Document:

Exhibit 10.1 Parkdale 8-K

SECOND AMENDMENT TO YARN SUPPLY AGREEMENT

This Second Amendment to the Yarn Supply Agreement (this “Second Amendment”) is made as of the 21st  day of October, 2011, by and between Parkdale Mills, Inc., a North Carolina corporation, and Parkdale America, LLC, a North Carolina limited liability company (collectively, “Parkdale”), and Delta Apparel, Inc., a Georgia corporation (“Delta”).

WHEREAS, Parkdale and Delta entered into that certain Yarn Supply Agreement dated as of January 5, 2005 with respect to the supply of yarn by Parkdale to Delta (the “Agreement”); and

WHEREAS, Parkdale and Delta desire to amend the Agreement as set forth in this Second Amendment;

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1.    Capitalized terms not otherwise defined in this Second Amendment shall have the meanings ascribed thereto in the Agreement;

2.    The Term of the Agreement is hereby extended until March 31, 2013.

3.    Effective as of January 1, 2012, Exhibit 1B shows the adjusted conversion prices for Open End and Air Jet spun yarns.  Effective April 1, 2012, Exhibit 2B shows the adjusted conversion prices for the Ring Spun yarns. Exhibit C is unchanged. 

4.    Except as expressly set forth in this Second Amendment, all terms and conditions of the Agreement shall remain in full force and effect.  In the event of any conflict between the terms and conditions of this Second Amendment and any of the terms and conditions of the Agreement, the terms and conditions of this Second Amendment shall control.     

5.    This Second Amendment shall be governed and controlled as to validity, enforcement, interpretation, construction, and effect, and in all other respects, by the laws of the State of North Carolina, without regard to principles of conflict of law.  

6.    This Second Amendment may be executed in multiple counterparts, each of which shall be deemed to be an original, and all such counterparts shall constitute but one instrument.  

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed by their respective duly authorized officers as of the day and year first above written.

PARKDALE MILLS, INC.

By: /s/ Charles S. Heilig III
Name: Charles S. Heilig III
Title: Executive V.P.

PARKDALE AMERICA LLC

By: /s/ Charles S. Heilig III
Name: Charles S. Heilig III
Title: Executive V.P.

DELTA APPAREL, INC.

By: /s/ Robert W. Humphreys
Name: Robert W. Humphreys
Title: Chairman & CEO

Exhibit 1B
Effective January 1, 2012

Purchase Price of Yarn:

The purchase price for each pound of Yarn delivered shall be calculated in accordance with the following formula:  Purchase Price = [(A + B) ÷ C] + D

Where:        A =     Cost Price 
B =     Basis, as agreed upon by the parties from time to time
C =     1.00 - applicable waste factor set forth in the table below (in decimal 
format)
D =     Applicable conversion price set forth in the table below

Waste Factors and Conversion Prices
	
			
	 
	 
	Conversion

	Polyester / Cotton
	Waste
	$ per pound

	8/1 50/50 (OES Backing)
	*
	*

	10/1 50/50 (OES Backing)
	*
	*

	12/1 50/50 (OES Backing)
	*
	*

	15/1 50/50 (OES Backing)
	*
	*

	14/1 50/50 (OES)
	*
	*

	16/1 50/50(OES)
	*
	*

	18/1 50/50(OES)
	*
	*

	20/1 50/50(OES)
	*
	*

	22/1 50/50(OES)
	*
	*

	26/1 50/50 (OES)
	*
	*

	Air Jet
	 
	 

	12/1 100% AJ
	*
	*

	18/1 100% AJ
	*
	*

	20/1 100% AJ
	*
	*

	20.5/1 100% AJ
	*
	*

	22/1 100% AJ
	*
	*

	16/1 50/50 AJ
	*
	*

	26/1 50/50 AJ
	*
	*

	27/1 50/50 AJ
	*
	*

	28/1 50/50 AJ
	*
	*

	100% Open End
	 
	 

	14/1 100% KPOE
	*
	*

	16/1 100% KPOE
	*
	*

	17/1 100% KPOE
	*
	*

	17.5/1 100% KPOE
	*
	*

	18/1 100% KPOE
	*
	*

	19/1 100% KPOE
	*
	*

	20/1 100% KPOE Soft Spun
	*
	*

	20/1 100% KPOE Style Spun
	*
	*

	20/1 100% KPOE
	*
	*

	22/1 100% KPOE
	*
	*

	24/1 100% KPOE
	*
	*

	26/1 100% KPOE
	*
	*

	28/1 100% KPOE
	*
	*

	30/1 100% KPOE
	*
	*

	
			
	Open End Heather
	 
	 

