-----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, S5Z88H8L94l2m5k0bhiRXND4ga8M6w7iYejf8rc8bEnOBAnTppmWLnbUNi2tzOgT 6uyF6bplCN+TzU6UUNDqfg== 0000950144-97-000920.txt : 19970225 0000950144-97-000920.hdr.sgml : 19970225 ACCESSION NUMBER: 0000950144-97-000920 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19970206 SROS: NASD GROUP MEMBERS: A M CUDDY GROUP MEMBERS: CUDDY FARMS INC GROUP MEMBERS: CUDDY INTERNATIONAL CORPORATION SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: WLR FOODS INC CENTRAL INDEX KEY: 0000760775 STANDARD INDUSTRIAL CLASSIFICATION: POULTRY SLAUGHTERING AND PROCESSING [2015] IRS NUMBER: 541295923 STATE OF INCORPORATION: VA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-39722 FILM NUMBER: 97519071 BUSINESS ADDRESS: STREET 1: P O BOX 7000 CITY: BROADWAY STATE: VA ZIP: 22815 BUSINESS PHONE: 7038674001 MAIL ADDRESS: STREET 1: 800 CO OP DRIVE CITY: TIMBERVILLE STATE: VA ZIP: 22853 FORMER COMPANY: FORMER CONFORMED NAME: WAMPLER LONGACRE ROCKINGHAM INC DATE OF NAME CHANGE: 19881114 FORMER COMPANY: FORMER CONFORMED NAME: WAMPLER LONGACRE INC DATE OF NAME CHANGE: 19880209 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CUDDY FARMS INC CENTRAL INDEX KEY: 0001031610 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 560940643 STATE OF INCORPORATION: NC FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 723 WEST MARSHVILLE BOULEVARD CITY: MARSHVILLE STATE: NC ZIP: 28103 BUSINESS PHONE: 7046245055 MAIL ADDRESS: STREET 1: 732 WEST MARSHVILLE BOULEVARD CITY: MARSHVILLE STATE: NC ZIP: 28103 SC 13D/A 1 SCHEDULE 13D/A4 WLR FOODS/CUDDY-FARMS; AM; INTNL 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ---------------- SCHEDULE 13D (Rule 13d-101) UNDER THE SECURITIES EXCHANGE ACT OF 1934 (Amendment No. 4) WLR FOODS, INC. - -------------------------------------------------------------------------------- (Name of Issuer) COMMON STOCK, NO PAR VALUE PER SHARE - -------------------------------------------------------------------------------- (Title of Class of Securities) 929286 10 2 - -------------------------------------------------------------------------------- (CUSIP Number) CUDDY FARMS, INC. 732 W. MARSHVILLE BLVD. MARSHVILLE, NC 28103 ATTN: ROBERT B. CLARK (704) 624-5055 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) JANUARY 17, 1997 - -------------------------------------------------------------------------------- (Date of Event Which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ]. Note: Six copies of this statement, including all exhibits, should be filed with the Commission. See Rule 13d- 1(a) for other parties to whom copies are to be sent. (Continued on following pages.) (Page 1 of 9 Pages) 2 ================================================================================ CUSIP NO. 929286 10 2 13D Page 2 of 9 Pages ----------- - -------------------------------------------------------------------------------- 1 Name of Reporting Person: CUDDY FARMS, INC. S.S. or I.R.S. Identification No. of Above Person: - -------------------------------------------------------------------------------- 2 Check the Appropriate Box if a Member of a Group* (a) [x] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC Use Only - -------------------------------------------------------------------------------- 4 Source of Funds*: OO - -------------------------------------------------------------------------------- 5 Check Box if Disclosure of Legal Proceedings is Required pursuant to Item 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization: NORTH CAROLINA, UNITED STATES OF AMERICA - -------------------------------------------------------------------------------- Number of 7 Sole Voting Power: 0 Shares - -------------------------------------------------------------------------------- Beneficially 8 Shared Voting Power: 887,509 Owned By - -------------------------------------------------------------------------------- Each 9 Sole Dispositive Power: 0 Reporting - -------------------------------------------------------------------------------- Person With 10 Shared Dispositive Power: 887,509 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by Each Reporting Person: 887,509 - -------------------------------------------------------------------------------- 12 Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares* [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11): 5.3% - -------------------------------------------------------------------------------- 14 Type of Reporting Person*: CO ================================================================================
