Exhibit 10.1

 

STOCKHOLDERS AGREEMENT

 

DATED AS OF JULY 20, 2016

 

BETWEEN

 

ADVANCEPIERRE FOODS HOLDINGS, INC.

 

AND

 

OCM PRINCIPAL OPPORTUNITIES FUND IV DELAWARE, L.P.

 

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Table of Contents

 

 

 

Page

 

 

 

ARTICLE I INTRODUCTORY MATTERS

1

1.1

Defined Terms

1

1.2

Construction

3

 

 

ARTICLE II CORPORATE GOVERNANCE MATTERS

3

2.1

Election of Directors

3

 

 

ARTICLE III INFORMATION

4

3.1

Books and Records; Access

4

3.2

Certain Reports

4

 

 

ARTICLE IV GENERAL PROVISIONS

4

4.1

Termination

4

4.2

Notices

4

4.3

Amendment; Waiver

5

4.4

Further Assurances

5

4.5

Assignment

6

4.6

Third Parties

6

4.7

Governing Law

6

4.8

Jurisdiction; Waiver of Jury Trial

6

4.9

Specific Performance

6

4.10

Entire Agreement

6

4.11

Severability

6

4.12

Table of Contents, Headings and Captions

7

4.13

Grant of Consent

7

4.14

Counterparts

7

4.15

Effectiveness

7

4.16

No Recourse

7

 

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STOCKHOLDERS AGREEMENT

 

This Stockholders Agreement is entered into as of July 20, 2016 by and between
AdvancePierre Foods Holdings, Inc., a Delaware corporation (the “Company”), and
OCM Principal Opportunities Fund IV Delaware, L.P., a Delaware limited
partnership (the “Oaktree LP”).

 

WHEREAS, the Company is currently contemplating an underwritten initial public
offering (“IPO”) of shares of its Common Stock (as defined below); and

 

WHEREAS, in connection with, and effective upon, the date of completion of the
IPO (the “Closing Date”), the Company and the Oaktree LP wish to set forth
certain understandings between such parties, including with respect to certain
governance matters.

 

NOW, THEREFORE, the parties agree as follows:

 

ARTICLE I
INTRODUCTORY MATTERS

 

1.1                               Defined Terms.  In addition to the terms
defined elsewhere herein, the following terms have the following meanings when
used herein with initial capital letters:

 

“Affiliate” has the meaning set forth in Rule 12b-2 promulgated under the
Exchange Act, as in effect on the date hereof.

 

“Agreement” means this Stockholders Agreement, as the same may be amended,
supplemented, restated or otherwise modified from time to time in accordance
with the terms hereof.

 

“beneficially own” has the meaning set forth in Rule 13d-3 promulgated under the
Exchange Act.

 

“Board” means the board of directors of the Company.

 

“Business Day” means a day other than a Saturday, Sunday, federal or New York
State holiday or other day on which commercial banks in New York City are
authorized or required by law to close.

 

“Closing Date” has the meaning set forth in the Recitals.

 

“Company” has the meaning set forth in the Preamble.

 

“Common Stock” means the shares of common stock, par value $0.01 per share, of
the Company, and any other capital stock of the Company into which such stock is
reclassified or reconstituted and any other common stock of the Company.

 

“Control” (including its correlative meanings, “Controlled by” and “under common
Control with”) means possession, directly or indirectly, of the power to direct
or cause the direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or
otherwise) of a Person.

 

“Director” means any member of the Board.

 

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“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder, as the same may be amended from
time to time.

 

“Governmental Authority” means any nation or government, any state or other
political subdivision thereof, and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.

 

“IPO” has the meaning set forth in the Recitals.

 

“Law” means any statute, law, regulation, ordinance, rule, injunction, order,
decree, governmental approval, directive, requirement, or other governmental
restriction or any similar form of decision of, or determination by, or any
interpretation or administration of any of the foregoing by, any Governmental
Authority.

 

“Oaktree Designee” has the meaning set forth in Section 2.1(b).

