UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
June 9, 2017 (June 7, 2017)
Date of report (date of earliest event reported)
ADVANCEPIERRE FOODS HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-37826 | 26-3712208 | ||
| (State of Incorporation) |
(Commission file number) |
(I.R.S. Employer Identification No.) |
| 9987 Carver Road, Blue Ash, OH | 45242 | |
| (Address of principal executive offices) | (Zip Code) |
(800) 969-2747
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.02. | Termination of a Material Definitive Agreement. |
On June 7, 2017, in connection with the consummation of the Merger (as defined below), AdvancePierre Foods, Inc., a Delaware corporation (“AdvancePierre Foods”), repaid all outstanding principal amounts under the Term Loan Agreement, dated as of June 2, 2016, among AdvancePierre Foods Holdings, Inc., a Delaware corporation (“AdvancePierre”), Pierre Holdco, Inc., a Delaware corporation, AdvancePierre Foods, as the borrower, the lenders party thereto and Morgan Stanley Senior Funding, Inc. (“Morgan Stanley”), as administrative agent and security agent (as amended from time to time, the “Term Loan Credit Agreement”), together with all accrued interest and fees and expenses thereunder. In connection with such repayment, all guarantees of obligations under the Term Loan Credit Agreement, and all liens and security interests securing such obligations, were released and terminated.
In addition, on June 7, 2017, in connection with the consummation of the Merger, AdvancePierre Foods repaid all outstanding principal amounts, and permanently terminated all commitments, under the Second Amended and Restated Credit Agreement, dated as of October 10, 2012, among AdvancePierre Foods, as the borrower, the lenders party thereto and Wells Fargo Capital Finance, LLC, as administrative agent (as amended from time to time, the “ABL Credit Agreement”), together with all accrued interest and fees and expenses thereunder. In connection with such repayment and commitment termination, all guarantees of obligations under the ABL Credit Agreement, and all liens and security interests securing such obligations, were released and terminated.
In addition, on June 7, 2017, in connection with the consummation of the Merger, AdvancePierre terminated (i) the Stockholders Agreement (the “Stockholders Agreement”), by and between AdvancePierre and OCM Principal Opportunities Fund IV Delaware, L.P. (“OCM POF”) and (ii) the Third Amended and Restated Registration Rights Agreement (the “Registration Rights Agreement”), by and among AdvancePierre, OCM POF, OCM APFH Holdings, LLC (“OCM APFH”) and the other stockholders named therein, except with respect to AdvancePierre’s indemnification obligations to OCM POF, OCM APFH and certain other stockholders under the Registration Rights Agreement. Except with respect to the indemnification obligations of AdvancePierre under the Registration Rights Agreement, all rights, obligations, responsibilities and liabilities of AdvancePierre under the Stockholders Agreement and Registration Rights Agreement have been repealed and eliminated. The foregoing summaries of the Stockholders Agreement and the Registration Rights Agreement do not purport to be complete and are subject to, and qualified in their entirety by, the full text of the Stockholders Agreement and the Registration Rights Agreement, copies of which are attached as Exhibit 10.1 and Exhibit 10.2, respectively, to AdvancePierre’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on July 25, 2016, and incorporated herein by reference.
The information contained in Item 2.04 of this Form 8-K is incorporated herein by reference.
| Item 2.01. | Completion of Acquisition or Disposition of Assets. |
As previously disclosed in the Current Report on Form 8-K filed by AdvancePierre with the SEC, AdvancePierre entered into an Agreement and Plan of Merger (the “Merger Agreement”), dated as of April 25, 2017, with Tyson Foods, Inc., a Delaware corporation (“Tyson”), and DVB Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Tyson (“Merger Sub”). Pursuant to the Merger Agreement, on May 9, 2017, Merger Sub commenced a tender offer to purchase any and all of the outstanding shares of common stock, par value $0.01 per share, of AdvancePierre (the “Shares”), at a price of $40.25 per Share (the “Offer Price”), net to the seller in cash, without interest, subject to any required withholding of taxes, upon the terms and subject to the conditions set forth in the Offer to Purchase dated May 9, 2017 (as amended or supplemented from time to time, the “Offer to Purchase”), and in the related Letter of Transmittal (as amended or supplemented from time to time, the “Letter of Transmittal,” and together with the Offer to Purchase and other related materials, as each may be amended or supplemented from time to time, the “Offer”), filed as Exhibit (a)(1)(A) and Exhibit (a)(1)(B), respectively, to the Tender Offer Statement on Schedule TO originally filed with the SEC by Tyson and Merger Sub on May 9, 2017 (as amended or supplemented from time to time, the “Schedule TO”).
The Offer expired at 12:00 midnight, New York City time, at the end of the day on June 6, 2017. American Stock Transfer & Trust Company LLC, in its capacity as depositary and paying agent for the Offer (the “Depositary”), has advised Tyson and Merger Sub that a total of 68,648,055 Shares were validly tendered and not validly withdrawn (excluding, for the avoidance of doubt, Shares presented pursuant to guaranteed delivery procedures provided by Tyson, but which have not yet been validly tendered in satisfaction of such guarantee and in accordance with such procedures) pursuant to the Offer as of the Expiration Date,
representing approximately 87.27% of the outstanding Shares. In addition, notices of guaranteed delivery have been delivered for 1,890,809 Shares, representing approximately 2.40% of the outstanding Shares. All conditions to the Offer having been satisfied or waived, on June 7, 2017, Merger Sub accepted for payment all Shares validly tendered and not validly withdrawn prior to the Expiration Date (as defined in the Offer), and payment of the Offer Price for such Shares will be made by the Depositary in accordance with the terms of the Merger Agreement.