* SEE INSTRUCTIONS BEFORE FILLING OUT! 3 ================================================================================ CUSIP NO. 929286 10 2 13D Page 3 of 9 Pages ----------- - -------------------------------------------------------------------------------- 1 Name of Reporting Person: A.M. CUDDY S.S. or I.R.S. Identification No. of Above Person: - -------------------------------------------------------------------------------- 2 Check the Appropriate Box if a Member of a Group* (a) [x] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC Use Only - -------------------------------------------------------------------------------- 4 Source of Funds*: AF - -------------------------------------------------------------------------------- 5 Check Box if Disclosure of Legal Proceedings is Required pursuant to Item 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization: CANADA - -------------------------------------------------------------------------------- Number of 7 Sole Voting Power: 0 Shares - -------------------------------------------------------------------------------- Beneficially 8 Shared Voting Power: 887,510 Owned By - -------------------------------------------------------------------------------- Each 9 Sole Dispositive Power: 0 Reporting - -------------------------------------------------------------------------------- Person With 10 Shared Dispositive Power: 887,510 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by Each Reporting Person: 887,510 - -------------------------------------------------------------------------------- 12 Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares* [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11): 5.3% - -------------------------------------------------------------------------------- 14 Type of Reporting Person*: IN ================================================================================
* SEE INSTRUCTIONS BEFORE FILLING OUT! 4 ================================================================================ CUSIP NO. 929286 10 2 13D Page 4 of 9 Pages ----------- - -------------------------------------------------------------------------------- 1 Name of Reporting Person: CUDDY INTERNATIONAL CORPORATION S.S. or I.R.S. Identification No. of Above Person: - -------------------------------------------------------------------------------- 2 Check the Appropriate Box if a Member of a Group* (a) [x] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC Use Only - -------------------------------------------------------------------------------- 4 Source of Funds*: AF - -------------------------------------------------------------------------------- 5 Check Box if Disclosure of Legal Proceedings is Required pursuant to Item 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 Citizenship or Place of Organization: ONTARIO, CANADA - -------------------------------------------------------------------------------- Number of 7 Sole Voting Power: 0 Shares - -------------------------------------------------------------------------------- Beneficially 8 Shared Voting Power: 887,510 Owned By - -------------------------------------------------------------------------------- Each 9 Sole Dispositive Power: 0 Reporting - -------------------------------------------------------------------------------- Person With 10 Shared Dispositive Power: 887,510 - -------------------------------------------------------------------------------- 11 Aggregate Amount Beneficially Owned by Each Reporting Person: 887,510 - -------------------------------------------------------------------------------- 12 Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares* [ ] - -------------------------------------------------------------------------------- 13 Percent of Class Represented by Amount in Row (11): 5.3% - -------------------------------------------------------------------------------- 14 Type of Reporting Person*: CO ================================================================================
* SEE INSTRUCTIONS BEFORE FILLING OUT! 5 AMENDMENT NO. 4 TO SCHEDULE 13D This statement amends the Schedule 13D, dated July 27, 1994, as amended by Amendment No. 1 to Schedule 13D, dated August 9, 1994, Amendment No. 2 to Schedule 13D, dated August 29, 1994, and Amendment No. 3 to Schedule 13D, dated October 26, 1994 (as amended, the "Schedule 13D"), filed by Cuddy Farms, Inc., A.M. Cuddy and Cuddy International Corporation, with respect to the Common Stock, no par value per share, of WLR Foods, Inc. Except as expressly provided in this Amendment No. 4, the Schedule 13D speaks as of its date. Capitalized terms used without definition herein shall have the meanings ascribed to them in the Schedule 13D. I. Item 4 of the Schedule 13D ("PURPOSE OF TRANSACTION") is