflict of laws rule or provision that would cause the application of the domestic substantive laws of any other jurisdiction. (b) This opinion is limited to pertinent laws in effect as of the date hereof, and we expressly disclaim any undertaking to advise you of any changes of law or fact that may thereafter come to our attention. (c) Our opinion is limited to the matters stated herein and no opinion is to be implied or may be inferred beyond those matters expressly stated. (d) This opinion is furnished by us solely for your benefit as a dealer of the Notes pursuant to the Dealer Agreement, and it may not be relied upon, quoted from or delivered to any person; provided, however, that The Chase Manhattan Bank, N.A. may rely upon this opinion in its capacity as Issuing and Paying Agent for the Notes, each of Moody's Investors Service, Inc. and Standard & Poor's Ratings Group may rely on this opinion in connection with its issuance of an investment rating for the Notes, and a copy of this opinion may be delivered to any purchaser of the Notes. The liability of this firm is limited to the fullest extent possible under Ark. Code Ann. Section 16-114-303. (e) The phrases "known to us" or "to our knowledge" as used in this letter means the actual knowledge of those attorneys of our firm who have represented the Company in connection with any offering or placement of securities or who have principal responsibility for representing the Company, and do not include constructive knowledge or knowledge imputed to our firm under common law principles of agency or otherwise. Except as expressly set forth herein, we have not undertaken any investigation to determine the existence or absence of any facts and no inference as to our knowledge concerning any facts should be drawn from the fact that such representation has been undertaken by us. 223 (f) For purposes of the factual matters material to the opinions expressed herein, we have, with your consent, relied upon the compliance with the covenants and the correctness of the representations contained in the Dealer Agreement and the Issuing and Paying Agency Agreement. Without limiting the foregoing, for purposes of the opinions expressed in paragraphs 4 and 5 above, we have assumed that the Company will timely file with the Securities and Exchange Commission notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. (g) Our opinions are rendered as of the date hereof and do not cover the effect of any amendment or supplement to the Dealer Agreement or the Issuing and Paying Agency Agreement or the validity or enforceability of any amendment or supplement thereto, including without limitation any modifications, extensions, waivers or releases or the effect or applicability of federal or state tax laws on or to the transactions contemplated thereby. (h) We have made no examination or investigation to verify the accuracy or completeness of any financial, accounting, or statistical information furnished to you or with respect to any other accounting and financial matters and express no opinion with respect thereto. (i) We call your attention to the fact that the awarding of attorney's fees and expenses is discretionary under Arkansas law. We cannot opine that attorney's fees and expenses will be awarded in any particular amount. (j) Our opinions are subject to, and we express no opinion on, state or federal law relating to usury or fraudulent conveyances. (k) The opinions expressed above are (i) given to you solely for your benefit and the benefit of your successors and transferees, (ii) not binding on any court and (iii) may not be quoted in whole or in part or otherwise referred to in any legal opinion, document, or other report to be furnished to another person or entity without our prior written consent. Very truly yours, 224 Model Certificate as to Resolutions1 [Name of Issuer] I, R. Read Hudson, the Secretary of Tyson Foods, Inc., a Delaware corporation (the "Issuer"), do hereby certify, in connection with the issuance and sale of short-term promissory notes under the Commercial Paper Dealer Agreement dated January 12, 2001 (the "Agreement", the terms defined therein being used herein as therein defined) between the Issuer and Banc of America Securities LLC (the "Dealer"), that: 1. The following resolution was duly adopted by the Board of Directors of the Issuer at a meeting thereof duly called and held on January 12, 2001, at which meeting a quorum was present and acting throughout, and such resolution has not been amended, modified or revoked and is in full force and effect on the date hereof: RESOLVED, that the Chairman of the Board, President, Chief Executive Officer, any Executive Vice President, any Senior Vice President, Controller or Chief Accounting Officer or Treasurer, either alone or with joinder of the Secretary or an Assistant Secretary, of the Corporation (the "Authorized Officers") be, and each of them hereby is, authorized to: (i) borrow under the Commercial Paper Program; (ii) execute such commercial paper notes in the name and on behalf of the Corporation; (iii) execute and deliver (A) Commercial Paper Dealer Agreements between the Corporation and each of the dealers selected by any Authorized Officer (each a "Dealer"), providing, among other things, for the sale of commercial paper notes on behalf of the Corporation and the indemnification of the Dealer in connection therewith and (B) an Issuing and Paying Agency Agreement between the Corporation and J.P. Morgan Chase & Co., or any of its affiliates, as issuing and paying agent; (iv) delegate to any other officers or employees of the Corporation authority to give instructions to the Dealer pursuant to the applicable Commercial Paper Dealer Agreement; and (v) do such acts and execute such other instruments and documents as may be necessary and proper to effect the transactions contemplated hereby including (A) amending documents referred to herein and (B) appointing additional dealers and successors to any of the parties named. 2. Each of the Agreement and the Issuing and Paying Agency Agreement, as executed and delivered by the Issuer, is substantially in the form thereof approved by the Board of Directors and referred to in the resolution set forth in paragraph 1 hereof. IN WITNESS WHEREOF, I have signed this certificate the 12th day of January, 2001 ________________________ Secretary _______________________________ 1This model certificate will serve as a guide for resolutions adopted by the Issuer. Any resolutions actually adopted, regardless of form, should cover all the substantive matters covered in this model, and a certificate substantially to the effect of this model is required to be delivered to the Dealer under Section 3.6(c) of the Agreement. 225 EX-10.4 6 0006.txt COMMERCIAL PAPER DEALER AGREEMENT COMMERCIAL PAPER DEALER AGREEMENT 4(2) PROGRAM between TYSON FOODS, INC., as Issuer and Credit Suisse First Boston Corporation, as Dealer Concerning Notes to be issued pursuant to an Issuing and Paying Agency Agreement dated as of January 12, 2001 between the Issuer and The Chase Manhattan Bank, as Issuing and Paying Agent Dated As of January 12, 2001 226 COMMERCIAL PAPER DEALER AGREEMENT 4(2) Program This agreement ("Agreement") sets forth the understandings between the Issuer and the Dealer in connection with the issuance and sale by the Issuer of its short-term promissory notes through the Dealer (the "Notes"). Certain terms used in this Agreement are defined in Section 6 hereof. The Addendum to this Agreement, and any Annexes or Exhibits described in this Agreement or such Addendum, are hereby incorporated into this Agreement and made fully a part hereof. Section 1. Offers, Sales and Resales of Notes 1.1 While (i) the Issuer has and shall have no obligation to sell the Notes to the Dealer or to permit the Dealer to arrange any sale of the Notes for the account of the Issuer, and (ii) the Dealer has and shall have no obligation to purchase the Notes from the Issuer or to arrange any sale of the Notes for the account of the Issuer, the parties hereto agree that in any case where the Dealer purchases Notes from the Issuer, or arranges for the sale of Notes by the Issuer, such Notes will be purchased or sold by the Dealer in reliance on the representations, warranties, covenants and agreements of the Issuer contained herein or made pursuant hereto and on the terms and conditions and in the manner provided herein. 1.2 So long as this Agreement shall remain in effect, and in addition to the limitations contained in Section 1.7 hereof, the Issuer shall not, without the consent of the Dealer, offer, solicit or accept offers to purchase, or sell, any Notes except (a) in transactions with one or more dealers which may from time to time after the date hereof become dealers with respect to the Notes by executing with the Issuer one or more agreements which contain provisions substantially identical to Section 1 of this Agreement, of which the Issuer hereby undertakes to provide the Dealer prompt notice or (b) in transactions with the other dealers listed on the Addendum hereto, which are executing agreements with the Issuer which contain provisions substantially identical to Section 1 of this Agreement contemporaneously herewith. In no event shall the Issuer offer, solicit or accept offers to purchase, or sell, any Notes directly on its own behalf in transactions with persons other than broker-dealers as specifically permitted in this Section 1.2. 1.3 The Notes shall be in a minimum denomination or minimum amount, whichever is applicable, of $250,000 or integral multiples of $1,000 in excess thereof, will bear such interest rates, if interest bearing, or will be sold at such discount from their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a maturity not exceeding 365 days from the date of issuance (exclusive of days of grace) and shall not contain any provision for extension, renewal or automatic "rollover." 1.4 The authentication, delivery and payment of the Notes shall be effected in accordance with the Issuing and Paying Agency Agreement and the Notes shall be either individual bearer physical certificates or represented by book-entry Notes registered in the name of DTC or its nominee in the form or forms annexed to the Issuing and Paying Agency Agreement. 227 1.5 If the Issuer and the Dealer shall agree on the terms of the purchase of any Note by the Dealer or the sale of any Note arranged by the Dealer (including, but not limited to, agreement with respect to the date of issue, purchase price, principal amount, maturity and interest rate (in the case of interest-bearing Notes) or discount thereof (in the case of Notes issued on a discount basis), and appropriate compensation for the Dealer's services hereunder) pursuant to this Agreement, the Issuer shall cause such Note to be issued and delivered in accordance with the terms of the Issuing and Paying Agency Agreement and payment for such Note shall be made by the purchaser thereof, either directly or through the Dealer, to the Issuer. Except as otherwise agreed, in the event that the Dealer is acting as an agent and a purchaser shall either fail to accept delivery of or make payment for a Note on the date fixed for settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has theretofore paid the Issuer for the Note, the Issuer will promptly return such funds to the Dealer against its return of the Note to the Issuer, in the case of a certificated Note, and upon notice of such failure in the case of a book- entry Note. 1.6 The Dealer and the Issuer hereby establish and agree to observe the following procedures in connection with offers, sales and subsequent resales or other transfers of the Notes: (a) Offers and sales of the Notes shall be made only to investors reasonably believed by the Dealer to be: (i) Institutional Accredited Investors or Sophisticated Individual Accredited Investors, (ii) non-bank fiduciaries or agents that will be purchasing Notes for one or more accounts, each of which is an Institutional Accredited Investor or Sophisticated Individual Accredited Investor, and (iii) Qualified Institutional Buyers. (b) Resales and other transfers of the Notes by or through the Dealer or by other holders thereof shall be made only in accordance with the restrictions in the legends described in clause (e) below. (c) No general solicitation or general advertising shall be used in connection with the offering of the Notes. Without limiting the generality of the foregoing, without the prior written approval of Dealer, the Issuer shall not issue any press release or place or publish any "tombstone" or other advertisement relating to the Notes. (d) No sale of Notes to any one purchaser shall be for less than $250,000 principal or face amount, and no Note shall be issued in a smaller principal or face amount. If the purchaser is a non-bank fiduciary acting on behalf of others, each person for whom such purchaser is acting must purchase at least $250,000 principal or face amount of Notes. (e) Offers and sales of the Notes by the Issuer through the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506 under the Securities Act, and shall be subject to the restrictions described in the legend appearing on Exhibit A hereto. A legend substantially to the effect of such Exhibit A shall appear as part of the Private Placement Memorandum used in connection with offers and sales of Notes hereunder, as well as on each Note offered and sold pursuant to this Agreement. 228 (f) Dealer shall furnish or shall have furnished to each purchaser of Notes being sold to an ultimate purchaser for the first time a copy of the then-current Private Placement Memorandum unless such purchaser has previously received a copy of the Private Placement Memorandum as then in effect. The Private Placement Memorandum shall expressly state that any person to whom Notes are offered shall have an opportunity to ask questions of, and receive information from, the Issuer and the Dealer and shall provide the names, addresses and telephone numbers of the persons from whom information regarding the Issuer may be obtained. (g) The Issuer agrees, for the benefit of the Dealer and each of the holders and prospective purchasers from time to time of the Notes that, if at any time the Issuer shall not be subject to Section 13 or 15(d) of the Exchange Act, the Issuer will furnish, upon request and at its expense, to the Dealer and to holders and prospective purchasers of Notes information required by Rule 144A(d)(4)(i) in compliance with Rule 144A(d). (h) In the event that any Note offered or to be offered by Dealer would be ineligible for resale under Rule 144A, the Issuer shall immediately notify Dealer (by telephone, confirmed in writing) of such fact and shall promptly prepare and deliver to Dealer an amendment or supplement to the Private Placement Memorandum describing the Notes that are ineligible, the reason for such ineligibility and any other relevant information relating thereto. (i) The Issuer represents that it has outstanding issuances of commercial paper in the United States market in reliance upon, and in compliance with, the exemption provided by Section 3(a)(3) of the Securities Act. In that connection, the Issuer agrees that (a) the proceeds from the sale of the Notes will be segregated from the proceeds of the sale of any such commercial paper by being placed in a separate account; (b) the Issuer will institute appropriate corporate procedures to ensure that the offers and sales of notes issued by the Issuer pursuant to the Section 3(a)(3) exemption are not integrated with offerings and sales of Notes hereunder; and (c) the Issuer will comply with each of the requirements of Section 3(a)(3) of the Act in selling commercial paper or other short-term debt securities other than the Notes in the United States. 1.7 The Issuer hereby represents and warrants to the Dealer, in connection with offers, sales and resales of Notes, as follows: (a) Issuer hereby confirms to the Dealer that (except as permitted by Section 1.6(i)) within the preceding six months neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof acting on behalf of the Issuer has offered or sold any Notes, or any substantially similar security of the Issuer (including, without limitation, medium-term notes issued by the Issuer), to, or solicited offers to buy any such security from, any person other than the Dealer or the other dealers referred to in Section 1.2 hereof. The Issuer also agrees that, as long as the Notes are being offered for sale by the Dealer and the other dealers referred to in Section 1.2 hereof as contemplated hereby and until at least six months after the offer of Notes hereunder has been terminated, neither the Issuer nor any person other than the Dealer or 229 (b) Except as described in Section 1.7(c) below, the Issuer represents and agrees that the proceeds of the sale of the Notes are not currently contemplated to be used for the purpose of buying, carrying or trading securities within the meaning of Regulation T and the interpretations thereunder by the Board of Governors of the Federal Reserve System. Except as described in Section 1.7(c) below, in the event that the Issuer determines to use such proceeds for the purpose of buying, carrying or trading securities, whether in connection with an acquisition of another company or otherwise, the Issuer shall give the Dealer at least five business days' prior written notice to that effect. The Issuer shall also give the Dealer prompt notice of the actual date that it commences to purchase securities with the proceeds of the Notes. Thereafter, in the event that the Dealer purchases Notes as principal and does not resell such Notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. (c) The Dealer acknowledges that proceeds from the sale of Notes prior to the consummation of the merger of IBP, inc. ("IBP") into Lasso Acquisition Corporation ("Lasso"), a wholly-owned subsidiary of the Issuer, pursuant to an Agreement and Plan of Merger dated as of January 1, 2001 among the Issuer, Lasso and IBP, as amended from time to time (the "Merger Agreement") are contemplated to be used, in part, for the purpose of purchasing shares of common stock of IBP pursuant to the terms of the offer to purchase up to 50.1% of the common stock of IBP contemplated by the Merger Agreement. In the event the Dealer purchases Notes as principal and does not resell such notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. Section 2. Representations and Warranties of Issuer The Issuer represents and warrants that: 2.1 The Issuer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, this Agreement and the Issuing and Paying Agency Agreement. 2.2 This Agreement and the Issuing and Paying Agency Agreement have been duly authorized, executed and delivered by the Issuer and constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 230 2.3 The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.4 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, the offer and sale of Notes in the manner contemplated hereby do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and no indenture in respect of the Notes is required to be qualified under the Trust Indenture Act of 1939, as amended. 2.5 The Notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness of the Issuer. 2.6 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, no consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the SEC, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, this Agreement, the Notes or the Issuing and Paying Agency Agreement, except (i)as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes, and (ii) for the requirement that the Issuer file with the SEC a notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. 2.7 Neither the execution and delivery of this Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions hereof or thereof by the Issuer, will (i) result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Issuer, or (ii) violate or result in a breach or an event of default under any of the terms of the Issuer's charter documents or by-laws, any contract or instrument to which the Issuer is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality, to which the Issuer is subject or by which it or its property is bound, which breach or event of default could reasonably be expected to have a material adverse effect on the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 231 2.8 There is no litigation or governmental proceeding pending, or to the knowledge of the Issuer threatened, against or affecting the Issuer or any of its subsidiaries which could reasonably be expected to have a material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.9 The Issuer is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. 2.10 Neither the Private Placement Memorandum nor the Company Information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, provided, that the Issuer make no representation or warranty as to the Dealer Information. 2.11 Each (a) issuance of Notes by the Issuer hereunder and (b) amendment or supplement of the Private Placement Memorandum shall be deemed a representation and warranty by the Issuer to the Dealer, as of the date thereof, that, both before and after giving effect to such issuance and after giving effect to such amendment or supplement, (i) the representations and warranties given by the Issuer set forth above in this Section 2 remain true and correct on and as of such date as if made on and as of such date, (ii) in the case of an issuance of Notes, the Notes being issued on such date have been duly and validly issued and constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations on rights to indemnity and contribution imposed by applicable law, and (iii) in the case of an issuance of Notes, since the date of the most recent Private Placement Memorandum, there has been no material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole which has not been disclosed to the Dealer in writing. Section 3. Covenants and Agreements of Issuer The Issuer covenants and agrees that: 3.1 The Issuer will give the Dealer prompt notice (but in any event prior to any subsequent issuance of Notes hereunder) of any amendment to, modification of, or waiver with respect to, the Notes or the Issuing and Paying Agency Agreement, including a complete copy of any such amendment, modification or waiver. 3.2 The Issuer shall, whenever there shall occur any event that could reasonably be expected to have a material adverse effect on the financial condition or results of operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement or the Notes, notify the Dealer (by telephone, confirmed in writing) of such event prior to any subsequent issuances of Notes hereunder. The Issuer shall, whenever it receives notice of any 232 downgrading or intended downgrading or any review for potential change in the rating accorded any of the Issuer's securities by any nationally recognized statistical rating organization which has published a rating of the Notes, promptly, and in any event prior to any subsequent issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in writing) of such occurrence. 3.3 The Issuer shall from time to time upon the request of the Dealer furnish to the Dealer copies of all materials provided by the Issuer to any national securities exchange regarding (i) the Issuer's operations and financial condition, and (ii) the Issuer's ability to pay the Notes as they mature. 3.4 The Issuer will take all such action as the Dealer may reasonably request to ensure that each offer and each sale of the Notes will comply with any applicable state Blue Sky laws; provided, that the Issuer shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. 3.5 The Issuer shall not issue Notes hereunder until the Dealer shall have received (a) an opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance to the Dealer, (b) a copy of the executed Issuing and Paying Agency Agreement as then in effect, (c) a copy of resolutions adopted by the Board of Directors of the Issuer, satisfactory in form and substance to the Dealer and certified by the Secretary or similar officer of the Issuer, authorizing execution and delivery by the Issuer of this Agreement the Issuing and Paying Agency Agreement and the Notes and consummation by the Issuer of the transactions contemplated hereby and thereby, (d) prior to the issuance of any Notes represented by a book-entry note registered in the name of DTC or its nominee, a copy of the executed Letter of Representations among the Issuer, the Issuing and Paying Agent and DTC, and (e) such other certificates, opinions, letters and documents as the Dealer shall have reasonably requested. 3.6 The Issuer shall reimburse the Dealer for all of the Dealer's reasonable out-of-pocket expenses related to this Agreement, including expenses incurred in connection with its preparation and negotiation, and the transactions contemplated hereby (including, but not limited to, the printing and distribution of the Private Placement Memorandum), and, if applicable, for the reasonable fees and out-of-pocket expenses of the Dealer's counsel. 3.7 Without limiting any obligation of the Issuer pursuant to this Agreement to provide the Dealer with credit and financial information, the Issuer hereby acknowledges and agrees that the Dealer may share the Company Information and any other information or matters relating to the Issuer or the transactions contemplated hereby with affiliates of the Dealer, and that such affiliates may likewise share information relating to the Issuer or such transactions with the Dealer. 233 Section 4. Disclosure 4.1 The Private Placement Memorandum and its contents (other than the Dealer Information) shall be the sole responsibility of the Issuer. The Private Placement Memorandum shall contain a statement expressly offering an opportunity for each prospective purchaser to ask questions of, and receive answers from, the Issuer concerning the offering of Notes and to obtain relevant additional information which the Issuer possesses or can acquire without unreasonable effort or expense. 4.2 The Issuer agrees promptly to furnish the Dealer the Company Information as it becomes available. 4.3 (a) The Issuer further agrees to notify the Dealer promptly upon the occurrence of any event relating to or affecting the Issuer that would cause the Company Information then in existence to include an untrue statement of material fact or to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they are made, not misleading. (b) In the event that the Issuer gives the Dealer notice pursuant to Section 4.3(a) and the Dealer notifies the Issuer that it then has Notes it is holding in inventory, the Issuer agrees promptly to supplement or amend the Private Placement Memorandum so that such Private Placement Memorandum, as amended or supplemented, shall not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and the Issuer shall make such supplement or amendment available to the Dealer. (c) In the event that (i) the Issuer gives the Dealer notice pursuant to Section 4.3(a) and (ii) the Dealer does not notify the Issuer that it is then holding Notes in inventory and (iii) the Issuer chooses not to promptly amend or supplement the Private Placement Memorandum in the manner described in clause (b) above, then all solicitations and sales of Notes shall be suspended until such time as the Issuer has so amended or supplemented the Private Placement Memorandum, and made such amendment or supplement available to the Dealer. Section 5. Indemnification and Contribution 5.1 The Issuer will indemnify and hold harmless the Dealer, each individual, corporation, partnership, trust, association or other entity controlling the Dealer, within the meaning of Section 15 of the Securities Act (hereinafter the "Indemnitees") against any and all liabilities, penalties, suits, causes of action, losses, damages, claims, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) or judgments of whatever kind or nature (each a "Claim"), imposed upon, incurred by or asserted against the Indemnitees arising out of or based upon (i) any allegation that the Private Placement Memorandum, the Company Information or any information provided by the Issuer to the Dealer included (as of any relevant time of offer and sale of the Notes by the Issuer) or includes an untrue statement of a material fact or omitted (as of any relevant time of offer and sale of the Notes by the Issuer) or omits to state any material fact necessary to make the statements therein, 234 in light of the circumstances under which they were made, not misleading or (ii) arising out of or based upon the breach by the Issuer of any agreement, covenant or representation made in or pursuant to this Agreement; provided, however, that the foregoing indemnity shall not extend to any Claims to the extent they arise out of or are based upon (A) the gross negligence or willful misconduct of the Dealer in the performance or failure to perform its obligations hereunder, or (B) an untrue statement by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes or an omission by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes necessary to make any statement, in light of the circumstances in which such statement was made, not misleading if such statement or omission relates to the Dealer in its capacity as dealer of the Notes or such statement or omission relates to other matters and has not been approved by the Issuer (whether through approval of the Private Placement Memorandum or otherwise). 