SUMMARY
This summary highlights certain information appearing elsewhere in this prospectus supplement and should be read
together with the more detailed information and financial data and statements contained elsewhere in or incorporated by reference into this prospectus supplement and the accompanying
prospectus.
Our Company
Overview
We manufacture, sell and distribute a diverse portfolio of branded, high quality, shelf-stable and frozen food and household products across the
United States, Canada and Puerto Rico. Many of our branded products have leading regional or national market shares. In general, we position our products to appeal to the consumer desiring a high
quality and reasonably priced product. We complement our branded product retail sales with institutional and foodservice sales and private label sales. Our business is characterized by a stable and
growing revenue base from our existing product portfolio and is augmented by acquisitions of highly attractive, shelf-stable and frozen brands. Additionally, we generate strong cash flows as a result
of our attractive margins, efficient working capital management, modest capital expenditure requirements and tax efficiencies achieved through our acquisitions. We believe that these characteristics
enable our company to be a leader in successfully achieving sales growth for shelf-stable and frozen branded products and executing an aggressive, disciplined acquisition strategy.
B&G
Foods, including our subsidiaries and predecessors, has been in business for over 125 years. We have a well established sales, marketing and distribution infrastructure that
enables us to sell our products in all major U.S. food distribution channels. These channels include supermarkets, mass merchants, wholesalers, food service accounts, warehouse clubs, non-food
outlets, such as drug store chains and dollar stores, specialty distributors, military commissaries and e-tailers. We have developed and leveraged this infrastructure through our acquisition of more
than 50 high quality brands since 1996. Our history includes a number of acquisitions of non-core brands from large, global packaged food companies, such as the B&M, Underwood,
Ac'cent, Joan of Arc, Sa-són Ac'cent and Las Palmas brands from Pillsbury in 1999, the Ortega brand from Nestlé in
2003, the Grandma's Molasses brand from Cadbury Schweppes in
2006, the Cream of Wheat and Cream of Rice brands from Kraft in 2007,
the Mrs. Dash, Sugar Twin, Baker's Joy, Molly McButter
and Static Guard brands from Unilever in 2011, the New York
Style, Old London, Devonsheer and JJ
Flats brands from Chipita America in 2012, the Green Giant and Le Sueur brands
from General Mills in 2015, the Spice Islands, Tone's, Durkee and Weber brands from ACH Food Companies in 2016, the McCann's brand of premium Irish oatmeal from TreeHouse Foods in 2018 and the Clabber Girl Corporation, including the
Clabber
Girl brand, from Hulman & Company in 2019. Based on our demonstrated record of successful acquisitions, we believe that we are well-positioned as a strategic acquirer of
non-core brands from large, global packaged food companies. We have also successfully acquired businesses from smaller, private companies, as well as private equity and individual sellers, including
Back to Nature Foods Company, LLC and related entities, including the Back to Nature and SnackWell's brands, from Brynwood Partners VI L.P., and
certain other sellers in 2017, Victoria Fine Foods, LLC, including the Victoria brand, from Huron Capital Partners and certain other sellers in 2016, Spartan Foods of America, Inc., and
related entities, including
the Mama Mary's brand, from Linsalata Capital Partners and certain other sellers in 2015; Specialty Brands of America, including the Bear Creek Country Kitchens, Spring Tree, Cary's, MacDonald's, New York Flatbreads and Canoleo brands,
from affiliates of American Capital in 2014; and the TrueNorth brand from DeMet's Candy Company in 2013.
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Our Competitive Strengths
We believe that our success in the packaged food industry and our financial results are due in large part to the following competitive
strengths:
Portfolio of high-margin brands with leading market positions in key growth categories. We are focused on operating smaller,
high-margin brands. We
have assembled a diverse portfolio of brands consisting primarily of niche or specialty products with strong market positions and high operating income margins. Several of our brands compete in
categories that benefit from positive consumer spending trends. For example, our Green Giant and Le
Sueur brands compete in a category well-positioned to
benefit from the health and wellness trend, our Back to Nature products compete in the "better-for-you" snack category, and our Ortega, Las Palmas and
Sa-són Ac'cent brands compete in the U.S. Mexican and Hispanic
market category. We believe that our diverse product portfolio provides a strong platform to capture growth in the packaged food industry and to generate strong profitability and significant cash
flows while mitigating the financial impact of competitive pressure or commodity cost increases in any single brand or product.
Well-developed and proven acquisition platform. We believe that our focus branded products, favorable relationships with retailers,
operations and
marketing expertise and leading acquisition integration capabilities allow us to be highly successful in growing our product and brand portfolio. We have acquired and successfully integrated over 50
brands since 1996. We seek to acquire shelf-stable and frozen food brands with leading market positions, identifiable growth opportunities and high and sustainable margins that will add to our cash
flows and return on capital. Our focus on shelf-stable and frozen branded products allows us to drive attractive profitability and gain efficiencies from our sales and distribution and general and
administrative systems. We believe that our acquisition expertise and ability to integrate businesses quickly lead to successful expansion of acquired brands and the realization of significant cost
synergies. As a result, we believe that we are an acquirer preferred by large, global packaged food companies for their non-core brands. We have successfully completed acquisitions from sellers such
as Treehouse Foods, ACH Food Companies, General Mills, Chipita America, Unilever, Kraft, Cadbury Schweppes, Nestlé, Pillsbury and Nabisco. Our acquisitions of the Back to Nature, Clabber Girl, Tone's,
Weber, Green Giant, Mama Mary's, Bear Creek Country Kitchens, Mrs. Dash, Cream of Wheat and Ortega
brands are examples of our ability to acquire leading shelf-stable brands with high profitability from large packaged food companies and private
investors.