On June 7, 2017 (the “Closing Date”), pursuant to the terms of the Merger Agreement and in accordance with Section 251(h) of the Delaware General Corporation Law (the “DGCL”), Merger Sub merged with and into AdvancePierre, with AdvancePierre continuing as the surviving corporation (the “Surviving Corporation”) (the “Merger”). Upon completion of the Merger, AdvancePierre became a wholly owned subsidiary of Tyson.
Pursuant to the Merger Agreement, at the effective time of the Merger (the “Effective Time”), any Shares not purchased pursuant to the Offer (other than (i) Shares owned by Tyson, Merger Sub, AdvancePierre (or held in AdvancePierre’s treasury) or any direct or indirect wholly owned subsidiary of Tyson or AdvancePierre or (ii) Shares held by any stockholder that has properly exercised appraisal rights under the DGCL) were automatically converted into the right to receive, in cash and without interest, an amount equal to the Offer Price (the “Merger Consideration”).
Any option (or portion thereof) to acquire Shares that was granted or issued pursuant to any Employee Plan (as defined in the Merger Agreement) that was outstanding immediately prior to the Effective Time (collectively, the “Company Stock Options”) was canceled and converted into the right to receive an amount in cash determined by multiplying (i) the excess, if any, of the Merger Consideration over the applicable exercise price of such canceled Company Stock Option by (ii) the number of Shares subject to such Company Stock Option immediately prior to the Effective Time, without interest and subject to any applicable withholding of taxes. In addition, any restricted stock unit granted or issued pursuant to any Employee Plan that was outstanding immediately prior to the Effective Time (collectively, the “Company RSUs”) was canceled and converted into the right to receive solely an amount in cash equal to the product of (i) the Merger Consideration and (ii) the total number of Shares subject to such Company RSU, without interest and subject to any applicable withholding of taxes. In addition, any restricted Share granted or issued pursuant to any Employee Plan that was outstanding immediately prior to the Effective Time was converted into the right to receive solely an amount in cash equal to the Merger Consideration, without interest and subject to any applicable withholding of taxes.
The aggregate consideration for the transaction, net of AdvancePierre’s cash and cash equivalents, was approximately $4.2 billion.
The foregoing summary description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the terms of the Merger Agreement, which was filed as Exhibit 2.1 to the Current Report on Form 8-K filed by AdvancePierre with the SEC on April 25, 2017 and is incorporated by reference herein.
| Item 2.04. | Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement. |
As previously disclosed in the Tender Offer Solicitation/Recommendation on Schedule 14D-9 filed by AdvancePierre, with the SEC on May 9, 2017, the consummation of the Merger on June 7, 2017 triggered an acceleration provision under the Income Tax Receivable Agreement (the “Tax Receivable Agreement”) among AdvancePierre and certain of its pre-IPO stockholders (the “TRA Holders”). As a result, the Tax Receivable Agreement was terminated and AdvancePierre made (or will make) a lump-sum payment to the TRA Holders equal to $223,366,823.00, representing the present value of all future amounts that would have been payable under the Tax Receivable Agreement (based on the assumptions provided therein).
| Item 3.01. | Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing. |
On the Closing Date, in connection with the consummation of the Merger, AdvancePierre notified the New York Stock Exchange (“NYSE”) that the Merger had been consummated, and requested that the trading of Shares on the NYSE be halted after market close on the Closing Date and that the listing of the Shares on the NYSE be withdrawn. In addition, AdvancePierre requested that the NYSE file with the SEC a notification on Form 25 to report the delisting of the Shares from the NYSE and to deregister the Shares under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). AdvancePierre intends to file with the SEC a Form 15 suspending AdvancePierre’s reporting obligations under Sections 13 and
15(d) of the Exchange Act.
| Item 3.03. | Material Modification to Rights of Security Holders. |
The information set forth under Item 2.01, Item 2.04, Item 3.01, Item 5.01 and Item 5.03 of this Current Report on 8-K is incorporated by reference into this Item 3.03.
| Item 5.01. | Changes in Control of Registrant. |
As a result of Merger Sub’s acceptance for payment of all Shares that were validly tendered and not validly withdrawn pursuant to the Offer and the consummation of the Merger pursuant to Section 251(h) of the DGCL on the Closing Date, a change in control of AdvancePierre occurred, and AdvancePierre is now a wholly owned subsidiary of Tyson. Tyson obtained the funds necessary to fund the acquisition through (i) proceeds from the Term Loan Facility dated May 12, 2017 among Tyson, as borrower, the lenders party thereto and Morgan Stanley, as administrative agent, on the terms and conditions previously disclosed in the Schedule TO, (ii) proceeds from concurrent offerings of four series of senior notes due 2019, 2020, 2027 and 2047 on the terms and conditions previously disclosed in the Prospectus Supplement on Form 424B5 filed by Tyson on May 24, 2017, (iii) proceeds from the issuance of commercial paper or commercial notes and (iv) cash on hand.
The information set forth under Item 2.01, Item 2.04, Item 5.02 and Item 5.03 of this Current Report on Form 8-K is incorporated by reference into this Item 5.01.
| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
In connection with the Merger, pursuant to the terms of the Merger Agreement, at the Effective Time, Dean Hollis, Celeste A. Clark, Peter C. Dillingham, Stephen A. Kaplan, Gary L. Perlin, Matthew C. Wilson and Christopher D. Sliva each resigned and ceased to be directors of AdvancePierre and members of any committee of AdvancePierre’s board of directors. Pursuant to the Merger Agreement, the directors of Merger Sub, David L. Van Bebber and Dennis Leatherby, became the directors of the Surviving Corporation. Biographical information regarding the new directors has been previously disclosed under the heading “Directors and Executive Officers of Purchaser” of the section entitled “Schedule I” of the Offer to Purchase, which information is incorporated herein by reference.