 

“Oaktree Entities” means Oaktree LP and its Affiliates and their respective
successors and Permitted Assigns.

 

“Oaktree LP” has the meaning set forth in the Preamble.

 

“Permitted Assigns” means with respect to an Oaktree Entity, a Transferee of
shares of Common Stock that agrees to become party to, and to be bound to the
same extent as its Transferor by the terms of, this Agreement.

 

“Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, or other form of business organization, whether or
not regarded as a legal entity under applicable Law, or any Governmental
Authority or any department, agency or political subdivision thereof.

 

“Subsidiary” means, with respect to any Person, any corporation, limited
liability company, partnership, association or other business entity of which:
(i) if a corporation, a majority of the total voting power of shares of stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, representatives or trustees thereof is at the time owned
or Controlled, directly or indirectly, by that Person or one or more of the
other Subsidiaries of that Person or a combination thereof; or (ii) if a limited
liability company, partnership, association or other business entity, a majority
of the total voting power of stock (or equivalent ownership interest) of the
limited liability company, partnership, association or other business entity is
at the time owned or Controlled, directly or indirectly, by any Person or one or
more Subsidiaries of that Person or a combination thereof. For purposes hereof,
a Person or Persons shall be deemed to have a majority ownership interest in a
limited liability company, partnership, association or other business entity if
such Person or Persons shall be allocated a majority of limited liability
company, partnership, association or other business entity gains or losses or
shall be or Control the managing member, managing director or other governing
body or general partner of such limited liability company, partnership,
association or other business entity.

 

“Total Number of Directors” means the total number of directors comprising the
Board at any point in time.

 

“Transfer” (including its correlative meanings, “Transferor”, “Transferee” and
“Transferred”) shall mean, with respect to any security, directly or indirectly,
to sell, contract to sell, give, assign, hypothecate, pledge, encumber, grant a
security interest in, offer, sell any option or contract to

 

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purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, lend or otherwise transfer or dispose of any economic,
voting or other rights in or to such security. When used as a noun, “Transfer”
shall have such correlative meaning as the context may require.

 

1.2                               Construction.  The language used in this
Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rule of strict construction will be applied against
any party.  Unless the context otherwise requires: (a) “or” is disjunctive but
not exclusive, (b) words in the singular include the plural, and words in the
plural include the singular, and (c) the words “hereof,” “herein,” and
“hereunder” and words of similar import when used in this Agreement refer to
this Agreement as a whole and not to any particular provision of this Agreement,
and Section references are to this Agreement unless otherwise specified.

 

ARTICLE II
CORPORATE GOVERNANCE MATTERS

 

2.1                               Election of Directors.

 

(a)                       Following the Closing Date, the Oaktree LP shall have
the right, but not the obligation, to nominate to the Board a number of
designees equal to at least: (i) a majority of the Total Number of Directors, so
long as the Oaktree Entities collectively beneficially own 50% or more of the
outstanding shares of Common Stock entitled to vote generally in the election of
the Directors; (ii) 40% of the Total Number of Directors, in the event that the
Oaktree Entities collectively beneficially own 40% or more, but less than 50%,
of the outstanding shares of Common Stock entitled to vote generally in the
election of the Directors; (iii) 30% of the Total Number of Directors, in the
event that the Oaktree Entities collectively beneficially own 30% or more, but
less than 40%, of the outstanding shares of Common Stock entitled to vote
generally in the election of the Directors; (iv) 20% of the Total Number of
Directors, in the event that the Oaktree Entities collectively beneficially own
20% or more, but less than 30%, of the outstanding shares of Common Stock
entitled to vote generally in the election of the Directors; and (v) 10% of the
Total Number of Directors, in the event that the Oaktree Entities collectively
beneficially own 5% or more, but less than 20%, of the outstanding shares of
Common Stock entitled to vote generally in the election of the Directors. For
purposes of calculating the number of directors that the Oaktree LP is entitled
to nominate pursuant to the immediately preceding sentence, any fractional
amounts shall automatically be rounded up to the nearest whole number (e.g., one
and one quarter (1¼) Directors shall equate to two (2) Directors) and any such
calculations shall be made after taking into account any increase in the Total
Number of Directors.