hereby amended and restated in its entirety as follows: ITEM 4. PURPOSE OF TRANSACTION. On July 27, 1994, the Company entered into an Asset Purchase Agreement ("Asset Purchase Agreement"), of same date, with Cuddy, Cuddy International and Wampler-Longacre, Inc., the Company's wholly-owned subsidiary ("Wampler-Longacre"). The closing (the "Closing") of the transactions contemplated by the Asset Purchase Agreement is to be within three (3) business days after Hart-Scott- Rodino clearance is obtained. Pursuant to the terms of the Asset Purchase Agreement, the Company and Wampler-Longacre will acquire substantially all of the assets of Cuddy's turkey processing division, including, without limitation, its processing facility, further processing facility, feed mill, three turkey grow-out farms, a leasehold interest in a second further processing facility, a partnership interest in a cold storage and distribution facility and all working capital, machinery, fixtures, equipment and other tangible personal property for, and inventory in, such facilities (the "Assets"). The purchase price for the Assets is $73.3 million, subject to adjustment, $42.5 million of which is payable in cash and the balance to be issued in Shares. The number of Shares issued will be based on a ten-day, pre-closing weight average stock market value, subject to a floor of $24 per Share and a ceiling of $28 per Share. The Agreement provides for certain post-closing adjustments which are not expected to be material. The Shares issued in this transaction will not be registered under the Securities Act of 1933, as amended, and will be subject to a Voting Trust Agreement by and among the Company, Cuddy and an independent corporate trustee. The Voting Trust Agreement will terminate upon the earlier of (a) the fourth anniversary of the Closing date; (b) the date on which a business acquisition by the Company occurs in which in excess of five percent (5%) of its then outstanding Shares is issued without voting and transfer restrictions similar to the Voting Trust Agreement and Cuddy's stock ownership in the Company after such acquisition is less than five percent (5%) of the total outstanding Shares; or (c) the date on which a "Change of Control" in the Company occurs. For purposes of the Voting Trust Agreement, a Change of Control means the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 30 percent (30%) of either the then outstanding Shares or the combined voting power of the then outstanding voting securities of the Company entitled 5 6 to vote generally in the election of directors. During the term of the Voting Trust Agreement, the trustee will vote in accordance with the recommendation of the Company's Board of Directors, as it exists at the time of the vote of the Company's shareholders, or if there is no recommendation, as directed by the registered holder of the voting trust certificate representing the Shares held by the trustee. Unless otherwise agreed to in writing by the Company, the voting trust certificates are not transferable except that (a) the holder thereof may pledge, mortgage or otherwise encumber the certificates and (b) the holder thereof may transfer the certificates to Cuddy International or a wholly-owned subsidiary of Cuddy International. Any transferee shall also be subject to the Voting Trust Agreement. After termination of the Voting Trust Agreement Cuddy will have certain demand and incidental registration rights. Upon the closing and the transaction contemplated by the Asset Purchase Agreement, Cuddy International, A.M.C. Family Holdings, Ltd. and A.M. Cuddy (the "Cuddy Group") will enter into a Non-Competition and Name Use Agreement by which the Cuddy Group will covenant not to compete with Wampler-Longacre in the business of poultry production for processing, further processing or marketing of processed poultry products (exclusive of production of eggs and poults)(the "Protected Business") in the geographical area in the continental United States in which Wampler-Longacre or its affiliates currently conduct business. Sales to certain existing customers of the Cuddy Group are excluded. The Company will pay Cuddy $500,000 in cash at Closing in consideration of this Agreement. Pursuant to the Non-Competition and Name Use Agreement, Cuddy will also grant Wampler-Longacre a five (5)-year exclusive right and license to the "Cuddy" name within the continental United States for the Protected Business. The Non-Competitive and Name Use Agreement contains "standstill" provisions by which the Cuddy Group agrees, for so long as the Voting Trust Agreement is not terminated, not to: solicit proxies or participate in an