	14/1 90/10 KPOE
	*
	*

	16/1 90/10 KPOE
	*
	*

	17/1 90/10 KPOE
	*
	*

	18/1 90/10 KPOE
	*
	*

	20/1 90/10 KPOE
	*
	*

	22/1 90/10 KPOE
	*
	*

	24/1 90/10 KPOE
	*
	*

	28/1 90/10 KPOE
	*
	*

	30/1 90/10 KPOE
	*
	*

	14/1 99/1 KPOE
	*
	*

	16/1 99/1 KPOE
	*
	*

	17/1 99/1 KPOE
	*
	*

	18/1 99/1 KPOE
	*
	*

	20/1 99/1 KPOE
	*
	*

	22/1 99/1 KPOE
	*
	*

	26/1 99/1 KPOE
	*
	*

	30/1 99/1 KPOE
	*
	*

	18/1 70/30 cotton/blk poly KPOE
	*
	*

	Tri-Blend
	 
	 

	14/1 50/40/10  Open End
	*
	*

	16/1 50/40/10 Open End
	*
	*

	18/1 50/40/10 Open End
	*
	*

	20/1 50/40/10  Open End
	*
	*

	22/1 50/40/10  Open End
	*
	*

	26/1 50/40/10  Open End
	*
	*

	14/1 50/49/1 Open End
	*
	*

	16/1 50/49/1 Open End
	*
	*

	18/1 50/49/1 Open End
	*
	*

	20/1 50/49/1 Open End
	*
	*

	22/1 50/49/1 Open End
	*
	*

	26/1 50/49/1 Open End
	*
	*

* Portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been filed separately with the United States Securities and Exchange Commission.

Exhibit 2B
Effective April 1, 2012

Conversion Prices for Ring Spun Yarn

	
			
	Ring Spun
	 
	 

	16/1 100% KPRS
	*
	*

	18/1 100% KPRS
	*
	*

	20/1 100% KPRS
	*
	*

	22/1 100% KPRS
	*
	*

	26/1 100% KPRS
	*
	*

	28/1 100% KPRS
	*
	*

	16/1 100% CPRS
	*
	*

	18/1 100% CPRS
	*
	*

	20/1 100% CPRS
	*
	*

	22/1 100% CPRS
	*
	*

	24/1 100% CPRS
	*
	*

	26/1 100% CPRS
	*
	*

	30/1 100% CPRS
	*
	*

	32/1 100% CPRS
	*
	*

	36/1 100% CPRS
	*
	*

	18/1 50/50 CPRS
	*
	*

	20/1 50/50 CPRS
	*
	*

	22/1 50/50 CPRS
	*
	*

	24/1 50/50 CPRS
	*
	*

	26/1 50/50 CPRS
	*
	*

	30/1 50/50 CPRS
	*
	*

	40/1 100% CPRS
	*
	*

	Ring Spun Heather
	 
	 

	16/1 90/10 KPRS
	*
	*

	18/1 90/10 KPRS
	*
	*

	19/1 90/10 KPRS
	*
	*

	20/1 90/10 KPRS
	*
	*

	22/1 90/10 KPRS
	*
	*

	30/1 90/10 KPRS
	*
	*

	18/1 90/10 CPRS
	*
	*

	22/1 80/20 CPRS
	*
	*

	30/1 80/20 CPRS
	*
	*

* Portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been filed separately with the United States Securities and Exchange Commission.

This Exhibit 1B and Exhibit 2B shall be amended from time to time to add basis, waste factors, and conversion prices per pound for Yarn Counts required by Delta or any of its Subsidiaries not set forth above, as agreed to by the parties in their reasonable discretion.

The Cost Price per pound shall be adjusted over the term of this Agreement as described on Exhibit C and shall be calculated for any given period based on the weighted average of cotton prices fixed for that period pursuant to Exhibit C.  The Basis per pound shall be adjusted over the term of this Agreement on an annual basis on each anniversary date of the Agreement.

Cotton Prices:

Parkdale shall purchase cotton at prices determined by Delta in accordance with Exhibit C attached hereto.    

* Portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been filed separately with the United States Securities and Exchange Commission.

Exhibit C

Cotton Pricing:

Parkdale is responsible for purchasing the cotton.  Delta is responsible for fixing the cotton price in accordance with the existing yarn pricing formula in place with the Agreement and the following procedure:

For each period during the term of the Agreement, Delta shall prior to the respective dates set forth below (i) deliver fixation orders to Parkdale in writing for cotton at a price per pound or a range of acceptable prices per pound for the applicable NY futures cover month in multiples of 100 bales or (ii) transfer to a brokerage account of Parkdale an equivalent number of ICE cotton futures.