 

(b)                       In the event that the Oaktree LP has nominated less
than the total number of designees that the Oaktree LP is entitled to nominate
pursuant to Section 2.1(a), the Oaktree LP shall have the right, at any time, to
nominate such additional designees to which it is entitled, in which case, the
Company and the Directors shall take all necessary corporation action, to the
fullest extent permitted by law, to (x) enable the Oaktree LP to nominate and
effect the election or appointment of such additional individuals, whether by
increasing the size of the Board, or otherwise and (y) to designate such
additional individuals nominated by the Oaktree LP to fill such newly-created
vacancies or to fill any other existing vacancies. Each such person whom the
Oaktree LP shall actually nominate pursuant to this Section 2.1 and who is
thereafter elected to the Board to serve as a Director shall be referred to
herein as a “Oaktree Designee.”

 

(c)                        In the event that a vacancy is created at any time by
the death, disability, retirement or resignation of any Oaktree Designee, the
Oaktree LP shall, to the fullest extent permitted by law, have the right, but
not the obligation, to nominate a new designee of the Oaktree LP to fill such
vacancy.  The remaining Directors and the Company shall, to the fullest extent
permitted by law,

 

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cause such vacancy to be filled by a new designee of the Oaktree LP as soon as
possible, and the Company hereby agrees to take, to the fullest extent permitted
by law, at any time and from time to time, all actions necessary to accomplish
the same.

 

(d)                       The Company agrees, to the fullest extent permitted by
law, to include in the slate of nominees recommended by the Board at any meeting
of stockholders called for the purpose of electing directors the persons
designated pursuant to this Section 2.1 and to use its best efforts to cause the
election of each such designee to the Board, including nominating each such
individual to be elected as a Director as provided herein, recommending such
individual’s election and soliciting proxies or consents in favor thereof.

 

ARTICLE III
INFORMATION

 

3.1                               Books and Records; Access.  The Company shall,
and shall cause its Subsidiaries to, keep proper books, records and accounts, in
which full and correct entries shall be made of all financial transactions and
the assets and business of the Company and each of its Subsidiaries in
accordance with generally accepted accounting principles.  The Company shall,
and shall cause its Subsidiaries to, permit the Oaktree Entities and their
respective designated representatives, at reasonable times and upon reasonable
prior notice to the Company, to review the books and records of the Company or
any of its Subsidiaries and to discuss the affairs, finances and condition of
the Company or any of its Subsidiaries with the officers of the Company or any
of its Subsidiaries; provided, however, that the Company shall not be required
to disclose any privileged information of the Company so long as the Company has
used its best efforts to enter into an arrangement pursuant to which it may
provide such information to the Oaktree Entities without the loss of any such
privilege.

 

3.2                               Certain Reports.  The Company shall deliver or
cause to be delivered to the Oaktree Entities, at their request:

 

(a)                       to the extent otherwise prepared by the Company,
operating and capital expenditure budgets and periodic information packages
relating to the operations and cash flows of the Company and its Subsidiaries;
and

 

(b)                       such other reports and information as may be
reasonably requested by the Oaktree Entities; provided, however, that the
Company shall not be required to disclose any privileged information of the
Company so long as the Company has used its best efforts to enter into an
arrangement pursuant to which it may provide such information to the Oaktree
Entities without the loss of any such privilege.

 

ARTICLE IV
GENERAL PROVISIONS

 

4.1                               Termination.  This Agreement shall terminate
on the earlier to occur of (i) such time as the Oaktree LP is no longer entitled
to nominate a Director pursuant to Section 2.1(a) and (ii) the delivery of a
written notice by the Oaktree LP to the Company requesting that this Agreement
terminate.