election contest relating to election of the directors; act together with others to acquire, hold or vote Shares; purchase or otherwise acquire Shares; or act alone or together with any person to acquire, or propose a business combination with, the Company. The Asset Purchase Agreement also requires Cuddy and Wampler-Longacre, before Closing, to enter into certain administrative, supply and processing agreements. The Asset Purchase Agreement provides that a Cuddy representative will be appointed to the Company's Board of Directors who shall serve until the next annual meeting of shareholders and shall be recommended by the Company's Board of Directors for election at such meeting. The Closing is subject to customary "due diligence" conditions and contains mutual indemnifications except that Cuddy and Cuddy International (the "Cuddy Corporations") shall not be required to indemnify the Company and Wampler-Longacre (collectively, "Wampler") for losses not in excess of $250,000. The Voting Trust further requires WLR Foods to indemnify Cuddy and the trustee for losses, including legal fees and expenses, in connection therewith. The parties to the Agreement also signed separate indemnification agreements, mutually agreeing to certain indemnifications. On the part of the Cuddy Corporations, indemnification of Wampler and their respective officers, directors, employees, shareholders, partners, agents, legal counsel and accountants is required in connections with certain possible litigation relating to stockholder and employee complaints. On the part of the Company, indemnification of the Cuddy Corporations and their respective officers, directors, employees, shareholders, partners, agents, legal counsel and accountants is required in connection with pending or possible litigation relating to the efforts of Tyson Foods, Inc., or any other bidder which commences its bid on or prior to June 30, 1995, to gain control of the Company. Both agreements terminate upon final termination of all actions, suits, proceedings or investigations 6 7 relating to the respective litigations. The indemnification agreements also provide that the parties release each other with respect to all matters except those arising out of, based upon or in connection with, a breach of the Asset Purchase Agreement (or any other agreement entered into in connection therewith). On January 15, 1997, the Company entered into an Stock Repurchase Agreement ("Stock Repurchase Agreement"), of the same date, with Cuddy, Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland), The Prudential Insurance Company of America, and Crestar Bank, as trustee, a copy of which is attached hereto as Exhibit F. Pursuant to the Stock Repurchase Agreement, Cuddy agreed to sell to the Company all of the 1,774,999 Shares that Cuddy acquired under the Asset Purchase Agreement (1,183,333 Shares adjusted for a 3 for 2 stock split effective on May 12, 1995) at a price of $10.00 in cash per Share. The sale of such Shares will take place in three installments: (i) 887,499 Shares on January 17, 1997; (ii) 443,750 Shares on March 31, 1997; and (iii) 443,750 Shares on June 30, 1997. In addition, the Stock Repurchase Agreement provides that the Registration Rights Agreement, the Voting trust Agreement and the Put and Call Agreement shall remain in full force and effect as to Shares not yet purchased by the Company under the Stock Repurchase Agreement until completion of the transactions contemplated therein; and that the banks that are parties to the Stock Repurchase Agreement will not exercise their rights under the Put and Call Agreement unless the Company breaches the terms of the Stock Repurchase Agreement and fails to cure such default within 10 days of notice of such breach. Except as set forth above, as of the date of the Amendment No. 4 to Schedule 13D, the Reporting Persons have no plan or proposals which relate to or would result in any of the transactions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D. II. Item of the Schedule 13D ("INTEREST IN SECURITIES OF THE COMPANY") is hereby amended and restated in its entirety as follows: ITEM 5. INTEREST IN SECURITIES OF THE COMPANY. (a) On August 29, 1994, the closing of the transactions contemplated by the Asset Purchase Agreement occurred, and 1,774,999 Shares (1,183,333 Shares adjusted for a 3 for 2 stock split effective on May 12, 1995) were issued by the Company to the Voting Trustee for the benefit of Cuddy under the Voting Trust Agreement. An additional 165,000 Shares could have been issued for the benefit of Cuddy under the Asset Purchase Agreement in connection with certain post-closing adjustments. On October 26, 