**Exhibit 4.3**

 

**WAIVER AND SECOND AMENDMENT**

**TO NOTE PURCHASE AGREEMENT ANDNOTES**

 

                THISWAIVER AND SECOND AMENDMENT TO NOTE PURCHASE AGREEMENT AND NOTES (this “Waiverand Amendment”) is made as of the 1st day of June, 2001 by and amongDAKOTA GROWERS PASTA COMPANY (the “Company”) and MASSACHUSETTS MUTUAL LIFEINSURANCE COMPANY, BAYSTATE HEALTH SYSTEMS, INC., C.M. LIFE INSURANCE COMPANY,THE SECURITY MUTUAL LIFE INSURANCE COMPANY OF LINCOLN, NEBRASKA, and THE CANADALIFE ASSURANCE COMPANY (collectively, the “Holders”).

 

# **R E C I T A L S**

 

WHEREAS, the Company andthe Holders entered into that certain Note Purchase Agreement, dated as of July15, 1998, as amended by Waiver and First Amendment, dated as of November 28,2000 (as amended, the “Agreement”) with respect to $18,000,000 7.04% SeniorSecured Guaranteed Notes, Series A, due August 1, 2008 (the “Series A Notes”)and with respect to $9,000,000 7.14% Senior Secured Guaranteed Notes, Series B,due August 1, 2010 (the “Series B Notes” and together with the Series A Notes,the “Notes”);

 

WHEREAS, an Event ofDefault exists, under Section 10.4(b) of the Agreement; and

 

WHEREAS, the Company andthe Holders are desirous of waiving the existing Events of Default and amendingthe Agreement and the Notes on the terms and conditions set forth below.

 

NOW THEREFORE, inconsideration of the mutual covenants and agreements set forth in the Agreementand herein, and other good and valuable consideration, the receipt andsufficiency of which are hereby acknowledged, the Company and the Holders agreeas follows:

 

1.        Section 10.4 (b) of the Agreement ishereby deleted in its entirety and replaced with the following:

 

(b)                TheCompany will not at any time permit the ratio of (1) Consolidated Funded Debtto (2) Consolidated Cash Flow to exceed (A) 4.00 to 1.00 for the period fromthe Closing to and including July 31, 1999, (B) 3.50 to 1.00 for the periodfrom August 1, 1999 to and including January 31, 2000 (C) 3.25 to 1.00 for theperiod from February 1, 2000 to and including July 31, 2000 (D) 3.50 to 1.00for the period from August 1, 2000 to and including October 31, 2000, (E) 4.20to 1.00 for the period from November 1, 2000 to and including January 31, 2001,(F) 5.00 to 1.00 for the period from February 1, 2001 to and including April30, 2001, (G) 4.25 to 1.00 for the period from May 1, 2001 to and includingJuly 31, 2001, (H) 3.75 to 1.00 for the period from August 1, 2001 to andincluding October 31, 2001, (I) 3.25 to 1.00 for the period from November 1,2001 to and including January 31, 2002, and (J) 3.00 to 1.00 at all timesthereafter, in each case determined as of the end of each fiscal quarter forthe immediately preceding four fiscal quarters (ending on the date ofcalculation) treating such period of four fiscal quarters as a singleaccounting period.

 

2.     The Events of Default currently existingunder Section 10.4 (b) of the Agreement are hereby waived.

3.     Section 11(g) of the Agreement is herebydeleted in its entirety and replaced with the following:

 

                (g)                (i) the Company or anySubsidiary is in default (as principal or as guarantor or other surety) in thepayment of any principal of or premium or make-whole amount or interest on anyDebt that is outstanding in an aggregate principal amount of at least$1,000,000 beyond any period of grace provided with respect thereto, or (ii)the Company or any Subsidiary is in default in the performance of or compliancewith any term of any evidence of any Debt in an aggregate outstanding principalamount of at least $1,000,000 or of any mortgage, indenture or other agreementrelating thereto, or (iii) as a consequence of the occurrence or continuationof any event or condition (other than the passage of time or the right of theholder of Debt to convert such Debt into equity interests), (x) the Company orany Subsidiary has become obligated to purchase or repay Debt before itsregular maturity or before its regularly scheduled dates of payment in anaggregate outstanding principal amount of at least $1,000,000, or (y) one ormore Persons have the right to require the Company or any Subsidiary so topurchase or repay such Debt; or

 

4.     The Series A Notes are hereby amended suchthat the rate of interest on the unpaid balance thereof shall be 8.04% at anytime that either (a) the ratio of the Company’s Consolidated Funded Debt toConsolidated Cash Flow is greater than 3.00 to 1.00, determined as of the endof each fiscal quarter for the immediately preceding four fiscal quarters(ending on the date of calculation) treating such period of four fiscalquarters as a single accounting period or (b) the Securities Valuation Officeof the National Association of Insurance Commissioners has not assigned adesignation category of “1” or “2” to the Series A Notes, provided that thePurchasers shall request a review of the Series A Notes by the SecuritiesValuation Office of the National Association of Insurance Commissioners atleast annually beginning with the calendar year 2002.  The parties hereto hereby agree that the interest rate of 8.04%became effective as of August 1, 2001 pursuant to this paragraph.

 

5.     The Series B Notes are hereby amended suchthat the rate of interest on the unpaid balance thereof shall be 8.14% at anytime that either (a) the ratio of the Company’s Consolidated Funded Debt toConsolidated Cash Flow is greater than 3.00 to 1.00, determined as of the endof each fiscal quarter for the immediately preceding four fiscal quarters(ending on the date of calculation) treating such period of four fiscalquarters as a single accounting period or (b) the Securities Valuation Officeof the National Association of Insurance Commissioners has not assigned adesignation category of “1” or “2” to the Series B Notes, provided that thePurchasers shall request a review of the Series A Notes by the SecuritiesValuation Office of the National Association of Insurance Commissioners atleast annually beginning with the calendar year 2002.  The parties hereto hereby agree that the interest rate of 8.14%became effective as of August 1, 2001 pursuant to this paragraph.