5.2 Provisions relating to claims made for indemnification under this Section 5 are set forth on Exhibit B to this Agreement. 5.3 In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in clause (i) of Section 5.1 is held to be unavailable or insufficient to hold harmless the Indemnitees, although applicable in accordance with the terms of this Section 5, the Issuer shall contribute to the aggregate costs incurred by the Dealer in connection with any Claim in the proportion of the respective economic interests of the Issuer and the Dealer; provided, however, that such contribution by the Issuer shall be in an amount such that the aggregate costs incurred by the Dealer do not exceed the aggregate of the commissions and fees earned by the Dealer hereunder with respect to the issue or issues of Notes to which such Claim relates. The respective economic interests shall be calculated by reference to the aggregate proceeds to the Issuer of the Notes issued hereunder and the aggregate commissions and fees earned by the Dealer hereunder. Section 6. Definitions 6.1 "Claim" shall have the meaning set forth in Section 5.1. 6.2 "Company Information" at any given time shall mean the Private Placement Memorandum together with, to the extent applicable, (i) the Issuer's most recent report on Form 10-K filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most recent Form 10-K, (ii) the Issuer's most recent annual audited financial statements and each interim financial statement or report prepared subsequent thereto, if not included in item (i) above, (iii) the Issuer's and its affiliates' other publicly available recent reports, including, but not limited to, any publicly available filings or reports provided to their respective shareholders, (iv) any other information or disclosure prepared pursuant to Section 4.3 hereof and (v) any information prepared or approved by the Issuer for dissemination to investors or potential investors in the Notes. 6.3 "Dealer" shall mean Credit Suisse First Boston Corporation. 235 6.4 "Dealer Information" shall mean material concerning the Dealer and provided by the Dealer in writing expressly for inclusion in the Private Placement Memorandum. 6.5 "DTC" shall mean The Depository Trust Company. 6.6 "Exchange Act" shall mean the U.S. Securities Exchange Act of 1934, as amended. 6.7 "Indemnitee" shall have the meaning set forth in Section 5.1. 6.8 "Institutional Accredited Investor" shall mean an institutional investor that is an accredited investor within the meaning of Rule 501 under the Securities Act and that has such knowledge and experience in financial and business matters that it is capable of evaluating and bearing the economic risk of an investment in the Notes, including, but not limited to, a bank, as defined in Section 3(a)(2) of the Securities Act, or a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity. 6.9 "Issuing and Paying Agency Agreement" shall mean the issuing and paying agency agreement described on the cover page of this Agreement, as such agreement may be amended or supplemented from time to time. 6.10 "Issuing and Paying Agent" shall mean the party designated as such on the cover page of this Agreement, as issuing and paying agent under the Issuing and Paying Agency Agreement. 6.11 "Non-bank fiduciary or agent" shall mean a fiduciary or agent other than (a) a bank, as defined in Section 3(a)(2) of the Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A) of the Securities Act. 6.12 "Private Placement Memorandum" shall mean offering materials prepared in accordance with Section 4 (including materials referred to therein or incorporated by reference therein) provided to purchasers and prospective purchasers of the Notes, and shall include amendments and supplements thereto which may be prepared from time to time in accordance with this Agreement (other than any amendment or supplement that has been completely superseded by a later amendment or supplement). 6.13 "Qualified Institutional Buyer" shall have the meaning assigned to that term in Rule 144A under the Securities Act. 6.14 "Rule 144A" shall mean Rule 144A under the Securities Act. 6.15 "SEC" shall mean the U.S. Securities and Exchange Commission. 6.16 "Securities Act" shall mean the U.S. Securities Act of 1933, as amended. 6.17 "Sophisticated Individual Accredited Investor" shall mean an individual who (a) is an accredited investor within the meaning of Regulation D under the Securities Act and (b) based on his or her pre- existing relationship with the Dealer, is reasonably believed by the Dealer to be a sophisticated investor (i) possessing such knowledge and experience 236 (or represented by a fiduciary or agent possessing such knowledge and experience) in financial and business matters that he or she is capable of evaluating and bearing the economic risk of an investment in the Notes and (ii) having a net worth of at least $5 million. Section 7. General 7.1 Unless otherwise expressly provided herein, all notices under this Agreement to parties hereto shall be in writing and shall be effective when received at the address of the respective party set forth in the Addendum to this Agreement. 7.2 This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws provisions. 7.3 EACH OF THE DEALER AND THE ISSUER WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 7.4 This Agreement may be terminated, at any time, by the Issuer, upon one business day's prior notice to such effect to the Dealer, or by the Dealer upon one business day's prior notice to such effect to the Issuer. Any such termination, however, shall not affect the obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations, warranties, agreements, covenants, rights or responsibilities of the parties made or arising prior to the termination of this Agreement. 7.5 This Agreement is not assignable by either party hereto without the written consent of the other party; provided, however, that the Dealer may assign its rights and obligations under this Agreement to any wholly- owned direct or indirect subsidiary of the Dealer or of its ultimate parent. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto and their respective permitted assigns. 7.6 This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 7.7 This Agreement constitutes the entire agreement between the parties hereto and supercedes any prior understandings, agreements or representations by or between the parties hereto, written or oral, to the extent they relate to the subject matter hereof. 7.7 Any payments to the Dealer hereunder, whether pursuant to Sections 3.6, 5.1 or otherwise, shall be in US dollars and shall be free of all withholding, stamp and other similar taxes and of all other governmental charges of any nature whatsoever. In the event any withholding is required by law, the Issuer agrees to (i) pay the same and (ii) pay such additional amounts to the Dealer which, after deduction of any such withholding, stamp or other taxes or governmental charges of any nature whatsoever imposed with respect to the payment of such additional amount, shall equal the amount withheld pursuant to clause (i). 237 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date and year first above written. TYSON FOODS, INC., as Issuer By: Name: Title: Credit Suisse First Boston Corporation, as Dealer By: Name: Title: 238 ADDENDUM 1. The other dealers referred to in clause (b) of Section 1.2 of the Agreement are: Banc of America Securities LLC J.P. Morgan Securities Inc. Chase Securities Inc. Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days SunTrust Equitable Securities Corp. 2. The addresses of the respective parties for purposes of notices under Section 7.1 are as follows: For the Issuer: Address: 2210 West Oaklawn Drive Springdale, Arkansas 72762-6999 Attention: General Counsel Telephone number: (501) 290-4000 Fax number: (501) 290-6776 For the Dealer: Address: Credit Suisse First Boston Corporation 11 Madison Avenue New York, New York 10010 Attention: Telephone number: (212) 325-7198 Fax number: (212) 325-8183 239 EXHIBIT A FORM OF LEGEND FOR PRIVATE PLACEMENT MEMORANDUM AND NOTES THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER AND THE NOTES, THAT IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND THAT IT IS EITHER (A) AN INSTITUTIONAL INVESTOR OR HIGHLY SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL, (i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE NOTES AND (ii) HAS A NET WORTH OF AT LEAST $5 MILLION (AN "INSTITUTIONAL ACCREDITED INVESTOR" OR "SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR", RESPECTIVELY) AND THAT EITHER IS PURCHASING NOTES FOR ITS OWN ACCOUNT, IS A U.S. BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR IS A FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN) PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH IS SUCH AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR (i) WHICH ITSELF POSSESSES SUCH KNOWLEDGE AND EXPERIENCE OR (ii) WITH RESPECT TO WHICH SUCH PURCHASER HAS SOLE INVESTMENT DISCRETION; OR (B) A QUALIFIED INSTITUTIONAL BUYER ("QIB") WITHIN THE MEANING OF RULE 144A UNDER THE ACT WHICH IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH IS A QIB AND WITH RESPECT TO EACH OF WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO CREDIT SUISSE FIRST BOSTON CORPORATION OR ANOTHER PERSON DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES (COLLECTIVELY, THE "PLACEMENT AGENTS"), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR OR A QIB BY A PLACEMENT AGENT, OR (3) TO A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000. 240 EXHIBIT B FURTHER PROVISIONS RELATING TO INDEMNIFICATION (a) The Issuer agrees to reimburse each Indemnitee for all expenses (including reasonable fees and disbursements of internal and external counsel) as they are incurred by it in connection with investigating or defending any loss, claim, damage, liability or action in respect of which indemnification may be sought under clause (i) of Section 5.1 of the Agreement (whether or not it is a party to any such proceedings). (b) Promptly after receipt by an Indemnitee of notice of the existence of a Claim arising under clause (i) of Section 5.1 of the Agreement, such Indemnitee will, if a claim in respect thereof is to be made against the Issuer, notify the Issuer in writing of the existence thereof; provided that (i) the omission so to notify the Issuer will not relieve it from any liability which it may have hereunder unless and except to the extent it did not otherwise learn of such Claim and the issuer is materially prejudiced thereby, and (ii) the omission so to notify the Issuer will not relieve it from liability which it may have to an Indemnitee otherwise than on account of this indemnity agreement. In case any such Claim is made against any Indemnitee and it notifies the Issuer of the existence thereof, the Issuer will be entitled to participate therein, and to the extent that it may elect by written notice delivered to the Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee; provided that if the defendants in any such Claim include both the Indemnitee and the Issuer and the Indemnitee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, the Issuer shall not have the right to direct the defense of such Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to select separate counsel to assert such legal defenses on behalf of such Indemnitee. Upon receipt of notice from the Issuer to such Indemnitee of the Issuer's election so to assume the defense of such Claim and approval by the Indemnitee of counsel, the Issuer will not be liable to such Indemnitee for expenses incurred thereafter by the Indemnitee in connection with the defense thereof (other than reasonable costs of investigation) unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next preceding sentence (it being understood, however, that the Issuer shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel in the jurisdiction in which any Claim is brought), approved by the Dealer, representing the Indemnitee who is party to such Claim), (ii) the Issuer shall not have employed counsel reasonably satisfactory to the Indemnitee to represent the Indemnitee within a reasonable time after notice of existence of the Claim or (iii) the Issuer has authorized in writing the employment of counsel for the Indemnitee. The indemnity, reimbursement and contribution obligations of the Issuer hereunder shall be in addition to any other liability the Issuer may otherwise have to an Indemnitee and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer and any Indemnitee. The Issuer agrees that without the Dealer's prior written consent, it will not settle, compromise or consent to the entry of any judgment in any Claim in respect of which 241 indemnification may be sought under the indemnification provision of the Agreement (whether or not the Dealer or any other Indemnitee is an actual or potential party to such Claim), unless such settlement, compromise or consent includes an unconditional release of each Indemnitee from all liability arising out of such Claim. 242 MODEL OPINION OF COUNSEL TO ISSUER [Date] [Name and Address of Dealer] Ladies and Gentlemen: We have acted as special counsel to Tyson Foods, Inc., a Delaware corporation (the "Company"), in connection with the proposed offering and sale by the Company in the United States of commercial paper in the form of short-term promissory notes (the "Notes") in the manner contemplated by the Commercial Paper Dealer Agreement dated as of January 12, 2001 by and between the Company and you (the "Agreement"). We are delivering this letter to you in order to satisfy the condition set forth in Section 3.5 of the Dealer Agreement. Each term used but not defined in this letter has the meaning ascribed to it in the Dealer Agreement. In our capacity as such counsel, we have examined a specimen form of Note, an executed copy of the Agreement, and the Issuing and Paying Agency Agreement dated January 12, 2001 (the "Issuing and Paying Agency Agreement") between the Company and The Chase Manhattan Bank, N.A., as issuing and paying agent (the "Issuing and Paying Agent") as well as originals, or copies certified or otherwise identified to our satisfaction, of such other records and documents as we have deemed necessary as a basis for the opinions expressed below. For purposes of this opinion, we have, with your permission, assumed without independent investigation or inquiry that: (i) all signatures of the parties on the Dealer Agreement and the Issuing and Paying Agency Agreement (other than the Company) that we examined are genuine, the agreement submitted to us as originals are authentic, and the agreements submitted to us as copies conform to the original agreements executed by the parties thereto; and (ii) the Dealer Agreement and the Issuing and Paying Agency Agreement have been duly and validly authorized, executed, delivered and accepted by all parties thereto (other than the Company) and all parties thereto (other than the Company) have all requisite power and authority to make and enter into the agreements and perform their obligations thereunder pursuant to the laws of all relevant jurisdictions. Based upon the foregoing, it is our opinion that: 1. The Company is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, the Agreement and the Issuing and Paying Agency Agreement. 243 2. Each of the Agreement and the Issuing and Paying Agency Agreement has been duly authorized, executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law), and except as rights under the Agreement to indemnity and contribution may be limited by federal or state laws. 3. The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and except as rights to indemnity and contribution may be limited by federal or state laws. 4. The issuance and sale of Notes under the circumstances contemplated by the Agreement and the Issuing and Paying Agency Agreement do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and do not require compliance with any provision of the Trust Indenture Act of 1939, as amended. 5. No consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the Securities and Exchange Commission, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, the Agreement, the Notes, or the Issuing and Paying Agency Agreement, except as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes. 6. Neither the execution and delivery of the Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions of either thereof by the Company, will violate or result in an event of default under any of the terms of the Company's charter documents or by-laws, any contract or instrument known to us to which the Company is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality known to us, to which the Company is subject or by which it or its property is bound. 7. Except as disclosed in reports and other information filed by the Company with the Securities and Exchange Commission, to our knowledge there is no litigation or governmental proceeding pending or threatened against the Company which in any way may prevent or interfere with or materially and adversely affect the Company's executing and delivering the Agreement, the Issuing and Paying Agency Agreement or the Notes, or materially and adversely affecting the Company carrying out its obligations thereunder. 244 8. The Company is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. The opinions hereinafter expressed are subject to the following qualifications and limitations: (a) The opinions set forth herein are subject to the qualification that we are members of the bar of the State of Arkansas only and we express no opinion as to the laws of any jurisdiction other than the United States of America, the State of Arkansas and the General Corporate Laws of the State of Delaware. We call your attention to the fact that each of the Dealer Agreement and the Issuing and Paying Agency Agreement, as well as the Notes issued thereunder, provides that it is to be governed and construed in accordance with the laws of the State of New York. For purposes of our opinions expressed above, we have assumed, with your approval, that the Dealer Agreement, the Issuing and Paying Agency Agreement and the Notes would be governed by and construed in accordance with the domestic substantive laws of the State of Arkansas without giving effect to any choice or conflict of laws rule or provision that would cause the application of the domestic substantive laws of any other jurisdiction. (b) This opinion is limited to pertinent laws in effect as of the date hereof, and we expressly disclaim any undertaking to advise you of any changes of law or fact that may thereafter come to our attention. (c) Our opinion is limited to the matters stated herein and no opinion is to be implied or may be inferred beyond those matters expressly stated. (d) This opinion is furnished by us solely for your benefit as a dealer of the Notes pursuant to the Dealer Agreement, and it may not be relied upon, quoted from or delivered to any person; provided, however, that The Chase Manhattan Bank, N.A. may rely upon this opinion in its capacity as Issuing and Paying Agent for the Notes, each of Moody's Investors Service, Inc. and Standard & Poor's Ratings Group may rely on this opinion in connection with its issuance of an investment rating for the Notes, and a copy of this opinion may be delivered to any purchaser of the Notes. The liability of this firm is limited to the fullest extent possible under Ark. Code Ann. Section 16-114-303. (e) The phrases "known to us" or "to our knowledge" as used in this letter means the actual knowledge of those attorneys of our firm who have represented the Company in connection with any offering or placement of securities or who have principal responsibility for representing the Company, and do not include constructive knowledge or knowledge imputed to our firm under common law principles of agency or otherwise. Except as expressly set forth herein, we have not undertaken any investigation to determine the existence or absence of any facts and no inference as to our knowledge concerning any facts should be drawn from the fact that such representation has been undertaken by us. 245 (f) For purposes of the factual matters material to the opinions expressed herein, we have, with your consent, relied upon the compliance with the covenants and the correctness of the representations contained in the Dealer Agreement and the Issuing and Paying Agency Agreement. Without limiting the foregoing, for purposes of the opinions expressed in paragraphs 4 and 5 above, we have assumed that the Company will timely file with the Securities and Exchange Commission notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. (g) Our opinions are rendered as of the date hereof and do not cover the effect of any amendment or supplement to the Dealer Agreement or the Issuing and Paying Agency Agreement or the validity or enforceability of any amendment or supplement thereto, including without limitation any modifications, extensions, waivers or releases or the effect or applicability of federal or state tax laws on or to the transactions contemplated thereby. (h) We have made no examination or investigation to verify the accuracy or completeness of any financial, accounting, or statistical information furnished to you or with respect to any other accounting and financial matters and express no opinion with respect thereto. (i) We call your attention to the fact that the awarding of attorney's fees and expenses is discretionary under Arkansas law. We cannot opine that attorney's fees and expenses will be awarded in any particular amount. (j) Our opinions are subject to, and we express no opinion on, state or federal law relating to usury or fraudulent conveyances. (k) The opinions expressed above are (i) given to you solely for your benefit and the benefit of your successors and transferees, (ii) not binding on any court and (iii) may not be quoted in whole or in part or otherwise referred to in any legal opinion, document, or other report to be furnished to another person or entity without our prior written consent. Very truly yours, 246 Model Certificate as to Resolutions1 [Name of Issuer] I, R. Read Hudson, the Secretary of Tyson Foods, Inc., a Delaware corporation (the "Issuer"), do hereby certify, in connection with the issuance and sale of short-term promissory notes under the Commercial Paper Dealer Agreement dated January 12, 2001 (the "Agreement", the terms defined therein being used herein as therein defined) between the Issuer and Credit Suisse First Boston Corporation (the "Dealer"), that: 1. The following resolution was duly adopted by the Board of Directors of the Issuer at a meeting thereof duly called and held on January 12, 2001, at which meeting a quorum was present and acting throughout, and such resolution has not been amended, modified or revoked and is in full force and effect on the date hereof: RESOLVED, that the Chairman of the Board, President, Chief Executive Officer, any Executive Vice President, any Senior Vice President, Controller or Chief Accounting Officer or Treasurer, either alone or with joinder of the Secretary or an Assistant Secretary, of the Corporation (the "Authorized Officers") be, and each of them hereby is, authorized to: (i) borrow under the Commercial Paper Program; (ii) execute such commercial paper notes in the name and on behalf of the Corporation; (iii) execute and deliver (A) Commercial Paper Dealer Agreements between the Corporation and each of the dealers selected by any Authorized Officer (each a "Dealer"), providing, among other things, for the sale of commercial paper notes on behalf of the Corporation and the indemnification of the Dealer in connection therewith and (B) an Issuing and Paying Agency Agreement between the Corporation and J.P. Morgan Chase & Co., or any of its affiliates, as issuing and paying agent; (iv) delegate to any other officers or employees of the Corporation authority to give instructions to the Dealer pursuant to the applicable Commercial Paper Dealer Agreement; and (v) do such acts and execute such other instruments and documents as may be necessary and proper to effect the transactions contemplated hereby including (A) amending documents referred to herein and (B) appointing additional dealers and successors to any of the parties named. 2. Each of the Agreement and the Issuing and Paying Agency Agreement, as executed and delivered by the Issuer, is substantially in the form thereof approved by the Board of Directors and referred to in the resolution set forth in paragraph 1 hereof. IN WITNESS WHEREOF, I have signed this certificate the 12th day of January, 2001 ________________________ Secretary _______________________________ 1This model certificate will serve as a guide for resolutions adopted by the Issuer. Any resolutions actually adopted, regardless of form, should cover all the substantive matters covered in this model, and a certificate substantially to the effect of this model is required to be delivered to the Dealer under Section 3.6(c) of the Agreement. 247 EX-10.5 7 0007.txt COMMERCIAL PAPER DEALER AGREEMENT COMMERCIAL PAPER DEALER AGREEMENT 4(2) PROGRAM between TYSON FOODS, INC., as Issuer and Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days; Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days Concerning Notes to be issued pursuant to an Issuing and Paying Agency Agreement dated as of January 12, 2001 between the Issuer and The Chase Manhattan Bank, as Issuing and Paying Agent Dated As of January 12, 2001 248 COMMERCIAL PAPER DEALER AGREEMENT 4(2) Program This agreement ("Agreement") sets forth the understandings between the Issuer and the Dealer in connection with the issuance and sale by the Issuer of its short-term promissory notes through the Dealer (the "Notes"). Certain terms used in this Agreement are defined in Section 6 hereof. The Addendum to this Agreement, and any Annexes or Exhibits described in this Agreement or such Addendum, are hereby incorporated into this Agreement and made fully a part hereof. Section 1. Offers, Sales and Resales of Notes 1.1 While (i) the Issuer has and shall have no obligation to sell the Notes to the Dealer or to permit the Dealer to arrange any sale of the Notes for the account of the Issuer, and (ii) the Dealer has and shall have no obligation to purchase the Notes from the Issuer or to arrange any sale of the Notes for the account of the Issuer, the parties hereto agree that in any case where the Dealer purchases Notes from the Issuer, or arranges for the sale of Notes by the Issuer, such Notes will be purchased or sold by the Dealer in reliance on the representations, warranties, covenants and agreements of the Issuer contained herein or made pursuant hereto and on the terms and conditions and in the manner provided herein. 1.2 So long as this Agreement shall remain in effect, and in addition to the limitations contained in Section 1.7 hereof, the Issuer shall not, without the consent of the Dealer, offer, solicit or accept offers to purchase, or sell, any Notes except (a) in transactions with one or more dealers which may from time to time after the date hereof become dealers with respect to the Notes by executing with the Issuer one or more agreements which contain provisions substantially identical to Section 1 of this Agreement, of which the Issuer hereby undertakes to provide the Dealer prompt notice or (b) in transactions with the other dealers listed on the Addendum hereto, which are executing agreements with the Issuer which contain provisions substantially identical to Section 1 of this Agreement contemporaneously herewith. In no event shall the Issuer offer, solicit or accept offers to purchase, or sell, any Notes directly on its own behalf in transactions with persons other than broker-dealers as specifically permitted in this Section 1.2. 1.3 The Notes shall be in a minimum denomination or minimum amount, whichever is applicable, of $250,000 or integral multiples of $1,000 in excess thereof, will bear such interest rates, if interest bearing, or will be sold at such discount from their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a maturity not exceeding 365 days from the date of issuance (exclusive of days of grace) and shall not contain any provision for extension, renewal or automatic "rollover." 1.4 The authentication, delivery and payment of the Notes shall be effected in accordance with the Issuing and Paying Agency Agreement and the Notes shall be either individual bearer physical certificates or represented by book-entry Notes registered in the name of DTC or its nominee in the form or forms annexed to the Issuing and Paying Agency Agreement. 