Schedule for Cotton Price Fixations
	
			
	Months
	Prices to be fixed no later than:
	Cover Month

	Jan, Feb, Mar
	The latest business day closest to but not exceeding December 25th
	March

	 
	 
	 

	Apr, May
	The latest business day closest to but not exceeding March 25th
	May

	 
	 
	 

	Jun, Jul
	The latest business day closest to but not exceeding May 25th
	July

	 
	 
	 

	Aug, Sep
	The latest business day closest to but not exceeding July 25th
	October

	 
	 
	 

	Oct, Nov, Dec
	The latest business day closest to but not exceeding September 24th
	December

In the event that the number of bales fixed for any pricing period exceeds the actual cotton content of the yarn delivered by Parkdale during such period, the excess cotton fixation will be rolled forward to the next period at the price for the current period and Delta shall reimburse Parkdale's carrying costs for the excess cotton fixation until such fixation is exhausted.   Carrying costs are * per bale per month and shall accrue after two weeks of the following period (e.g. unused cotton on March 31st will be subject to carrying charges if still unused on April 14th.  Accrued carrying costs shall be paid by Delta on a pricing period basis or upon demand by Parkdale.

* Portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been filed separately with the United States Securities and Exchange Commission.

In the event that the actual cotton content of the yarn delivered by Parkdale during such period exceeds the number of bales fixed for that period Delta may elect to cover the shortfall using the next period's fixations at the next period's price.
 
For example assume 8,000 bales are fixed for the second period basis May at 50 cents and 5,000 bales are fixed for the third period basis July at 52 cents.  The actual cotton consumed for the second period is 10,000 bales.  Delta may elect to utilize fixations for 2,000 bales from the third period at 52 cents.  In this case, fixations for 2,000 bales would be rolled to the second period making the second period's price the average of .5040 (8,000 @ .5000 and 2,000 @ .5200).  There would then be fixations for 3,000 bales remaining for the third period at .5200.    

In the event that Delta fails to fix the price of cotton for any period prior to the respective date set forth above and Delta does not elect to roll fixations back, Parkdale shall have the right to fix the cotton price for that period.   If Delta fails to fix the price of cotton for any period in quantities that are sufficient for Parkdale to fulfill the purchase orders for yarn issued by Delta for delivery during that period the applicable market price for such excess yarn shall be equal to the price fixed by Parkdale if Parkdale manufactures such excess yarn from cotton delivered to it pursuant to futures contracts, or Parkdale's cost to obtain cotton in the spot market if Parkdale manufactures such excess yarn from cotton purchased by it in the spot market.

The amount of cotton bales consumed in the period shall be based on invoice date and shall be derived using the following formula:

((Y x P) / (1-W))/500

Where:
    
Y = Pounds of Yarn
P = Percent of Cotton
W = Waste Factor in decimal format (for example: 5% would be 
.05)

All fixation orders and executions must be promptly confirmed in writing by any of the respective representatives listed below or otherwise designated by written notice.

Individuals Responsible for Fixation Orders/Execution:

Delta                     Parkdale
                                
Will McGhee        Jim Martin
Gene Frye
Andy Warlick

* Portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been filed separately with the United States Securities and Exchange Commission.Exhibit 4.1

 

EXECUTION VERSION

 

AMENDMENT TO AMENDED AND RESTATED RIGHTS AGREEMENT

 

THIS AMENDMENT (the “Amendment”), dated as of October 24, 2011, to the Amended and Restated Rights Agreement (the “Rights Agreement”), dated as of January 31, 2011, between ADOLOR CORPORATION, a Delaware corporation (the “Company”), and BROADRIDGE CORPORATE ISSUER SOLUTIONS, INC. (formerly known as STOCKTRANS, A BROADRIDGE COMPANY), a Pennsylvania corporation (the “Rights Agent”), is being executed at the direction of the Company.  Capitalized terms used in this Amendment and not otherwise defined herein shall have the meanings given them in the Rights Agreement.

 

W I T N E S S E T H

 

WHEREAS, Section 27 of the Rights Agreement provides that the Company and the Rights Agent may, if the Company so directs, supplement or amend any provision of the Rights Agreement without the approval of any holders of certificates representing shares of Common Stock;

 

WHEREAS , Cubist Pharmaceuticals, Inc., FRD Acquisition Corporation and the Company contemplate entering into an Agreement and Plan of Merger (the “Merger Agreement”);

 

WHEREAS, the Company desires to amend the Rights Agreement, as set forth herein, to facilitate the transactions contemplated by the Merger Agreement.