1994, Cuddy, Cuddy International, the Company and Wampler-Longacre reached agreement on the post-closing adjustments and, as a result, the additional 165,000 Shares will not be issued and the cash portion of the purchase price was reduced by approximately $6.3 million. On January 17, 1997, the first (out of three) closing of the transactions contemplated by the Stock Repurchase Agreement occurred, and Cuddy sold to the Company (and the Voting Trustee transferred to the Company) 887,499 Shares at a price of $10.00 in cash per Share. The Reporting Persons currently beneficially own the following numbers of Shares (adjusted for a 3 for 2 stock split effective on May 12, 1995): Cuddy - 887,509 Shares; Cuddy International - 887,510 Shares; and A.M. Cuddy - 887,510 Shares, representing approximately 5.3% of the issued and outstanding Shares of the Company. Each of the Reporting Persons shares the power to vote and to dispose of the Shares beneficially owned by him or it with the Company pursuant to the Voting Trust Agreement. 7 8 Except as set forth in this Item 5(a), none of the Reporting Persons, Limited, Holdings nor, to the best of the knowledge of any of the Reporting Persons, any of the persons listed in Schedule I hereto, beneficially owns any Shares. (b) Except as set forth in Item 5(a) hereof, none of the Reporting Persons, Limited, Holdings nor, to the best of the knowledge of any of the Reporting Persons, any of the persons listed in Schedule I hereto, currently has sole or shared power to vote, to direct the vote, to dispose or direct the disposition of any Shares. (c) Except as set forth in Item 5(a) hereof, there have been no transactions in Shares that were effected during the past 60 days by the Reporting Persons, Limited, Holdings nor, to the best of the knowledge of any of the Reporting Persons, any of the persons listed in Schedule I hereto. (d) Not applicable. (e) Not applicable. III. Item 7 of the Schedule 13D ("EXHIBITS.") is hereby amended and restated in its entirety as follows to add Exhibit F thereto: ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. Exhibit A: Joint Filing Agreement, dated August 8, 1994, by and among Cuddy Foods, Inc., Cuddy International Corporation and A.M. Cuddy. Exhibit B: Asset Purchase Agreement, dated July 27, 1994, by and among Cuddy Farms, Inc., Cuddy International Corporation, WLR Foods, Inc. and Wampler-Longacre, Inc. (including the form of the Non-Competition and Name Use Agreement and the form of the Voting Trust Agreement). Exhibit C: Indemnification Agreement and Release, dated July 27, 1994, by and between WLR Foods, Inc. and Cuddy Farms, Inc. Exhibit D: Indemnification Agreement and Release, dated July 27, 1994, by and among Cuddy Farms, Inc., Cuddy International Corporation and WLR Foods, Inc. Exhibit E: Form of Registration Rights Agreement. Exhibit F: Stock Repurchase Agreement, dated January 15, 1997, by and among WLR Foods, Inc., Cuddy Farms, Inc., Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank Nederland), The Prudential Insurance Company of America, and Crestar Bank, as trustee. [Signatures appear on following page] 8 9 SIGNATURES After reasonable inquiry and to the best knowledge and belief of the undersigned, the undersigned certifies that the information set forth in this statement is true, complete and correct. Date: February 6, 1997 CUDDY FARMS, INC. By: /s/ Peter N.T. Widdrington ------------------------------ Name: Peter N.T. Widdrington Title: Chairman of the Board CUDDY INTERNATIONAL CORPORATION By: /s/ A.M. Cuddy ------------------------------ Name: A.M. Cuddy Title: Chairman of the Board /s/ A.M. Cuddy ---------------------------------- A.M. Cuddy 9 EX-99 2 STOCK REPURCHASE AGREEMENT 1 EXHIBIT F STOCK REPURCHASE AGREEMENT THIS AGREEMENT, dated as of January 15, 1997, is made by and among WLR FOODS, INC., a Virginia corporation (WLR), CUDDY FARMS, INC., a North Carolina corporation (Cuddy), COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A., "Rabobank Nederland", New York Branch (Rabobank), THE PRUDENTIAL INSURANCE COMPANY OF AMERICA (Prudential) (Rabobank and Prudential collectively are referred to herein as "the Banks"), and CRESTAR BANK, as Trustee (the Trustee). RECITALS: A. Pursuant to an Asset Purchase Agreement dated July 27, 1994, WLR issued 1,774,999 shares of its common stock (adjusted for splits) to Cuddy. Under the terms of a Voting Trust Agreement dated August 29, 1994, the 1,774,999 shares of WLR common stock were issued to the Trustee, who in turn issued to Cuddy voting trust certificates representing such shares. The shares issued pursuant to the Asset Purchase Agreement shall be referred to herein