249 1.5 If the Issuer and the Dealer shall agree on the terms of the purchase of any Note by the Dealer or the sale of any Note arranged by the Dealer (including, but not limited to, agreement with respect to the date of issue, purchase price, principal amount, maturity and interest rate (in the case of interest-bearing Notes) or discount thereof (in the case of Notes issued on a discount basis), and appropriate compensation for the Dealer's services hereunder) pursuant to this Agreement, the Issuer shall cause such Note to be issued and delivered in accordance with the terms of the Issuing and Paying Agency Agreement and payment for such Note shall be made by the purchaser thereof, either directly or through the Dealer, to the Issuer. Except as otherwise agreed, in the event that the Dealer is acting as an agent and a purchaser shall either fail to accept delivery of or make payment for a Note on the date fixed for settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has theretofore paid the Issuer for the Note, the Issuer will promptly return such funds to the Dealer against its return of the Note to the Issuer, in the case of a certificated Note, and upon notice of such failure in the case of a book- entry Note. 1.6 The Dealer and the Issuer hereby establish and agree to observe the following procedures in connection with offers, sales and subsequent resales or other transfers of the Notes: (a) Offers and sales of the Notes shall be made only to investors reasonably believed by the Dealer to be: (i) Institutional Accredited Investors or Sophisticated Individual Accredited Investors, (ii) non-bank fiduciaries or agents that will be purchasing Notes for one or more accounts, each of which is an Institutional Accredited Investor or Sophisticated Individual Accredited Investor, and (iii) Qualified Institutional Buyers. (b) Resales and other transfers of the Notes by or through the Dealer or by other holders thereof shall be made only in accordance with the restrictions in the legends described in clause (e) below. (c) No general solicitation or general advertising shall be used in connection with the offering of the Notes. Without limiting the generality of the foregoing, without the prior written approval of Dealer, the Issuer shall not issue any press release or place or publish any "tombstone" or other advertisement relating to the Notes. (d) No sale of Notes to any one purchaser shall be for less than $250,000 principal or face amount, and no Note shall be issued in a smaller principal or face amount. If the purchaser is a non-bank fiduciary acting on behalf of others, each person for whom such purchaser is acting must purchase at least $250,000 principal or face amount of Notes. (e) Offers and sales of the Notes by the Issuer through the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506 under the Securities Act, and shall be subject to the restrictions described in the legend appearing on Exhibit A hereto. A legend substantially to the effect of such Exhibit A shall appear as part of the Private Placement Memorandum used in connection with offers and sales of Notes hereunder, as well as on each Note offered and sold pursuant to this Agreement. 250 (f) Dealer shall furnish or shall have furnished to each purchaser of Notes being sold to an ultimate purchaser for the first time a copy of the then-current Private Placement Memorandum unless such purchaser has previously received a copy of the Private Placement Memorandum as then in effect. The Private Placement Memorandum shall expressly state that any person to whom Notes are offered shall have an opportunity to ask questions of, and receive information from, the Issuer and the Dealer and shall provide the names, addresses and telephone numbers of the persons from whom information regarding the Issuer may be obtained. (g) The Issuer agrees, for the benefit of the Dealer and each of the holders and prospective purchasers from time to time of the Notes that, if at any time the Issuer shall not be subject to Section 13 or 15(d) of the Exchange Act, the Issuer will furnish, upon request and at its expense, to the Dealer and to holders and prospective purchasers of Notes information required by Rule 144A(d)(4)(i) in compliance with Rule 144A(d). (h) In the event that any Note offered or to be offered by Dealer would be ineligible for resale under Rule 144A, the Issuer shall immediately notify Dealer (by telephone, confirmed in writing) of such fact and shall promptly prepare and deliver to Dealer an amendment or supplement to the Private Placement Memorandum describing the Notes that are ineligible, the reason for such ineligibility and any other relevant information relating thereto. (i) The Issuer represents that it has outstanding issuances of commercial paper in the United States market in reliance upon, and in compliance with, the exemption provided by Section 3(a)(3) of the Securities Act. In that connection, the Issuer agrees that (a) the proceeds from the sale of the Notes will be segregated from the proceeds of the sale of any such commercial paper by being placed in a separate account; (b) the Issuer will institute appropriate corporate procedures to ensure that the offers and sales of notes issued by the Issuer pursuant to the Section 3(a)(3) exemption are not integrated with offerings and sales of Notes hereunder; and (c) the Issuer will comply with each of the requirements of Section 3(a)(3) of the Act in selling commercial paper or other short-term debt securities other than the Notes in the United States. 1.7 The Issuer hereby represents and warrants to the Dealer, in connection with offers, sales and resales of Notes, as follows: (a) Issuer hereby confirms to the Dealer that (except as permitted by Section 1.6(i)) within the preceding six months neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof acting on behalf of the Issuer has offered or sold any Notes, or any substantially similar security of the Issuer (including, without limitation, medium-term notes issued by the Issuer), to, or solicited offers to buy any such security from, any person other than the Dealer or or other dealers referred to in Section 1.2 hereof. The Issuer also agrees that, as long as the Notes are being offered for sale by the Dealer and the other dealers referred to in Section 1.2 hereof as contemplated hereby and until at least six months after the offer of Notes hereunder has been terminated, neither the Issuer nor any person other than the Dealer or the other dealers 251 referred to in Section 1.2 hereof (except as contemplated by Section 1.2 hereof) will offer the Notes or any substantially similar security of the Issuer for sale to, or solicit offers to buy any such security from, any person other than the Dealer and the other dealers referred to in Section 1.2 hereof (except to the extent any of the foregoing would not cause the offer and sale of the Notes by the Issuer to be integrated with other offers and sales so as no longer to come within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder), it being understood that such agreement is made with a view to bringing the offer and sale of the Notes within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder and shall survive any termination of this Agreement. The Issuer hereby represents and warrants that it has not taken or omitted to take, and will not take or omit to take, any action that would cause the offering and sale of Notes hereunder to be integrated with any other offering of securities, whether such offering is made by the Issuer or some other party or parties, under circumstances that would cause the offering and sale of the Notes by the Issuer to fail to be exempt under Section 4(2) of the Securities Act. (b) Except as described in Section 1.7(c) below, the Issuer represents and agrees that the proceeds of the sale of the Notes are not currently contemplated to be used for the purpose of buying, carrying or trading securities within the meaning of Regulation T and the interpretations thereunder by the Board of Governors of the Federal Reserve System. Except as described in Section 1.7(c) below, in the event that the Issuer determines to use such proceeds for the purpose of buying, carrying or trading securities, whether in connection with an acquisition of another company or otherwise, the Issuer shall give the Dealer at least five business days' prior written notice to that effect. The Issuer shall also give the Dealer prompt notice of the actual date that it commences to purchase securities with the proceeds of the Notes. Thereafter, in the event that the Dealer purchases Notes as principal and does not resell such Notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. (c) The Dealer acknowledges that proceeds from the sale of Notes prior to the consummation of the merger of IBP, inc. ("IBP") into Lasso Acquisition Corporation ("Lasso"), a wholly-owned subsidiary of the Issuer, pursuant to an Agreement and Plan of Merger dated as of January 1, 2001 among the Issuer, Lasso and IBP, as amended from time to time (the "Merger Agreement") are contemplated to be used, in part, for the purpose of purchasing shares of common stock of IBP pursuant to the terms of the offer to purchase up to 50.1% of the common stock of IBP contemplated by the Merger Agreement. In the event the Dealer purchases Notes as principal and does not resell such notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. 252 Section 2. Representations and Warranties of Issuer The Issuer represents and warrants that: 2.1 The Issuer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, this Agreement and the Issuing and Paying Agency Agreement. 2.2 This Agreement and the Issuing and Paying Agency Agreement have been duly authorized, executed and delivered by the Issuer and constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.3 The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.4 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, the offer and sale of Notes in the manner contemplated hereby do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and no indenture in respect of the Notes is required to be qualified under the Trust Indenture Act of 1939, as amended. 2.5 The Notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness of the Issuer. 2.6 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, no consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the SEC, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, this Agreement, the Notes or the Issuing and Paying Agency Agreement, except (i)as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes, and (ii) for the requirement that the Issuer file with the SEC a notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. 253 2.7 Neither the execution and delivery of this Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions hereof or thereof by the Issuer, will (i) result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Issuer, or (ii) violate or result in a breach or an event of default under any of the terms of the Issuer's charter documents or by-laws, any contract or instrument to which the Issuer is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality, to which the Issuer is subject or by which it or its property is bound, which breach or event of default could reasonably be expected to have a material adverse effect on the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.8 There is no litigation or governmental proceeding pending, or to the knowledge of the Issuer threatened, against or affecting the Issuer or any of its subsidiaries which could reasonably be expected to have a material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.9 The Issuer is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. 2.10 Neither the Private Placement Memorandum nor the Company Information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, provided, that the Issuer make no representation or warranty as to the Dealer Information. 2.11 Each (a) issuance of Notes by the Issuer hereunder and (b) amendment or supplement of the Private Placement Memorandum shall be deemed a representation and warranty by the Issuer to the Dealer, as of the date thereof, that, both before and after giving effect to such issuance and after giving effect to such amendment or supplement, (i) the representations and warranties given by the Issuer set forth above in this Section 2 remain true and correct on and as of such date as if made on and as of such date, (ii) in the case of an issuance of Notes, the Notes being issued on such date have been duly and validly issued and constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations on rights to indemnity and contribution imposed by applicable law, and (iii) in the case of an issuance of Notes, since the date of the most recent Private Placement Memorandum, there has been no material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole which has not been disclosed to the Dealer in writing. 254 Section 3. Covenants and Agreements of Issuer The Issuer covenants and agrees that: 3.1 The Issuer will give the Dealer prompt notice (but in any event prior to any subsequent issuance of Notes hereunder) of any amendment to, modification of, or waiver with respect to, the Notes or the Issuing and Paying Agency Agreement, including a complete copy of any such amendment, modification or waiver. 3.2 The Issuer shall, whenever there shall occur any event that could reasonably be expected to have a material adverse effect on the financial condition or results of operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement or the Notes, notify the Dealer (by telephone, confirmed in writing) of such event prior to any subsequent issuances of Notes hereunder. The Issuer shall, whenever it receives notice of any downgrading or intended downgrading or any review for potential change in the rating accorded any of the Issuer's securities by any nationally recognized statistical rating organization which has published a rating of the Notes, promptly, and in any event prior to any subsequent issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in writing) of such occurrence. 3.3 The Issuer shall from time to time upon the request of the Dealer furnish to the Dealer copies of all materials provided by the Issuer to any national securities exchange regarding (i) the Issuer's operations and financial condition, and (ii) the Issuer's ability to pay the Notes as they mature. 3.4 The Issuer will take all such action as the Dealer may reasonably request to ensure that each offer and each sale of the Notes will comply with any applicable state Blue Sky laws; provided, that the Issuer shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. 3.5 The Issuer shall not issue Notes hereunder until the Dealer shall have received (a) an opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance to the Dealer, (b) a copy of the executed Issuing and Paying Agency Agreement as then in effect, (c) a copy of resolutions adopted by the Board of Directors of the Issuer, satisfactory in form and substance to the Dealer and certified by the Secretary or similar officer of the Issuer, authorizing execution and delivery by the Issuer of this Agreement the Issuing and Paying Agency Agreement and the Notes and consummation by the Issuer of the transactions contemplated hereby and thereby, (d) prior to the issuance of any Notes represented by a book-entry note registered in the name of DTC or its nominee, a copy of the executed Letter of Representations among the Issuer, the Issuing and Paying Agent and DTC, and (e) such other certificates, opinions, letters and documents as the Dealer shall have reasonably requested. 255 3.6 The Issuer shall reimburse the Dealer for all of the Dealer's reasonable out-of-pocket expenses related to this Agreement, including expenses incurred in connection with its preparation and negotiation, and the transactions contemplated hereby (including, but not limited to, the printing and distribution of the Private Placement Memorandum), and, if applicable, for the reasonable fees and out-of-pocket expenses of the Dealer's counsel. 3.7 Without limiting any obligation of the Issuer pursuant to this Agreement to provide the Dealer with credit and financial information, the Issuer hereby acknowledges and agrees that the Dealer may share the Company Information and any other information or matters relating to the Issuer or the transactions contemplated hereby with affiliates of the Dealer, including, but not limited to, Merrill Lynch Bank & Trust Co. and Merrill Lynch Bank USA, and that such affiliates may likewise share information relating to the Issuer or such transactions with the Dealer. Section 4. Disclosure 4.1 The Private Placement Memorandum and its contents (other than the Dealer Information) shall be the sole responsibility of the Issuer. The Private Placement Memorandum shall contain a statement expressly offering an opportunity for each prospective purchaser to ask questions of, and receive answers from, the Issuer concerning the offering of Notes and to obtain relevant additional information which the Issuer possesses or can acquire without unreasonable effort or expense. 4.2 The Issuer agrees promptly to furnish the Dealer the Company Information as it becomes available. 4.3 (a) The Issuer further agrees to notify the Dealer promptly upon the occurrence of any event relating to or affecting the Issuer that would cause the Company Information then in existence to include an untrue statement of material fact or to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they are made, not misleading. (b) In the event that the Issuer gives the Dealer notice pursuant to Section 4.3(a) and the Dealer notifies the Issuer that it then has Notes it is holding in inventory, the Issuer agrees promptly to supplement or amend the Private Placement Memorandum so that such Private Placement Memorandum, as amended or supplemented, shall not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and the Issuer shall make such supplement or amendment available to the Dealer. (c) In the event that (i) the Issuer gives the Dealer notice pursuant to Section 4.3(a) and (ii) the Dealer does not notify the Issuer that it is then holding Notes in inventory and (iii) the Issuer chooses not to promptly amend or supplement the Private Placement Memorandum in the manner described in clause (b) above, then all solicitations and sales of Notes shall be suspended until such time as the Issuer has so amended or supplemented the Private Placement Memorandum, and made such amendment or supplement available to the Dealer. 256 Section 5. Indemnification and Contribution 5.1 The Issuer will indemnify and hold harmless the Dealer, each individual, corporation, partnership, trust, association or other entity controlling the Dealer, within the meaning of Section 15 of the Securities Act (hereinafter the "Indemnitees") against any and all liabilities, penalties, suits, causes of action, losses, damages, claims, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) or judgments of whatever kind or nature (each a "Claim"), imposed upon, incurred by or asserted against the Indemnitees arising out of or based upon (i) any allegation that the Private Placement Memorandum, the Company Information or any information provided by the Issuer to the Dealer included (as of any relevant time of offer and sale of the Notes by the Issuer) or includes an untrue statement of a material fact or omitted (as of any relevant time of offer and sale of the Notes by the Issuer) or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or (ii) arising out of or based upon the breach by the Issuer of any agreement, covenant or representation made in or pursuant to this Agreement; provided, however, that the foregoing indemnity shall not extend to any Claims to the extent they arise out of or are based upon (A) the gross negligence or willful misconduct of the Dealer in the performance or failure to perform its obligations hereunder, or (B) an untrue statement by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes or an omission by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes necessary to make any statement, in light of the circumstances in which such statement was made, not misleading if such statement or omission relates to the Dealer in its capacity as dealer of the Notes or such statement or omission relates to other matters and has not been approved by the Issuer (whether through approval of the Private Placement Memorandum or otherwise). 5.2 Provisions relating to claims made for indemnification under this Section 5 are set forth on Exhibit B to this Agreement. 5.3 In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in clause (i) of Section 5.1 is held to be unavailable or insufficient to hold harmless the Indemnitees, although applicable in accordance with the terms of this Section 5, the Issuer shall contribute to the aggregate costs incurred by the Dealer in connection with any Claim in the proportion of the respective economic interests of the Issuer and the Dealer; provided, however, that such contribution by the Issuer shall be in an amount such that the aggregate costs incurred by the Dealer do not exceed the aggregate of the commissions and fees earned by the Dealer hereunder with respect to the issue or issues of Notes to which such Claim relates. The respective economic interests shall be calculated by reference to the aggregate proceeds to the Issuer of the Notes issued hereunder and the aggregate commissions and fees earned by the Dealer hereunder. 257 Section 6. Definitions 6.1 "Claim" shall have the meaning set forth in Section 5.1. 6.2 "Company Information" at any given time shall mean the Private Placement Memorandum together with, to the extent applicable, (i) the Issuer's most recent report on Form 10-K filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most recent Form 10-K, (ii) the Issuer's most recent annual audited financial statements and each interim financial statement or report prepared subsequent thereto, if not included in item (i) above, (iii) the Issuer's and its affiliates' other publicly available recent reports, including, but not limited to, any publicly available filings or reports provided to their respective shareholders, (iv) any other information or disclosure prepared pursuant to Section 4.3 hereof and (v) any information prepared or approved by the Issuer for dissemination to investors or potential investors in the Notes. 6.3 "Dealer" shall mean Merrill Lynch Money Markets Inc. for Notes with maturities up to 270 days and Merrill Lynch, Pierce, Fenner & Smith Incorporated for Notes with maturities over 270 days to 364 days. 6.4 "Dealer Information" shall mean material concerning the Dealer and provided by the Dealer in writing expressly for inclusion in the Private Placement Memorandum. 6.5 "DTC" shall mean The Depository Trust Company. 6.6 "Exchange Act" shall mean the U.S. Securities Exchange Act of 1934, as amended. 6.7 "Indemnitee" shall have the meaning set forth in Section 5.1. 6.8 "Institutional Accredited Investor" shall mean an institutional investor that is an accredited investor within the meaning of Rule 501 under the Securities Act and that has such knowledge and experience in financial and business matters that it is capable of evaluating and bearing the economic risk of an investment in the Notes, including, but not limited to, a bank, as defined in Section 3(a)(2) of the Securities Act, or a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity. 6.9 "Issuing and Paying Agency Agreement" shall mean the issuing and paying agency agreement described on the cover page of this Agreement, as such agreement may be amended or supplemented from time to time. 6.10 "Issuing and Paying Agent" shall mean the party designated as such on the cover page of this Agreement, as issuing and paying agent under the Issuing and Paying Agency Agreement. 6.11 "Non-bank fiduciary or agent" shall mean a fiduciary or agent other than (a) a bank, as defined in Section 3(a)(2) of the Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A) of the Securities Act. 258 6.12 "Private Placement Memorandum" shall mean offering materials prepared in accordance with Section 4 (including materials referred to therein or incorporated by reference therein) provided to purchasers and prospective purchasers of the Notes, and shall include amendments and supplements thereto which may be prepared from time to time in accordance with this Agreement (other than any amendment or supplement that has been completely superseded by a later amendment or supplement). 6.13 "Qualified Institutional Buyer" shall have the meaning assigned to that term in Rule 144A under the Securities Act. 6.14 "Rule 144A" shall mean Rule 144A under the Securities Act. 6.15 "SEC" shall mean the U.S. Securities and Exchange Commission. 6.16 "Securities Act" shall mean the U.S. Securities Act of 1933, as amended. 6.17 "Sophisticated Individual Accredited Investor" shall mean an individual who (a) is an accredited investor within the meaning of Regulation D under the Securities Act and (b) based on his or her pre- existing relationship with the Dealer, is reasonably believed by the Dealer to be a sophisticated investor (i) possessing such knowledge and experience (or represented by a fiduciary or agent possessing such knowledge and experience) in financial and business matters that he or she is capable of evaluating and bearing the economic risk of an investment in the Notes and (ii) having a net worth of at least $5 million. Section 7. General 7.1 Unless otherwise expressly provided herein, all notices under this Agreement to parties hereto shall be in writing and shall be effective when received at the address of the respective party set forth in the Addendum to this Agreement. 7.2 This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws provisions. 7.3 EACH OF THE DEALER AND THE ISSUER WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 7.4 This Agreement may be terminated, at any time, by the Issuer, upon one business day's prior notice to such effect to the Dealer, or by the Dealer upon one business day's prior notice to such effect to the Issuer. Any such termination, however, shall not affect the obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations, warranties, agreements, covenants, rights or responsibilities of the parties made or arising prior to the termination of this Agreement. 259 7.5 This Agreement is not assignable by either party hereto without the written consent of the other party; provided, however, that the Dealer may assign its rights and obligations under this Agreement to any wholly- owned direct or indirect subsidiary of the Dealer or of its ultimate parent. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto and their respective permitted assigns. 7.6 This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 7.7 This Agreement constitutes the entire agreement between the parties hereto and supercedes any prior understandings, agreements or representations by or between the parties hereto, written or oral, to the extent they relate to the subject matter hereof. 7.7 Any payments to the Dealer hereunder, whether pursuant to Sections 3.6, 5.1 or otherwise, shall be in US dollars and shall be free of all withholding, stamp and other similar taxes and of all other governmental charges of any nature whatsoever. In the event any withholding is required by law, the Issuer agrees to (i) pay the same and (ii) pay such additional amounts to the Dealer which, after deduction of any such withholding, stamp or other taxes or governmental charges of any nature whatsoever imposed with respect to the payment of such additional amount, shall equal the amount withheld pursuant to clause (i). 