Track record of new product introductions. We have demonstrated the ability to develop new products and product extensions rapidly, and
we have been
able to deliver these new products to our customers quickly. We have generally been able to develop these products from concept to final product and deliver these products to our customers' shelves
within six months of development. We work directly with certain of our customers to implement new product introduction in markets where we expect significant growth. For example, new products we have
introduced in recent years include Green Giant Veggie Spirals, Green Giant Cauliflower Pizza Crust, Green Giant Harvest Protein Bowls, Little Green Sprout's Organics Veggie Spirals, Green Giant Veggie
Tots, Green Giant Riced Veggies, Green Giant Mashed Cauliflower, Cream of
Wheat To-Go Cups, Crock-Pot Seasoning Mixes, No Salt Added Joan of Arc Kidney
Beans, Bear Creek Country Kitchens Dry Soup Mix Bowls, Ortega Reduced Sodium Taco Seasoning and Ortega Fiesta Flats Flat Bottom Taco Shells.
Diversity of customers and distribution channels. We sell our products through all major U.S. food distribution channels, including
supermarkets,
mass merchants, warehouse clubs, wholesalers, food service accounts, specialty distributors, military commissaries and non-food outlets such as drug store chains and dollar stores. We have strong,
long standing, national relationships with all our major customers. Our customers include Walmart, Kroger, Publix, C&S Wholesale Grocers, US Foods, Supervalu, Safeway, Wakefern, Cracker Barrel,
Costco, Target and Sysco. The breadth of our
multiple-channel sales and distribution system allows us to capitalize on above-average growth trends within
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certain
of these distribution channels and expand distribution of acquired brands. Our diverse distribution channels have also contributed to our ability to maintain a broad customer base, with sales
to our ten largest customers accounting for 54.4% of our net sales for fiscal 2018.
Strong cash flow generation. We have generated significant cash flows from our operations. Beginning with fiscal 2014 through fiscal
2018, we have
generated cumulative net cash provided by operating activities of $764.6 million. Our strong financial performance is a result of our attractive operating income margins, efficient working
capital management, modest capital expenditure requirements and tax efficiencies achieved through our acquisitions. Our business continues to be positioned to generate strong cash flows.
Experienced management team with proven track record. Our management team is a strong, complementary combination of relatively new
arrivals with
fresh ideas and long-term B&G Foods veterans with long-standing experience managing our business in a highly competitive environment, and all of whom have extensive food industry experience and long
standing experience managing our company in a highly competitive environment. Our management team has acquired and integrated over 50 brands successfully since 1996 and has developed and implemented a
business strategy that has enabled us to become a highly successful manufacturer and distributor of a diverse portfolio of high quality, branded, shelf-stable and frozen food products.
Growth Strategy
Our goal is to continue to increase sales, profitability and cash flows by enhancing our existing portfolio of shelf-stable and frozen branded
products and by capitalizing on our competitive strengths. We intend to implement our growth strategy through the following initiatives:
Expand brand portfolio with acquisitions of complementary branded businesses. We intend to continue expanding our brand portfolio by
acquiring
shelf-stable and frozen brands with leading market positions, strong brand equity, distribution expansion opportunities and compelling cost efficiencies at attractive valuations. We believe we can
continue our track record of building and improving acquired brands post-acquisition through increased management focus and integration into our well-established manufacturing, sales, distribution and
administrative infrastructure. We believe we are well-positioned as a preferred acquirer to capitalize on the trend of large packaged food companies divesting smaller, non-core, yet profitable, brands
to increase their focus on their large, global brands.
Continue to develop new products and deliver them to market quickly. We intend to continue to leverage our new product development
capability and our
sales and distribution breadth to introduce new products and product extensions. Our management has demonstrated the ability to launch new products quickly. Examples of the new products we have
introduced in recent years are listed above under "Our Competitive StrengthsTrack record of new product introductions."
Leverage our multiple-channel sales and distribution system. Our multiple-channel sales and distribution system allows us to capitalize
on growth
opportunities through the quick and efficient introduction of new and acquired products to our customers. We continue to strengthen our sales and distribution system in order to realize distribution
economies of scale and provide an efficient, national platform for new products by expanding distribution channels, enlarging geographic reach, more effectively managing trade spending, improving
packaging and introducing line extensions.
Continue to focus on higher growth distribution channels and customers. We sell our products through all major U.S. food distribution
channels,
including supermarkets, mass merchants, wholesalers, food service accounts, warehouse clubs, specialty distributors, military commissaries and non-food outlets such as drug store chains and dollar
stores. Our distribution breadth allows us to benefit from high growth channels such as mass merchants, warehouse and club stores, specialty distributors,
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convenience
stores, drug stores, e-tailers, vending machines and food services. We intend to continue to create products specific to our higher growth distribution channels and customers.
History
B&G Foods, including our subsidiaries and predecessors, has been in business for more than 125 years. Our company has been built upon a
successful track record of both organic and acquisition-related growth. We have acquired more than 50 brands since 1996, demonstrating our ability to acquire, integrate and grow branded products.
The
table below includes some of the acquisitions and the divestiture we have completed in recent years:
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Date
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Acquisition
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April 2014
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Acquisition of Specialty Brands of America, Inc. and related entities, including the Bear Creek Country Kitchens, Spring Tree, Cary's, MacDonald's, New York Flatbreads and Canoleo
brands, from affiliates of American Capital, Ltd.
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July 2015
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Acquisition of Spartan Foods of America, Inc., and related entities, including the Mama Mary's brand from Linsalata Capital Partners and certain other
sellers.
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November 2015
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Acquisition of the Green Giant and Le Sueur brands from General Mills, Inc.
