Exhibit 10.5

 

AMENDMENT No. 4

Dated as of December 31, 2003

to

RECEIVABLES PURCHASE AGREEMENT

Dated as of June 26, 1998

 

This AMENDMENT NO. 4 (this “Amendment”) dated as of December 31, 2003 is entered
into among PILGRIM’S PRIDE FUNDING CORPORATION (“Seller”), PILGRIM’S PRIDE
CORPORATION (“Pilgrim’s Pride”) as initial Servicer, FAIRWAY FINANCE COMPANY,
LLC (as successor to Fairway Finance Corporation) (“Purchaser”) and HARRIS
NESBITT CORP. (f/k/a BMO Nesbitt Burns Corp.), as agent for the Purchaser (in
such capacity, together with its successors and assigns, the “Agent”).

 

RECITALS

 

WHEREAS, the parties hereto have entered into a certain Receivables Purchase
Agreement dated as of June 26, 1998 (as amended through the date hereof, the
“Agreement”);

 

WHEREAS, in order to make the most efficient use of the financing facility
contemplated by the Agreement and the other Transaction Documents, the Seller
has requested the Purchaser and the Agent to agree to certain amendments and/or
modifications to such facility as described herein for various purposes,
including for the purpose of allowing certain accounts receivable and related
rights generated by various Affiliates of the Seller and Pilgrim’s Pride to be
transferred and assigned (pursuant to various Purchase Agreements, as defined
below) into the facility and included in the Receivables Pool;

 

WHEREAS, the Purchaser and the Agent are willing to agree to such amendments
solely on the terms and subject to the conditions set forth herein;

 

NOW, THEREFORE, in consideration of the promises and the mutual agreements
contained herein and in the Agreement, the parties hereto agree as follows:

 

SECTION 1. Definitions. All capitalized terms used, but not otherwise defined,
herein shall have the respective meanings for such terms set forth in Exhibit I
to the Agreement.

 

SECTION 2. Amendments to the Agreement. The Agreement is hereby amended as
follows:

 

2.1. Exhibit I to the Agreement is hereby amended by adding thereto the
following new definitions in the appropriate alphabetical order:

 

“Excluded Turkey Plants” means, solely those production and turkey processing
plants of Pilgrim’s Pride designated by it as: (i) the New Oxford Plant (located
in Pennsylvania), (ii) the Franconia Plant (located in Pennsylvania) and (iii)
the Hinton Plant (located in Virginia), each of which relates to a portion (but
not all) of Pilgrim’s Pride’s business in respect of turkey and/or turkey
related products.

 

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“Purchase Agreement” means each Purchase Agreement dated as of December 31,
2003, among Pilgrim’s Pride, as buyer and each of the various Transferors from
time to time parties thereto, as sellers, as such agreement may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereto.

 

“Transferor” means, each Affiliate of Pilgrim’s Pride, from time to time party
to a Purchase Agreement, as a seller or transferor thereunder. As of the date
hereof such Transferors shall include only the following entities: each of
Pilgrim’s Pride Corporation of West Virginia, Inc., Pilgrim’s Pride Corporation
of Delaware, Inc., Pilgrim’s Pride Corporation of North Carolina, Inc. and
Pilgrim’s Food Systems Inc.

 

2.2. Clause (viii) of the definition of “Eligible Receivables” set forth in
Exhibit I to the Agreement is hereby amended in its entirety as follows:

 

“(viii) which arise form the sale and delivery of goods or services (other than
the sale and delivery of turkey and turkey related products directly to
third-party customers from any Excluded Turkey Plant) in the ordinary course of
the applicable Originator’s (including the applicable Transferor’s) business;”

 

2.3. The definition of “Originator” set forth in Exhibit I to the Agreement is
hereby amended in its entirety as follows:

 

“Originator” means, individually or collectively, as the context may require (a)
Pilgrim’s Pride, as the transferor of Receivables to the Seller under the
Purchase and Contribution Agreement described in clause (i) of the definition
thereof and (b) each Transferor, as a transferor of Receivables to Pilgrim’s
Pride under a Purchase Agreement.

 

2.4. The definition of “Purchase and Contribution Agreement” set forth in
Exhibit I to the Agreement is hereby amended in its entirety as follows:

 

“Purchase and Contribution Agreement” means, as the context may require, either
or both of (i) the Purchase and Contribution Agreement, dated as of June 26,
1998, among Pilgrim’s Pride, the Servicer and the Seller, as amended through the
date hereof and as the same may be modified, supplemented, amended and amended
and restated from time to time in accordance with the Transaction Documents and
(ii) each Purchase Agreement, as the same may be modified, supplemented, amended
and amended and restated from time to time in accordance with the Transaction
Documents.