260 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date and year first above written. TYSON FOODS, INC., as Issuer By: Name: Title: Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days By: Name: Title: Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days By: Name: Title: 261 ADDENDUM 1. The other dealers referred to in clause (b) of Section 1.2 of the Agreement are: Banc of America Securities LLC J.P. Morgan Securities Inc. Chase Securities Inc. Credit Suisse first Boston Corporation SunTrust Equitable Securities Corp. 2. The addresses of the respective parties for purposes of notices under Section 7.1 are as follows: For the Issuer: Address: 2210 West Oakland Drive Springdale, Arkansas 72762-6999 Attention: General Counsel Telephone number: (501) 290-4000 Fax number: (501) 290-6776 For the Dealer: Address: Merrill Lynch Money Markets Inc. 4 World Financial Center North Tower, 11th Floor New York, New York 10080 Attention: Carter Harris Telephone number: (212) 449-0348 Fax number: (212) 449-0599 262 EXHIBIT A FORM OF LEGEND FOR PRIVATE PLACEMENT MEMORANDUM AND NOTES THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER AND THE NOTES, THAT IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND THAT IT IS EITHER (A) AN INSTITUTIONAL INVESTOR OR HIGHLY SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL, (i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE NOTES AND (ii) HAS A NET WORTH OF AT LEAST $5 MILLION (AN "INSTITUTIONAL ACCREDITED INVESTOR" OR "SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR", RESPECTIVELY) AND THAT EITHER IS PURCHASING NOTES FOR ITS OWN ACCOUNT, IS A U.S. BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR IS A FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN) PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH IS SUCH AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR (i) WHICH ITSELF POSSESSES SUCH KNOWLEDGE AND EXPERIENCE OR (ii) WITH RESPECT TO WHICH SUCH PURCHASER HAS SOLE INVESTMENT DISCRETION; OR (B) A QUALIFIED INSTITUTIONAL BUYER ("QIB") WITHIN THE MEANING OF RULE 144A UNDER THE ACT WHICH IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH IS A QIB AND WITH RESPECT TO EACH OF WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO MERRILL LYNCH MONEY MARKETS INC., MERRILL LYNCH, PIERCE, FENNER & SMITH, INCORPORATED OR ANOTHER PERSON DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES (COLLECTIVELY, THE "PLACEMENT AGENTS"), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR OR A QIB BY A PLACEMENT AGENT, OR (3) TO A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000. 263 EXHIBIT B FURTHER PROVISIONS RELATING TO INDEMNIFICATION (a) The Issuer agrees to reimburse each Indemnitee for all expenses (including reasonable fees and disbursements of internal and external counsel) as they are incurred by it in connection with investigating or defending any loss, claim, damage, liability or action in respect of which indemnification may be sought under clause (i) of Section 5.1 of the Agreement (whether or not it is a party to any such proceedings). (b) Promptly after receipt by an Indemnitee of notice of the existence of a Claim arising under clause (i) of Section 5.1 of the Agreement, such Indemnitee will, if a claim in respect thereof is to be made against the Issuer, notify the Issuer in writing of the existence thereof; provided that (i) the omission so to notify the Issuer will not relieve it from any liability which it may have hereunder unless and except to the extent it did not otherwise learn of such Claim and the issuer is materially prejudiced thereby, and (ii) the omission so to notify the Issuer will not relieve it from liability which it may have to an Indemnitee otherwise than on account of this indemnity agreement. In case any such Claim is made against any Indemnitee and it notifies the Issuer of the existence thereof, the Issuer will be entitled to participate therein, and to the extent that it may elect by written notice delivered to the Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee; provided that if the defendants in any such Claim include both the Indemnitee and the Issuer and the Indemnitee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, the Issuer shall not have the right to direct the defense of such Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to select separate counsel to assert such legal defenses on behalf of such Indemnitee. Upon receipt of notice from the Issuer to such Indemnitee of the Issuer's election so to assume the defense of such Claim and approval by the Indemnitee of counsel, the Issuer will not be liable to such Indemnitee for expenses incurred thereafter by the Indemnitee in connection with the defense thereof (other than reasonable costs of investigation) unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next preceding sentence (it being understood, however, that the Issuer shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel in the jurisdiction in which any Claim is brought), approved by the Dealer, representing the Indemnitee who is party to such Claim), (ii) the Issuer shall not have employed counsel reasonably satisfactory to the Indemnitee to represent the Indemnitee within a reasonable time after notice of existence of the Claim or (iii) the Issuer has authorized in writing the employment of counsel for the Indemnitee. The indemnity, reimbursement and contribution obligations of the Issuer hereunder shall be in addition to any other liability the Issuer may otherwise have to an Indemnitee and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer and any Indemnitee. The Issuer agrees that without the Dealer's prior written consent, it will not settle, compromise or consent to the entry of any judgment in any Claim in respect of which indemnification may be sought 264 under the indemnification provision of the Agreement (whether or not the Dealer or any other Indemnitee is an actual or potential party to such Claim), unless such settlement, compromise or consent includes an unconditional release of each Indemnitee from all liability arising out of such Claim. 265 MODEL OPINION OF COUNSEL TO ISSUER [Date] [Name and Address of Dealer] Ladies and Gentlemen: We have acted as special counsel to Tyson Foods, Inc., a Delaware corporation (the "Company"), in connection with the proposed offering and sale by the Company in the United States of commercial paper in the form of short-term promissory notes (the "Notes") in the manner contemplated by the Commercial Paper Dealer Agreement dated as of January 12, 2001 by and between the Company and you (the "Agreement"). We are delivering this letter to you in order to satisfy the condition set forth in Section 3.5 of the Dealer Agreement. Each term used but not defined in this letter has the meaning ascribed to it in the Dealer Agreement. In our capacity as such counsel, we have examined a specimen form of Note, an executed copy of the Agreement, and the Issuing and Paying Agency Agreement dated January 12, 2001 (the "Issuing and Paying Agency Agreement") between the Company and The Chase Manhattan Bank, N.A., as issuing and paying agent (the "Issuing and Paying Agent") as well as originals, or copies certified or otherwise identified to our satisfaction, of such other records and documents as we have deemed necessary as a basis for the opinions expressed below. For purposes of this opinion, we have, with your permission, assumed without independent investigation or inquiry that: (i) all signatures of the parties on the Dealer Agreement and the Issuing and Paying Agency Agreement (other than the Company) that we examined are genuine, the agreement submitted to us as originals are authentic, and the agreements submitted to us as copies conform to the original agreements executed by the parties thereto; and (ii) the Dealer Agreement and the Issuing and Paying Agency Agreement have been duly and validly authorized, executed, delivered and accepted by all parties thereto (other than the Company) and all parties thereto (other than the Company) have all requisite power and authority to make and enter into the agreements and perform their obligations thereunder pursuant to the laws of all relevant jurisdictions. Based upon the foregoing, it is our opinion that: 1. The Company is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, the Agreement and the Issuing and Paying Agency Agreement. 266 2. Each of the Agreement and the Issuing and Paying Agency Agreement has been duly authorized, executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law), and except as rights under the Agreement to indemnity and contribution may be limited by federal or state laws. 3. The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and except as rights to indemnity and contribution may be limited by federal or state laws. 4. The issuance and sale of Notes under the circumstances contemplated by the Agreement and the Issuing and Paying Agency Agreement do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and do not require compliance with any provision of the Trust Indenture Act of 1939, as amended. 5. No consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the Securities and Exchange Commission, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, the Agreement, the Notes, or the Issuing and Paying Agency Agreement, except as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes. 6. Neither the execution and delivery of the Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions of either thereof by the Company, will violate or result in an event of default under any of the terms of the Company's charter documents or by-laws, any contract or instrument known to us to which the Company is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality known to us, to which the Company is subject or by which it or its property is bound. 7. Except as disclosed in reports and other information filed by the Company with the Securities and Exchange Commission, to our knowledge there is no litigation or governmental proceeding pending or threatened against the Company which in any way may prevent or interfere with or materially and adversely affect the Company's executing and delivering the Agreement, the Issuing and Paying Agency Agreement or the Notes, or materially and adversely affecting the Company carrying out its obligations thereunder. 267 8. The Company is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. The opinions hereinafter expressed are subject to the following qualifications and limitations: (a) The opinions set forth herein are subject to the qualification that we are members of the bar of the State of Arkansas only and we express no opinion as to the laws of any jurisdiction other than the United States of America, the State of Arkansas and the General Corporate Laws of the State of Delaware. We call your attention to the fact that each of the Dealer Agreement and the Issuing and Paying Agency Agreement, as well as the Notes issued thereunder, provides that it is to be governed and construed in accordance with the laws of the State of New York. For purposes of our opinions expressed above, we have assumed, with your approval, that the Dealer Agreement, the Issuing and Paying Agency Agreement and the Notes would be governed by and construed in accordance with the domestic substantive laws of the State of Arkansas without giving effect to any choice or conflict of laws rule or provision that would cause the application of the domestic substantive laws of any other jurisdiction. (b) This opinion is limited to pertinent laws in effect as of the date hereof, and we expressly disclaim any undertaking to advise you of any changes of law or fact that may thereafter come to our attention. (c) Our opinion is limited to the matters stated herein and no opinion is to be implied or may be inferred beyond those matters expressly stated. (d) This opinion is furnished by us solely for your benefit as a dealer of the Notes pursuant to the Dealer Agreement, and it may not be relied upon, quoted from or delivered to any person; provided, however, that The Chase Manhattan Bank, N.A. may rely upon this opinion in its capacity as Issuing and Paying Agent for the Notes, each of Moody's Investors Service, Inc. and Standard & Poor's Ratings Group may rely on this opinion in connection with its issuance of an investment rating for the Notes, and a copy of this opinion may be delivered to any purchaser of the Notes. The liability of this firm is limited to the fullest extent possible under Ark. Code Ann. Section 16-114-303. (e) The phrases "known to us" or "to our knowledge" as used in this letter means the actual knowledge of those attorneys of our firm who have represented the Company in connection with any offering or placement of securities or who have principal responsibility for representing the Company, and do not include constructive knowledge or knowledge imputed to our firm under common law principles of agency or otherwise. Except as expressly set forth herein, we have not undertaken any investigation to determine the existence or absence of any facts and no inference as to our knowledge concerning any facts should be drawn from the fact that such representation has been undertaken by us. 268 (f) For purposes of the factual matters material to the opinions expressed herein, we have, with your consent, relied upon the compliance with the covenants and the correctness of the representations contained in the Dealer Agreement and the Issuing and Paying Agency Agreement. Without limiting the foregoing, for purposes of the opinions expressed in paragraphs 4 and 5 above, we have assumed that the Company will timely file with the Securities and Exchange Commission notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. (g) Our opinions are rendered as of the date hereof and do not cover the effect of any amendment or supplement to the Dealer Agreement or the Issuing and Paying Agency Agreement or the validity or enforceability of any amendment or supplement thereto, including without limitation any modifications, extensions, waivers or releases or the effect or applicability of federal or state tax laws on or to the transactions contemplated thereby. (h) We have made no examination or investigation to verify the accuracy or completeness of any financial, accounting, or statistical information furnished to you or with respect to any other accounting and financial matters and express no opinion with respect thereto. (i) We call your attention to the fact that the awarding of attorney's fees and expenses is discretionary under Arkansas law. We cannot opine that attorney's fees and expenses will be awarded in any particular amount. (j) Our opinions are subject to, and we express no opinion on, state or federal law relating to usury or fraudulent conveyances. (k) The opinions expressed above are (i) given to you solely for your benefit and the benefit of your successors and transferees, (ii) not binding on any court and (iii) may not be quoted in whole or in part or otherwise referred to in any legal opinion, document, or other report to be furnished to another person or entity without our prior written consent. Very truly yours, 269 Model Certificate as to Resolutions1 [Name of Issuer] I, R. Read Hudson, the Secretary of Tyson Foods, Inc., a Delaware corporation (the "Issuer"), do hereby certify, in connection with the issuance and sale of short-term promissory notes under the Commercial Paper Dealer Agreement dated January 12, 2001 (the "Agreement", the terms defined therein being used herein as therein defined) between the Issuer and Merrill Lynch Money Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated (collectively, the "Dealer"), that: 1. The following resolution was duly adopted by the Board of Directors of the Issuer at a meeting thereof duly called and held on January 12, 2001, at which meeting a quorum was present and acting throughout, and such resolution has not been amended, modified or revoked and is in full force and effect on the date hereof: RESOLVED, that the Chairman of the Board, President, Chief Executive Officer, any Executive Vice President, any Senior Vice President, Controller or Chief Accounting Officer or Treasurer, either alone or with joinder of the Secretary or an Assistant Secretary, of the Corporation (the "Authorized Officers") be, and each of them hereby is, authorized to: (i) borrow under the Commercial Paper Program; (ii) execute such commercial paper notes in the name and on behalf of the Corporation; (iii) execute and deliver (A) Commercial Paper Dealer Agreements between the Corporation and each of the dealers selected by any Authorized Officer (each a "Dealer"), providing, among other things, for the sale of commercial paper notes on behalf of the Corporation and the indemnification of the Dealer in connection therewith and (B) an Issuing and Paying Agency Agreement between the Corporation and J.P. Morgan Chase & Co., or any of its affiliates, as issuing and paying agent; (iv) delegate to any other officers or employees of the Corporation authority to give instructions to the Dealer pursuant to the applicable Commercial Paper Dealer Agreement; and (v) do such acts and execute such other instruments and documents as may be necessary and proper to effect the transactions contemplated hereby including (A) amending documents referred to herein and (B) appointing additional dealers and successors to any of the parties named. 2. Each of the Agreement and the Issuing and Paying Agency Agreement, as executed and delivered by the Issuer, is substantially in the form thereof approved by the Board of Directors and referred to in the resolution set forth in paragraph 1 hereof. IN WITNESS WHEREOF, I have signed this certificate the 12th day of January, 2001 ________________________ Secretary _______________________________ 1This model certificate will serve as a guide for resolutions adopted by the Issuer. Any resolutions actually adopted, regardless of form, should cover all the substantive matters covered in this model, and a certificate substantially to the effect of this model is required to be delivered to the Dealer under Section 3.6(c) of the Agreement. 270 EX-10.6 8 0008.txt COMMERCIAL PAPER DEALER AGREEMENT COMMERCIAL PAPER DEALER AGREEMENT 4(2) PROGRAM between TYSON FOODS, INC., as Issuer and SunTrust Equitable Securities Corporation, as Dealer Concerning Notes to be issued pursuant to an Issuing and Paying Agency Agreement dated as of January 12, 2001 between the Issuer and The Chase Manhattan Bank, as Issuing and Paying Agent Dated As of January 12, 2001 271 COMMERCIAL PAPER DEALER AGREEMENT 4(2) Program This agreement ("Agreement") sets forth the understandings between the Issuer and the Dealer in connection with the issuance and sale by the Issuer of its short-term promissory notes through the Dealer (the "Notes"). Certain terms used in this Agreement are defined in Section 6 hereof. The Addendum to this Agreement, and any Annexes or Exhibits described in this Agreement or such Addendum, are hereby incorporated into this Agreement and made fully a part hereof. Section 1. Offers, Sales and Resales of Notes 1.1 While (i) the Issuer has and shall have no obligation to sell the Notes to the Dealer or to permit the Dealer to arrange any sale of the Notes for the account of the Issuer, and (ii) the Dealer has and shall have no obligation to purchase the Notes from the Issuer or to arrange any sale of the Notes for the account of the Issuer, the parties hereto agree that in any case where the Dealer purchases Notes from the Issuer, or arranges for the sale of Notes by the Issuer, such Notes will be purchased or sold by the Dealer in reliance on the representations, warranties, covenants and agreements of the Issuer contained herein or made pursuant hereto and on the terms and conditions and in the manner provided herein. 1.2 So long as this Agreement shall remain in effect, and in addition to the limitations contained in Section 1.7 hereof, the Issuer shall not, without the consent of the Dealer, offer, solicit or accept offers to purchase, or sell, any Notes except (a) in transactions with one or more dealers which may from time to time after the date hereof become dealers with respect to the Notes by executing with the Issuer one or more agreements which contain provisions substantially identical to Section 1 of this Agreement, of which the Issuer hereby undertakes to provide the Dealer prompt notice or (b) in transactions with the other dealers listed on the Addendum hereto, which are executing agreements with the Issuer which contain provisions substantially identical to Section 1 of this Agreement contemporaneously herewith. In no event shall the Issuer offer, solicit or accept offers to purchase, or sell, any Notes directly on its own behalf in transactions with persons other than broker-dealers as specifically permitted in this Section 1.2. 1.3 The Notes shall be in a minimum denomination or minimum amount, whichever is applicable, of $250,000 or integral multiples of $1,000 in excess thereof, will bear such interest rates, if interest bearing, or will be sold at such discount from their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a maturity not exceeding 365 days from the date of issuance (exclusive of days of grace) and shall not contain any provision for extension, renewal or automatic "rollover." 1.4 The authentication, delivery and payment of the Notes shall be effected in accordance with the Issuing and Paying Agency Agreement and the Notes shall be either individual bearer physical certificates or represented by book-entry Notes registered in the name of DTC or its nominee in the form or forms annexed to the Issuing and Paying Agency Agreement. 272 1.5 If the Issuer and the Dealer shall agree on the terms of the purchase of any Note by the Dealer or the sale of any Note arranged by the Dealer (including, but not limited to, agreement with respect to the date of issue, purchase price, principal amount, maturity and interest rate (in the case of interest-bearing Notes) or discount thereof (in the case of Notes issued on a discount basis), and appropriate compensation for the Dealer's services hereunder) pursuant to this Agreement, the Issuer shall cause such Note to be issued and delivered in accordance with the terms of the Issuing and Paying Agency Agreement and payment for such Note shall be made by the purchaser thereof, either directly or through the Dealer, to the Issuer. Except as otherwise agreed, in the event that the Dealer is acting as an agent and a purchaser shall either fail to accept delivery of or make payment for a Note on the date fixed for settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has theretofore paid the Issuer for the Note, the Issuer will promptly return such funds to the Dealer against its return of the Note to the Issuer, in the case of a certificated Note, and upon notice of such failure in the case of a book- entry Note. 1.6 The Dealer and the Issuer hereby establish and agree to observe the following procedures in connection with offers, sales and subsequent resales or other transfers of the Notes: (a) Offers and sales of the Notes shall be made only to investors reasonably believed by the Dealer to be: (i) Institutional Accredited Investors or Sophisticated Individual Accredited Investors, (ii) non-bank fiduciaries or agents that will be purchasing Notes for one or more accounts, each of which is an Institutional Accredited Investor or Sophisticated Individual Accredited Investor, and (iii) Qualified Institutional Buyers. (b) Resales and other transfers of the Notes by or through the Dealer or by other holders thereof shall be made only in accordance with the restrictions in the legends described in clause (e) below. (c) No general solicitation or general advertising shall be used in connection with the offering of the Notes. Without limiting the generality of the foregoing, without the prior written approval of Dealer, the Issuer shall not issue any press release or place or publish any "tombstone" or other advertisement relating to the Notes. (d) No sale of Notes to any one purchaser shall be for less than $250,000 principal or face amount, and no Note shall be issued in a smaller principal or face amount. If the purchaser is a non-bank fiduciary acting on behalf of others, each person for whom such purchaser is acting must purchase at least $250,000 principal or face amount of Notes. (e) Offers and sales of the Notes by the Issuer through the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506 under the Securities Act, and shall be subject to the restrictions described in the legend appearing on Exhibit A hereto. A legend substantially to the effect of such Exhibit A shall appear as part of the Private Placement Memorandum used in connection with offers and sales of Notes hereunder, as well as on each Note offered and sold pursuant to this Agreement. 273 (f) Dealer shall furnish or shall have furnished to each purchaser of Notes being sold to an ultimate purchaser for the first time a copy of the then-current Private Placement Memorandum unless such purchaser has previously received a copy of the Private Placement Memorandum as then in effect. The Private Placement Memorandum shall expressly state that any person to whom Notes are offered shall have an opportunity to ask questions of, and receive information from, the Issuer and the Dealer and shall provide the names, addresses and telephone numbers of the persons from whom information regarding the Issuer may be obtained. (g) The Issuer agrees, for the benefit of the Dealer and each of the holders and prospective purchasers from time to time of the Notes that, if at any time the Issuer shall not be subject to Section 13 or 15(d) of the Exchange Act, the Issuer will furnish, upon request and at its expense, to the Dealer and to holders and prospective purchasers of Notes information required by Rule 144A(d)(4)(i) in compliance with Rule 144A(d). (h) In the event that any Note offered or to be offered by Dealer would be ineligible for resale under Rule 144A, the Issuer shall immediately notify Dealer (by telephone, confirmed in writing) of such fact and shall promptly prepare and deliver to Dealer an amendment or supplement to the Private Placement Memorandum describing the Notes that are ineligible, the reason for such ineligibility and any other relevant information relating thereto. (i) The Issuer represents that it has outstanding issuances of commercial paper in the United States market in reliance upon, and in compliance with, the exemption provided by Section 3(a)(3) of the Securities Act. In that connection, the Issuer agrees that (a) the proceeds from the sale of the Notes will be segregated from the proceeds of the sale of any such commercial paper by being placed in a separate account; (b) the Issuer will institute appropriate corporate procedures to ensure that the offers and sales of notes issued by the Issuer pursuant to the Section 3(a)(3) exemption are not integrated with offerings and sales of Notes hereunder; and (c) the Issuer will comply with each of the requirements of Section 3(a)(3) of the Act in selling commercial paper or other short-term debt securities other than the Notes in the United States. 1.7 The Issuer hereby represents and warrants to the Dealer, in connection with offers, sales and resales of Notes, as follows: (a) Issuer hereby confirms to the Dealer that (except as permitted by Section 1.6(i)) within the preceding six months neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof acting on behalf of the Issuer has offered or sold any Notes, or any substantially similar security of the Issuer (including, without limitation, medium-term notes issued by the Issuer), to, or solicited offers to buy any such security from, any person other than the Dealer or the other dealers referred to in Section 1.2 hereof. The Issuer also agrees that, as long as the Notes are being offered for sale by the Dealer and the other dealers referred to in Section 1.2 hereof as contemplated hereby and until at least six months after the offer of Notes hereunder has been terminated, neither 274 the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof (except as contemplated by Section 1.2 hereof) will offer the Notes or any substantially similar security of the Issuer for sale to, or solicit offers to buy any such security from, any person other than the Dealer and the other dealers referred to in Section 1.2 hereof (except to the extent any of the foregoing would not cause the offer and sale of the Notes by the Issuer to be integrated with other offers and sales so as no longer to come within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder), it being understood that such agreement is made with a view to bringing the offer and sale of the Notes within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder and shall survive any termination of this Agreement. The Issuer hereby represents and warrants that it has not taken or omitted to take, and will not take or omit to take, any action that would cause the offering and sale of Notes hereunder to be integrated with any other offering of securities, whether such offering is made by the Issuer or some other party or parties, under circumstances that would cause the offering and sale of the Notes by the Issuer to fail to be exempt under Section 4(2) of the Securities Act. (b) Except as described in Section 1.7(c) below, the Issuer represents and agrees that the proceeds of the sale of the Notes are not currently contemplated to be used for the purpose of buying, carrying or trading securities within the meaning of Regulation T and the interpretations thereunder by the Board of Governors of the Federal Reserve System. Except as described in Section 1.7(c) below, in the event that the Issuer determines to use such proceeds for the purpose of buying, carrying or trading securities, whether in connection with an acquisition of another company or otherwise, the Issuer shall give the Dealer at least five business days' prior written notice to that effect. The Issuer shall also give the Dealer prompt notice of the actual date that it commences to purchase securities with the proceeds of the Notes. Thereafter, in the event that the Dealer purchases Notes as principal and does not resell such Notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. (c) The Dealer acknowledges that proceeds from the sale of Notes prior to the consummation of the merger of IBP, inc. ("IBP") into Lasso Acquisition Corporation ("Lasso"), a wholly-owned subsidiary of the Issuer, pursuant to an Agreement and Plan of Merger dated as of January 1, 2001 among the Issuer, Lasso and IBP, as amended from time to time (the "Merger Agreement") are contemplated to be used, in part, for the purpose of purchasing shares of common stock of IBP pursuant to the terms of the offer to purchase up to 50.1% of the common stock of IBP contemplated by the Merger Agreement. In the event the Dealer purchases Notes as principal and does not resell such notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. 