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November 2016
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Acquisition of the spices & seasonings business of ACH Food Companies, Inc., including the Spice Islands, Tone's, Durkee and Weber brands.
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December 2016
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Acquisition of Victoria Fine Foods, LLC, including the Victoria brand, from Huron Capital Partners and certain other sellers.
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October 2017
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Acquisition of Back to Nature Foods Company, LLC and related entities, including the Back to Nature and SnackWell's
brands, from Brynwood Partners VI L.P., Mondelēz International and certain other sellers.
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July 2018
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Acquisition of the McCann's brand of premium Irish oatmeal from TreeHouse Foods, Inc.
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October 2018
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Divestiture of Pirate Brands, including the Pirate's Booty, Smart Puffs, and Original
Tings brands, which was sold to The Hershey Company.
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May 2019
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Acquisition of the Clabber Girl Corporation, including the Clabber Girl brand, from Hulman & Company.
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Products and Markets
The following is a brief description of our brands and product lines:
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Brand
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Year
Originated
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Description
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Green Giant and Le Sueur
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1903
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For more than
100 years, the Green Giant and Le Sueur vegetables have been grown and picked at the peak of perfection
in the Valley of the Jolly Green Giant
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Brand
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Year
Originated
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Description
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Shelf-stable and frozen
vegetables
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Ortega
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1897
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Taco shells, tortillas,
seasonings, dinner kits, taco sauces, peppers, refried beans, salsas and related food products
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Maple Grove Farms of Vermont
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1915
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A leading brand of pure
maple syrup
Also includes gourmet salad dressings, sugar free syrups, marinades, fruit syrups, confections, pancake mixes and organic products
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Clabber Girl
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1850
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America's #1 brand of
baking powder
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Clabber
Girl offerings also include baking powder, baking soda and corn starch under the Rumford, Davis and Hearth Club brands
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Cream of Wheat
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1893
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One of the most trusted
and widely recognized brands of hot cereals sold in the United States
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Cream of
Wheat is available in Original, Whole Grain and Maple Brown Sugar stove top, and also in instant packets and cups of original and other flavors
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Cream of
Rice is a gluten-free rice-based hot cereal
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Mrs. Dash
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1983
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The original brand in
salt-free seasonings; available in more than a dozen blends
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Also offers salt-free
marinades
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The brand essence of
Mrs. Dash, "Salt-Free, Flavor-Full," resonates with consumers and underscores the brand's commitment to provide "better-for-you" products that fulfill consumers' expectations for taste
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Brand
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Year
Originated
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Description
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Back to Nature
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1960
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Offers "better-for-you"
snacks, including cookies, crackers, nuts and trail mixes and granola
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Product offerings include
Non-GMO Project Verified, organic and gluten free snacks
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Bear Creek Country Kitchens
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1992
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The leading brand of
hearty dry soups in the United States. Also offers a line of savory pasta dishes and hearty rice dishes
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Victoria
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1929
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A variety of premium pasta
and specialty sauces, savory condiments and tasty gourmet spreads
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Las Palmas
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1922
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Authentic Mexican
enchilada sauce, chili sauce and various pepper products
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Spice Islands
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1941
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A leading premium spices
and extracts brand offering a diverse line of high quality products, including spices, seasonings, dried herbs, extracts, flavorings and sauce blends
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Polaner
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1880
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Fruit-based spreads as
well as jarred wet spices such as chopped garlic and oregano
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Polaner All
Fruit is a leading national brand of fruit-juice sweetened fruit spread
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Polaner Sugar
Free is the second leading national brand of sugar free preserves
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Mama Mary's
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1986
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A leading brand of
shelf-stable pizza crust
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Also offers pizza sauces
and premium gourmet pepperoni slices
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Weber
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2006
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A wide range of grilling
seasoning blends, rubs, marinades, sprays and sauces
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Tone's
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1873
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Responsible for many of
the early advancements in the spice industry
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Brand
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Year
Originated
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Description
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Bloch & Guggenheimer
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1889
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Shelf-stable pickles,
relishes, peppers, olives and other related specialty items
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Underwood
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1870
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Underwood meat spreads
include deviled ham, white-meat chicken, roast beef, corned beef and liverwurst
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New York Style
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1985
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Foods for snacking and
entertaining, including Original Bagel Crisps, Pita Chips and Panetini Italian Toast
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Ac'cent
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1947
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A flavor enhancer for meat
preparation and is generally used on beef, poultry, fish and vegetables
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B&M
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1927
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The original brand of
brick-oven baked beans and remains one of the very few authentic baked beans
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Includes a variety of
baked beans and brown bread
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SnackWell's
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1992
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Includes a variety of
delicious reduced fat products such as its signature Devil's Food Cookie Cakes and peanut-free treats such as its tasty Vanilla Crème Sandwich Cookies
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Spring Tree
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1976
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Pure maple syrup and sugar
free syrup
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Grandma's
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1890
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Molasses offered in two
distinct styles: Grandma's Original Molasses and Grandma's Robust Molasses
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Durkee
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1850
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An early leader in the
spice industry
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Old London
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1932
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Old
London has a wide variety of flavors available in melba toasts, melba rounds and other snacks. Old London also markets specialty snacks under the Devonsheer and JJ Flats brand names
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Brand
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Year
Originated
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Description