In connection with the Merger, the officers of AdvancePierre ceased serving in such capacities. The officers of Merger Sub immediately prior to the Effective Time became the officers of the Surviving Corporation each to hold office in accordance with the Amended and Restated Certificate of Incorporation (as defined below) and the Amended and Restated By-Laws (as defined below) of the Surviving Corporation until their respective successors are duly appointed. Biographical information with respect to Messrs. Hayes, Leatherby, Van Bebber, Hudson, Munsell, Hodne and Tademy are included under the heading “Directors and Executive Officers of Purchaser” of the section entitled “Schedule I” of the Offer to Purchase, which information is incorporated herein by reference.
On June 6, 2017, the board of directors of AdvancePierre approved Tax Reimbursement Agreements with each of Christopher D. Sliva, Michael B. Sims, George F. Chappelle, Jr., James L. Clough and certain of AdvancePierre’s other employees (collectively, the “Tax Reimbursement Agreements”), as previously disclosed in the Schedule 14D-9 filed by AdvancePierre with the SEC on May 9, 2017 and in Amendment No. 4 thereto filed with the SEC on June 2, 2017. The Tax Reimbursement Agreements provide that in the event any employee party to any Tax Reimbursement Agreement becomes subject to an excise tax under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), such employee will be entitled to a tax reimbursement payment in respect of Section 4999 of the Code, inclusive of any income taxes, employment taxes and excise taxes applicable thereto. Notwithstanding the previous sentence, the Tax Reimbursement Agreements provide that in no event will the aggregate payments made under all of the Tax Reimbursement Agreements exceed $12,500,000, and will be allocated amongst such employees pro rata based on the maximum amount of such taxes that is reasonably expected to become payable by such employees. This summary does not purport to be complete and is subject to and qualified in its entirety by reference to the Tax Reimbursement Agreements, a form of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
| Item 5.03. | Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. |
Pursuant to the terms of the Merger Agreement, at the Effective Time, AdvancePierre’s certificate of incorporation, as in effect immediately prior to the Effective Time, was amended and restated in its entirety (the “Amended and Restated Certificate of
Incorporation”). In addition, pursuant to the terms of the Merger Agreement, at the Effective Time, AdvancePierre’s By-Laws, as in effect immediately prior to the Effective Time, were amended and restated in their entirety (the “Amended and Restated By-Laws”).
Copies of the Amended and Restated Certificate of Incorporation and the Amended and Restated By-Laws are filed as Exhibits 3.1 and 3.2, respectively, to this Current Report on Form 8-K, and are incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits. |
|
Exhibit |
Description | |
| 2.1 | Agreement and Plan of Merger, dated as of April 25, 2017, by and among AdvancePierre Foods Holdings, Inc., Tyson Foods, Inc. and DVB Merger Sub, Inc. (incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K filed by AdvancePierre Foods Holdings, Inc. with the SEC on April 25, 2017). | |
| 3.1 | Amended and Restated Certificate of Incorporation of AdvancePierre Foods Holdings, Inc. | |
| 3.2 | Amended and Restated By-Laws of AdvancePierre Foods Holdings, Inc. | |
| 10.1 | Form of Tax Reimbursement Agreement | |
SIGNATURES
Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ADVANCEPIERRE FOODS HOLDINGS, INC. | ||||
| Date: June 9, 2017 | By: | /s/ R. Read Hudson | ||
| Name: | R. Read Hudson | |||
| Title: | Vice President and Secretary | |||
EXHIBIT INDEX
|
Exhibit |
Description | |
| 2.1 | Agreement and Plan of Merger, dated as of April 25, 2017, by and among AdvancePierre Foods Holdings, Inc., Tyson Foods, Inc. and DVB Merger Sub, Inc. (incorporated herein by reference to Exhibit 2.1 to Current Report on Form 8-K filed by AdvancePierre Foods Holdings, Inc. with the SEC on April 25, 2017). | |
| 3.1 | Amended and Restated Certificate of Incorporation of AdvancePierre Foods Holdings, Inc. | |
| 3.2 | Amended and Restated By-Laws of AdvancePierre Foods Holdings, Inc. | |
| 10.1 | Form of Tax Reimbursement Agreement | |
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF
ADVANCEPIERRE FOODS HOLDINGS, INC.
ARTICLE I
The name of the corporation is AdvancePierre Foods Holdings, Inc. (the “Corporation”).
ARTICLE II
The address, including street, number, city, and county, of the registered office of the Corporation in the State of Delaware is The Corporation Trust Center, 1209 Orange Street, City of Wilmington, County of New Castle, State of Delaware 19801; and the name of the registered agent of the Corporation in the State of Delaware at such address is The Corporation Trust Company.
ARTICLE III
The purpose of the Corporation shall be to engage in any lawful act or activity for which corporations may be organized and incorporated under the General Corporation Law of the State of Delaware.
ARTICLE IV
(a) The Corporation shall be authorized to issue 1,000 shares of capital stock, all of which 1,000 shares shall be shares of common stock, par value $0.01 per share (the “Common Stock”).
(b) Except as otherwise provided by law, the Common Stock shall have the exclusive right to vote for the election of directors and for all other purposes. Each share of the Common Stock shall have one vote and the Common Stock shall vote together as a single class.
ARTICLE V
Any one or more directors may be removed, with or without cause, by the vote or written consent of the holders of a majority of the issued and outstanding shares of capital stock of the Corporation entitled to be voted in the election of directors.
ARTICLE VI
In furtherance and not in limitation of those powers conferred by law, the board of directors of the Corporation (the “Board”) is expressly authorized and empowered to make, alter and repeal the by-laws of the Corporation (the “By-Laws”).
ARTICLE VII
Meetings of the stockholders shall be held at such place, within or without the State of Delaware as may be designated by, or in the manner provided in, the By-Laws or, if not so designated, at the registered office of the Corporation in the State of Delaware. Elections of directors need not be by written ballot unless and to the extent that the By-Laws so provide.