275 Section 2. Additional Representations and Warranties of Issuer The Issuer represents and warrants that: 2.1 The Issuer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, this Agreement and the Issuing and Paying Agency Agreement. 2.2 This Agreement and the Issuing and Paying Agency Agreement have been duly authorized, executed and delivered by the Issuer and constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.3 The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.4 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, the offer and sale of Notes in the manner contemplated hereby do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and no indenture in respect of the Notes is required to be qualified under the Trust Indenture Act of 1939, as amended. 2.5 The Notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness of the Issuer. 2.6 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, no consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including, without limitation, the SEC, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, this Agreement, the Notes or the Issuing and Paying Agency Agreement, except (i)as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes, and (ii) for the requirement that the Issuer file with the SEC a notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require, which the Issuer agrees to do. 276 2.7 Neither the execution and delivery of this Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions hereof or thereof by the Issuer, will (i) result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Issuer, or (ii) violate or result in a breach or an event of default under any of the terms of the Issuer's charter documents or by-laws, any contract or instrument to which the Issuer is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality, to which the Issuer is subject or by which it or its property is bound, which breach or event of default could reasonably be expected to have a material adverse effect on the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.8 There is no litigation or governmental proceeding pending, or to the knowledge of the Issuer threatened, against or affecting the Issuer or any of its subsidiaries which could reasonably be expected to have a material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.9 The Issuer is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. 2.10 Neither the Private Placement Memorandum nor the Company Information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, provided, that the Issuer make no representation or warranty as to the Dealer Information. 2.11 Each (a) issuance of Notes by the Issuer hereunder and (b) amendment or supplement of the Private Placement Memorandum shall be deemed a representation and warranty by the Issuer to the Dealer, as of the date thereof, that, both before and after giving effect to such issuance and after giving effect to such amendment or supplement, (i) the representations and warranties given by the Issuer set forth above in this Section 2 remain true and correct on and as of such date as if made on and as of such date, (ii) in the case of an issuance of Notes, the Notes being issued on such date have been duly and validly issued and constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations on rights to indemnity and contribution imposed by applicable law, and (iii) in the case of an issuance of Notes, since the date of the most recent Private Placement Memorandum, there has been no material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole which has not been disclosed to the Dealer in writing. 277 Section 3. Covenants and Agreements of Issuer The Issuer covenants and agrees that: 3.1 The Issuer will give the Dealer prompt notice (but in any event prior to any subsequent issuance of Notes hereunder) of any amendment to, modification of, or waiver with respect to, the Notes or the Issuing and Paying Agency Agreement, including a complete copy of any such amendment, modification or waiver. 3.2 The Issuer shall, whenever there shall occur any event that could reasonably be expected to have a material adverse effect on the financial condition or results of operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement or the Notes, notify the Dealer (by telephone, confirmed in writing) of such event prior to any subsequent issuances of Notes hereunder. The Issuer shall, whenever it receives notice of any downgrading or intended downgrading or any review for potential change in the rating accorded any of the Issuer's securities by any nationally recognized statistical rating organization which has published a rating of the Notes, promptly, and in any event prior to any subsequent issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in writing) of such occurrence. 3.3 The Issuer shall from time to time upon the request of the Dealer furnish to the Dealer copies of all materials provided by the Issuer to any national securities exchange regarding (i) the Issuer's operations and financial condition, and (ii) the Issuer's ability to pay the Notes as they mature. 3.4 The Issuer will take all such action as the Dealer may reasonably request to ensure that each offer and each sale of the Notes will comply with any applicable state Blue Sky laws; provided, that the Issuer shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. 3.5 The Issuer shall not issue Notes hereunder until the Dealer shall have received (a) an opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance to the Dealer, (b) a copy of the executed Issuing and Paying Agency Agreement as then in effect, (c) a copy of resolutions adopted by the Board of Directors of the Issuer, satisfactory in form and substance to the Dealer and certified by the Secretary or similar officer of the Issuer, authorizing execution and delivery by the Issuer of this Agreement the Issuing and Paying Agency Agreement and the Notes and consummation by the Issuer of the transactions contemplated hereby and thereby, (d) prior to the issuance of any Notes represented by a book-entry note registered in the name of DTC or its nominee, a copy of the executed Letter of Representations among the Issuer, the Issuing and Paying Agent and DTC, and (e) such other certificates, opinions, letters and documents as the Dealer shall have reasonably requested. 278 3.6 The Issuer shall reimburse the Dealer for all of the Dealer's reasonable out-of-pocket expenses related to this Agreement, including expenses incurred in connection with its preparation and negotiation, and the transactions contemplated hereby (including, but not limited to, the printing and distribution of the Private Placement Memorandum), and, if applicable, for the reasonable fees and out-of-pocket expenses of the Dealer's counsel. 3.7 Without limiting any obligation of the Issuer pursuant to this Agreement to provide the Dealer with credit and financial information, the Issuer hereby acknowledges and agrees that the Dealer may share the Company Information and any other information or matters relating to the Issuer or the transactions contemplated hereby with affiliates of the Dealer, including, but not limited to, SunTrust Banks, Inc, and that such affiliates may likewise share information relating to the Issuer or such transactions with the Dealer. Section 4. Disclosure 4.1 The Private Placement Memorandum and its contents (other than the Dealer Information) shall be the sole responsibility of the Issuer. The Private Placement Memorandum shall contain a statement expressly offering an opportunity for each prospective purchaser to ask questions of, and receive answers from, the Issuer concerning the offering of Notes and to obtain relevant additional information which the Issuer possesses or can acquire without unreasonable effort or expense. 4.2 The Issuer agrees promptly to furnish the Dealer the Company Information as it becomes available. 4.3 (a) The Issuer further agrees to notify the Dealer promptly upon the occurrence of any event relating to or affecting the Issuer that would cause the Company Information then in existence to include an untrue statement of material fact or to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they are made, not misleading. (b) In the event that the Issuer gives the Dealer notice pursuant to Section 4.3(a) and the Dealer notifies the Issuer that it then has Notes it is holding in inventory, the Issuer agrees promptly to supplement or amend the Private Placement Memorandum so that such Private Placement Memorandum, as amended or supplemented, shall not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and the Issuer shall make such supplement or amendment available to the Dealer. (c) In the event that (i) the Issuer gives the Dealer notice pursuant to Section 4.3(a) and (ii) the Dealer does not notify the Issuer that it is then holding Notes in inventory and (iii) the Issuer chooses not to promptly amend or supplement the Private Placement Memorandum in the manner described in clause (b) above, then all solicitations and sales of Notes shall be suspended until such time as the Issuer has so amended or supplemented the Private Placement Memorandum, and made such amendment or supplement available to the Dealer. 279 Section 5. Indemnification and Contribution 5.1 The Issuer will indemnify and hold harmless the Dealer, and each individual, corporation, partnership, trust, association or other entity controlling the Dealer, within the meaning of Section 15 of the Securities Act (hereinafter the "Indemnitees") against any and all liabilities, penalties, suits, causes of action, losses, damages, claims, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) or judgments of whatever kind or nature (each a "Claim"), imposed upon, incurred by or asserted against the Indemnitees arising out of or based upon (i) any allegation that the Private Placement Memorandum, the Company Information or any information provided by the Issuer to the Dealer included (as of any relevant time of offer and sale of the Notes by the Issuer) or includes an untrue statement of a material fact or omitted (as of any relevant time of offer and sale of the Notes by the Issuer) or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or (ii) arising out of or based upon the breach by the Issuer of any agreement, covenant or representation made in or pursuant to this Agreement; provided, however, that the foregoing indemnity shall not extend to any Claims to the extent they arise out of or are based upon (A) the gross negligence or willful misconduct of the Dealer in the performance or failure to perform its obligations hereunder, or (B) an untrue statement by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes or an omission by an Indemnitee of a material fact made in connection with Dealer's sale or arrangement for sale of Notes necessary to make any statement, in light of the circumstances in which such statement was made, not misleading if such statement or omission relates to the Dealer in its capacity as dealer of the Notes or such statement or omission relates to other matters and has not been approved by the Issuer (whether through approval of the Private Placement Memorandum or otherwise). 5.2 Provisions relating to claims made for indemnification under this Section 5 are set forth on Exhibit B to this Agreement. 5.3 In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in clause (i) of Section 5.1 is held to be unavailable or insufficient to hold harmless the Indemnitees, although applicable in accordance with the terms of this Section 5, the Issuer shall contribute to the aggregate costs incurred by the Dealer in connection with any Claim in the proportion of the respective economic interests of the Issuer and the Dealer; provided, however, that such contribution by the Issuer shall be in an amount such that the aggregate costs incurred by the Dealer do not exceed the aggregate of the commissions and fees earned by the Dealer hereunder with respect to the issue or issues of Notes to which such Claim relates. The respective economic interests shall be calculated by reference to the aggregate proceeds to the Issuer of the Notes issued hereunder and the aggregate commissions and fees earned by the Dealer hereunder. 280 Section 6. Definitions 6.1 "Claim" shall have the meaning set forth in Section 5.1. 6.2 "Company Information" at any given time shall mean the Private Placement Memorandum together with, to the extent applicable, (i) the Issuer's most recent report on Form 10-K filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most recent Form 10-K, (ii) the Issuer's most recent annual audited financial statements and each interim financial statement or report prepared subsequent thereto, if not included in item (i) above, (iii) the Issuer's and its affiliates' other publicly available recent reports, including, but not limited to, any publicly available filings or reports provided to their respective shareholders, (iv) any other information or disclosure prepared pursuant to Section 4.3 hereof and (v) any information prepared or approved by the Issuer for dissemination to investors or potential investors in the Notes. 6.3 "Dealer" shall mean SunTrust Equitable Securities Corporation. 6.4 "Dealer Information" shall mean material concerning the Dealer and provided by the Dealer in writing expressly for inclusion in the Private Placement Memorandum. 6.5 "DTC" shall mean The Depository Trust Company. 6.6 "Exchange Act" shall mean the U.S. Securities Exchange Act of 1934, as amended. 6.7 "Indemnitee" shall have the meaning set forth in Section 5.1. 6.8 "Institutional Accredited Investor" shall mean an institutional investor that is an accredited investor within the meaning of Rule 501 under the Securities Act and that has such knowledge and experience in financial and business matters that it is capable of evaluating and bearing the economic risk of an investment in the Notes, including, but not limited to, a bank, as defined in Section 3(a)(2) of the Securities Act, or a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity. 6.9 "Issuing and Paying Agency Agreement" shall mean the issuing and paying agency agreement described on the cover page of this Agreement, as such agreement may be amended or supplemented from time to time. 6.10 "Issuing and Paying Agent" shall mean the party designated as such on the cover page of this Agreement, as issuing and paying agent under the Issuing and Paying Agency Agreement. 6.11 "Non-bank fiduciary or agent" shall mean a fiduciary or agent other than (a) a bank, as defined in Section 3(a)(2) of the Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A) of the Securities Act. 281 6.12 "Private Placement Memorandum" shall mean offering materials prepared in accordance with Section 4 (including materials referred to therein or incorporated by reference therein) provided to purchasers and prospective purchasers of the Notes, and shall include amendments and supplements thereto which may be prepared from time to time in accordance with this Agreement (other than any amendment or supplement that has been completely superseded by a later amendment or supplement). 6.13 "Qualified Institutional Buyer" shall have the meaning assigned to that term in Rule 144A under the Securities Act. 6.14 "Rule 144A" shall mean Rule 144A under the Securities Act. 6.15 "SEC" shall mean the U.S. Securities and Exchange Commission. 6.16 "Securities Act" shall mean the U.S. Securities Act of 1933, as amended. 6.17 "Sophisticated Individual Accredited Investor" shall mean an individual who (a) is an accredited investor within the meaning of Regulation D under the Securities Act and (b) based on his or her pre- existing relationship with the Dealer, is reasonably believed by the Dealer to be a sophisticated investor (i) possessing such knowledge and experience (or represented by a fiduciary or agent possessing such knowledge and experience) in financial and business matters that he or she is capable of evaluating and bearing the economic risk of an investment in the Notes and (ii) having a net worth of at least $5 million. Section 7. General 7.1 Unless otherwise expressly provided herein, all notices under this Agreement to parties hereto shall be in writing and shall be effective when received at the address of the respective party set forth in the Addendum to this Agreement. 7.2 This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws provisions. 7.3 EACH OF THE DEALER AND THE ISSUER WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 7.4 This Agreement may be terminated, at any time, by the Issuer, upon one business day's prior notice to such effect to the Dealer, or by the Dealer upon one business day's prior notice to such effect to the Issuer. Any such termination, however, shall not affect the obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations, warranties, agreements, covenants, rights or responsibilities of the parties made or arising prior to the termination of this Agreement, which shall survive such termination. 282 7.5 This Agreement is not assignable by either party hereto without the written consent of the other party; provided, however, that the Dealer may assign its rights and obligations under this Agreement to any wholly- owned direct or indirect subsidiary of the Dealer or of its ultimate parent without such consent. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto and their respective permitted assigns. 7.6 This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 7.7 This Agreement constitutes the entire agreement between the parties hereto and supercedes any prior understandings, agreements or representations by or between the parties hereto, written or oral, to the extent they relate to the subject matter hereof. 7.7 Any payments to the Dealer hereunder, whether pursuant to Sections 3.6, 5.1 or otherwise, shall be in US dollars and shall be free of all withholding, stamp and other similar taxes and of all other governmental charges of any nature whatsoever. In the event any withholding is required by law, the Issuer agrees to (i) pay the same and (ii) pay such additional amounts to the Dealer which, after deduction of any such withholding, stamp or other taxes or governmental charges of any nature whatsoever imposed with respect to the payment of such additional amount, shall equal the amount withheld pursuant to clause (i). 283 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date and year first above written. TYSON FOODS, INC., as Issuer By: Name: Title: SunTrust Equitable Securities Corporation, as Dealer By: Name: Title: 284 ADDENDUM 1. The other dealers referred to in clause (b) of Section 1.2 of the Agreement are: Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days Banc of America Securities LLC J.P. Morgan Securities Inc. Chase Securities Inc. Credit Suisse First Boston Corporation 2. The addresses of the respective parties for purposes of notices under Section 7.1 are as follows: For the Issuer: Address: 2210 West Oakland Drive Springdale, Arkansas 72762-6999 Attention: General Counsel Telephone number: (501) 290-4000 Fax number: (501) 290-6776 For the Dealer: Address: 303 Peachtree Street, 23rd floor Atlanta, Georgia 30308 Attention: Matt Vincent Telephone number: (404) 588-8445 Fax number: (404) 588-7005 285 EXHIBIT A FORM OF LEGEND FOR PRIVATE PLACEMENT MEMORANDUM AND NOTES THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER AND THE NOTES, THAT IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND THAT IT IS EITHER (A) AN INSTITUTIONAL INVESTOR OR HIGHLY SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL, (i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE NOTES AND (ii) HAS A NET WORTH OF AT LEAST $5 MILLION (AN "INSTITUTIONAL ACCREDITED INVESTOR" OR "SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR", RESPECTIVELY) AND THAT EITHER IS PURCHASING NOTES FOR ITS OWN ACCOUNT, IS A U.S. BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR IS A FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN) PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH IS SUCH AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR (i) WHICH ITSELF POSSESSES SUCH KNOWLEDGE AND EXPERIENCE OR (ii) WITH RESPECT TO WHICH SUCH PURCHASER HAS SOLE INVESTMENT DISCRETION; OR (B) A QUALIFIED INSTITUTIONAL BUYER ("QIB") WITHIN THE MEANING OF RULE 144A UNDER THE ACT WHICH IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH IS A QIB AND WITH RESPECT TO EACH OF WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO SUNTRUST EQUITABLE SECURITIES CORPORATION OR ANOTHER PERSON DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES (COLLECTIVELY, THE "PLACEMENT AGENTS"), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR OR A QIB BY A PLACEMENT AGENT, OR (3) TO A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000. 286 EXHIBIT B FURTHER PROVISIONS RELATING TO INDEMNIFICATION (a) The Issuer agrees to reimburse each Indemnitee for all expenses (including reasonable fees and disbursements of internal and external counsel) as they are incurred by it in connection with investigating or defending any loss, claim, damage, liability or action in respect of which indemnification may be sought under clause (i) of Section 5.1 of the Agreement (whether or not it is a party to any such proceedings). (b) Promptly after receipt by an Indemnitee of notice of the existence of a Claim arising under clause (i) of Section 5.1 of the Agreement, such Indemnitee will, if a claim in respect thereof is to be made against the Issuer, notify the Issuer in writing of the existence thereof; provided that (i) the omission so to notify the Issuer will not relieve it from any liability which it may have hereunder unless and except to the extent it did not otherwise learn of such Claim and the issuer is materially prejudiced thereby, and (ii) the omission so to notify the Issuer will not relieve it from liability which it may have to an Indemnitee otherwise than on account of this indemnity agreement. In case any such Claim is made against any Indemnitee and it notifies the Issuer of the existence thereof, the Issuer will be entitled to participate therein, and to the extent that it may elect by written notice delivered to the Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee; provided that if the defendants in any such Claim include both the Indemnitee and the Issuer and the Indemnitee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, the Issuer shall not have the right to direct the defense of such Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to select separate counsel to assert such legal defenses on behalf of such Indemnitee. Upon receipt of notice from the Issuer to such Indemnitee of the Issuer's election so to assume the defense of such Claim and approval by the Indemnitee of counsel, the Issuer will not be liable to such Indemnitee for expenses incurred thereafter by the Indemnitee in connection with the defense thereof (other than reasonable costs of investigation) unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next preceding sentence (it being understood, however, that the Issuer shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel in the jurisdiction in which any Claim is brought), approved by the Dealer, representing the Indemnitee who is party to such Claim), (ii) the Issuer shall not have employed counsel reasonably satisfactory to the Indemnitee to represent the Indemnitee within a reasonable time after notice of existence of the Claim or (iii) the Issuer has authorized in writing the employment of counsel for the Indemnitee. The indemnity, reimbursement and contribution obligations of the Issuer hereunder shall be in addition to any other liability the Issuer may otherwise have to an Indemnitee and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer and any Indemnitee. The Issuer agrees that without the Dealer's prior written consent, it will not settle, compromise or consent to the entry of any judgment in any Claim in respect of which indemnification may be sought under the indemnification provision of the Agreement (whether or not the 287 Dealer or any other Indemnitee is an actual or potential party to such Claim), unless such settlement, compromise or consent includes an unconditional release of each Indemnitee from all liability arising out of such Claim. 288 MODEL OPINION OF COUNSEL TO ISSUER [Date] [Name and Address of Dealer] Ladies and Gentlemen: We have acted as special counsel to Tyson Foods, Inc., a Delaware corporation (the "Company"), in connection with the proposed offering and sale by the Company in the United States of commercial paper in the form of short-term promissory notes (the "Notes") in the manner contemplated by the Commercial Paper Dealer Agreement dated as of January 12, 2001 by and between the Company and you (the "Agreement"). We are delivering this letter to you in order to satisfy the condition set forth in Section 3.5 of the Dealer Agreement. Each term used but not defined in this letter has the meaning ascribed to it in the Dealer Agreement. In our capacity as such counsel, we have examined a specimen form of Note, an executed copy of the Agreement, and the Issuing and Paying Agency Agreement dated January 12, 2001 (the "Issuing and Paying Agency Agreement") between the Company and The Chase Manhattan Bank, N.A., as issuing and paying agent (the "Issuing and Paying Agent") as well as originals, or copies certified or otherwise identified to our satisfaction, of such other records and documents as we have deemed necessary as a basis for the opinions expressed below. For purposes of this opinion, we have, with your permission, assumed without independent investigation or inquiry that: (i) all signatures of the parties on the Dealer Agreement and the Issuing and Paying Agency Agreement (other than the Company) that we examined are genuine, the agreement submitted to us as originals are authentic, and the agreements submitted to us as copies conform to the original agreements executed by the parties thereto; and (ii) the Dealer Agreement and the Issuing and Paying Agency Agreement have been duly and validly authorized, executed, delivered and accepted by all parties thereto (other than the Company) and all parties thereto (other than the Company) have all requisite power and authority to make and enter into the agreements and perform their obligations thereunder pursuant to the laws of all relevant jurisdictions. Based upon the foregoing, it is our opinion that: 1. The Company is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, the Agreement and the Issuing and Paying Agency Agreement. 289 2. Each of the Agreement and the Issuing and Paying Agency Agreement has been duly authorized, executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law), and except as rights under the Agreement to indemnity and contribution may be limited by federal or state laws. 3. The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and except as rights to indemnity and contribution may be limited by federal or state laws. 4. The issuance and sale of Notes under the circumstances contemplated by the Agreement and the Issuing and Paying Agency Agreement do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and do not require compliance with any provision of the Trust Indenture Act of 1939, as amended. 5. No consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including, without limitation, the Securities and Exchange Commission, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, the Agreement, the Notes, or the Issuing and Paying Agency Agreement, except as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes. 6. Neither the execution and delivery of the Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions of either thereof by the Company, will violate or result in an event of default under any of the terms of the Company's charter documents or by-laws, any contract or instrument known to us to which the Company is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality known to us, to which the Company is subject or by which it or its property is bound. 7. Except as disclosed in reports and other information filed by the Company with the Securities and Exchange Commission, to our knowledge there is no litigation or governmental proceeding pending or threatened against the Company which in any way may prevent or interfere with or materially and adversely affect the Company's executing and delivering the Agreement, the Issuing and Paying Agency Agreement or the Notes, or materially and adversely affecting the Company carrying out its obligations thereunder. 