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Trappey's
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1898
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High quality peppers and
hot sauces, including Trappey's Red Devil
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McCann's
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1800
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Offers classic traditional
steel cut Irish oatmeal as well as convenience-oriented oatmeal products
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Don Pepino and Sclafani
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1955
and
1900
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Primarily include pizza
and spaghetti sauces, whole and crushed tomatoes and tomato puree
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Emeril's
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2000
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Introduced under a
licensing agreement with celebrity chef Emeril Lagasse
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Pasta sauces, seasonings,
cooking stocks, mustards and cooking sprays
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TrueNorth
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2008
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TrueNorth nut cluster snacks combine freshly roasted nuts, a dash of sea salt and just a hint of sweetness. Their bite-sized shape makes them ideal for between meal snacking and on-the-go nourishment
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Static Guard
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1978
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The number one brand name
in static elimination sprays, created the anti-static spray category
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Cary's
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1904
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The oldest brand of pure
maple syrup in the United States. Cary's also offers sugar free syrup
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Joan of Arc
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1895
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Canned beans including
kidney, chili and other beans
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Baker's Joy
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1968
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The original brand of
no-stick baking spray with flour
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Regina
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1949
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Vinegars and cooking
wines
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Products are most commonly
used in the preparation of salad dressings as well as in a variety of recipe applications, including sauces, marinades and soups
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Brand
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Year
Originated
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Description
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Sugar Twin
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1968
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A calorie free sugar
substitute
Mainly
distributed in Canada
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Wright's
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1895
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A seasoning that
reproduces the flavor and aroma of pit smoking in meats, chicken and fish; offered in three flavors: Hickory, Mesquite and Applewood
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Sa-són Ac'cent
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1947
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A flavor enhancer used
primarily for Puerto Rican and Hispanic food preparation
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Offered in four flavors:
Original, Coriander and Achiote, Garlic and Onion, and Tomato
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Brer Rabbit
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1907
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Mild and full-flavored
molasses products and a blackstrap molasses product
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New York Flatbreads
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1987
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Thin, crispy, flavorful
crispbread that is available in several toppings
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Vermont Maid
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1919
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Vermont
Maid syrup is available in regular, sugar-free and sugar-free butter varieties
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Mainly distributed in New
England
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Molly McButter
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1987
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A sprinkle, available in
butter and cheese flavors
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Canoleo
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Offers an all-purpose
margarine used for spreading, cook and baking.
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Our Corporate Information
We are a Delaware corporation. Our corporate headquarters are located at Four Gatehall Drive, Parsippany, New Jersey 07054, and our telephone
number is 973.401.6500. Our web site address is www.bgfoods.com. The information contained on our web site is not part of this prospectus supplement and
is not incorporated in this prospectus supplement by reference.
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Concurrent Transactions
New term loan borrowings under our senior secured credit facility. In connection with this offering, we also intend to incur new term
loan borrowings
under our senior secured credit facility. The incurrence of the new term loan borrowings under our senior secured credit facility is subject to completion of definitive agreements as well as customary
closing conditions, and is subject to market conditions. There can be no assurance that we will incur new term loan borrowings under our senior secured credit facility, or, if we do, as to the terms
of those borrowings. This offering is not conditioned upon the incurrence of new term loan borrowings under our senior secured credit facility. The notes offered hereby will be effectively junior in
right of payment to any borrowings under our senior secured credit facility.
Redemption of 2021 notes. On September 10, 2019, we issued a conditional notice of redemption to the holders of our outstanding
2021 notes,
notifying such holders that we intend to redeem all of the outstanding 2021 notes on October 10, 2019. The redemption of the 2021 notes is conditioned upon the consummation of this offering
and/or the new term loan borrowings under our senior secured credit facility and our receipt of gross proceeds of not less than $700.0 million. We intend to use the net proceeds from this
offering, together with the proceeds of the new term loan borrowings under our senior secured credit facility, (1) to redeem all of the outstanding 2021 notes, (2) to repay certain
borrowings under our revolving credit facility, (3) to pay related fees and expenses and (4) for general corporate purposes. If this offering is completed, but the new term loan
borrowings under our senior secured credit facility are not incurred by the redemption date, we intend to use the net proceeds from this offering, together with cash on hand and/or borrowings under
our revolving credit facility, to pay the redemption price of the 2021 notes. The redemption price of the 2021 notes is 100% of the principal amount, plus accrued and unpaid interest to, but excluding
the redemption date. As of the date of this prospectus supplement, we have $700.0 million principal amount of 2021 notes outstanding. This prospectus supplement is not a notice to redeem the
2021 notes, and the completion of this offering is not conditioned upon redemption of the 2021 notes. Affiliates of certain of the underwriters will receive a portion of the net proceeds of this
offering. See "UnderwritingOther Relationships."
Summary of the Offering
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Issuer
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B&G Foods, Inc.
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Notes Offered
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$550,000,000 in aggregate principal amount of 5.25% senior notes due 2027.
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Maturity Date
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September 15, 2027.
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Interest Payment Dates
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March 15 and September 15 of each year, commencing March 15, 2020.
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Guarantees
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Our obligations under the notes will be jointly and severally and fully and unconditionally guaranteed on a senior basis by
all of our existing and future domestic restricted subsidiaries other than immaterial subsidiaries. For a discussion of the risks relating to the guarantees, see "Risk FactorsAlthough the notes are referred to as "senior" notes, your right to
receive payments on these notes is effectively subordinated to the rights of our existing and future secured creditors. Further, the guarantees of these notes are effectively subordinated to all the guarantors' existing and future secured
indebtedness." and "United States Federal and state fraudulent transfer laws permit a court to void the notes and the guarantees, and, if that occurs, you may not receive any payments on the notes or the guarantees."
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Ranking
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The notes and the subsidiary guarantees will be our and the guarantors' general unsecured obligations and:
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will be effectively
junior in right of payment to all of our and the guarantors' secured indebtedness, including term loans and revolving loans under the senior secured credit facility, to the extent of the value of the assets pledged to secure those
obligations;
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will be structurally
subordinated to all existing and future indebtedness and other liabilities of our subsidiaries that do not guarantee the notes;
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will be pari passu in right of payment to all of our and the guarantors' existing and future unsecured senior debt, including the 2025 notes; and
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will be senior in right
of payment to all of our and the guarantors' future subordinated debt.