as the "Shares" and the voting trust certificates representing such Shares shall be referred to herein as the "Voting Trust Certificates". B. WLR and Cuddy entered into a Registration Rights Agreement dated August 29, 1994. The Shares have not been registered with the United States Securities and Exchange Commission. C. The parties hereto entered into a Put and Call Agreement dated August 29, 1994, in which WLR agreed to be bound by certain "put" provisions and the Banks agreed to be bound by certain "call" provisions as described therein. D. Cuddy entered into certain pledge agreements dated August 29, 1994 with the Banks by which it granted first priority security interests to Rabobank and second priority security interests to Prudential in the Shares and Voting Trust Certificates for the purpose of securing the payment and performance of Cuddy under respective loan agreements with the Banks. 2 E. Cuddy has agreed to sell and WLR has agreed to purchase the Shares, and the Banks have agreed to release their respective security interests in the Shares and the Voting Trust Certificates, all upon the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the premises and the covenants and conditions hereinafter set forth, the parties covenant and agree as follows: 1. Redemption of Cuddy Shares. 1.1 Transaction. Cuddy agrees to convey, and WLR agrees to acquire, the Shares at a price of ten dollars ($10.00) per share. Cuddy and WLR have agreed to the following closing schedule: WLR shall purchase and Cuddy shall convey 887,499 Shares on January 17, 1997; WLR shall purchase and Cuddy shall convey 443,750 Shares on March 31, 1997; the balance of the Shares shall be purchased by WLR and conveyed by Cuddy on June 30, 1997. All closings shall take place at 10:00 a.m. at the office of WLR's legal counsel or such other time and place mutually agreed upon by the parties. All such dates are referred to herein as "the Closing". Payment for the Shares transferred shall be paid at each Closing by certified or bank cashier's check or other current funds acceptable to Rabobank, provided however at the January 17, 1997 Closing, Nine Hundred Thousand Dollars ($900,000), of the payment due on such date shall be paid to Prudential by wire transfer of immediately available federal funds and the Seven Million Nine Hundred Seventy-Four Thousand Nine Hundred Ninety Dollar ($7,974,990) balance shall be paid to Rabobank by wire transfer of immediately available federal funds. 1.2 Release of Security Interests. Concurrently with WLR's payment of the purchase price of the Shares on each of the respective Closing Dates set forth above, (i) Rabobank shall surrender to the Trustee, Voting Trust Certificates representing the number of Shares to be purchased by WLR on such date, and (ii) the Banks shall each release and terminate their respective security interests and other liens in the Shares and related Voting Trust Certificates to be purchased by WLR on such date and execute and deliver any and all lien release documents as necessary to terminate all UCC financing statements recorded by the Banks, with respect to such liens. Immediately upon surrender of the Voting Trust Certificates at the Trustee's offices, Trustee shall deliver to WLR certificates for the number of shares of WLR stock represented by the surrendered 2 3 Voting Trust Certificates. Upon WLR's receipt of such share certificates, WLR shall deliver to the Trustee, certificates for the remaining number of Shares, if any, owned by Cuddy. Upon the Trustee's receipt of such share certificates, the Trustee and Cuddy shall execute and deliver to Rabobank, new Voting Trust Certificates representing the remaining Shares, if any. 2. Representations and Warranties of Cuddy. Cuddy represents and warrants to WLR on the date hereof (which representations and warranties shall be certified true at and as of the Closing) as follows: 2.1 Due Incorporation. Cuddy is a corporation duly organized, validly existing and in good standing under the laws of the State of North Carolina, the state of its incorporation. 2.2 Corporate Power of Cuddy. Cuddy has the full corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. Neither the execution and delivery of this Agreement nor the consummation of the transactions herein contemplated will violate any provision of the Articles of Incorporation or Bylaws of Cuddy. The execution and delivery of this Agreement by Cuddy and the consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action on the part of Cuddy. This Agreement is the valid and binding obligation of Cuddy enforceable according to its terms. 