 

4.2                               Notices.  Any notice provided for in this
Agreement shall be in writing and shall be either personally delivered, mailed
first class mail (postage prepaid) or sent by a reputable overnight courier
service (charges prepaid) to the Company at the address set forth below and to
any other recipient at the address indicated on the Company’s records, or at
such address or to the attention of such other

 

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Person as the recipient party has specified by prior written notice to the
sending party.  Notices will be deemed to have been given hereunder when sent by
facsimile (receipt confirmed) delivered personally, five (5) days after deposit
in the U.S. mail and one (1) day after deposit with a reputable overnight
courier service.

 

The Company’s address is:

 

AdvancePierre Foods Holdings, Inc.
 9987 Carver Road
Blue Ash, Ohio 45242
Attention: Michael B. Sims
Fax: (513) 682-1330

 

with a copy (not constituting notice) to:

 

Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue, Suite 3400
Los Angeles, California 90071
Attention: Jonathan Ko, Esq.
Fax: (213) 621-5527

 

The Oaktree Entities’ address is:

 

Oaktree Capital Management, L.P.
333 South Grand Avenue, 28th Floor
Los Angeles, California 90071
Attention: Ted Crockin
Fax: (213) 830-6394

 

with a copy (not constituting notice) to:

 

Skadden, Arps, Slate, Meagher & Flom LLP
 300 South Grand Avenue, Suite 3400
Los Angeles, California 90071
Attention: Jeffrey Cohen, Esq. and Jonathan Ko, Esq.
Fax: (213) 621-5527

 

4.3                               Amendment; Waiver.  This Agreement may be
amended, supplemented or otherwise modified only by a written instrument
executed by the Company and the other parties hereto.  Neither the failure nor
delay on the part of any party hereto to exercise any right, remedy, power or
privilege under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, remedy, power or privilege preclude any
other or further exercise of the same or of any other right, remedy, power or
privilege, nor shall any waiver of any right, remedy, power or privilege with
respect to any occurrence be construed as a waiver of such right, remedy, power
or privilege with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have granted such
waiver.

 

4.4                               Further Assurances.  The parties hereto will
sign such further documents, cause such meetings to be held, resolutions passed,
exercise their votes and do and perform and cause to be done such further acts
and things necessary, proper or advisable in order to give full effect to this
Agreement and every provision hereof.  To the fullest extent permitted by law,
the Company shall not

 

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directly or indirectly take any action that is intended to, or would reasonably
be expected to result in, any Oaktree Entity being deprived of the rights
contemplated by this Agreement.

 

4.5                               Assignment.  This Agreement will inure to the
benefit of and is binding on the parties hereto and their respective successors
and permitted assigns.  This Agreement may not be assigned without the express
prior written consent of the other parties hereto, and any attempted assignment,
without such consents, will be null and void; provided, however, that each
Oaktree Entity shall be entitled to assign, in whole or in part, any of its
rights hereunder to any of its Permitted Assigns without such prior written
consent.

 

4.6                               Third Parties.  This Agreement does not create
any rights, claims or benefits inuring to any person that is not a party hereto
or create or establish any third party beneficiary hereto.

 

4.7                               Governing Law.  This Agreement shall be
governed by and construed in accordance with the laws of the State of Delaware,
without regard to principles of conflicts of laws thereof.

 

4.8                               Jurisdiction; Waiver of Jury Trial.  In any
judicial proceeding involving any dispute, controversy or claim arising out of
or relating to this Agreement, each of the parties hereto unconditionally
accepts the jurisdiction and venue of the Court of Chancery, or, if the Court of
Chancery does not have subject matter jurisdiction over this matter, the
Superior Court of the State of Delaware (Complex Commercial Division), or if
jurisdiction over the matter is vested exclusively in federal courts, the United
States District Court for the District of Delaware, and the appellate courts to
which orders and judgments thereof may be appealed. In any such judicial
proceeding, the parties hereto agree that in addition to any method for the
service of process permitted or required by such courts, to the fullest extent
permitted by law, service of process may be made by delivery provided pursuant
to the directions set forth in Section 4.2.  EACH OF THE PARTIES HEREBY WAIVES
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF OR
RELATING TO THIS AGREEMENT.