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As of June 29, 2019, after giving effect to the completion of this offering, the new term loan borrowings under our
senior secured credit facility and the use of proceeds therefrom, we would have had $477.7 million principal amount of outstanding senior secured debt and $1.45 billion principal amount of outstanding senior unsecured debt. In addition, as
of June 29, 2019, after giving effect to the completion of this offering, the new term loan borrowings under our senior secured credit facility and the use of proceeds therefrom, we would have had the ability to borrow up to $670.7 million
under our revolving credit facility (net of $1.6 million reserved for issued and outstanding letters of credit), which would be effectively senior in right of payment to the notes.
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As of June 29, 2019, after giving effect to the completion of this offering, the new term loan borrowings under our
senior secured credit facility and the use of proceeds therefrom, our three foreign subsidiaries, B&G Foods Canada, ULC, B&G Foods Manufacturing Mexico, S. de R.L. de C.V. and Sirops Maple Grove Inc., that do not guarantee the notes
would have no indebtedness outstanding other than intercompany indebtedness. As of June 29, 2019, the total assets and total liabilities of our non-guarantor subsidiaries were approximately $123.9 million and $25.3 million,
respectively, and, for the two quarters ended June 29, 2019, our non-guarantor subsidiaries generated approximately $101.6 million and $2.5 million of our net sales and net income, respectively.
|
Optional Redemption
|
|
On or after March 1, 2022, we may redeem some or all of the notes at the redemption prices set forth under "Description
of NotesOptional Redemption."
|
|
|
Prior to March 1, 2022, we may redeem up to 40% of the aggregate principal amount of the notes issued under the
indenture from the proceeds of one or more equity offerings at the redemption prices set forth under "Description of NotesOptional Redemption."
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S-11
Table of Contents
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At any time prior to March 1, 2022, we may on any one or more occasions redeem all or a part of the notes at a redemption price equal
to 100% of the principal amount of the notes redeemed, plus a "make whole premium" as of, and accrued and unpaid interest, if any, to the date of redemption. See "Description of NotesOptional Redemption."
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Sale of Assets; Change of Control
|
|
If we or any of the guarantors sell certain assets or experience specific kinds of changes in control, we must offer to
purchase the notes at the prices set forth under "Description of NotesAsset Sales" and "Change of Control" plus accrued and unpaid interest, to the date of repurchase.
|
Covenants
|
|
We will issue the notes under an indenture among us, the guarantors and the trustee. The indenture (among other things) will
limit our ability and the ability of the guarantors to:
|
|
|
incur or guarantee
additional indebtedness and issue preferred stock;
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make restricted payments,
including investments;
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sell assets;
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sell all or substantially
all of our assets or consolidate or merge with or into other companies;
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enter into certain
transactions with affiliates;
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create liens;
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create unrestricted
subsidiaries; and
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enter into sale and
leaseback transactions.
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|
|
Each of the covenants is subject to a number of important exceptions and qualifications. See "Description of
NotesCertain Covenants." Additionally, some of the covenants may be suspended if and while the notes are rated investment grade. See "Description of NotesCertain CovenantsEffectiveness of Covenants."
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Use of Proceeds
|
|
We intend to use the net proceeds from this offering, together with the proceeds of the new term loan borrowings under our
senior secured credit facility, (1) to redeem all of the outstanding 2021 notes, (2) to repay certain borrowings under our revolving credit facility, (3) to pay related fees and expenses and (4) for general corporate purposes. See
"Use of Proceeds." Affiliates of certain of the underwriters will receive a portion of the net proceeds of this offering. See "UnderwritingOther Relationships."
|
Governing Law
|
|
The notes will be governed by the laws of the State of New York.
|
Trustee
|
|
The Bank of New York Mellon.
|
See
"Description of Notes" for a more detailed discussion of the notes.
Risk Factors
You should carefully consider the information under the caption "Risk Factors" and all other information in this prospectus supplement before
investing in the notes.
S-12
Table of Contents
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL DATA
The following summary historical consolidated financial data should be read in conjunction with "Selected Historical Consolidated Financial
Data," included elsewhere in this prospectus supplement, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our
Annual Report on Form 10-K for the year ended December 31,
2018 and our Quarterly Report on Form 10-Q for the quarter
ended June 29, 2019, each of which is incorporated by reference into this prospectus supplement, and our audited and unaudited consolidated financial statements and notes to
those statements incorporated by reference into this prospectus supplement. Our summary historical consolidated statement of operations data for fiscal 2016, fiscal 2017 and fiscal 2018 have been
derived from our audited consolidated financial statements incorporated by reference into this prospectus supplement. Our summary historical consolidated balance sheet data for fiscal 2017 and fiscal
2018 have been derived from our audited consolidated financial statements incorporated by reference into this prospectus supplement. Our summary historical consolidated balance sheet data as of the
end of fiscal 2016 have been derived from our audited consolidated financial statements that are not incorporated by reference into this prospectus supplement. Our summary historical consolidated
statements of operations data for the first two quarters of fiscal 2019 and the first two quarters of fiscal 2018 have been derived from our unaudited consolidated financial statements incorporated by
reference into this prospectus supplement. Our summary historical consolidated balance sheet data as of June 30, 2018 have been derived from our unaudited consolidated financial statements that
are not incorporated by reference into this prospectus supplement. Our summary historical consolidated balance sheet data as of June 29, 2019 have been derived from our unaudited consolidated
financial statements incorporated by reference into this prospectus supplement.