 

2.5. The definition of “Receivable” set forth in Exhibit I to the Agreement is
hereby amended in its entirety as follows:

 

“Receivable” means any indebtedness and other obligations owed to any Originator
(including any applicable Transferor) or the Seller or any right of any
Originator (including any applicable Transferor) or Seller to payment from or on

 

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behalf of an Obligor, or any right to reimbursement for funds paid or advanced
by such Originator or Seller on behalf of an Obligor (other than any such
indebtedness, obligation or right which arises solely from the sale and delivery
of turkey and turkey related products directly to third-party customers from the
Excluded Turkey Plants), whether constituting an account, chattel paper, payment
intangible, instrument or general intangible, however arising in connection with
the sale of goods or the rendering of services by such Originator or Seller
(whether or not earned by performance), and includes, without limitation, the
obligation to pay any finance charges, fees and other charges with respect
thereto. Indebtedness and other obligations arising from any one transaction,
including, without limitation, indebtedness and other obligations represented by
an individual invoice or agreement, shall constitute a Receivable separate from
a Receivable consisting of the indebtedness and other obligations arising from
any other transaction.

 

2.6. Clause (i) of the definition of “Related Security” set forth in Exhibit I
to the Agreement is hereby amended in its entirety as follows:

 

“(i) all of the Seller’s or the applicable Originator’s (including the
applicable Transferor’s) interest in any goods (including returned goods), and
documentation or title evidencing the shipment or storage of any goods
(including returned goods), relating to any sale giving rise to such
Receivable;”

 

2.7. Paragraph (s) of Exhibit IV to the Agreement is hereby in its entirety as
follows:

 

“(s) Turkey Operations. In addition to and without limiting any other
obligations of the Seller or the Servicer herein or in the other Transaction
Documents, the Seller and the Servicer shall have established, and shall at all
times maintain, procedures for identifying and segregating collections relating
to turkey and/or turkey related products sold directly to third-party customers
from the Excluded Turkey Plants from Collections on the Receivables which are
financed under the Agreement and the other Transaction Documents, and have
notified all applicable Obligors or other applicable Persons to make all
payments in respect of turkey and/or turkey related receivables originated by or
generated from the Excluded Turkey Plants other than to the Lock-Box Account(s)
and/or the Collection Account (into which Collections solely on the Receivables
are and will continue to be deposited), and no collections relating to
receivables originated by or in connection with the sale of turkey or turkey
related products directly from Excluded Turkey Plants are or will be deposited
in the Lock-Box Accounts and/or Collection Account or otherwise commingled with
Collections on the Receivables. In addition, the Seller and/or the Servicer
shall (or shall cause the applicable Originator (including the Transferors) to)
invoice all turkey and/or turkey related receivables originated by or generated
from the sale of turkey and turkey related products directly from Excluded
Turkey Plants separately from invoices relating to the Receivables which are
financed under the Agreement and the other Transaction Documents.”

 

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2.8. Schedule II to the Receivables Purchase Agreement is hereby amended, by
adding thereto the following additional Lock-Box Bank(s) and Lock-Box
Account(s):

 

Lock-Box Bank

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   Lock-Box Account

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Bank of America, N.A.

   3751519818

Bank of America, N.A.

   3751812269

 

SECTION 3. Representations and Warranties. Each of the Seller and the Servicer
hereby represents and warrants to the Purchaser and the Agent that the
representations and warranties of such Person contained in Exhibit III to the
Agreement are true and correct as of the date hereof (unless stated to relate
solely to an earlier date, in which case such representations and warranties
were true and correct as of such earlier date), and that as of the date hereof,
no Termination Event or Unmatured Termination Event has occurred and is
continuing or will result from this Amendment.

 

SECTION 4. Effect of Amendment. (a) All provisions of the Agreement, as
expressly amended and modified by this Amendment, shall remain in full force and
effect and are hereby ratified and confirmed in all respects. After this
Amendment becomes effective, all references in the Agreement (or in any other
Transaction Document) to “this Agreement”, “hereof”, “herein” or words of
similar effect referring to the Agreement shall be deemed to be references to
the Agreement as amended by this Amendment. This Amendment shall not be deemed,
either expressly or impliedly, to waive, amend or supplement any provision of
the Agreement other than as set forth herein.

 

(b) Notwithstanding anything in the Agreement or any other Transaction Document
to the contrary, each of the parties hereto, hereby consents and agrees to the
amendments contemplated hereby and that all of the provisions in the Agreement,
the Purchase and Contribution Agreement, the Purchase and Sale Agreement and the
other Transaction Documents shall be interpreted so as to give effect to the
intent of the parties hereto as set forth in this Amendment (including, without
limitation, that (i) all references to “Originator” in the singular form in any
of the foregoing documents shall, as the context may require, be deemed to be a
reference to each, any or all applicable Originators (including the
Transferors), collectively, as the case may be and (ii) all references to the
“Purchase and Contribution Agreement” shall, as the context may require, be
deemed to be a reference to either or both of the Purchase and Contribution
Agreement as described in clause (i) of the definition thereof (as amended
hereby) and each Purchase Agreement, as applicable). In addition, all references
to the “Transaction Documents” in any of the foregoing documents shall be deemed
to include a reference to each Purchase Agreement.