ARTICLE VIII
The Corporation reserves the right at any time from time to time to amend, alter, change or repeal any provision contained in this Amended and Restated Certificate of Incorporation, and any other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted, in the manner now or hereinafter prescribed by law, and all rights, preferences and privileges of whatsoever nature conferred upon stockholders, directors or any other persons whomsoever by and pursuant to this Amended and Restated Certificate of Incorporation in its present form or as hereafter amended are granted subject to the right reserved in this Article.
ARTICLE IX
A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the General Corporation Law of the State of Delaware or (iv) for any transaction from which the director derived an improper personal benefit. If the General Corporation Law of the State of Delaware is amended after approval by the stockholders of this Article to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director shall be eliminated or limited to the fullest extent permitted by the General Corporation Law of the State of Delaware, as so amended.
ARTICLE X
(a) The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “Proceeding”) by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another Corporation or of a partnership, joint venture, trust, nonprofit entity, or other enterprise, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys’ fees) reasonably incurred by such person. The Corporation shall be required to indemnify a person in connection with
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a Proceeding (or part thereof) initiated by such person only if the Proceeding (or part thereof) was authorized by the Board of the Corporation.
(b) The Corporation shall pay the expenses (including attorneys’ fees) incurred by an officer or director of the Corporation in defending any civil, criminal, administrative or investigative action, suit or proceeding in advance of its final disposition, upon receipt of an undertaking by or on behalf of such director or officer to repay all amounts advanced if it shall ultimately be determined that the director or officer is not entitled to be indemnified. Payment of such expenses incurred by former directors and officers, or by any other employees and agents of the Corporation, may be made by the Corporation, subject to such terms and conditions as the General Counsel in his or her discretion deems appropriate.
(c) If a claim for indemnification or payment of expenses (including attorneys’ fees) under this Article X is not paid in full within sixty days after a written claim therefor has been received by the Corporation the claimant may file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim. In any such action the Corporation shall have the burden of proving that the claimant was not entitled to the requested indemnification or payment of expenses under applicable law.
(d) The right conferred on any person by this Article X shall not be exclusive of any other rights which such person may have or hereafter acquire under any statute, provision of this Amended and Restated Certificate of Incorporation, the By-Laws, agreement, vote of stockholders or disinterested directors or otherwise.
(e) The Corporation’s obligation, if any, to indemnify any person who was or is serving at its request as a director, officer, employee or agent of another company, partnership, joint venture, trust, enterprise or nonprofit entity shall be reduced by any amount such person may collect as indemnification from such other company, partnership, joint venture, trust, nonprofit entity, or other enterprise.
(f) Any repeal or modification of the foregoing provisions of this Article X shall not adversely affect any right or protection hereunder of any person in respect of any act or omission occurring prior to the time of such repeal or modification.
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AMENDED
AND RESTATED BYLAWS
OF
ADVANCEPIERRE FOODS HOLDINGS, INC.
* * * * *
Article
1
Offices
Section 1.01. Registered Office. The registered office of the Corporation shall be in the City of Wilmington, County of New Castle, State of Delaware.
Section 1.02. Other Offices. The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.
Section 1.03. Books. The books of the Corporation may be kept within or without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.
Article
2
Meetings of Stockholders
Section 2.01. Time and Place of Meetings. All meetings of stockholders shall be held at such place, either within or without the State of Delaware, on such date and at such time as may be determined from time to time by the Board of Directors (or the Chairman in the absence of a designation by the Board of Directors).
Section 2.02. Annual Meetings. Unless directors are elected by written consent in lieu of an annual meeting as permitted by the General Corporation Law of the State of Delaware as the same exists or may hereafter be amended (“Delaware Law”), an annual meeting of stockholders, commencing with the year 2018, shall be held for the election of directors and to transact such other business as may properly be brought before the meeting. Stockholders may, unless the certificate of incorporation otherwise provides, act by written consent to elect directors; provided, however, that if such consent is less than unanimous, such action by written consent may be in lieu of holding an annual meeting only if all of the directorships to which directors could be elected at an annual meeting held at the effective time of such action are vacant and are filled by such action.
Section 2.03. Special Meetings. Special meetings of stockholders may be called by the Board of Directors or the Chairman of the Board and shall be called by the Secretary at the request in writing of holders of record of a majority of the outstanding capital stock of the Corporation entitled to vote. Such request shall state the purpose or purposes of the proposed meeting.
Section 2.04. Notice of Meetings and Adjourned Meetings; Waivers of Notice. (a) Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, if any, date and hour of the meeting, the means of remote communications, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Unless otherwise provided by Delaware Law, such notice shall be given not less than 10 nor more than 60 days before the date of the meeting to each stockholder of record entitled to vote at such meeting. Unless these amended and restated bylaws otherwise require, when a meeting is adjourned to another time or place (whether or not a quorum is present), notice need not be given of the adjourned meeting if the time, place, if any, and the means of remote communications, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, are announced at the meeting at which the adjournment is taken. At the adjourned meeting, the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 30 days, or after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.
(b) A written waiver of any such notice signed by the person entitled thereto, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice.
Section 2.05. Quorum. Unless otherwise provided under the certificate of incorporation or these amended and restated bylaws and subject to Delaware Law, the presence, in person or by proxy, of the holders of a majority of the outstanding capital stock of the Corporation entitled to vote at a meeting of stockholders shall constitute a quorum for the transaction of business. If, however, such quorum shall not be present or represented at any meeting of the stockholders, a majority in voting interest of the stockholders present in person or represented by proxy may adjourn the meeting, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented any business may be transacted which might have been transacted at the meeting as originally notified.