Our
unaudited consolidated financial statements have been prepared on the same basis as our audited financial statements and, in the opinion of our management, include all adjustments
(consisting of normal recurring adjustments) necessary for a fair presentation of the information for the unaudited interim periods. The results for any interim period are not necessarily indicative
of results that may be expected for a full year.
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Twenty-six Weeks Ended
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Fiscal 2016
|
|
Fiscal 2017
|
|
Fiscal 2018
|
|
June 30,
2018
|
|
June 29,
2019
|
|
|
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(in thousands)
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
Consolidated Statement of Operations Data1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales2
|
|
$
|
1,372,307
|
|
$
|
1,646,387
|
|
$
|
1,700,764
|
|
$
|
820,107
|
|
$
|
783,931
|
|
Cost of goods sold3
|
|
|
943,295
|
|
|
1,205,809
|
|
|
1,351,264
|
|
|
635,578
|
|
|
603,985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit2
|
|
|
429,012
|
|
|
440,578
|
|
|
349,500
|
|
|
184,529
|
|
|
179,946
|
|
Selling, general and administrative expenses2,4
|
|
|
157,028
|
|
|
183,448
|
|
|
167,389
|
|
|
79,840
|
|
|
78,153
|
|
Amortization expense5
|
|
|
13,803
|
|
|
17,611
|
|
|
18,343
|
|
|
9,218
|
|
|
9,092
|
|
Loss (gain) on sale of assets6
|
|
|
|
|
|
1,608
|
|
|
(176,386
|
)
|
|
|
|
|
|
|
Impairment of intangible assets7
|
|
|
5,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income2
|
|
|
252,776
|
|
|
237,911
|
|
|
340,154
|
|
|
95,471
|
|
|
92,701
|
|
Interest expense, net
|
|
|
74,456
|
|
|
91,784
|
|
|
108,334
|
|
|
55,913
|
|
|
46,253
|
|
Loss on extinguishment of debt8
|
|
|
2,836
|
|
|
1,163
|
|
|
13,135
|
|
|
3,324
|
|
|
|
|
Other income2,9
|
|
|
(1,582
|
)
|
|
(3,098
|
)
|
|
(3,592
|
)
|
|
(1,666
|
)
|
|
(783
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax expense
|
|
|
177,066
|
|
|
148,062
|
|
|
222,277
|
|
|
37,900
|
|
|
47,231
|
|
Income tax expense
|
|
|
67,641
|
|
|
(69,401
|
)
|
|
49,842
|
|
|
9,377
|
|
|
12,189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
109,425
|
|
$
|
217,463
|
|
$
|
172,435
|
|
$
|
28,523
|
|
$
|
35,042
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
S-13
Table of Contents
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|
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|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
Twenty-six Weeks Ended
|
|
|
|
Fiscal 2016
|
|
Fiscal 2017
|
|
Fiscal 2018
|
|
June 30, 2018
|
|
June 29, 2019
|
|
|
|
(in thousands, except ratios)
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
Other Financial Data1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA10
|
|
$
|
322,040
|
|
$
|
333,201
|
|
$
|
314,182
|
|
$
|
163,862
|
|
$
|
146,805
|
|
Net cash provided by operating activities
|
|
|
289,661
|
|
|
37,799
|
|
|
209,456
|
|
|
104,804
|
|
|
16,846
|
|
Capital expenditures
|
|
|
(42,418
|
)
|
|
(59,802
|
)
|
|
(41,627
|
)
|
|
(17,208
|
)
|
|
(18,148
|
)
|
Cash payments for acquisition of businesses
|
|
|
(438,787
|
)
|
|
(162,965
|
)
|
|
(30,787
|
)
|
|
|
|
|
(82,430
|
)
|
Net cash (used in) provided by financing activities
|
|
$
|
216,005
|
|
$
|
359,336
|
|
$
|
(753,327
|
)
|
$
|
(232,249
|
)
|
$
|
91,901
|
|
Adjusted EBITDA / cash interest expense10,11
|
|
|
4.7x
|
|
|
3.9x
|
|
|
3.0x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twenty-six Weeks Ended
|
|
|
|
Fiscal 2016
|
|
Fiscal 2017
|
|
Fiscal 2018
|
|
June 30, 2018
|
|
June 29, 2019
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
Consolidated Balance Sheet Data (at end of period)1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
28,833
|
|
$
|
206,506
|
|
$
|
11,648
|
|
$
|
62,840
|
|
$
|
19,911
|
|
Total assets
|
|
|
3,043,505
|
|
|
3,561,038
|
|
|
3,054,799
|
|
|
3,355,113
|
|
|
3,171,767
|
|
Long-term debt, including current portion
|
|
|
1,725,783
|
|
|
2,217,574
|
|
|
1,635,881
|
|
|
2,073,874
|
|
|
1,802,626
|
|
Total stockholders' equity
|
|
$
|
785,657
|
|
$
|
880,819
|
|
$
|
900,049
|
|
$
|
827,014
|
|
$
|
863,360
|
|
-
1
-
We
completed the spices & seasonings acquisition from ACH Food Companies, Inc. on November 21, 2016. We completed the Victoria acquisition from Huron Capital Partners and certain other
sellers on December 2, 2016. We completed the Back to
Nature acquisition from Brynwood Partners VI L.P., Mondelēz International and certain other sellers on October 2, 2017. We completed the McCann's acquisition from
TreeHouse Foods, Inc. on July 16, 2018. We completed the sale of Pirate Brands to The Hershey Company on
October 17, 2018. We completed the Clabber Girl acquisition from Hulman & Company on May 15, 2019. Each of the acquisitions listed
above has been accounted for using the acquisition method of accounting and, accordingly, the assets acquired, liabilities assumed and results of operations of the acquired business is included in our
consolidated financial statements from the date of acquisition.