290 8. The Company is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. The opinions hereinafter expressed are subject to the following qualifications and limitations: (a) The opinions set forth herein are subject to the qualification that we are members of the bar of the State of Arkansas only and we express no opinion as to the laws of any jurisdiction other than the United States of America, the State of Arkansas and the General Corporate Laws of the State of Delaware. We call your attention to the fact that each of the Dealer Agreement and the Issuing and Paying Agency Agreement, as well as the Notes issued thereunder, provides that it is to be governed and construed in accordance with the laws of the State of New York. For purposes of our opinions expressed above, we have assumed, with your approval, that the Dealer Agreement, the Issuing and Paying Agency Agreement and the Notes would be governed by and construed in accordance with the domestic substantive laws of the State of Arkansas without giving effect to any choice or conflict of laws rule or provision that would cause the application of the domestic substantive laws of any other jurisdiction. (b) This opinion is limited to pertinent laws in effect as of the date hereof, and we expressly disclaim any undertaking to advise you of any changes of law or fact that may thereafter come to our attention. (c) Our opinion is limited to the matters stated herein and no opinion is to be implied or may be inferred beyond those matters expressly stated. (d) This opinion is furnished by us solely for your benefit as a dealer of the Notes pursuant to the Dealer Agreement, and it may not be relied upon, quoted from or delivered to any person; provided, however, that The Chase Manhattan Bank, N.A. may rely upon this opinion in its capacity as Issuing and Paying Agent for the Notes, each of Moody's Investors Service, Inc. and Standard & Poor's Ratings Group may rely on this opinion in connection with its issuance of an investment rating for the Notes, and a copy of this opinion may be delivered to any purchaser of the Notes. The liability of this firm is limited to the fullest extent possible under Ark. Code Ann. Section 16-114-303. (e) The phrases "known to us" or "to our knowledge" as used in this letter means the actual knowledge of those attorneys of our firm who have represented the Company in connection with any offering or placement of securities or who have principal responsibility for representing the Company, and do not include constructive knowledge or knowledge imputed to our firm under common law principles of agency or otherwise. Except as expressly set forth herein, we have not undertaken any investigation to determine the existence or absence of any facts and no inference as to our knowledge concerning any facts should be drawn from the fact that such representation has been undertaken by us. 291 (f) For purposes of the factual matters material to the opinions expressed herein, we have, with your consent, relied upon the compliance with the covenants and the correctness of the representations contained in the Dealer Agreement and the Issuing and Paying Agency Agreement. Without limiting the foregoing, for purposes of the opinions expressed in paragraphs 4 and 5 above, we have assumed that the Company will timely file with the Securities and Exchange Commission notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. (g) Our opinions are rendered as of the date hereof and do not cover the effect of any amendment or supplement to the Dealer Agreement or the Issuing and Paying Agency Agreement or the validity or enforceability of any amendment or supplement thereto, including without limitation any modifications, extensions, waivers or releases or the effect or applicability of federal or state tax laws on or to the transactions contemplated thereby. (h) We have made no examination or investigation to verify the accuracy or completeness of any financial, accounting, or statistical information furnished to you or with respect to any other accounting and financial matters and express no opinion with respect thereto. (i) We call your attention to the fact that the awarding of attorney's fees and expenses is discretionary under Arkansas law. We cannot opine that attorney's fees and expenses will be awarded in any particular amount. (j) Our opinions are subject to, and we express no opinion on, state or federal law relating to usury or fraudulent conveyances. (k) The opinions expressed above are (i) given to you solely for your benefit and the benefit of your successors and transferees, (ii) not binding on any court and (iii) may not be quoted in whole or in part or otherwise referred to in any legal opinion, document, or other report to be furnished to another person or entity without our prior written consent. Very truly yours, 292 Model Certificate as to Resolutions1 [Name of Issuer] I, R. Read Hudson, the Secretary of Tyson Foods, Inc., a Delaware corporation (the "Issuer"), do hereby certify, in connection with the issuance and sale of short-term promissory notes under the Commercial Paper Dealer Agreement dated January 12, 2001 (the "Agreement", the terms defined therein being used herein as therein defined) between the Issuer and SunTrust Equitable Securities Corporation (the "Dealer"), that: 1. The following resolution was duly adopted by the Board of Directors of the Issuer at a meeting thereof duly called and held on January 12, 2001, at which meeting a quorum was present and acting throughout, and such resolution has not been amended, modified or revoked and is in full force and effect on the date hereof: RESOLVED, that the Chairman of the Board, President, Chief Executive Officer, any Executive Vice President, any Senior Vice President, Controller or Chief Accounting Officer or Treasurer, either alone or with joinder of the Secretary or an Assistant Secretary, of the Corporation (the "Authorized Officers") be, and each of them hereby is, authorized to: (i) borrow under the Commercial Paper Program; (ii) execute such commercial paper notes in the name and on behalf of the Corporation; (iii) execute and deliver (A) Commercial Paper Dealer Agreements between the Corporation and each of the dealers selected by any Authorized Officer (each a "Dealer"), providing, among other things, for the sale of commercial paper notes on behalf of the Corporation and the indemnification of the Dealer in connection therewith and (B) an Issuing and Paying Agency Agreement between the Corporation and J.P. Morgan Chase & Co., or any of its affiliates, as issuing and paying agent; (iv) delegate to any other officers or employees of the Corporation authority to give instructions to the Dealer pursuant to the applicable Commercial Paper Dealer Agreement; and (v) do such acts and execute such other instruments and documents as may be necessary and proper to effect the transactions contemplated hereby including (A) amending documents referred to herein and (B) appointing additional dealers and successors to any of the parties named. 2. Each of the Agreement and the Issuing and Paying Agency Agreement, as executed and delivered by the Issuer, is substantially in the form thereof approved by the Board of Directors and referred to in the resolution set forth in paragraph 1 hereof. IN WITNESS WHEREOF, I have signed this certificate the 12th day of January, 2001 ________________________ Secretary _______________________________ 1This model certificate will serve as a guide for resolutions adopted by the Issuer. Any resolutions actually adopted, regardless of form, should cover all the substantive matters covered in this model, and a certificate substantially to the effect of this model is required to be delivered to the Dealer under Section 3.6(c) of the Agreement. 293 EX-10.7 9 0009.txt COMMERCIAL PAPER DEALER AGREEMENT COMMERCIAL PAPER DEALER AGREEMENT 4(2) PROGRAM between TYSON FOODS, INC., as Issuer and J.P. MORGAN SECURITIES INC., as Dealer Concerning Notes to be issued pursuant to an Issuing and Paying Agency Agreement dated as of January 12, 2001 between the Issuer and The Chase Manhattan Bank, as Issuing and Paying Agent Dated As of January 12, 2001 294 COMMERCIAL PAPER DEALER AGREEMENT 4(2) Program This agreement ("Agreement") sets forth the understandings between the Issuer and the Dealer in connection with the issuance and sale by the Issuer of its short-term promissory notes through the Dealer (the "Notes"). Certain terms used in this Agreement are defined in Section 6 hereof. The Addendum to this Agreement, and any Annexes or Exhibits described in this Agreement or such Addendum, are hereby incorporated into this Agreement and made fully a part hereof. Section 1. Offers, Sales and Resales of Notes 1.1 While (i) the Issuer has and shall have no obligation to sell the Notes to the Dealer or to permit the Dealer to arrange any sale of the Notes for the account of the Issuer, and (ii) the Dealer has and shall have no obligation to purchase the Notes from the Issuer or to arrange any sale of the Notes for the account of the Issuer, the parties hereto agree that in any case where the Dealer purchases Notes from the Issuer, or arranges for the sale of Notes by the Issuer, such Notes will be purchased or sold by the Dealer in reliance on the representations, warranties, covenants and agreements of the Issuer contained herein or made pursuant hereto and on the terms and conditions and in the manner provided herein. 1.2 So long as this Agreement shall remain in effect, and in addition to the limitations contained in Section 1.7 hereof, the Issuer shall not, without the consent of the Dealer, offer, solicit or accept offers to purchase, or sell, any Notes except (a) in transactions with one or more dealers which may from time to time after the date hereof become dealers with respect to the Notes by executing with the Issuer one or more agreements which contain provisions substantially identical to Section 1 of this Agreement, of which the Issuer hereby undertakes to provide the Dealer prompt notice or (b) in transactions with the other dealers listed on the Addendum hereto, which are executing agreements with the Issuer which contain provisions substantially identical to Section 1 of this Agreement contemporaneously herewith. In no event shall the Issuer offer, solicit or accept offers to purchase, or sell, any Notes directly on its own behalf in transactions with persons other than broker-dealers as specifically permitted in this Section 1.2. 1.3 The Notes shall be in a minimum denomination or minimum amount, whichever is applicable, of $250,000 or integral multiples of $1,000 in excess thereof, will bear such interest rates, if interest bearing, or will be sold at such discount from their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a maturity not exceeding 364 days from the date of issuance (exclusive of days of grace) and shall not contain any provision for extension, renewal or automatic "rollover." 1.4 The authentication, delivery and payment of the Notes shall be effected in accordance with the Issuing and Paying Agency Agreement and the Notes shall be either individual bearer physical certificates or represented by book-entry Notes evidenced by a Master Note registered in the name of DTC or its nominee in the form or forms annexed to the Issuing and Paying Agency Agreement. 295 1.5 If the Issuer and the Dealer shall agree on the terms of the purchase of any Note by the Dealer or the sale of any Note arranged by the Dealer (including, but not limited to, agreement with respect to the date of issue, purchase price, principal amount, maturity and interest rate (in the case of interest-bearing Notes) or discount thereof (in the case of Notes issued on a discount basis), and appropriate compensation for the Dealer's services hereunder) pursuant to this Agreement, the Issuer shall cause such Note to be issued and delivered in accordance with the terms of the Issuing and Paying Agency Agreement and payment for such Note shall be made by the purchaser thereof, either directly or through the Dealer, to the Issuing and Paying Agent, for the account of the Issuer. Except as otherwise agreed, in the event that the Dealer is acting as an agent and a purchaser shall either fail to accept delivery of or make payment for a Note on the date fixed for settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has theretofore paid the Issuer for the Note, the Issuer will promptly return such funds to the Dealer against its return of the Note to the Issuer, in the case of a certificated Note, and upon notice of such failure in the case of a book-entry Note. 1.6 The Dealer and the Issuer hereby establish and agree to observe the following procedures in connection with offers, sales and subsequent resales or other transfers of the Notes: (a) Offers and sales of the Notes shall be made only to investors reasonably believed by the Dealer to be: (i) Institutional Accredited Investors or Sophisticated Individual Accredited Investors, (ii) non-bank fiduciaries or agents that will be purchasing Notes for one or more accounts, each of which is reasonably believed by the Dealer to be an Institutional Accredited Investor or Sophisticated Individual Accredited Investor, and (iii) Qualified Institutional Buyers. (b) Resales and other transfers of the Notes by or through the Dealer or by other holders thereof shall be made only in accordance with the restrictions in the legends described in clause (e) below. (c) No general solicitation or general advertising shall be used in connection with the offering of the Notes. Without limiting the generality of the foregoing, without the prior written approval of Dealer, the Issuer shall not issue any press release or place or publish any "tombstone" or other advertisement relating to the Notes. (d) No sale of Notes to any one purchaser shall be for less than $250,000 principal or face amount, and no Note shall be issued in a smaller principal or face amount. If the purchaser is a non-bank fiduciary acting on behalf of others, each person for whom such purchaser is acting must purchase at least $250,000 principal or face amount of Notes. (e) Offers and sales of the Notes by the Issuer through the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506 under the Securities Act, and shall be subject to the restrictions described in the legend appearing on Exhibit A hereto. A legend substantially to the effect of such Exhibit A shall appear as part of the Private Placement Memorandum used in connection with offers and sales of Notes hereunder, as well as on each individual certificate representing a Note and each Master Note representing book- entry Notes offered and sold pursuant to this Agreement. 296 (f) Dealer shall furnish or shall have furnished to each purchaser of Notes for which it has acted as the Dealer being sold to an ultimate purchaser for the first time a copy of the then-current Private Placement Memorandum unless such purchaser has previously received a copy of the Private Placement Memorandum as then in effect. The Private Placement Memorandum shall expressly state that any person to whom Notes are offered shall have an opportunity to ask questions of, and receive information from, the Issuer and the Dealer and shall provide the names, addresses and telephone numbers of the persons from whom information regarding the Issuer may be obtained. (g) The Issuer agrees, for the benefit of the Dealer and each of the holders and prospective purchasers from time to time of the Notes that, if at any time the Issuer shall not be subject to Section 13 or 15(d) of the Exchange Act, the Issuer will furnish, upon request and at its expense, to the Dealer and to holders and prospective purchasers of Notes information required by Rule 144A(d)(4)(i) in compliance with Rule 144A(d). (h) In the event that any Note offered or to be offered by Dealer would be ineligible for resale under Rule 144A, the Issuer shall immediately notify Dealer (by telephone, confirmed in writing) of such fact and shall promptly prepare and deliver to Dealer an amendment or supplement to the Private Placement Memorandum describing the Notes that are ineligible, the reason for such ineligibility and any other relevant information relating thereto. (i) The Issuer represents that it has outstanding issuances of commercial paper in the United States market in reliance upon, and in compliance with, the exemption provided by Section 3(a)(3) of the Securities Act. In that connection, the Issuer agrees that (a) the proceeds from the sale of the Notes will be segregated from the proceeds of the sale of any such commercial paper by being placed in a separate account; (b) the Issuer will institute appropriate corporate procedures to ensure that the offers and sales of notes issued by the Issuer pursuant to the Section 3(a)(3) exemption are not integrated with offerings and sales of Notes hereunder; and (c) the Issuer will comply with each of the requirements of Section 3(a)(3) of the Act in selling commercial paper or other short-term debt securities other than the Notes in the United States. 1.7 The Issuer hereby represents and warrants to the Dealer, in connection with offers, sales and resales of Notes, as follows: (a) Issuer hereby confirms to the Dealer that (except as permitted by Section 1.6(i)) within the preceding six months neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof acting on behalf of the Issuer has offered or sold any Notes, or any substantially similar security of the Issuer (including, without limitation, medium-term notes issued by the Issuer), to, or solicited offers to buy any such security from, any person other than the Dealer or the other dealers referred to in Section 1.2 hereof. The Issuer also agrees that, as long as the Notes are being offered for sale by the Dealer and the other dealers referred to in Section 1.2 hereof as contemplated hereby and until at least six months after the offer of Notes hereunder has been terminated, neither the Issuer nor any person other than the Dealer or the other dealers 297 referred to in Section 1.2 hereof (except as contemplated by Section 1.2 hereof) will offer the Notes or any substantially similar security of the Issuer for sale to, or solicit offers to buy any such security from, any person other than the Dealer and the other dealers referred to in Section 1.2 hereof (except to the extent any of the foregoing would not cause the offer and sale of the Notes by the Issuer to be integrated with other offers and sales so as no longer to come within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder), it being understood that such agreement is made with a view to bringing the offer and sale of the Notes within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder and shall survive any termination of this Agreement. The Issuer hereby represents and warrants that it has not taken or omitted to take, and will not take or omit to take, any action that would cause the offering and sale of Notes hereunder to be integrated with any other offering of securities, whether such offering is made by the Issuer or some other party or parties, under circumstances that would cause the offering and sale of the Notes by the Issuer to fail to be exempt under Section 4(2) of the Securities Act. (b) Except as described in Section 1.7(c) below, the Issuer represents and agrees that the proceeds of the sale of the Notes are not currently contemplated to be used for the purpose of buying, carrying or trading securities within the meaning of Regulation T and the interpretations thereunder by the Board of Governors of the Federal Reserve System. Except as described in Section 1.7(c) below, in the event that the Issuer determines to use such proceeds for the purpose of buying, carrying or trading securities, whether in connection with an acquisition of another company or otherwise, the Issuer shall give the Dealer at least five business days' prior written notice to that effect. The Issuer shall also give the Dealer prompt notice of the actual date that it commences to purchase securities with the proceeds of the Notes. Thereafter, in the event that the Dealer purchases Notes as principal and does not resell such Notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. (c) The Dealer acknowledges that proceeds from the sale of Notes prior to the consummation of the merger of IBP, inc. ("IBP") into Lasso Acquisition Corporation ("Lasso"), a wholly-owned subsidiary of the Issuer, pursuant to an Agreement and Plan of Merger dated as of January 1, 2001 among the Issuer, Lasso and IBP, as amended from time to time (the "Merger Agreement") are contemplated to be used, in part, for the purpose of purchasing shares of common stock of IBP pursuant to the terms of the offer to purchase up to 50.1% of the common stock of IBP contemplated by the Merger Agreement. In the event the Dealer purchases Notes as principal and does not resell such notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. 298 Section 2. Representations and Warranties of Issuer The Issuer represents and warrants that: 2.1 The Issuer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, this Agreement and the Issuing and Paying Agency Agreement. 2.2 This Agreement and the Issuing and Paying Agency Agreement have been duly authorized, executed and delivered by the Issuer and constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.3 The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.4 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, the offer and sale of Notes in the manner contemplated hereby do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and no indenture in respect of the Notes is required to be qualified under the Trust Indenture Act of 1939, as amended. 2.5 The Notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness of the Issuer. 2.6 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, no consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the SEC, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, this Agreement, the Notes or the Issuing and Paying Agency Agreement, except (i)as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes, and (ii) for the requirement that the Issuer file with the SEC a notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. 299 2.7 Neither the execution and delivery of this Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions hereof or thereof by the Issuer, will (i) result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Issuer, or (ii) violate or result in a breach or an event of default under any of the terms of the Issuer's charter documents or by-laws, any contract or instrument to which the Issuer is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality, to which the Issuer is subject or by which it or its property is bound, which breach or event of default could reasonably be expected to have a material adverse effect on the financial condition or operations of the Issuer and its subsidiaries taken as a whole, and the validity of the Notes or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.8 There is no litigation or governmental proceeding pending, or to the knowledge of the Issuer threatened, against or affecting the Issuer or any of its subsidiaries which could reasonably be expected to have a material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.9 The Issuer is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. 2.10 Neither the Private Placement Memorandum nor the Company Information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, provided, that the Issuer makes no representation or warranty as to the Dealer Information. 2.11 Each (a) issuance of Notes by the Issuer hereunder and (b) amendment or supplement of the Private Placement Memorandum shall be deemed a representation and warranty by the Issuer to the Dealer, as of the date thereof, that, both before and after giving effect to such issuance and after giving effect to such amendment or supplement, (i) the representations and warranties given by the Issuer set forth above in this Section 2 remain true and correct on and as of such date as if made on and as of such date, (ii) in the case of an issuance of Notes, the Notes being issued on such date have been duly and validly issued and constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations on rights to indemnity and contribution imposed by applicable law, and (iii) in the case of an issuance of Notes, since the date of the most recent Private Placement Memorandum, there has been no material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole which has not been disclosed to the Dealer in writing. 300 Section 3. Covenants and Agreements of Issuer The Issuer covenants and agrees that: 3.1 The Issuer will give the Dealer prompt notice (but in any event prior to any subsequent issuance of Notes hereunder) of any amendment to, modification of, or waiver with respect to, the Notes or the Issuing and Paying Agency Agreement, including a complete copy of any such amendment, modification or waiver. 3.2 The Issuer shall, whenever there shall occur any event that could reasonably be expected to have a material adverse effect on the financial condition or results of operations of the Issuer and its subsidiaries taken as a whole, or any adverse development or occurrence in relation to the Issuer that would reasonably be expected to be material to the holders of the Notes or potential holders of the Notes or the ability of the Issuer to perform its obligations under this Agreement or the Notes, notify the Dealer (by telephone, confirmed in writing) of such event prior to any subsequent issuances of Notes hereunder. The Issuer shall, whenever it (i) receives notice of any downgrading or intended downgrading or any review for potential change in the rating accorded any of the Issuer's securities by any nationally recognized statistical rating organization which has published a rating of the Notes (a "Rating Agency"), or (ii) provides material information to any Rating Agency that could reasonably be expected to result in a downgrading or review for potential change in the rating accorded any of the Issuer's securities by any Rating Agency, in each case, promptly, and in any event prior to any subsequent issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in writing) of such occurrence. 3.3 The Issuer shall from time to time upon the request of the Dealer furnish to the Dealer copies of all materials provided by the Issuer to any national securities exchange regarding (i) the Issuer's operations and financial condition, and (ii) due authorization and execution of the Notes, and (iii) the Issuer's ability to pay the Notes as they mature. 3.4 The Issuer will take all such action as the Dealer may reasonably request to ensure that each offer and each sale of the Notes will comply with any applicable state Blue Sky laws; provided, that the Issuer shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. 3.5 The Issuer shall not issue Notes hereunder until the Dealer shall have received (a) an opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance to the Dealer, (b) a copy of the executed Issuing and Paying Agency Agreement as then in effect, c a copy of resolutions adopted by the Board of Directors of the Issuer, satisfactory in form and substance to the Dealer and certified by the Secretary or similar officer of the Issuer, authorizing execution and delivery by the Issuer of this Agreement the Issuing and Paying Agency Agreement and the Notes and consummation by the Issuer of the transactions contemplated hereby and thereby, (d) prior to the issuance of any Notes represented by a book-entry note registered in the name of DTC or its nominee, a copy of the executed Letter of Representations among the Issuer, the Issuing and Paying Agent and DTC, and (e) such other certificates, 301 opinions, letters and documents as the Dealer shall have reasonably requested. 3.6 The Issuer shall reimburse the Dealer for all of the Dealer's reasonable out-of-pocket expenses related to this Agreement, including expenses incurred in connection with its preparation and negotiation, and the transactions contemplated hereby (including, but not limited to, the printing and distribution of the Private Placement Memorandum), and, if applicable, for the reasonable fees and out-of-pocket expenses of the Dealer's counsel. 3.7 Without limiting any obligation of the Issuer pursuant to this Agreement to provide the Dealer with credit and financial information, the Issuer hereby acknowledges and agrees that the Dealer may share the Company Information and any other information or matters relating to the Issuer or the transactions contemplated hereby with affiliates of the Dealer, and that such affiliates may likewise share information relating to the Issuer or such transactions with the Dealer. Section 4. Disclosure 4.1 The Private Placement Memorandum and its contents (other than the Dealer Information) shall be the sole responsibility of the Issuer. The Private Placement Memorandum shall contain a statement expressly offering an opportunity for each prospective purchaser to ask questions of, and receive answers from, the Issuer concerning the offering of Notes and to obtain relevant additional information which the Issuer possesses or can acquire without unreasonable effort or expense. 