2.3 Options. Cuddy is not a party to, or bound by any option, warrant, call or other agreement relating to the sale or disposition of any of the Shares, except as referenced in the Recitals of this Agreement. 2.4 No Breach. The consummation of the transactions herein contemplated including, but not limited to, the execution, delivery and consummation of this Agreement and the documents required to effect the transactions herein contemplated do not (a) constitute a violation of or default under, conflict with or result in a breach of (i) any terms of any mortgage, indenture, bond, lease, instrument, contract or other agreement to which Cuddy is or may be bound or constitute a default thereunder (either immediately or upon notice, lapse of time or both), except as referenced in the Recitals of this Agreement, (ii) any judgment, order, award, decree of any court, administrative agency or governmental body, or (iii) any Federal, state or local 3 4 statute, law, ordinance, rule or regulation; or (b) result in the creation or imposition of any lien or other encumbrance on the Shares or give to any person other than WLR any interest or right in the Shares. 2.5 Title to Shares. Except for the encumbrances referenced in the Recitals of this Agreement, Cuddy owns, free and clear of any lien or other encumbrance, and shall have full power and authority to convey free and clear of any lien or other encumbrance, the Shares and, upon delivery of and payment for the Shares as herein provided, WLR will acquire good and valid title thereto, free and clear of any lien or other encumbrance. 3. Representations and Warranties of WLR. WLR represents and warrants to Cuddy on the date hereof (which representations and warranties shall be true at and as of the date of Closing) as follows: 3.1 Due Incorporation. WLR is a corporation duly organized, validly existing and in good standing under the laws of the Commonwealth of Virginia, the state of its incorporation. 3.2 Corporate Power of WLR. WLR has the full corporate power and authority to enter into this Agreement and to consummate the transactions contemplated hereby. Neither the execution and delivery of this Agreement nor the consummation of the transactions herein contemplated will violate any agreement to which WLR is a party or by which WLR is bound or any provision of the Articles of Incorporation or Bylaws of WLR. The execution and delivery of this Agreement by WLR and the consummation of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action on the part of WLR. This Agreement is the valid and binding obligation of WLR enforceable according to its terms. 4. Closing Requirements for Cuddy. At each Closing, Cuddy shall take any and all steps necessary to ensure delivery to WLR of the stock certificates representing the Shares, duly endorsed, in blank or with duly executed stock powers attached, in proper form for transfer with all signatures guaranteed, at the expense of Cuddy. 5. Closing Requirements for WLR. At the first Closing, WLR shall deliver to Cuddy a copy of the relevant excerpt from the minutes of the meeting of the Board of Directors of WLR authorizing the execution and performance of this Agreement and the transactions contemplated by this Agreement by WLR 4 5 certified by the Secretary or Assistant Secretary of WLR. At each Closing, WLR shall deliver to Cuddy, or its designee, cash payments as required by subsection 1.1 of this Agreement. 6. Closing Conditions. Each Closing is conditioned upon the fulfillment of the Closing requirements of Cuddy and WLR as set forth in Sections 4 and 5 above. In addition, WLR and Cuddy must be current in their payments to each other and not in default with regard to the Turkey Poult Marketing Agreement and the Feed Supply Agreement. If either party fails to close due to the failure to comply with the Closing conditions set forth herein, the nondefaulting party, in addition to any other remedies available at law or in equity, may require specific performance, and all reasonable attorney's fees incurred in enforcing the contract shall be paid by the defaulting party. 7. Dividends. Prior to the conclusion of the transactions contemplated by this agreement, the holder of each Voting Trust Certificate shall be entitled to receive dividends paid by WLR, if any, on shares represented by Voting Trust Certificates held by the Trustee as of the record date, in the amount of such dividends. 8. Termination of Agreements: The Registration Rights Agreement, the Voting Trust Agreement, and the Put and Call Agreement shall remain in full force and effect, unless modified by the terms of this Agreement as to the Shares not yet purchased by WLR, until the completion of the transactions contemplated by this Agreement. Notwithstanding the above, however, the Banks agree not to exercise their rights under the Put and Call Agreement unless WLR breaches the terms of this Agreement and has not cured such breach within ten (10) days notice of the breach. 