-
2
-
Net
sales, gross profit, selling, general and administrative expenses, operating income and other income for fiscal 2016 and 2017 have been adjusted as a
result of our retrospective adoption of new accounting standards relating to revenue recognition and the presentation of net periodic pension cost and net periodic post-retirement benefit cost. We
also reclassified a $1.6 million pre-tax loss on sale of assets for fiscal 2017 from selling, general and administrative expenses to loss on sale of assets.
-
3
-
Fiscal
2016 includes $5.4 million of amortization of acquisition-related inventory fair value step-up (for certain spices & seasonings
business inventory acquired and sold during the period and certain Green Giant inventory sold during the period) and a $0.8 million loss on
disposal of inventory related to the impairment of Rickland Orchards. Cost of goods sold for fiscal 2017 includes $2.4 million of amortization of
acquisition-related inventory fair value step-up (for certain spices & seasonings business and Back to Nature inventory acquired and sold during
the period) and a $3.3 million loss on disposal of inventory related to the write-off of discontinued and expired inventory from recent acquisitions. Cost of goods sold for fiscal 2018 includes
$76.3 million of
S-14
Table of Contents
non-recurring
expenses, including $66.3 million relating to the non-cash accounting impact of our inventory reduction plan and $10.0 million of warehouse, delivery and other costs
associated with our transition from certain of our existing distribution centers to new distribution centers.
-
4
-
Selling,
general and administrative expenses for fiscal 2016 include $17.5 million of acquisition-related expenses for the Victoria, spices & seasonings, Green
Giant and Mama
Mary's acquisitions and $1.3 million of distribution restructuring expenses. Selling, general and administrative expenses for fiscal 2017 include $35.6 million of
acquisition-related and non-recurring expenses, including acquisition and integration expenses for the Green Giant, spices & seasonings, Victoria
and Back to Nature acquisitions, severance and hiring costs and a non-recurring startup
surcharge paid to a co-packer. Selling, general and administrative expenses for fiscal 2018 includes $16.9 million of acquisition/divestiture-related and non-recurring expenses, including
divestiture expenses for the Pirate Brands sale and acquisition and integration expenses for the McCann's, Green
Giant, spices & seasonings, Victoria and Back to Nature acquisitions.
-
5
-
Amortization
expense includes the amortization of customer relationships, amortizable trademarks and other intangible assets acquired in the McCann's, Back to Nature, Victoria, spices & seasonings, Green Giant, Mama Mary's,
Specialty Brands, Rickland Orchards, Pirate Brands, TrueNorth
and prior acquisitions.
-
6
-
During
fiscal 2017, we recorded a $1.6 million pre-tax loss as we sold to a third-party co-packer our Le Sueur, Minnesota research center,
including the seed technology assets, property, plant and equipment. During fiscal 2018, we recognized a pre-tax gain on the Pirate Brands sale of $176.4 million.
-
7
-
Impairment
of intangible assets for fiscal 2016 includes a $4.5 million loss for the impairment of amortizable trademarks and a
$0.9 million loss for the impairment of customer relationship intangibles, both relating to Rickland Orchards.
-
8
-
Fiscal
2016 loss on extinguishment of debt includes the write-off of deferred debt financing costs of $2.2 million and the write-off of
unamortized discount of $0.6 million in connection with the repayment of $40.1 million aggregate principal amount of our tranche A term loans and $109.9 million aggregate
principal amount of our tranche B term loans. Fiscal 2017 loss on extinguishment of debt includes the write-off of deferred debt financing costs of $0.9 million and the write-off of
unamortized discount of $0.2 million in connection with the repayment of all outstanding borrowings under the tranche A term loans and the write-off of deferred debt financing costs and
the write-off of unamortized discount of less than $0.1 million in connection with the refinancing of our tranche B term loans. Fiscal 2018 loss on extinguishment of debt includes the
write-off of deferred debt financing costs and unamortized discount of $11.1 million and $2.0 million, respectively, relating to the repayment of all outstanding borrowings under the
tranche B term loans. Loss on extinguishment of debt for the first two quarters of 2018 included the write-off of deferred debt financing costs and unamortized discount of $2.8 million
and $0.5 million, respectively, relating to the prepayment of borrowings under the tranche B term loans.
-
9
-
Other
income for fiscal 2016 includes remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of $0.4 million and
includes the impact of the newly adopted presentation of net periodic pension cost and net periodic post-retirement benefit costs below operating profit in the amount of $1.2 million. Other
income for fiscal 2017 includes remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of $1.6 million and includes the impact of the newly adopted presentation of
net periodic pension cost and net periodic post-retirement benefit costs below operating profit in the amount of $1.5 million. Other income for fiscal 2018 includes remeasurement of monetary
assets denominated in a foreign currency into U.S. dollars of $1.2 million and includes the impact of the newly
S-15
Table of Contents
adopted
presentation of net periodic pension cost and net periodic post-retirement benefit costs below operating profit in the amount of $2.4 million.