4.2 The Issuer agrees promptly to furnish the Dealer the Company Information as it becomes available. 4.3 (a) The Issuer further agrees to notify the Dealer promptly upon the occurrence of any event relating to or affecting the Issuer that would cause the Company Information then in existence to include an untrue statement of material fact or to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they are made, not misleading. (b) In the event that the Issuer gives the Dealer notice pursuant to Section 4.3(a) and the Dealer notifies the Issuer that it then has Notes it is holding in inventory, the Issuer agrees promptly to supplement or amend the Private Placement Memorandum so that such Private Placement Memorandum, as amended or supplemented, shall not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and the Issuer shall make such supplement or amendment available to the Dealer. (c) In the event that (i) the Issuer gives the Dealer notice pursuant to Section 4.3(a) and (ii) the Dealer does not notify the Issuer that it is then holding Notes in inventory and (iii) the Issuer chooses not to promptly amend or supplement the Private Placement Memorandum in the manner described in clause (b) above, then all solicitations and sales of Notes shall be suspended until such time as the Issuer has so amended or supplemented the Private Placement Memorandum, and made such amendment or supplement available to the Dealer. 302 Section 5. Indemnification and Contribution 5.1 The Issuer will indemnify and hold harmless the Dealer, each individual, corporation, partnership, trust, association or other entity controlling the Dealer, within the meaning of Section 15 of the Securities Act, any affiliate of the Dealer or any such controlling entity and their respective directors, officers, employees, partners and incorporators (hereinafter the "Indemnitees") against any and all liabilities, penalties, suits, causes of action, losses, damages, claims, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) or judgments of whatever kind or nature (each a "Claim"), imposed upon, incurred by or asserted against the Indemnitees arising out of or based upon (i) any allegation that the Private Placement Memorandum, the Company Information or any information provided by the Issuer to the Dealer included (as of any relevant time of offer and sale of the Notes by the Issuer) or includes an untrue statement of a material fact or omitted (as of any relevant time of offer and sale of the Notes by the Issuer) or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or (ii) arising out of or based upon the breach by the Issuer of any agreement, covenant or representation made in or pursuant to this Agreement; provided, however, that the foregoing indemnity shall not extend to any Claims to the extent they arise out of or are based upon the Dealer's breach of its obligations hereunder (it being understood that the Dealer has no obligation to prepare or cause to be prepared any updates or supplements to the Private Placement Memorandum). This indemnification shall not apply to the extent that the Claim arises out of or is based on Dealer Information. 5.2 Provisions relating to claims made for indemnification under this Section 5 are set forth on Exhibit B to this Agreement. 5.3 In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in clause (i) of Section 5.1 is held to be unavailable or insufficient to hold harmless the Indemnitees, although applicable in accordance with the terms of this Section 5, the Issuer shall contribute to the aggregate costs incurred by the Dealer in connection with any Claim in the proportion of the respective economic interests of the Issuer and the Dealer; provided, however, that such contribution by the Issuer shall be in an amount such that the aggregate costs incurred by the Dealer do not exceed the aggregate of the commissions and fees earned by the Dealer hereunder with respect to the issue or issues of Notes to which such Claim relates. The respective economic interests shall be calculated by reference to the aggregate proceeds to the Issuer of the Notes issued hereunder and the aggregate commissions and fees earned by the Dealer hereunder. 303 Section 6. Definitions 6.1 "Claim" shall have the meaning set forth in Section 5.1. 6.2 "Company Information" at any given time shall mean the Private Placement Memorandum together with, to the extent applicable, (i) the Issuer's most recent report on Form 10-K filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most recent Form 10-K, (ii) the Issuer's most recent annual audited financial statements and each interim financial statement or report prepared subsequent thereto, if not included in item (i) above, (iii) the Issuer's and its affiliates' other publicly available recent reports, including, but not limited to, any publicly available filings or reports provided to their respective shareholders, (iv) any other information or disclosure prepared pursuant to Section 4.3 hereof and (v) any information prepared or approved by the Issuer for dissemination to investors or potential investors in the Notes. 6.3 "Dealer" shall mean J.P. Morgan Securities Inc. 6.4 "Dealer Information" shall mean material concerning the Dealer and provided by the Dealer in writing expressly for inclusion in the Private Placement Memorandum. 6.5 "DTC" shall mean The Depository Trust Company. 6.6 "Exchange Act" shall mean the U.S. Securities Exchange Act of 1934, as amended. 6.7 "Indemnitee" shall have the meaning set forth in Section 5.1. 6.8 "Institutional Accredited Investor" shall mean an institutional investor that is an accredited investor within the meaning of Rule 501 under the Securities Act and that has such knowledge and experience in financial and business matters that it is capable of evaluating and bearing the economic risk of an investment in the Notes, including, but not limited to, a bank, as defined in Section 3(a)(2) of the Securities Act, or a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity. 6.9 "Issuing and Paying Agency Agreement" shall mean the issuing and paying agency agreement described on the cover page of this Agreement, as such agreement may be amended or supplemented from time to time. 6.10 "Issuing and Paying Agent" shall mean the party designated as such on the cover page of this Agreement, as issuing and paying agent under the Issuing and Paying Agency Agreement. 6.11 "Non-bank fiduciary or agent" shall mean a fiduciary or agent other than (a) a bank, as defined in Section 3(a)(2) of the Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A) of the Securities Act. 304 6.12 "Private Placement Memorandum" shall mean offering materials prepared in accordance with Section 4 (including materials referred to therein or incorporated by reference therein) provided to purchasers and prospective purchasers of the Notes, and shall include amendments and supplements thereto which may be prepared from time to time in accordance with this Agreement (other than any amendment or supplement that has been completely superseded by a later amendment or supplement). 6.13 "Qualified Institutional Buyer" shall have the meaning assigned to that term in Rule 144A under the Securities Act. 6.14 "Rule 144A" shall mean Rule 144A under the Securities Act. 6.15 "SEC" shall mean the U.S. Securities and Exchange Commission. 6.16 "Securities Act" shall mean the U.S. Securities Act of 1933, as amended. 6.17 "Sophisticated Individual Accredited Investor" shall mean an individual who (a) is an accredited investor within the meaning of Regulation D under the Securities Act and (b) based on his or her pre- existing relationship with the Dealer, is reasonably believed by the Dealer to be a sophisticated investor (i) possessing such knowledge and experience (or represented by a fiduciary or agent possessing such knowledge and experience) in financial and business matters that he or she is capable of evaluating and bearing the economic risk of an investment in the Notes and (ii) having a net worth of at least $5 million. Section 7. General 7.1 Unless otherwise expressly provided herein, all notices under this Agreement to parties hereto shall be in writing and shall be effective when received at the address of the respective party set forth in the Addendum to this Agreement. 7.2 This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws provisions. 7.3 EACH OF THE DEALER AND THE ISSUER AGREES THAT ANY SUIT, ACTION OR PROCEEDING BROUGHT BY THE DEALER AGAINST THE ISSUER IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR THE NOTES OR THE OFFER AND SALE OF THE NOTES MAY BE BROUGHT IN THE U.S. FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN OR THE COURTS OF THE SATE OF NEW YORK LOCATED IN THE BOROUGH OF MANHATTAN. EACH OF THE DEALER AND THE ISSUER WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 7.4 This Agreement may be terminated, at any time, by the Issuer, upon one business day's prior notice to such effect to the Dealer, or by the Dealer upon one business day's prior notice to such effect to the Issuer. Any such termination, however, shall not affect the obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations, warranties, agreements, covenants, rights or responsibilities of the parties made or arising prior to the termination of this Agreement. 305 7.5 This Agreement is not assignable by either party hereto without the written consent of the other party; provided, however, that the Dealer may assign its rights and obligations under this Agreement to any wholly- owned direct or indirect subsidiary of the Dealer or of its ultimate parent. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto and their respective permitted assigns. 7.6 This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 7.7 This Agreement constitutes the entire agreement between the parties hereto and supercedes any prior understandings, agreements or representations by or between the parties hereto, written or oral, to the extent they relate to the subject matter hereof. 7.7 Any payments to the Dealer hereunder, whether pursuant to Sections 3.6, 5.1 or otherwise, shall be in US dollars and shall be free of all withholding, stamp and other similar taxes and of all other governmental charges of any nature whatsoever. In the event any withholding is required by law, the Issuer agrees to (i) pay the same and (ii) pay such additional amounts to the Dealer which, after deduction of any such withholding, stamp or other taxes or governmental charges of any nature whatsoever imposed with respect to the payment of such additional amount, shall equal the amount withheld pursuant to clause (i). 306 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date and year first above written. TYSON FOODS, INC., as Issuer By: Name: Title: J.P. MORGAN SECURITIES INC., as Dealer By: Name: Title: 307 ADDENDUM 1. The other dealers referred to in clause (b) of Section 1.2 of the Agreement are: Banc of America Securities LLC Chase Securities Inc. Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days Credit Suisse First Boston Corporation SunTrust Equitable Securities Corp. Section 7. The addresses of the respective parties for purposes of notices under Section 7.1 are as follows: For the Issuer: Address: 2210 West Oakland Drive Springdale, Arkansas 72762-6999 Attention: General Counsel Telephone number: (501) 290-4000 Fax number: (501) 290-6776 For the Dealer: Address: 60 Wall Street New York, New York 10260 Attention: Money Market Division Telephone number: Fax number: 308 EXHIBIT A FORM OF LEGEND FOR PRIVATE PLACEMENT MEMORANDUM AND NOTES THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER AND THE NOTES, THAT IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND THAT IT IS EITHER (A) AN INSTITUTIONAL INVESTOR OR HIGHLY SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL, (i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE NOTES AND (ii) HAS A NET WORTH OF AT LEAST $5 MILLION (AN "INSTITUTIONAL ACCREDITED INVESTOR" OR "SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR", RESPECTIVELY) AND THAT EITHER IS PURCHASING NOTES FOR ITS OWN ACCOUNT, IS A U.S. BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR IS A FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN) PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH IS SUCH AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR (i) WHICH ITSELF POSSESSES SUCH KNOWLEDGE AND EXPERIENCE OR (ii) WITH RESPECT TO WHICH SUCH PURCHASER HAS SOLE INVESTMENT DISCRETION; OR (B) A QUALIFIED INSTITUTIONAL BUYER ("QIB") WITHIN THE MEANING OF RULE 144A UNDER THE ACT WHICH IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH IS A QIB AND WITH RESPECT TO EACH OF WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO J.P. MORGAN SECURITIES INC. OR ANOTHER PERSON DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES (COLLECTIVELY, THE "PLACEMENT AGENTS"), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR OR A QIB BY A PLACEMENT AGENT, OR (3) TO A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000. 309 EXHIBIT B FURTHER PROVISIONS RELATING TO INDEMNIFICATION (a) The Issuer agrees to reimburse each Indemnitee for all expenses (including reasonable fees and disbursements of internal and external counsel) as they are incurred by it in connection with investigating or defending any loss, claim, damage, liability or action in respect of which indemnification may be sought under clause (i) of Section 5.1 of the Agreement (whether or not it is a party to any such proceedings). (b) Promptly after receipt by an Indemnitee of notice of the existence of a Claim arising under clause (i) of Section 5.1 of the Agreement, such Indemnitee will, if a claim in respect thereof is to be made against the Issuer, notify the Issuer in writing of the existence thereof; provided that (i) the omission so to notify the Issuer will not relieve it from any liability which it may have hereunder unless and except to the extent it did not otherwise learn of such Claim and the issuer is materially prejudiced thereby as determined by a court of law, and (ii) the omission so to notify the Issuer will not relieve it from liability which it may have to an Indemnitee otherwise than on account of this indemnity agreement. In case any such Claim is made against any Indemnitee and it notifies the Issuer of the existence thereof, the Issuer will be entitled to participate therein, and to the extent that it may elect by written notice delivered to the Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee; provided that if the defendants in any such Claim include both the Indemnitee and the Issuer and the Indemnitee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, the Issuer shall not have the right to direct the defense of such Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to select separate counsel to assert such legal defenses on behalf of such Indemnitee. Upon receipt of notice from the Issuer to such Indemnitee of the Issuer's election so to assume the defense of such Claim and approval by the Indemnitee of counsel, the Issuer will not be liable to such Indemnitee for expenses incurred thereafter by the Indemnitee in connection with the defense thereof (other than reasonable costs of investigation) unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next preceding sentence (it being understood, however, that the Issuer shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel in the jurisdiction in which any Claim is brought), approved by the Dealer, representing the Indemnitee who is party to such Claim), (ii) the Issuer shall not have employed counsel reasonably satisfactory to the Indemnitee to represent the Indemnitee within a reasonable time after notice of existence of the Claim or (iii) the Issuer has authorized in writing the employment of counsel for the Indemnitee. The indemnity, reimbursement and contribution obligations of the Issuer hereunder shall be in addition to any other liability the Issuer may otherwise have to an Indemnitee and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer and any Indemnitee. The Issuer agrees that without the Dealer's prior written consent, it will not settle, compromise or consent to the entry of any judgment in any Claim in respect of which 310 indemnification may be sought under the indemnification provision of the Agreement (whether or not the Dealer or any other Indemnitee is an actual or potential party to such Claim), unless such settlement, compromise or consent includes an unconditional release of each Indemnitee from all liability arising out of such Claim. 311 EX-10.8 10 0010.txt COMMERCIAL PAPER DEALER AGREEMENT COMMERCIAL PAPER DEALER AGREEMENT 4(2) PROGRAM between TYSON FOODS, INC., as Issuer and CHASE SECURITIES INC., as Dealer Concerning Notes to be issued pursuant to an Issuing and Paying Agency Agreement dated as of January 12, 2001 between the Issuer and The Chase Manhattan Bank, as Issuing and Paying Agent Dated As of January 12, 2001 312 COMMERCIAL PAPER DEALER AGREEMENT 4(2) Program This agreement ("Agreement") sets forth the understandings between the Issuer and the Dealer in connection with the issuance and sale by the Issuer of its short-term promissory notes through the Dealer (the "Notes"). Certain terms used in this Agreement are defined in Section 6 hereof. The Addendum to this Agreement, and any Annexes or Exhibits described in this Agreement or such Addendum, are hereby incorporated into this Agreement and made fully a part hereof. Section 1. Offers, Sales and Resales of Notes 1.1 While (i) the Issuer has and shall have no obligation to sell the Notes to the Dealer or to permit the Dealer to arrange any sale of the Notes for the account of the Issuer, and (ii) the Dealer has and shall have no obligation to purchase the Notes from the Issuer or to arrange any sale of the Notes for the account of the Issuer, the parties hereto agree that in any case where the Dealer purchases Notes from the Issuer, or arranges for the sale of Notes by the Issuer, such Notes will be purchased or sold by the Dealer in reliance on the representations, warranties, covenants and agreements of the Issuer contained herein or made pursuant hereto and on the terms and conditions and in the manner provided herein. 1.2 So long as this Agreement shall remain in effect, and in addition to the limitations contained in Section 1.7 hereof, the Issuer shall not, without the consent of the Dealer, offer, solicit or accept offers to purchase, or sell, any Notes except (a) in transactions with one or more dealers which may from time to time after the date hereof become dealers with respect to the Notes by executing with the Issuer one or more agreements which contain provisions substantially identical to Section 1 of this Agreement, of which the Issuer hereby undertakes to provide the Dealer prompt notice or (b) in transactions with the other dealers listed on the Addendum hereto, which are executing agreements with the Issuer which contain provisions substantially identical to Section 1 of this Agreement contemporaneously herewith. In no event shall the Issuer offer, solicit or accept offers to purchase, or sell, any Notes directly on its own behalf in transactions with persons other than broker-dealers as specifically permitted in this Section 1.2. 1.3 The Notes shall be in a minimum denomination or minimum amount, whichever is applicable, of $250,000 or integral multiples of $1,000 in excess thereof, will bear such interest rates, if interest bearing, or will be sold at such discount from their face amounts, as shall be agreed upon by the Dealer and the Issuer, shall have a maturity not exceeding 364 days from the date of issuance (exclusive of days of grace) and shall not contain any provision for extension, renewal or automatic "rollover. " 313 1.4 The authentication, delivery and payment of the Notes shall be effected in accordance with the Issuing and Paying Agency Agreement and the Notes shall be either individual bearer physical certificates or represented by book-entry Notes evidenced by a Master Note registered in the name of DTC or its nominee in the form or forms annexed to the Issuing and Paying Agency Agreement. 1.5 If the Issuer and the Dealer shall agree on the terms of the purchase of any Note by the Dealer or the sale of any Note arranged by the Dealer (including, but not limited to, agreement with respect to the date of issue, purchase price, principal amount, maturity and interest rate (in the case of interest-bearing Notes) or discount thereof (in the case of Notes issued on a discount basis), and appropriate compensation for the Dealer's services hereunder) pursuant to this Agreement, the Issuer shall cause such Note to be issued and delivered in accordance with the terms of the Issuing and Paying Agency Agreement and payment for such Note shall be made by the purchaser thereof, either directly or through the Dealer, to the Issuing and Paying Agent, for the account of the Issuer. Except as otherwise agreed, in the event that the Dealer is acting as an agent and a purchaser shall either fail to accept delivery of or make payment for a Note on the date fixed for settlement, the Dealer shall promptly notify the Issuer, and if the Dealer has theretofore paid the Issuer for the Note, the Issuer will promptly return such funds to the Dealer against its return of the Note to the Issuer, in the case of a certificated Note, and upon notice of such failure in the case of a book-entry Note. 1.6 The Dealer and the Issuer hereby establish and agree to observe the following procedures in connection with offers, sales and subsequent resales or other transfers of the Notes: (a) Offers and sales of the Notes shall be made only to investors reasonably believed by the Dealer to be: (i) Institutional Accredited Investors or Sophisticated Individual Accredited Investors, (ii) non-bank fiduciaries or agents that will be purchasing Notes for one or more accounts, each of which is reasonably believed by the Dealer to be an Institutional Accredited Investor or Sophisticated Individual Accredited Investor, and (iii) Qualified Institutional Buyers. (b) Resales and other transfers of the Notes by or through the Dealer or by other holders thereof shall be made only in accordance with the restrictions in the legends described in clause (e) below. (c) No general solicitation or general advertising shall be used in connection with the offering of the Notes. Without limiting the generality of the foregoing, without the prior written approval of Dealer, the Issuer shall not issue any press release or place or publish any "tombstone" or other advertisement relating to the Notes. (d) No sale of Notes to any one purchaser shall be for less than $250,000 principal or face amount, and no Note shall be issued in a smaller principal or face amount. If the purchaser is a non-bank fiduciary acting on behalf of others, each person for whom such purchaser is acting must purchase at least $250,000 principal or face amount of Notes. 314 (e) Offers and sales of the Notes by the Issuer through the Dealer acting as agent for the Issuer shall be made in accordance with Rule 506 under the Securities Act, and shall be subject to the restrictions described in the legend appearing on Exhibit A hereto. A legend substantially to the effect of such Exhibit A shall appear as part of the Private Placement Memorandum used in connection with offers and sales of Notes hereunder, as well as on each individual certificate representing a Note and each Master Note representing book- entry Notes offered and sold pursuant to this Agreement. (f) Dealer shall furnish or shall have furnished to each purchaser of Notes for which it has acted as the Dealer being sold to an ultimate purchaser for the first time a copy of the then-current Private Placement Memorandum unless such purchaser has previously received a copy of the Private Placement Memorandum as then in effect. The Private Placement Memorandum shall expressly state that any person to whom Notes are offered shall have an opportunity to ask questions of, and receive information from, the Issuer and the Dealer and shall provide the names, addresses and telephone numbers of the persons from whom information regarding the Issuer may be obtained. (g) The Issuer agrees, for the benefit of the Dealer and each of the holders and prospective purchasers from time to time of the Notes that, if at any time the Issuer shall not be subject to Section 13 or 15(d) of the Exchange Act, the Issuer will furnish, upon request and at its expense, to the Dealer and to holders and prospective purchasers of Notes information required by Rule 144A(d)(4)(i) in compliance with Rule 144A(d). (h) In the event that any Note offered or to be offered by Dealer would be ineligible for resale under Rule 144A, the Issuer shall immediately notify Dealer (by telephone, confirmed in writing) of such fact and shall promptly prepare and deliver to Dealer an amendment or supplement to the Private Placement Memorandum describing the Notes that are ineligible, the reason for such ineligibility and any other relevant information relating thereto. (i) The Issuer represents that it has outstanding issuances of commercial paper in the United States market in reliance upon, and in compliance with, the exemption provided by Section 3(a)(3) of the Securities Act. In that connection, the Issuer agrees that (a) the proceeds from the sale of the Notes will be segregated from the proceeds of the sale of any such commercial paper by being placed in a separate account; (b) the Issuer will institute appropriate corporate procedures to ensure that the offers and sales of notes issued by the Issuer pursuant to the Section 3(a)(3) exemption are not integrated with offerings and sales of Notes hereunder; and (c) the Issuer will comply with each of the requirements of Section 3(a)(3) of the Act in selling commercial paper or other short-term debt securities other than the Notes in the United States. 1.7 The Issuer hereby represents and warrants to the Dealer, in connection with offers, sales and resales of Notes, as follows: 315 (a) Issuer hereby confirms to the Dealer that (except as permitted by Section 1.6(i)) within the preceding six months neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof acting on behalf of the Issuer has offered or sold any Notes, or any substantially similar security of the Issuer (including, without limitation, medium-term notes issued by the Issuer), to, or solicited offers to buy any such security from, any person other than the Dealer or the other dealers referred to in Section 1.2 hereof. The Issuer also agrees that, as long as the Notes are being offered for sale by the Dealer and the other dealers referred to in Section 1.2 hereof as contemplated hereby and until at least six months after the offer of Notes hereunder has been terminated, neither the Issuer nor any person other than the Dealer or the other dealers referred to in Section 1.2 hereof (except as contemplated by Section 1.2 hereof) will offer the Notes or any substantially similar security of the Issuer for sale to, or solicit offers to buy any such security from, any person other than the Dealer and the other dealers referred to in Section 1.2 hereof (except to the extent any of the foregoing would not cause the offer and sale of the Notes by the Issuer to be integrated with other offers and sales so as no longer to come within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder), it being understood that such agreement is made with a view to bringing the offer and sale of the Notes within the exemption provided by Section 4(2) of the Securities Act and Rule 506 thereunder and shall survive any termination of this Agreement. The Issuer hereby represents and warrants that it has not taken or omitted to take, and will not take or omit to take, any action that would cause the offering and sale of Notes hereunder to be integrated with any other offering of securities, whether such offering is made by the Issuer or some other party or parties, under circumstances that would cause the offering and sale of the Notes by the Issuer to fail to be exempt under Section 4(2) of the Securities Act. (b) Except as described in Section 1.7(c) below, the Issuer represents and agrees that the proceeds of the sale of the Notes are not currently contemplated to be used for the purpose of buying, carrying or trading securities within the meaning of Regulation T and the interpretations thereunder by the Board of Governors of the Federal Reserve System. Except as described in Section 1.7(c) below, in the event that the Issuer determines to use such proceeds for the purpose of buying, carrying or trading securities, whether in connection with an acquisition of another company or otherwise, the Issuer shall give the Dealer at least five business days' prior written notice to that effect. The Issuer shall also give the Dealer prompt notice of the actual date that it commences to purchase securities with the proceeds of the Notes. Thereafter, in the event that the Dealer purchases Notes as principal and does not resell such Notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. 