Section 2.06. Voting. (a) Unless otherwise provided in the certificate of incorporation and subject to Delaware Law, each stockholder shall be entitled to one vote for each outstanding share of capital stock of the Corporation held by such stockholder. Any share of capital stock of the Corporation held by the Corporation shall have no voting rights. Except as otherwise provided by law, the certificate of incorporation or these amended and restated bylaws, in all matters other than the election of directors, the affirmative vote of the majority of the shares of capital stock of the Corporation present
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in person or represented by proxy at the meeting and entitled to vote on the subject matter shall be the act of the stockholders.
(b) Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to a corporate action in writing without a meeting may authorize another person or persons to act for such stockholder by proxy, appointed by an instrument in writing, subscribed by such stockholder or by his attorney thereunto authorized, or by proxy sent by cable, telegram or by any means of electronic communication permitted by law, which results in a writing from such stockholder or by his attorney, and delivered to the secretary of the meeting. No proxy shall be voted after three years from its date, unless said proxy provides for a longer period.
(c) In determining the number of votes cast for or against a proposal or nominee, shares abstaining from voting on a matter will not be treated as a vote cast.
Section 2.07. Action by Consent. (a) Unless otherwise provided in the certificate of incorporation and subject to the proviso in Section 2.02, any action required to be taken at any annual or special meeting of stockholders, or any action which may be taken at any annual or special meeting of stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding capital stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation by delivery to its registered office in Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of stockholders to take the action were delivered to the Corporation as provided in Section 2.07(b).
(b) Every written consent shall bear the date of signature of each stockholder who signs the consent, and no written consent shall be effective to take the corporate action referred to therein unless, within 60 days of the earliest dated consent delivered in the manner required by this section and Delaware Law to the Corporation, written consents signed by a sufficient number of holders to take action are delivered to the Corporation by delivery to its registered office in Delaware, its principal place of business or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.
Section 2.08. Organization. At each meeting of stockholders, the Chairman of the Board, if one shall have been elected, or in the Chairman’s absence or if one shall not
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have been elected, the director designated by the vote of the majority of the directors present at such meeting, shall act as chairman of the meeting. The Secretary (or in the Secretary’s absence or inability to act, the person whom the chairman of the meeting shall appoint secretary of the meeting) shall act as secretary of the meeting and keep the minutes thereof.
Section 2.09. Order of Business. The order of business at all meetings of stockholders shall be as determined by the chairman of the meeting.
Article
3
Directors
Section 3.01. General Powers. Except as otherwise provided in Delaware Law or the certificate of incorporation, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.
Section 3.02. Number, Election and Term Of Office. (a) The number of directors which shall constitute the whole Board shall be fixed from time to time by resolution of the Board of Directors but shall not be less than one or more than nine. The directors shall be elected at the annual meeting of the stockholders by written ballot, except as provided in Section 2.02 and Section 3.12 herein, and each director so elected shall hold office until such director’s successor is elected and qualified or until such director’s earlier death, resignation or removal. Directors need not be stockholders.
(b) Subject to the rights of the holders of any series of preferred stock to elect additional directors under specific circumstances, directors shall be elected by a plurality of the votes of the shares of capital stock of the Corporation present in person or represented by proxy at the meeting and entitled to vote on the election of directors.
Section 3.03. Quorum and Manner of Acting. Unless the certificate of incorporation or these amended and restated bylaws require a greater number, a majority of the total number of directors shall constitute a quorum for the transaction of business, and the affirmative vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors. When a meeting is adjourned to another time or place (whether or not a quorum is present), notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting, the Board of Directors may transact any business which might have been transacted at the original meeting. If a quorum shall not be present at any meeting of the Board of Directors the directors present thereat shall adjourn the meeting, from time to time, without notice other than announcement at the meeting, until a quorum shall be present.
Section 3.04. Time and Place of Meetings. The Board of Directors shall hold its meetings at such place, either within or without the State of Delaware, and at such time as may be determined from time to time by the Board of Directors (or the Chairman in the absence of a determination by the Board of Directors).
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Section 3.05. Annual Meeting. The Board of Directors shall meet for the purpose of organization, the election of officers and the transaction of other business, as soon as practicable after each annual meeting of stockholders, on the same day and at the same place where such annual meeting shall be held. Notice of such meeting need not be given. In the event such annual meeting is not so held, the annual meeting of the Board of Directors may be held at such place either within or without the State of Delaware, on such date and at such time as shall be specified in a notice thereof given as hereinafter provided in Section 3.07 herein or in a waiver of notice thereof signed by any director who chooses to waive the requirement of notice.
Section 3.06. Regular Meetings. After the place and time of regular meetings of the Board of Directors shall have been determined and notice thereof shall have been once given to each member of the Board of Directors, regular meetings may be held without further notice being given.
Section 3.07. Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board or the President and shall be called by the Chairman of the Board, President or Secretary on the written request of any one director. Notice of special meetings of the Board of Directors shall be given to each director at least three days before the date of the meeting in such manner as is determined by the Board of Directors.
Section 3.08. Committees. The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to any of the following matters: (a) approving or adopting, or recommending to the stockholders, any action or matter (other than the election or removal of directors) expressly required by Delaware Law to be submitted to the stockholders for approval or (b) adopting, amending or repealing any bylaw of the Corporation. Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required.
Section 3.09. Action by Consent. Unless otherwise restricted by the certificate of incorporation or these amended and restated bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board or committee, as the case may be, consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions, are filed with the minutes of proceedings of the
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Board or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.
Section 3.10. Telephonic Meetings. Unless otherwise restricted by the certificate of incorporation or these amended and restated bylaws, members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting of the Board of Directors, or such committee, as the case may be, by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.