 

4.9                               Specific Performance.  Each party hereto
acknowledges and agrees that in the event of any breach of this Agreement by any
of them, the other parties hereto would be irreparably harmed and could not be
made whole by monetary damages.  Each party accordingly agrees to waive the
defense in any action for specific performance that a remedy at law would be
adequate and that the parties, in addition to any other remedy to which they may
be entitled at law or in equity, shall be entitled to specific performance of
this Agreement without the posting of bond.

 

4.10                        Entire Agreement.  This Agreement sets forth the
entire understanding of the parties hereto with respect to the subject matter
hereof.  There are no agreements, representations, warranties, covenants or
understandings with respect to the subject matter hereof or thereof other than
those expressly set forth herein and therein.  This Agreement supersedes all
other prior agreements and understandings between the parties with respect to
such subject matter.

 

4.11                        Severability.  If any provision of this Agreement,
or the application of such provision to any Person or circumstance or in any
jurisdiction, shall be held to be invalid or unenforceable to any extent,
(i) the remainder of this Agreement shall not be affected thereby, and each
other provision hereof shall be valid and enforceable to the fullest extent
permitted by law, (ii) as to such Person or circumstance or in such
jurisdiction, such provision shall be reformed to be valid and enforceable to
the fullest extent permitted by law and (iii) the application of such provision
to other Persons or circumstances or in other jurisdictions shall not be
affected thereby.

 

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4.12                        Table of Contents, Headings and Captions.  The table
of contents, headings, subheadings and captions contained in this Agreement are
included for convenience of reference only, and in no way define, limit or
describe the scope of this Agreement or the intent of any provision hereof.

 

4.13                        Grant of Consent.  Any vote, consent or approval of
the Oaktree LP or an Oaktree Entity hereunder shall be deemed to be given with
respect to such entities or entity if such vote, consent or approval is given by
members of such entities or entity having a pecuniary interest in a majority of
the shares of Common Stock over which all members of such entities or entity
then have a pecuniary interest.

 

4.14                        Counterparts.  This Agreement and any amendment
hereto may be signed in any number of separate counterparts, each of which shall
be deemed an original, but all of which taken together shall constitute one
agreement (or amendment, as applicable).

 

4.15                        Effectiveness.  This Agreement shall become
effective upon the Closing Date.

 

4.16                        No Recourse.  This Agreement may only be enforced
against, and any claims or cause of action that may be based upon, arise out of
or relate to this Agreement, or the negotiation, execution or performance of
this Agreement may only be made against, the entities that are expressly
identified as parties hereto and no past, present or future Affiliate, director,
officer, employee, incorporator, member, manager, partner, stockholder, agent,
attorney or representative of any party hereto shall have any liability for any
obligations or liabilities of the parties to this Agreement or for any claim
based on, in respect of, or by reason of, the transactions contemplated hereby.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Stockholders Agreement
on the day and year first above written.

 

 

COMPANY:

 

 

 

ADVANCEPIERRE FOODS HOLDINGS, INC.

 

 

 

 

 

By:

/s/ Michael B. Sims

 

Name:

Michael B. Sims

 

Title:

Chief Financial Officer, Executive Vice President, Treasurer and Secretary

 

 

 

OAKTREE LP:

 

 

 

OCM PRINCIPAL OPPORTUNITIES FUND IV DELAWARE, L.P.

 

 

 

By:         OCM Principal Opportunities Fund IV Delaware GP Inc., its general
partner

 

 

 

 

 

By:

/s/ Martin Boskovich

 

Name:

Martin Boskovich

 

Title:

Authorized Signatory

 

 

 

 

 

 

 

By:

/s/ Jamie Toothman

 

Name:

Jamie Toothman

 

Title:

Authorized Signatory

 

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