9. Miscellaneous. 9.1 Publicity. Except as otherwise required by law, no publicity release or announcement concerning this Agreement or the transactions contemplated hereby shall be issued without advance approval of the form and substance thereof by WLR . 9.2 Notices. Any notice or other communication required or which may be given hereunder shall be in writing and either delivered personally to the addressee, faxed to the addressee or mailed, 5 6 certified or registered mail or express mail, postage prepaid, and shall be deemed received when so delivered personally, or received via fax or if by certified or registered mail, four days after the date of mailing, or if express mailed, two days after the date of mailing as follows: (a) if to Cuddy to: Cuddy Farms, Inc. P. O. Box 247 Marshville, NC 28103-0247 Attn: Vaughan L. Correll Fax No. 704-624-5772 With a required copy to: J. Rob Collins, Esquire Blake, Cassels & Graydon Suite 2800, Box 25 Commerce Court West Toronto, Canada M5L 1A9 Fax No. 416-863-2653 and David E. Johnston, Esquire Hunton & Williams One NationsBank Plaza Suite 2650 101 South Tryon Street Charlotte, NC 28280 Fax No. 704-378-4890 (b) if to WLR, to: WLR Foods, Inc. P. O. Box 7000 Broadway, VA 22815-7000 Attn: James L, Keeler, President (540) 896-0498 fax With a required copy to: John W. Flora, Esquire Wharton, Aldhizer & Weaver, P.L.C. 100 South Mason Street P. O. Box 20028 Harrisonburg, VA 22801-7528 (540) 434-5502 fax 6 7 (c) if to Rabobank, to: Rabobank Nederland 245 Park Avenue New York, NY 10167 Attn: Legal Dept. Fax No. 212-818-0233 With a required copy to: Rabobank Nederland 1 Atlanta Center Suite 3450 1201 W. Peachtree Street Atlanta, GA 30309-3400 Attn: Steve Rich Fax No. 404-877-9150 (d) if to Prudential, to: The Prudential Insurance Company of America 801 Warrenville Road, Suite 600 Lisle, IL 60532 Fax No. 708-810-0764 With a required copy to: The Prudential Insurance Company of America 201 S. Orange Ave., Suite 795 Orlando, FL 32803 Fax No. 407-649-4963 (e) if to the Trustee (Crestar Bank) Crestar Bank Corporate Trust Administration 10th Floor 919 E. Main Street Richmond, VA 23219 Fax No. 804-782-7855 or to such other address or addresses as the parties may designate to the other by notice as set forth above. 9.3 Entire Agreement. This Agreement, together with the Registration Rights Agreement, Put and Call Agreement, and the Voting Trust Agreement, contains the entire agreement among the parties with respect to the repurchase of the Shares and related transactions and supersedes all prior agreements, written or oral, with respect thereto. 7 8 9.4 Binding Agreement. All of the terms and provisions of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by, each of the parties hereto and their respective legal representatives, successors and assigns. 9.5 Governing Law. This Agreement shall be governed and construed according to the laws of the Commonwealth of Virginia applicable to agreements made, delivered and performed entirely within Virginia. 9.6 Reformation and Severability. If any provision of this Agreement shall be determined by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be enforced to the maximum extent permitted by law, and further, such determination shall not affect the remaining provisions of this Agreement, all of which shall remain in full force and effect. 9.7 Waiver. A waiver by any party of a breach of any provisions of this Agreement shall not operate, nor be construed, as a waiver of any subsequent breach hereof. 9.8 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. 9.9 Headings. The headings in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK] 8 9 WLR FOODS, INC. By ---------------------------------------- James L. Keeler, President CUDDY FARMS, INC. By ---------------------------------------- Its --------------------------------------- COOPERATIEVE CENTRALE RAIFFEISEN- BOERENLEENBANK B.A., "Rabobank Nederland" New York Branch By ---------------------------------------- Its --------------------------------------- By ---------------------------------------- Its --------------------------------------- THE PRUDENTIAL INSURANCE COMPANY OF AMERICA By ---------------------------------------- Its --------------------------------------- CRESTAR BANK, as Trustee By ---------------------------------------- Its --------------------------------------- 9 -----END PRIVACY-ENHANCED MESSAGE-----