PURCHASE AND REDEMPTION
AGREEMENT
THIS PURCHASE AND REDEMPTION AGREEMENT
(the “Agreement”) is made this 15 th day of
August, 2006 by and among Cagle’s, Inc., a Georgia
corporation (“Seller”), Cagle’s-Keystone Foods
LLC, a Delaware limited liability company (the
“Company” or the “Buyer”) and Grow-Out
Holdings LLC, a Delaware limited liability company
(“Holdings”).
WHEREAS, Seller is the legal and
equitable owner of a thirty percent (30%) limited liability company
interest in the Company;
WHEREAS, Holdings is the legal and
equitable owner of a seventy percent (70%) limited liability
company interest in the Company;
WHEREAS, pursuant to Section 7.02 of the
Limited Liability Company Agreement of the Company dated October
31, 1997, as amended (the “LLC Agreement”) Holdings has
exercised its right to require the Company to purchase the limited
liability company interests of Seller in the Company;
and
WHEREAS the parties desire to enter into
this Agreement in order to consummate the transactions described
herein.
NOW, THEREFORE, in consideration of the
foregoing, and of the mutual covenants and agreements set forth
herein, and intending to be legally bound, the parties agree as
follows:
1.
Sale of Interests; Closing
.
1.1
Subject to the terms of this Agreement
and in reliance on the representations and warranties of Seller
contained herein, Seller agrees to sell to Buyer, and Buyer agrees
to purchase and redeem from Seller, all of Seller’s right,
title and interest in and to the thirty percent (30%) limited
liability company interests owned by Seller in the Company (the
“Interests”), free and clear of all liens, charges or
encumbrances.
1.2
The closing with respect to the sale of
the Interests (“Closing”) shall be held simultaneously
with the execution of this Agreement.
2.
Purchase Price . The purchase price for the Interests
shall be Twenty-Eight Million Dollars ($28,000,000.00) (the
“Purchase Price”). In addition, Buyer has agreed
to pay Seller at the Closing hereunder a current return in the
amount of Twenty-Eight Thousand One Hundred and Twenty-Five Dollars
($28,125.00) (the “Current Return”) and an
administrative fee in the amount of Sixty-Two Thousand Six Hundred
Ninety-Five Dollars ($62,695.00) (the “Administrative
Fee”). Buyer has delivered to Seller the Purchase Price, the
Current Return and the Administrative Fee by wire transfer
contemporaneous with the execution and delivery of this Agreement,
and Seller has accepted such Purchase Price, Administrative Fee and
Current Return as payment in full for the Interests, including any
and all claimed rights to distributions or payments of any kind
including, without limitation, any payments for taxes,
distributions, current or special return or services performed on
or prior to the date of this
Agreement with respect to the Interests,
other than Seller’s tax distribution through August 15, 2006
which shall be paid to Seller by Buyer on October 2, 2006.
3.
Closing Deliveries
.
At or prior to Closing, the parties shall
execute and/or deliver the following documents (collectively, the
“Transaction Documents”):
3.1
Assignment of Limited Liability Company
Interests; and
3.2
Consent in Writing of the Majority Member
of the Company, authorizing the execution, delivery and performance
of this Agreement and the Transaction Documents and the redemption
of Seller’s Interests in the Company.
4.
Representations and Warranties of
Seller . Seller hereby
represents, warrants and covenants to Buyer as follows, which
representations, warranties and covenants are an inducement to
Buyer to purchase and redeem the Interests from Seller:
4.1
Seller is duly organized, validly
existing and in good standing as a corporation under the laws of
the state of Georgia and has full power and authority to execute
and deliver this Agreement and all Transaction Documents to which
it is a party, to perform fully its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby
and thereby. The execution and delivery by Seller of this
Agreement and the Transaction Documents to which it is a party, the
performance of its obligations hereunder and thereunder and the
consummation of the transactions contemplated hereby and thereby
have been duly and validly authorized by all necessary corporate
action. Each of this Agreement and the Transaction Documents
to which Seller is a party has been (or, when executed, will be)
duly executed and delivered by it and constitutes a legal, valid
and binding obligation of Seller, enforceable against Seller in
accordance with its terms.
4.2
Seller has, and at the Closing hereunder
the Buyer will acquire, good and marketable title to the Interests,
free and clear of all liens, charges or encumbrances
whatsoever.
4.3
No person holds a power of attorney,
including a proxy, with respect to any of the Interests, and Seller
has not granted any option to purchase or made any commitments to
sell any of the Interests to any other person or entity.
4.4
Neither the execution or delivery of this
Agreement or the Transaction Documents, nor the consummation of the
transactions contemplated hereby or thereby on the terms provided
herein or therein constitute a default under any term or provision
of any contract or agreement to which the Seller is a party, nor of
any statute, ordinance, administrative interpretation, ruling or
decision of any court to which Seller is subject. No consent,
approval or authorization of any third party is necessary for the
performance by Seller of its obligations hereunder.
4.5
To the best of Seller’s knowledge,
there are no loans, obligations or liabilities of the Company that
are not reflected on the books and records of the Company.
2
4.6
There are no loans, obligations or
liabilities owed by Seller to, or for the benefit of, the Company
or any member of the Company that are not reflected on the books
and records of the Company.
4.7
There are no obligations, liabilities,
payments, disbursements or charges reflected on the books and
records of the Company as of the date hereof which constitute loans
or other amounts owed by Seller to, or for the benefit of, the
Company or any member of the Company.
4.8
There are no obligations, liabilities,
payments, disbursements or charges reflected on the books and
records of the Company as of the date hereof which constitute loans
or other amounts owed by the Company or any member of the Company
to, or for the benefit of, Seller.
4.9
Seller has complied in all material
respects with all federal, state and local laws, rules, regulations
and ordinances applicable to it relating to the Company and its
business and properties.
4.10
Except as disclosed on Schedule 4.10
attached hereto, no civil, criminal or administrative action,
hearing, proceeding, suit, or investigation is as of the date of
this Agreement pending or, to the knowledge of Seller, threatened,
against the Company or its business and properties.
4.11
No representation or warranty of Seller
contained in this Agreemen