Section 3.11. Resignation. Any director may resign at any time by giving notice in writing or by electronic transmission to the Board of Directors or to the Secretary of the Corporation. The resignation of any director shall take effect upon receipt of notice thereof or at such later time as shall be specified in such notice; and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Section 3.12. Vacancies. Unless otherwise provided in the certificate of incorporation, vacancies and newly created directorships resulting from any increase in the authorized number of directors elected by all the stockholders having the right to vote as a single class may be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director. Whenever the holders of any class or classes of stock or series thereof are entitled to elect one or more directors by the certificate of incorporation, vacancies and newly created directorships of such class or classes or series may be filled by a majority of directors elected by such class or classes or series thereof then in office, or by a sole remaining director so elected. Each director so chosen shall hold office until his or her successor is elected and qualified, or until his or her earlier death, resignation or removal. If there are no directors in office, then an election of directors may be held in accordance with Delaware Law. Unless otherwise provided in the certificate of incorporation, when one or more directors shall resign from the Board, effective at a future date, a majority of the directors then in office shall have the power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office as provided in the filling of other vacancies.
Section 3.13. Removal. Any director or the entire Board of Directors may be removed, with or without cause, at any time by the affirmative vote of the holders of a majority of the outstanding capital stock of the Corporation then entitled to vote at any election of directors and the vacancies thus created may be filled in accordance with Section 3.12 herein.
Section 3.14. Compensation. Unless otherwise restricted by the certificate of incorporation or these amended and restated bylaws, the Board of Directors shall have authority to fix the compensation of directors, including fees and reimbursement of expenses.
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Article
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Officers
Section 4.01. Principal Officers. The principal officers of the Corporation shall be a President, one or more Vice Presidents, a Treasurer and a Secretary who shall have the duty, among other things, to record the proceedings of the meetings of stockholders and directors in a book kept for that purpose. The Corporation may also have such other principal officers, including one or more Controllers, as the Board may in its discretion appoint. One person may hold the offices and perform the duties of any two or more of said offices, except that no one person shall hold the offices and perform the duties of President and Secretary.
Section 4.02. Election, Term of Office and Remuneration. Each officer of the Corporation shall hold office until his or her successor is elected and qualified, or until his or her earlier death, resignation or removal. The remuneration of all officers of the Corporation shall be fixed by the Board of Directors. Any vacancy in any office shall be filled in such manner as the Board of Directors shall determine.
Section 4.03. Subordinate Officers. In addition to the principal officers enumerated in Section 4.01 herein, the Corporation may have one or more Assistant Treasurers, Assistant Secretaries and Assistant Controllers and such other subordinate officers, agents and employees as the Board of Directors may deem necessary, each of whom shall hold office for such period as the Board of Directors may from time to time determine. The Board of Directors may delegate to any principal officer the power to appoint and to remove any such subordinate officers, agents or employees.
Section 4.04. Removal. Except as otherwise permitted with respect to subordinate officers, any officer may be removed, with or without cause, at any time, by resolution adopted by the Board of Directors.
Section 4.05. Resignations. Any officer may resign at any time by giving written notice to the Board of Directors (or to a principal officer if the Board of Directors has delegated to such principal officer the power to appoint and to remove such officer). The resignation of any officer shall take effect upon receipt of notice thereof or at such later time as shall be specified in such notice; and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Section 4.06. Powers and Duties. The officers of the Corporation shall have such powers and perform such duties incident to each of their respective offices and such other duties as may from time to time be conferred upon or assigned to them by the Board of Directors.
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Capital Stock
Section 5.01. Certificates For Stock; Uncertificated Shares. The shares of the Corporation shall be represented by certificates, provided that the Board of Directors of
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the Corporation may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation. Except as otherwise provided by law, the rights and obligations of the holders of uncertificated shares and the rights and obligations of the holders of shares represented by certificates of the same class and series shall be identical. Every holder of stock represented by certificates shall be entitled to have a certificate signed by, or in the name of, the Corporation by any two authorized officers of the corporation representing the number of shares registered in certificate form. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue. A Corporation shall not have power to issue a certificate in bearer form.
Section 5.02. Transfer Of Shares. Shares of the stock of the Corporation may be transferred on the record of stockholders of the Corporation by the holder thereof or by such holder’s duly authorized attorney upon surrender of a certificate therefor properly endorsed or upon receipt of proper transfer instructions from the registered holder of uncertificated shares or by such holder’s duly authorized attorney and upon compliance with appropriate procedures for transferring shares in uncertificated form, unless waived by the Corporation.
Section 5.03. Authority for Additional Rules Regarding Transfer. The Board of Directors shall have the power and authority to make all such rules and regulations as they may deem expedient concerning the issue, transfer and registration of certificated or uncertificated shares of the stock of the Corporation, as well as for the issuance of new certificates in lieu of those which may be lost or destroyed, and may require of any stockholder requesting replacement of lost or destroyed certificates, bond in such amount and in such form as they may deem expedient to indemnify the Corporation, and/or the transfer agents, and/or the registrars of its stock against any claims arising in connection therewith.
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General Provisions
Section 6.01. Fixing the Record Date. (a) In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than 60 nor less than 10 days before the date of such meeting. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of
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record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided that the Board of Directors may fix a new record date for the adjourned meeting.
(b) In order that the Corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which date shall not be more than 10 days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date has been fixed by the Board of Directors, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by Delaware Law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office in Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by Delaware Law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.
(c) In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than 60 days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.
Section 6.02. Dividends. Subject to limitations contained in Delaware Law and the certificate of incorporation, the Board of Directors may declare and pay dividends upon the shares of capital stock of the Corporation, which dividends may be paid either in cash, in property or in shares of the capital stock of the Corporation.
Section 6.03. Year. The fiscal year of the Corporation shall end on the Saturday nearest the 30th day of September of each year, except as may be modified by the Board of Directors in its discretion as provided herein.