 

NOW, THEREFORE, in accordance with the procedures for amendment of the Rights Agreement set forth in Section 27 thereof, and in consideration of the foregoing and the mutual agreements herein set forth, the parties hereto, intending to be legally bound, hereby agree as follows:

 

Section 1.               AMENDMENT TO SECTION 1.  The definition of “Acquiring Person” in Section 1(a) of the Rights Agreement is hereby amended by deleting clause (ii) of Section 1(a)in its entirety and the following should be inserted in its place:

 

An Acquiring Person shall not include (A) the Company, (B) any Subsidiary of the Company, (C) any employee benefit and/or savings plan of the Company, or of any Subsidiary of the Company, or any Person or entity organized, appointed or established by the Company for or pursuant to the terms of any such plan, (D) any Person who falls within the definition of an Acquiring Person pursuant to Section 1(a)(i), but falls within such definition solely as a result of a reduction in the number of shares of Common Stock (or securities convertible into or exchangeable for Common Stock) outstanding due to the acquisition of Beneficial Ownership of shares of Common Stock by the Company unless and until such Person, after that such Person has become an Acquiring Person as a result of such acquisition of Beneficial Ownership of Common Stock by the Company, acquires Beneficial Ownership of any additional shares of Common Stock, (E) any Person

 

 

who qualifies as an Acquiring Person pursuant to Section 1(a)(i), if the Board of Directors determines in good faith that a Person who would not otherwise be an Acquiring Person had become such solely as a result of an inadvertent acquisition (including, without limitation, because (x) such Person was unaware that it beneficially owned a percentage of the Common Stock that would otherwise cause such Person to be an “Acquiring Person,” as defined pursuant to the foregoing provisions of Section 1(a)(i), or (y) such Person was aware of the extent of the Common Shares it beneficially owned but had no actual knowledge of the consequences of such Beneficial Ownership under this Agreement), without any intention of changing or influencing the control of the Company, and such Person divests as promptly as practicable a sufficient number of shares of Common Stock so that such Person would no longer be an Acquiring Person pursuant to Section 1(a)(i), and (F) Cubist Pharmaceuticals, Inc. (“Cubist”) and FRD Acquisition Corporation (“Sub”), or any of their respective Affiliates by reason of (I) the approval, execution, delivery, performance or public announcement of the Merger Agreement (the “Merger Agreement”), dated as of October 24, 2011, among Cubist, Sub and the Company, (II) the commencement or public announcement of the Offer (as defined in the Merger Agreement), (III) the purchase of Common Stock pursuant to the Offer, (IV) the consummation or public announcement of the Merger (as defined in the Merger Agreement), (V) the exercise, or public announcement of the exercise, of the Top-Up Option (as defined in the Merger Agreement) and the purchase of the Top-Up Shares (as defined in the Merger Agreement), (VI) the execution and entry into Tender and Voting Agreements (as defined in the Merger Agreement) to be entered into by and among Cubist, Sub and certain stockholders of the Company, (VII)  any combination of (I) through (VI).

 

Section 2.               New Section.  A new Section 35 shall be added to the Rights agreement which shall read in its entirety:

 

Notwithstanding anything herein to the contrary, immediately prior to the Acceptance Time (as defined in the Merger Agreement), this Agreement shall terminate and shall have no further force and effect and the Rights shall expire and become null and void, without any payment, liability or obligation on the part of the Company, the Rights Agent or the holders of any Rights to any holder. The Company shall give the Rights Agent prior written notice of the Acceptance Time and shall remain obligated to pay the Rights Agent and to indemnify the Rights Agent in accordance with Section 18 of the Rights Agreement.

 

Section 3.               Effectiveness.  This Amendment shall become effective as of the date first written above, as if executed on such date.  Except as specifically amended by this Amendment, all other terms and conditions of the Rights Agreement shall remain in full force and effect and are hereby ratified and confirmed.

 

Section 4.               Benefits of this Agreement.  Nothing in this Agreement shall be construed to give to any Person other than the Company, the Rights Agent and the registered holders of the Rights Certificates (and, prior to the Distribution Date, registered holders of the Common Stock)

 

 

any legal or equitable right, remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of the Rights Certificates (and, prior to the Distribution Date, registered holders of the Common Stock).

 

Section 5.               Governing Law.  This Amendment shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts made and to be performed entirely within such State; provided, however, that all provisions regarding the rights, duties and obligations of the Rights Agent shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed entirely within such State.

 

Section 6.               Counterparts.  This Amendment may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.  A signature to this Amendment transmitted electronically shall have the same authority, effect and enforceability as an original signature.

 

Section 7.               Descriptive Headings.  Descriptive headings of the several sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.

 

[Remainder of page intentionally left blank]

 

 

[Signature Page to Amendment to Amended and Restated Rights Agreement]

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed, all as of the day and year first above written.

 

 

	
 
    	
ADOLOR CORPORATION
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Michael   R. Dougherty
    
	
 
    	
Name:
    	
Michael R.   Dougherty
    
	
 
    	
Title:
    	
President and CEO
    
	
 
    	
 
    
	
 
    	
BROADRIDGE CORPORTE ISSUER   SOLUTIONS, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Linnette   Samuels 
    
	
 
    	
Name:
    	
Linnette Samuels 
    
	
 
    	
Title:
    	
Vice President

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