 

SECTION 5. Effectiveness. This Amendment shall become effective as of the date
hereof upon receipt by the Agent of the following (each, in form and substance
satisfactory to the Agent):

 

(a) Counterparts of this Amendment (whether by facsimile or otherwise) executed
by each of the parties hereto;

 

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(b) A fully executed copy of a Purchase Agreement dated as of the date hereof
between Pilgrim’s Pride and each of Pilgrim’s Pride Corporation of West
Virginia, Inc., Pilgrim’s Pride Corporation of Delaware, Inc., Pilgrim’s Pride
Corporation of North Carolina, Inc. and Pilgrim’s Food Systems Inc. and signed
by each of the parties thereto;

 

(c) Evidence of the filing of UCC-1 Financing Statement(s), naming each
Transferor, as debtor/seller, Pilgrim’s Pride, as buyer/assignor and the
Purchaser, as secured party/assignee, in all applicable jurisdictions;

 

(d) Acknowledgment copies, or time-stamped receipt copies of proper financing
statements, if any, necessary to release all security interests and other rights
of any Person in the Receivables, Contracts or Related Security previously
granted by any Transferor;

 

(e) Completed UCC requests for information, dated on or before the date hereof
listing all effective financing statements filed in any applicable UCC
jurisdictions that name any Transferor as debtor or seller, together with copies
of such other financing statements (none of which shall cover any Receivables,
Contracts or Related Security), and similar search reports with respect to
judgment, federal tax liens and liens of the Pension Benefit Guaranty
Corporation in such jurisdictions as the Agent may request, showing no such
liens on any of the Receivables, Contracts or Related Security; it being
understood that within 30 days of the date hereof, the Agent shall have received
from the Servicer or the Seller updates of the search reports against the
following debtors in the following jurisdictions: Pilgrim’s Pride Corporation of
West Virginia, Inc. (West Virginia), Pilgrim’s Pride Corporation of Delaware,
Inc. (Delaware), Pilgrim’s Pride Corporation of North Carolina, Inc. (North
Carolina) and Pilgrim’s Food Systems Inc. (Delaware), in each case in form and
substance satisfactory to the Agent, and that the failure to provide such
updates by such date shall constitute a Termination Event under the Agreement
and the other Transaction Documents;

 

(f) Copies of executed Lock-Box Agreements with respect to the new Lock-Box
Accounts at the Lock-Box Banks described in Section 2.8 of this Amendment;

 

(g) Favorable opinions of Baker & McKenzie, counsel for the Seller, Pilgrim’s
Pride and the Transferors, in form and substance acceptable to the Agent and as
to such corporate, enforceability, UCC and other matters as the Agent may
reasonably request;

 

(h) Favorable opinions of Baker & McKenzie, counsel for the Seller, Pilgrim’s
Pride and the Transferor’s in form and substance acceptable to the Agent and as
to such bankruptcy matters as the Agent may reasonably request;

 

(i) Written confirmation from each of the Rating Agencies that the then current
rating by such Rating Agency of the Notes of the Purchaser will not be
downgraded or withdrawn as a result of the effectiveness of this Amendment and
the transactions contemplated hereby; and

 

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(j) Such other documents, resolutions, certificates, agreements and opinions as
the Agent may reasonably request in connection herewith.

 

SECTION 6. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties on separate counterparts, each of which
when so executed shall be deemed to be an original and all of which when taken
together shall constitute but one and the same instrument.

 

SECTION 7. Governing Law. This Amendment, including the rights and duties of the
parties hereto, shall be governed by, and construed in accordance with, the laws
of the State of Texas (without giving effect to the conflict of laws principles
thereof).

 

SECTION 8. Section Headings. The various headings of this Amendment are included
for convenience only and shall not affect the meaning or interpretation of this
Amendment, the Agreement or any provision hereof or thereof.

 

(continued on following page)

 

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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by
their respective officers thereunto duly authorized as of the date first above
written.

 

PILGRIM’S PRIDE FUNDING CORPORATION,

as Seller

By:

       

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Name:

   

Title:

   

 

PILGRIM’S PRIDE CORPORATION,

as initial Servicer

By:

       

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Name:

   

Title:

   

 

FAIRWAY FINANCE COMPANY, LLC,

as Purchaser

By:

       

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Name:

   

Title:

   

 

HARRIS NESBITT CORP.,

as Agent

By:

       

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Name:

   

Title:

     

By:

       

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Name:

   

Title:

   

 

Amendment No. 4 to RPA

 

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