316 (c) The Dealer acknowledges that proceeds from the sale of Notes prior to the consummation of the merger of IBP, inc. ("IBP") into Lasso Acquisition Corporation ("Lasso"), a wholly-owned subsidiary of the Issuer, pursuant to an Agreement and Plan of Merger dated as of January 1, 2001 among the Issuer, Lasso and IBP, as amended from time to time (the "Merger Agreement") are contemplated to be used, in part, for the purpose of purchasing shares of common stock of IBP pursuant to the terms of the offer to purchase up to 50.1% of the common stock of IBP contemplated by the Merger Agreement. In the event the Dealer purchases Notes as principal and does not resell such notes on the day of such purchase, to the extent necessary to comply with Regulation T and the interpretations thereunder, the Dealer will sell such Notes only to offerees it reasonably believes to be QIBs or to QIBs it reasonably believes are acting for other QIBs, in each case in accordance with Rule 144A. Section 2. Representations and Warranties of Issuer The Issuer represents and warrants that: 2.1 The Issuer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all the requisite power and authority to execute, deliver and perform its obligations under the Notes, this Agreement and the Issuing and Paying Agency Agreement. 2.2 This Agreement and the Issuing and Paying Agency Agreement have been duly authorized, executed and delivered by the Issuer and constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.3 The Notes have been duly authorized, and when issued and delivered as provided in the Issuing and Paying Agency Agreement, will be duly and validly issued and delivered and will constitute legal, valid and binding obligations of the Issuer enforceable against the Issuer in accordance with their terms subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations imposed on rights to indemnity and contribution imposed by applicable law. 2.4 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, the offer and sale of Notes in the manner contemplated hereby do not require registration of the Notes under the Securities Act, pursuant to the exemption from registration contained in Section 4(2) thereof, and no indenture in respect of the Notes is required to be qualified under the Trust Indenture Act of 1939, as amended. 317 2.5 The Notes will rank at least pari passu with all other unsecured and unsubordinated indebtedness of the Issuer. 2.6 Assuming compliance by the Dealer with the procedures applicable to it set forth in Section 1 hereof, no consent or action of, or filing or registration with, any governmental or public regulatory body or authority, including the SEC, is required to authorize, or is otherwise required in connection with the execution, delivery or performance of, this Agreement, the Notes or the Issuing and Paying Agency Agreement, except (i)as may be required by the securities or Blue Sky laws of the various states in connection with the offer and sale of the Notes, and (ii) for the requirement that the Issuer file with the SEC a notice on Form D in accordance with Rule 503 under the Securities Act and such amendments thereto as Rule 503 may require. 2.7 Neither the execution and delivery of this Agreement and the Issuing and Paying Agency Agreement, nor the issuance and delivery of the Notes in accordance with the Issuing and Paying Agency Agreement, nor the fulfillment of or compliance with the terms and provisions hereof or thereof by the Issuer, will (i) result in the creation or imposition of any mortgage, lien, charge or encumbrance of any nature whatsoever upon any of the properties or assets of the Issuer, or (ii) violate or result in a breach or an event of default under any of the terms of the Issuer's charter documents or by-laws, any contract or instrument to which the Issuer is a party or by which it or its property is bound, or any law or regulation, or any order, writ, injunction or decree of any court or government instrumentality, to which the Issuer is subject or by which it or its property is bound, which breach or event of default could reasonably be expected to have a material adverse effect on the financial condition or operations of the Issuer and its subsidiaries taken as a whole, and the validity of the Notes or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.8 There is no litigation or governmental proceeding pending, or to the knowledge of the Issuer threatened, against or affecting the Issuer or any of its subsidiaries which could reasonably be expected to have a material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole or the ability of the Issuer to perform its obligations under this Agreement, the Notes or the Issuing and Paying Agency Agreement. 2.9 The Issuer is not an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended. 2.10 Neither the Private Placement Memorandum nor the Company Information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, provided, that the Issuer makes no representation or warranty as to the Dealer Information. 318 2.11 Each (a) issuance of Notes by the Issuer hereunder and (b) amendment or supplement of the Private Placement Memorandum shall be deemed a representation and warranty by the Issuer to the Dealer, as of the date thereof, that, both before and after giving effect to such issuance and after giving effect to such amendment or supplement, (i) the representations and warranties given by the Issuer set forth above in this Section 2 remain true and correct on and as of such date as if made on and as of such date, (ii) in the case of an issuance of Notes, the Notes being issued on such date have been duly and validly issued and constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) and limitations on rights to indemnity and contribution imposed by applicable law, and (iii) in the case of an issuance of Notes, since the date of the most recent Private Placement Memorandum, there has been no material adverse change in the financial condition or operations of the Issuer and its subsidiaries taken as a whole which has not been disclosed to the Dealer in writing. Section 3. Covenants and Agreements of Issuer The Issuer covenants and agrees that: 3.1 The Issuer will give the Dealer prompt notice (but in any event prior to any subsequent issuance of Notes hereunder) of any amendment to, modification of, or waiver with respect to, the Notes or the Issuing and Paying Agency Agreement, including a complete copy of any such amendment, modification or waiver. 3.2 The Issuer shall, whenever there shall occur any event that could reasonably be expected to have a material adverse effect on the financial condition or results of operations of the Issuer and its subsidiaries taken as a whole, or any adverse development or occurrence in relation to the Issuer that would reasonably be expected to be material to the holders of the Notes or potential holders of the Notes or the ability of the Issuer to perform its obligations under this Agreement or the Notes, notify the Dealer (by telephone, confirmed in writing) of such event prior to any subsequent issuances of Notes hereunder. The Issuer shall, whenever it (i) receives notice of any downgrading or intended downgrading or any review for potential change in the rating accorded any of the Issuer's securities by any nationally recognized statistical rating organization which has published a rating of the Notes (a "Rating Agency"), or (ii) provides material information to any Rating Agency that could reasonably be expected to result in a downgrading or review for potential change in the rating accorded any of the Issuer's securities by any Rating Agency, in each case, promptly, and in any event prior to any subsequent issuance of Notes hereunder, notify the Dealer (by telephone, confirmed in writing) of such occurrence. 319 3.3 The Issuer shall from time to time upon the request of the Dealer furnish to the Dealer copies of all materials provided by the Issuer to any national securities exchange regarding (i) the Issuer's operations and financial condition, and (ii) due authorization and execution of the Notes, and (iii) the Issuer's ability to pay the Notes as they mature. 3.4 The Issuer will take all such action as the Dealer may reasonably request to ensure that each offer and each sale of the Notes will comply with any applicable state Blue Sky laws; provided, that the Issuer shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation in any jurisdiction in which it is not so qualified or subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. 3.5 The Issuer shall not issue Notes hereunder until the Dealer shall have received (a) an opinion of counsel to the Issuer, addressed to the Dealer, satisfactory in form and substance to the Dealer, (b) a copy of the executed Issuing and Paying Agency Agreement as then in effect, (c) a copy of resolutions adopted by the Board of Directors of the Issuer, satisfactory in form and substance to the Dealer and certified by the Secretary or similar officer of the Issuer, authorizing execution and delivery by the Issuer of this Agreement the Issuing and Paying Agency Agreement and the Notes and consummation by the Issuer of the transactions contemplated hereby and thereby, (d) prior to the issuance of any Notes represented by a book-entry note registered in the name of DTC or its nominee, a copy of the executed Letter of Representations among the Issuer, the Issuing and Paying Agent and DTC, and (e) such other certificates, opinions, letters and documents as the Dealer shall have reasonably requested. 3.6 The Issuer shall reimburse the Dealer for all of the Dealer's reasonable out-of-pocket expenses related to this Agreement, including expenses incurred in connection with its preparation and negotiation, and the transactions contemplated hereby (including, but not limited to, the printing and distribution of the Private Placement Memorandum), and, if applicable, for the reasonable fees and out-of-pocket expenses of the Dealer's counsel. 3.7 Without limiting any obligation of the Issuer pursuant to this Agreement to provide the Dealer with credit and financial information, the Issuer hereby acknowledges and agrees that the Dealer may share the Company Information and any other information or matters relating to the Issuer or the transactions contemplated hereby with affiliates of the Dealer, and that such affiliates may likewise share information relating to the Issuer or such transactions with the Dealer. Section 4. Disclosure 4.1 The Private Placement Memorandum and its contents (other than the Dealer Information) shall be the sole responsibility of the Issuer. The Private Placement Memorandum shall contain a statement expressly offering an opportunity for each prospective purchaser to ask questions of, and receive answers from, the Issuer concerning the offering of Notes and to obtain relevant additional information which the Issuer possesses or can acquire without unreasonable effort or expense. 320 4.2 The Issuer agrees promptly to furnish the Dealer the Company Information as it becomes available. 4.3 (a) The Issuer further agrees to notify the Dealer promptly upon the occurrence of any event relating to or affecting the Issuer that would cause the Company Information then in existence to include an untrue statement of material fact or to omit to state a material fact necessary in order to make the statements contained therein, in light of the circumstances under which they are made, not misleading. (b) In the event that the Issuer gives the Dealer notice pursuant to Section 4.3(a) and the Dealer notifies the Issuer that it then has Notes it is holding in inventory, the Issuer agrees promptly to supplement or amend the Private Placement Memorandum so that such Private Placement Memorandum, as amended or supplemented, shall not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and the Issuer shall make such supplement or amendment available to the Dealer. (c) In the event that (i) the Issuer gives the Dealer notice pursuant to Section 4.3(a) and (ii) the Dealer does not notify the Issuer that it is then holding Notes in inventory and (iii) the Issuer chooses not to promptly amend or supplement the Private Placement Memorandum in the manner described in clause (b) above, then all solicitations and sales of Notes shall be suspended until such time as the Issuer has so amended or supplemented the Private Placement Memorandum, and made such amendment or supplement available to the Dealer. Section 5. Indemnification and Contribution 5.1 The Issuer will indemnify and hold harmless the Dealer, each individual, corporation, partnership, trust, association or other entity controlling the Dealer, within the meaning of Section 15 of the Securities Act, any affiliate of the Dealer or any such controlling entity and their respective directors, officers, employees, partners and incorporators (hereinafter the "Indemnitees") against any and all liabilities, penalties, suits, causes of action, losses, damages, claims, costs and expenses (including, without limitation, reasonable fees and disbursements of counsel) or judgments of whatever kind or nature (each a "Claim"), imposed upon, incurred by or asserted against the Indemnitees arising out of or based upon (i) any allegation that the Private Placement Memorandum, the Company Information or any information provided by the Issuer to the Dealer included (as of any relevant time of offer and sale of the Notes by the Issuer) or includes an untrue statement of a material fact or omitted (as of any relevant time of offer and sale of the Notes by the Issuer) or omits to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or (ii) arising out of or based upon the breach by the Issuer of any agreement, covenant or representation made in or pursuant to this Agreement; provided, however, that the foregoing indemnity shall not extend to any Claims to the extent they arise out of or are based upon the Dealer's breach of its obligations hereunder (it being understood that the Dealer has no obligation to prepare or cause to be prepared any updates or supplements to the Private Placement Memorandum). This indemnification shall not apply to the extent that the Claim arises out of or is based on Dealer Information. 321 5.2 Provisions relating to claims made for indemnification under this Section 5 are set forth on Exhibit B to this Agreement. 5.3 In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in clause (i) of Section 5.1 is held to be unavailable or insufficient to hold harmless the Indemnitees, although applicable in accordance with the terms of this Section 5, the Issuer shall contribute to the aggregate costs incurred by the Dealer in connection with any Claim in the proportion of the respective economic interests of the Issuer and the Dealer; provided, however, that such contribution by the Issuer shall be in an amount such that the aggregate costs incurred by the Dealer do not exceed the aggregate of the commissions and fees earned by the Dealer hereunder with respect to the issue or issues of Notes to which such Claim relates. The respective economic interests shall be calculated by reference to the aggregate proceeds to the Issuer of the Notes issued hereunder and the aggregate commissions and fees earned by the Dealer hereunder. Section 6. Definitions 6.1 "Claim" shall have the meaning set forth in Section 5.1. 6.2 "Company Information" at any given time shall mean the Private Placement Memorandum together with, to the extent applicable, (i) the Issuer's most recent report on Form 10-K filed with the SEC and each report on Form 10-Q or 8-K filed by the Issuer with the SEC since the most recent Form 10-K, (ii) the Issuer's most recent annual audited financial statements and each interim financial statement or report prepared subsequent thereto, if not included in item (i) above, (iii) the Issuer's and its affiliates' other publicly available recent reports, including, but not limited to, any publicly available filings or reports provided to their respective shareholders, (iv) any other information or disclosure prepared pursuant to Section 4.3 hereof and (v) any information prepared or approved by the Issuer for dissemination to investors or potential investors in the Notes. 6.3 "Dealer" shall mean Chase Securities Inc. 6.4 "Dealer Information" shall mean material concerning the Dealer and provided by the Dealer in writing expressly for inclusion in the Private Placement Memorandum. 6.5 "DTC" shall mean The Depository Trust Company. 6.6 "Exchange Act" shall mean the U.S. Securities Exchange Act of 1934, as amended. 6.7 "Indemnitee" shall have the meaning set forth in Section 5.1. 322 6.8 "Institutional Accredited Investor" shall mean an institutional investor that is an accredited investor within the meaning of Rule 501 under the Securities Act and that has such knowledge and experience in financial and business matters that it is capable of evaluating and bearing the economic risk of an investment in the Notes, including, but not limited to, a bank, as defined in Section 3(a)(2) of the Securities Act, or a savings and loan association or other institution, as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity. 6.9 "Issuing and Paying Agency Agreement" shall mean the issuing and paying agency agreement described on the cover page of this Agreement, as such agreement may be amended or supplemented from time to time. 6.10 "Issuing and Paying Agent" shall mean the party designated as such on the cover page of this Agreement, as issuing and paying agent under the Issuing and Paying Agency Agreement. 6.11 "Non-bank fiduciary or agent" shall mean a fiduciary or agent other than (a) a bank, as defined in Section 3(a)(2) of the Securities Act, or (b) a savings and loan association, as defined in Section 3(a)(5)(A) of the Securities Act. 6.12 "Private Placement Memorandum" shall mean offering materials prepared in accordance with Section 4 (including materials referred to therein or incorporated by reference therein) provided to purchasers and prospective purchasers of the Notes, and shall include amendments and supplements thereto which may be prepared from time to time in accordance with this Agreement (other than any amendment or supplement that has been completely superseded by a later amendment or supplement). 6.13 "Qualified Institutional Buyer" shall have the meaning assigned to that term in Rule 144A under the Securities Act. 6.14 "Rule 144A" shall mean Rule 144A under the Securities Act. 6.15 "SEC" shall mean the U.S. Securities and Exchange Commission. 6.16 "Securities Act" shall mean the U.S. Securities Act of 1933, as amended. 6.17 "Sophisticated Individual Accredited Investor" shall mean an individual who (a) is an accredited investor within the meaning of Regulation D under the Securities Act and (b) based on his or her pre- existing relationship with the Dealer, is reasonably believed by the Dealer to be a sophisticated investor (i) possessing such knowledge and experience (or represented by a fiduciary or agent possessing such knowledge and experience) in financial and business matters that he or she is capable of evaluating and bearing the economic risk of an investment in the Notes and (ii) having a net worth of at least $5 million. 323 Section 7. General 7.1 Unless otherwise expressly provided herein, all notices under this Agreement to parties hereto shall be in writing and shall be effective when received at the address of the respective party set forth in the Addendum to this Agreement. 7.2 This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to its conflict of laws provisions. 7.3 EACH OF THE DEALER AND THE ISSUER AGREES THAT ANY SUIT, ACTION OR PROCEEDING BROUGHT BY THE DEALER AGAINST THE ISSUER IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR THE NOTES OR THE OFFER AND SALE OF THE NOTES MAY BE BROUGHT IN THE U.S. FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN OR THE COURTS OF THE SATE OF NEW YORK LOCATED IN THE BOROUGH OF MANHATTAN. EACH OF THE DEALER AND THE ISSUER WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 7.4 This Agreement may be terminated, at any time, by the Issuer, upon one business day's prior notice to such effect to the Dealer, or by the Dealer upon one business day's prior notice to such effect to the Issuer. Any such termination, however, shall not affect the obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the respective representations, warranties, agreements, covenants, rights or responsibilities of the parties made or arising prior to the termination of this Agreement. 7.5 This Agreement is not assignable by either party hereto without the written consent of the other party; provided, however, that the Dealer may assign its rights and obligations under this Agreement to any wholly- owned direct or indirect subsidiary of the Dealer or of its ultimate parent. This Agreement shall not confer any rights or remedies upon any person other than the parties hereto and their respective permitted assigns. 7.6 This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 7.7 This Agreement constitutes the entire agreement between the parties hereto and supercedes any prior understandings, agreements or representations by or between the parties hereto, written or oral, to the extent they relate to the subject matter hereof. 7.7 Any payments to the Dealer hereunder, whether pursuant to Sections 3.6, 5.1 or otherwise, shall be in US dollars and shall be free of all withholding, stamp and other similar taxes and of all other governmental charges of any nature whatsoever. In the event any withholding is required by law, the Issuer agrees to (i) pay the same and (ii) pay such additional amounts to the Dealer which, after deduction of any such withholding, stamp or other taxes or governmental charges of any nature whatsoever imposed with respect to the payment of such additional amount, shall equal the amount withheld pursuant to clause (i). 324 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date and year first above written. TYSON FOODS, INC., as Issuer By: Name: Title: CHASE SECURITIES INC., as Dealer By: Name: Title: 325 ADDENDUM 1. The other dealers referred to in clause (b) of Section 1.2 of the Agreement are: Banc of America Securities LLC J.P. Morgan Securities Inc. Merrill Lynch Money Markets Inc., as Dealer for Notes with maturities up to 270 days Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Dealer for Notes with maturities over 270 days up to 365 days Credit Suisse First Boston Corporation SunTrust Equitable Securities Corp. 2. The addresses of the respective parties for purposes of notices under Section 7.1 are as follows: For the Issuer: Address: 2210 West Oakland Drive Springdale, Arkansas 72762-6999 Attention: General Counsel Telephone number: (501) 290-4000 Fax number: (501) 290-6776 For the Dealer: Address: 270 Park Avenue 9th Floor New York, New York 10017 Attention: Money Market Division Telephone number: 212-834-5070 Fax number: 212-834-6560 326 EXHIBIT A FORM OF LEGEND FOR PRIVATE PLACEMENT MEMORANDUM AND NOTES THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE ISSUER AND THE NOTES, THAT IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY DISTRIBUTION THEREOF AND THAT IT IS EITHER (A) AN INSTITUTIONAL INVESTOR OR HIGHLY SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL, (i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS THAT HE OR SHE IS CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN INVESTMENT IN THE NOTES AND (ii) HAS A NET WORTH OF AT LEAST $5 MILLION (AN "INSTITUTIONAL ACCREDITED INVESTOR" OR "SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR", RESPECTIVELY) AND THAT EITHER IS PURCHASING NOTES FOR ITS OWN ACCOUNT, IS A U.S. BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF THE ACT) ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY OR IS A FIDUCIARY OR AGENT (OTHER THAN A U.S. BANK OR SAVINGS AND LOAN) PURCHASING NOTES FOR ONE OR MORE ACCOUNTS EACH OF WHICH IS SUCH AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR (i) WHICH ITSELF POSSESSES SUCH KNOWLEDGE AND EXPERIENCE OR (ii) WITH RESPECT TO WHICH SUCH PURCHASER HAS SOLE INVESTMENT DISCRETION; OR (B) A QUALIFIED INSTITUTIONAL BUYER ("QIB") WITHIN THE MEANING OF RULE 144A UNDER THE ACT WHICH IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF WHICH IS A QIB AND WITH RESPECT TO EACH OF WHICH THE PURCHASER HAS SOLE INVESTMENT DISCRETION; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF SECTION 5 OF THE ACT PROVIDED BY RULE 144A. BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO CHASE SECURITIES INC. OR ANOTHER PERSON DESIGNATED BY THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES (COLLECTIVELY, THE "PLACEMENT AGENTS"), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2) THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR OR A QIB BY A PLACEMENT AGENT, OR (3) TO A QIB IN A TRANSACTION THAT MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000. 327 EXHIBIT B FURTHER PROVISIONS RELATING TO INDEMNIFICATION (a) The Issuer agrees to reimburse each Indemnitee for all expenses (including reasonable fees and disbursements of internal and external counsel) as they are incurred by it in connection with investigating or defending any loss, claim, damage, liability or action in respect of which indemnification may be sought under clause (i) of Section 5.1 of the Agreement (whether or not it is a party to any such proceedings). (b) Promptly after receipt by an Indemnitee of notice of the existence of a Claim arising under clause (i) of Section 5.1 of the Agreement, such Indemnitee will, if a claim in respect thereof is to be made against the Issuer, notify the Issuer in writing of the existence thereof; provided that (i) the omission so to notify the Issuer will not relieve it from any liability which it may have hereunder unless and except to the extent it did not otherwise learn of such Claim and the issuer is materially prejudiced thereby as determined by a court of law, and (ii) the omission so to notify the Issuer will not relieve it from liability which it may have to an Indemnitee otherwise than on account of this indemnity agreement. In case any such Claim is made against any Indemnitee and it notifies the Issuer of the existence thereof, the Issuer will be entitled to participate therein, and to the extent that it may elect by written notice delivered to the Indemnitee, to assume the defense thereof, with counsel reasonably satisfactory to such Indemnitee; provided that if the defendants in any such Claim include both the Indemnitee and the Issuer and the Indemnitee shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Issuer, the Issuer shall not have the right to direct the defense of such Claim on behalf of such Indemnitee, and the Indemnitee shall have the right to select separate counsel to assert such legal defenses on behalf of such Indemnitee. Upon receipt of notice from the Issuer to such Indemnitee of the Issuer's election so to assume the defense of such Claim and approval by the Indemnitee of counsel, the Issuer will not be liable to such Indemnitee for expenses incurred thereafter by the Indemnitee in connection with the defense thereof (other than reasonable costs of investigation) unless (i) the Indemnitee shall have employed separate counsel in connection with the assertion of legal defenses in accordance with the proviso to the next preceding sentence (it being understood, however, that the Issuer shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel in the jurisdiction in which any Claim is brought), approved by the Dealer, representing the Indemnitee who is party to such Claim), (ii) the Issuer shall not have employed counsel reasonably satisfactory to the Indemnitee to represent the Indemnitee within a reasonable time after notice of existence of the Claim or (iii) the Issuer has authorized in writing the employment of counsel for the Indemnitee. The indemnity, reimbursement and contribution obligations of the Issuer hereunder shall be in addition to any other liability the Issuer may otherwise have to an Indemnitee and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer and any Indemnitee. The Issuer agrees that without the Dealer's prior written consent, it will not settle, compromise or consent to the entry of any judgment in any Claim in respect of which 328 indemnification may be sought under the indemnification provision of the Agreement (whether or not the Dealer or any other Indemnitee is an actual or potential party to such Claim), unless such settlement, compromise or consent includes an unconditional release of each Indemnitee from all liability arising out of such Claim. 329 -----END PRIVACY-ENHANCED MESSAGE-----