Section 6.04. Corporate Seal. The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Delaware”. The seal may be used by causing it or a facsimile thereof to be impressed, affixed or otherwise reproduced.
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Section 6.05. Voting of Stock Owned by a Corporation. The Board of Directors may authorize any person, on behalf of the Corporation, to attend, vote at and grant proxies to be used at any meeting of stockholders of any corporation (except this Corporation) in which the Corporation may hold stock.
Section 6.06. Amendments. These amended and restated bylaws or any of them, may be altered, amended or repealed, or new bylaws may be made, by the stockholders entitled to vote thereon at any annual or special meeting thereof or by the Board of Directors.
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Exhibit 10.1
June 2, 2017
[Name]
Re: Tax Reimbursement Agreement
To [•]:
On April 25, 2017, AdvancePierre Foods Holdings, Inc. (the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement” and the transactions contemplated by the Merger Agreement, collectively, the “Transaction”) with Tyson Foods, Inc., a Delaware corporation (“Parent”), and DVB Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”). Pursuant to the Merger Agreement, Merger Sub commenced a cash tender offer to acquire all of the outstanding shares of common stock of the Company at a price per share of $40.25 net to each seller in cash, without interest, subject to any applicable withholding taxes. The Company has determined it is appropriate to enter into this letter agreement (this “Agreement”) with you in the event that you become subject to any Excise Tax (as defined below) in connection with or following the Transaction.
1. Certain Definitions. Capitalized terms not defined this Agreement shall have the meaning ascribed thereto in the Merger Agreement. The following terms shall have the following meanings for purposes of this Agreement:
a. “Accounting Firm” shall mean PricewaterhouseCoopers LLP or such other nationally recognized certified public accounting firm chosen by the Company.
b. “Code” shall mean the Internal Revenue Code of 1986, as amended.
c. “Excise Tax” shall mean the excise tax imposed by Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.
d. “Parachute Value” shall mean, with respect to a Payment, the present value as of the date of the Closing for purposes of Section 280G of the Code of the portion of such Payment that constitutes a “parachute payment” under Section 280G(b)(2), as determined by the Accounting Firm for purposes of determining whether and to what extent the Excise Tax will apply to such Payment.
e. “Payment” shall mean any payment or distribution in the nature of compensation (within the meaning of Section 280G(b)(2) of the Code) to or for your benefit, whether paid or payable pursuant to this Agreement or otherwise.
2. Gross-up Payment.
a. If it is determined that any Payment would be subject to any Excise Tax, then you shall be entitled to receive an additional payment (the “Gross-up Payment”) in an amount such that, after payment by you of all taxes (and any interest or penalties imposed with respect to such taxes), including without limitation any income, employment and other taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-up Payment, you retain an amount of the Gross-up Payment equal to the Excise Tax imposed upon the Payment. The Company’s obligation to make Gross-up Payments shall not be conditioned upon your continued employment with the Company, Parent or any of their respective Affiliates.
b. Notwithstanding anything to the contrary in this Agreement, the amount of the Gross-up Payment shall not exceed the product of (x) $12,500,000, multiplied by (y) a fraction the numerator of which equals the aggregate amount of all Gross-up Payments payable pursuant to this Agreement without regard to this Section 2(0), and the denominator of which equals the aggregate amount of all Gross-up Payments (not to exceed $12,500,000) payable to employees of the Company pursuant to this Agreement and all other Tax Reimbursement Agreements entered into on or about the date first above stated, determined without regard to any similar limitation provisions in any such agreements (such product, the “Cap”).
c. For purposes of determining the amount of any Gross-up Payment, you will be deemed to pay federal income tax at the highest marginal rate of federal income taxation in the calendar year in which the Gross-up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in your state and locality of residence on the date on which the Gross-up Payment is calculated, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes.
3. Determinations; Tax Returns.
a. Subject to the provisions of Section 4, all determinations required to be made under this Section 3(a), including whether and when a Gross-up Payment is required, the amount of such Gross-up Payment, and the assumptions to be utilized in arriving at such determination shall be made by the Accounting Firm. The Accounting Firm shall provide detailed supporting calculations both to the Company and you within fifteen (15) business days of the receipt of notice from you that there has been a Payment or such earlier time as is requested by the Company. The Company shall solely bear all fees and expenses of the Accounting Firm. Any determination by the Accounting Firm shall be binding upon you and the Company. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm, it is possible that some amount of Gross-up Payment will not have been made by the Company that should have been made (an “Underpayment”), consistent with the calculations required to be made pursuant to this Agreement. In the event the Company exhausts its remedies pursuant to Section 4 and you thereafter are required to make a
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payment of any Excise Tax, you shall so notify the Company, which will direct the Accounting Firm to determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to you or for your benefit (subject in all instances to the Cap). You and the Company shall each provide the Accounting Firm access to and copies of any books, records and documents in your or the Company’s possession, as the case may be, reasonably requested by the Accounting Firm, and otherwise cooperate with the Accounting Firm in connection with the preparation and issuance of the determination contemplated by this Section 3(a).
b. You agree that any federal, state and local income or other tax returns filed by you will be prepared and filed on a basis consistent with the determination of the Accounting Firm with respect to any Excise Tax payable by you. You agree that you will make proper payment of the amount of any Excise Tax, and at the request of the Company, provide to the Company true and correct copies (with any amendments) of your federal income tax return as filed with the Internal Revenue Service and corresponding state and local tax returns, if relevant, as filed with the applicable taxing authority, and such other documents reasonably requested by the Company, evidencing such payment. If prior to the filing of your federal income tax return, or corresponding state or local tax return, if relevant, the Accounting Firm determines that the amount of the Gross-Up Payment should be reduced, you agree that within fifteen (15) business days of receipt of written notice, to pay to the Company the amount of such reduction; provided the Accounting Firm has provided to you written documentation supporting such reduction prior to your filing of such tax returns.