 

6.     The effectiveness of this Waiver andAmendment is expressly subject to the following conditions:

 

(a)        The Company shall have executed anddelivered this Waiver and Amendment to the Holders;

 

(b)        All proceedings taken in connection withthe transactions contemplated by this Waiver and Amendment and all documents,instruments and other legal matters incident thereto shall be satisfactory tothe Holders;

 

(c)        No Default or Event of Default otherthan the Events of Default waived hereby shall have occurred and be continuing;

 

(d)        The representations and warranties setforth in Section 8 below shall be true and correct as of the date hereof; and

 

(e)           The CoBank senior debt documentsshall have been amended in a manner satisfactory to the Holders.

7.     The initially capitalized terms used hereinshall have the respective meanings specified in the Agreement unless otherwisedefined herein or if the context shall otherwise require.

 

8.     To inducethe Holders to enter into this Waiver and Second Amendment, the Companyrepresents and warrants to the Holders that the execution, delivery, andperformance of this Waiver and Second Amendment has been duly authorized by allrequisite corporate action on the part of the Company and that this Waiver andSecond Amendment has been duly executed and delivered by the Company.

 

9.     Except as expressly waived or amendedhereby, the terms and conditions of the Agreement are hereby ratified,confirmed and approved in all respects.

 

10.   This waiver and Amendment may be executed inone or more counterparts and shall be effective when at least one counterpartshall have been executed by each party hereto, and each set of counterpartsthat, collectively, show execution by each party hereto shall constitute oneduplicate original.

 

                INWITNESS WHEREOF, the parties hereto have duly executed this Waiver andAmendment as of the date first set forth above.

 
| DAKOTA GROWERS PASTA COMPANY                                       |                                 | BAYSTATE HEALTH  SYSTEM, INC |
|--------------------------------------------------------------------|--------------------------------------|------------------------------|
|                                                               |                                 |                         | By: | David L. Babson &  Company Inc., |
|                                                               |                                 |                         |   | as Investment Adviser |
|                                                               |                                 |                         |   |   |
|                                                               |                                 |                         |   |   |
| By:                                                                |                                 | /s/ Thomas Friezen           |   | By: |   | /s/ Mark A. Ahmed |
| Name:                                                              |                                 | Thomas Friezen               |   | Name: |   | Mark  A. Ahmed |
| Title:                                                             |                                 | CFO                          |   | Title: |   | Managing Director |
|                                                               |                                 |                         |   |   |
| MASSACHUSETTS MUTUAL  LIFE  INSURANCE COMPANY                      |                                 | C.M. LIFE INSURANCE COMPANY  |
| By:                                                                | David L. Babson & Company  Inc., |                         | By: | David L. Babson &  Company Inc., |
|                                                               | as Investment Adviser                |                         |   | as Investment  Sub-Adviser |
|                                                               |                                 |                         |   |   |
|                                                               |                                 |                         |   |   |
| By:                                                                |                                 | /s/ Mark A. Ahmed            |   | By: |   | /s/ Mark A. Ahmed |
| Name:                                                              |                                 | Mark  A. Ahmed               |   | Name: |   | Mark  A. Ahmed |
| Title:                                                             |                                 | Managing Director            |   | Title: |   | Managing Director |
|                                                               |                                 |                         |   |   |
| THE  SECURITY MUTUAL LIFE  INSURANCE COMPANY OF  LINCOLN, NEBRASKA |                                 | THE CANADA LIFE  INSURANCE   |
|                                                               | COMPANY                              |
|                                                               |                                 |                         |
|                                                               |                                 |                         |   |   |
|                                                               |                                 |                         |   |   |
| By:                                                                |                                 | /s/ Kevin W. Hammond         |   | By: |   | /s/ C. Paul English |
| Name:                                                              |                                 | Kevin W. Hammond             |   | Name: |   | C. Paul English |
| Title:                                                             | Vice President                       |                         | Title: |   | Associate Treasurer |
|                                                               | Chief Investment  Officer            |                         |   |   |
|                                                                    |                                      |                              |  |  |  |  |  |  |  |  |  |

 

**CONSENT AND REAFFIRMATION**

 

The undersigned (the"Guarantor") hereby (i) acknowledges receipt of a copy of theforegoing Waiver and Second Amendmentto Note Purchase Agreement and Notes (the "Amendment"); (ii)consents to the Company's execution and delivery of the Amendment;  (iii) agrees to be bound by the Amendment;and (iv) affirms that nothing contained in the Amendment shall modify in anyrespect whatsoever its guaranty of the obligations of the Company to thePurchasers as provided in any Financing Agreements to which it is a party andreaffirms that all Financing Agreements to which it is a party shall continueto remain in full force and effect, as amended.  Although the Guarantor has been informed of the matters set forthherein and has acknowledged and agreed to same, the Guarantor understands thatPurchasers have no obligation to inform the Guarantor of such matters in thefuture or to seek the Guarantor's acknowledgment or agreement to futureamendments, waivers or consents, and nothing herein shall create such a duty.

 

IN WITNESS WHEREOF, theundersigned has executed this Consent and Reaffirmation on and as of the dateof the Amendment.
| PRIMO PIATTO, INC. |
|--------------------|
|               |   |
|               |   |
|               |   |
| By:                |   | /s/ Thomas Friezen |
| Printed Name:      | Thomas Friezen |
| Title:             | V.P. – Finance |
|                    |  |  |