4. Claims by the IRS. You shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-up Payment. Such notification shall be given as soon as practicable, but no later than fifteen (15) business days after you are informed in writing of such claim. You shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. You shall not pay such claim prior to the expiration of the thirty (30) calendar day period following the date on which you give such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies you in writing prior to the expiration of such period that the Company desires to contest such claim, you shall:
a. give the Company any information (including, without limitation, any written records or documents) reasonably requested by the Company relating to such claim;
b. take such action in connection with contesting such claim as the Company may reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company;
c. cooperate with the Company in good faith in order effectively to contest such claim; and
d. permit the Company to participate in any proceedings relating to such claim;
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provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest, and shall indemnify and hold you harmless, on an after-tax basis, for any Excise Tax or income, employment and other tax (including interest and penalties) imposed as a result of such representation and payment of costs and expenses (disregarding for this purpose the Cap). Without limitation on the foregoing provisions of this Section 4, the Company shall control all proceedings taken in connection with such contest, and, at its sole discretion, may pursue or forgo any and all administrative appeals, proceedings, hearings, and conferences with the applicable taxing authority in respect of such claim and may, at its sole discretion, either pay the tax claimed to the appropriate taxing authority on your behalf and direct you to sue for a refund or to contest the claim in any permissible manner, and you agree to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction, and in one or more appellate courts, as the Company shall determine; provided, further, that, if the Company pays such claim and directs you to sue for a refund, the Company shall indemnify and hold you harmless, on an after-tax basis, from any Excise Tax or income, employment or other tax (including interest or penalties) imposed with respect to such payment or with respect to any imputed income in connection with such payment (disregarding for this purpose the Cap); and provided, further, that any extension of the statute of limitations relating to payment of taxes for the taxable year with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company’s control of the contest shall be limited to issues with respect to which the Gross-up Payment would be payable pursuant to this Agreement, and you shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.
5. Refunds. If, after your receipt of a Gross-up Payment or payment by the Company of an amount on your behalf pursuant to Section 4, you become entitled to receive any refund with respect to the Excise Tax to which such Gross-up Payment relates or with respect to such claim, you shall (subject to the Company’s complying with the requirements of Section 4, if applicable) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after payment by the Company of an amount on your behalf pursuant to Section 4, a determination is made that you shall not be entitled to any refund with respect to such claim and the Company does not notify you in writing of its intent to contest such denial of refund prior to the expiration of thirty (30) calendar days after such determination, then the amount of such payment shall offset, to the extent thereof, the amount of Gross-up Payment required to be paid.
6. Payment of the Gross-up Payment. Any Gross-up Payment, as determined pursuant to this Agreement, shall be paid by the Company to you no earlier than ninety (90) calendar days nor later than five (5) calendar days prior to the due date of your income tax return on which the Excise Tax is included. Notwithstanding any other provision of this Agreement, the Company may, in its sole discretion, withhold and pay over to the Internal Revenue Service or any other applicable taxing authority, for your benefit, all or any portion of any Gross-up Payment, and you hereby consent to such withholding.
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7. Attorneys’ Fees. If any action is brought to enforce the terms of this Agreement, the prevailing party will be entitled to recover its reasonable attorneys’ fees, costs and expenses from the other party, in addition to any other relief to which the prevailing party may be entitled.
8. Conditionality. This Agreement is conditioned upon the consummation of the Transaction, and will become null and void, and will have no effect whatsoever, in the event the Transaction is not consummated for any reason by the first anniversary of the date first stated above.
9. Severability. The provisions of this Agreement are severable, and if any part of it is found to be invalid or unenforceable, the other parts shall remain fully valid and enforceable. Specifically, should a court, arbitrator, or government agency conclude that a particular claim may not be released as a matter of law, it is the intention of the parties that the general release, the waiver of unknown claims and the covenant not to sue above shall otherwise remain effective to release any and all other claims.
10. Modification; Counterparts; Facsimile/PDF Signatures. It is expressly agreed that this Agreement shall be binding on any acquirer of or successor to the Company, including Parent, and may not be altered, amended, modified, or otherwise changed in any respect except by another written agreement that specifically refers to this Agreement, executed by each of the parties to this Agreement. This Agreement may be executed in any number of counterparts, each of which shall constitute an original and all of which together shall constitute one and the same instrument. Execution of a facsimile or PDF copy shall have the same force and effect as execution of an original, and a copy of a signature will be equally admissible in any legal proceeding as if an original.
11. Section 409A. The Company makes no representation about the tax treatment or impact of any of the payment(s) or benefit(s) in this Agreement. The intent of the parties is that the payment(s) and benefit(s) comply with Section 409A of the Code to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted and administered in compliance with such intent. Neither the Company nor any of its affiliates or successors (including Parent and Merger Sub), nor any of their current or former officers, directors, employees or representatives shall have any liability to you or otherwise have any obligation to gross-up or indemnify you or otherwise hold you harmless from any taxes or penalties you may incur with respect to Section 409A of the Code regarding any payment(s) or benefit(s) contemplated by this Agreement.
12. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to the choice of law principles thereof.
13. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Agreement and supersedes all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter of this Agreement.
[Remainder of page intentionally left blank.]
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If you agree to abide by the terms outlined in this Agreement, please sign this letter below and return it to me.
| Sincerely, | ||
| AdvancePierre Foods Holdings, Inc. | ||
| By: | ||
| Linn Harson | ||
| General Counsel | ||
READ, UNDERSTOOD AND AGREED
| Name (Sign) | |
| Name (Print) |
| Date: |
[Signature Page to Tax Reimbursement Agreement]