-
10
-
EBITDA
and adjusted EBITDA are non-GAAP financial measures used by management to measure operating performance. A non-GAAP financial measure is defined
as a numerical measure of our financial performance that excludes or includes amounts so as to be different from the most directly comparable measure calculated and presented in accordance with GAAP
in our consolidated balance sheets and related consolidated statements of operations, comprehensive income, changes in stockholders' equity and cash flows. We define EBITDA as net income before net
interest expense, income taxes, depreciation and amortization and loss on extinguishment of debt (see footnote (10) above). We define adjusted EBITDA as EBITDA adjusted for cash and non-cash
acquisition/divestiture-related expenses, gains and losses (which may include third party fees and expenses, integration, restructuring and consolidation expenses, amortization of acquired inventory
fair value step-up and gains and losses on the sale of assets); non-recurring expenses, gains and losses; gains and losses related to changes in the fair value of contingent liabilities from
earn-outs; the non-cash accounting impact of our inventory reduction plan; intangible asset impairment charges and related asset write-offs; loss on product recalls, including customer refunds,
selling, general and administrative expenses and the impact on cost of sales; and distribution restructuring expenses. Management believes that it is useful to eliminate these items because it allows
management to focus on what it deems to be a more reliable indicator of ongoing operating performance and our ability to generate cash flow from operations. We use EBITDA and adjusted EBITDA in our
business operations to, among other things, evaluate our operating performance, develop budgets and measure our performance against those budgets, determine employee bonuses and evaluate our cash
flows in terms of cash needs. We also present EBITDA and adjusted EBITDA because we believe they are useful indicators of our historical debt capacity and ability to service debt and because covenants
in our credit agreement and our senior notes indentures contain ratios based on these measures. As a result, reports used by internal management during monthly operating reviews feature the EBITDA and
adjusted EBITDA metrics. However, management uses these metrics in conjunction with traditional GAAP operating performance and liquidity measures as part of its overall assessment of company
performance and liquidity, and therefore does not place undue reliance on these measures as its only measures of operating performance and liquidity.
-
-
EBITDA
and adjusted EBITDA are not recognized terms under GAAP and do not purport to be alternatives to operating income, net income or any other GAAP
measure as an indicator of operating performance. EBITDA and adjusted EBITDA are not complete net cash flow measures because EBITDA and adjusted EBITDA are measures of liquidity that do not include
reductions for cash payments for an entity's obligation to service its debt, fund its working capital, capital expenditures and acquisitions and pay its income taxes and dividends. Rather, EBITDA and
adjusted EBITDA are two potential indicators of an entity's ability to fund these cash requirements. EBITDA and adjusted EBITDA are not complete measures of an entity's profitability because they do
not include certain costs and expenses and gains and losses described above. Because not all companies use identical calculations, this presentation of EBITDA and adjusted EBITDA may not be comparable
to other similarly titled measures of other companies. However, EBITDA and adjusted EBITDA can still be useful in evaluating our performance against our peer companies because management believes
these measures provide users with valuable insight into key components of GAAP amounts.
S-16
Table of Contents
The
following is a reconciliation of net income to EBITDA and adjusted EBITDA for the periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twenty-six Weeks Ended
|
|
|
|
Fiscal 2016
|
|
Fiscal 2017
|
|
Fiscal 2018
|
|
June 30,
2018
|
|
June 29,
2019
|
|
|
|
(in thousands)
|
|
(unaudited)
|
|
Net income
|
|
$
|
109,425
|
|
$
|
217,463
|
|
$
|
172,435
|
|
$
|
28,523
|
|
$
|
35,042
|
|
Income tax expense
|
|
|
67,641
|
|
|
(69,401
|
)
|
|
49,842
|
|
|
9,377
|
|
|
12,189
|
|
Interest expense, net
|
|
|
74,456
|
|
|
91,784
|
|
|
108,334
|
|
|
55,913
|
|
|
46,253
|
|
Depreciation and amortization
|
|
|
37,266
|
|
|
49,172
|
|
|
53,639
|
|
|
26,407
|
|
|
28,420
|
|
Loss on extinguishment of debtA
|
|
|
2,836
|
|
|
1,163
|
|
|
13,135
|
|
|
3,324
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
291,624
|
|
|
290,181
|
|
|
397,385
|
|
|
123,544
|
|
|
121,904
|
|
Acquisition/divestiture-related and non-recurring expensesB
|
|
|
17,523
|
|
|
35,745
|
|
|
26,863
|
|
|
4,892
|
|
|
8,519
|
|
Inventory reduction plan impactC
|
|
|
|
|
|
|
|
|
66,320
|
|
|
35,426
|
|
|
16,382
|
|
Amortization of acquisition-related inventory step-upD
|
|
|
5,424
|
|
|
2,380
|
|
|
|
|
|
|
|
|
|
|
Impairment of intangible assetsE
|
|
|
5,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on disposal of inventoryF
|
|
|
791
|
|
|
3,287
|
|
|
|
|
|
|
|
|
|
|
(Gain) loss on sale of assetsG
|
|
|
|
|
|
1,608
|
|
|
(176,386
|
)
|
|
|
|
|
|
|
Distribution restructuring expensesH
|
|
|
1,273
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
|
322,040
|
|
$
|
333,201
|
|
$
|
314,182
|
|
$
|
163,862
|
|
$
|
146,805
|
|
-
A
-
See
note 8 in Summary Historical Consolidated Financial Data, above.
-
B
-
Fiscal
2016 primarily includes acquisition and integration expenses for the Green Giant, spices &
seasonings, Victoria and Back to Nature acquisitions, and severance and hiring costs. Fiscal 2017
primarily includes acquisition and integration expenses for the Green Giant, spices & seasonings, Victoria and Back to
Nature acquisitions, severance and hiring costs, a non-recurring interest charge
relating to the refinancing of our credit agreement and a non-recurring startup surcharge paid to a co-packer. Acquisition/divestiture-related and non-recurring expenses for fiscal 2018 primarily
includes divestiture expenses for the Pirate Brands sale and acquisition and integration expenses for the McCann's, Green
Giant, spices & seasonings, Victoria and Back to Nature acquisitions.
Acquisition/divestiture-related and non-recurring expenses for the first two quarters of 2018 primarily included acquisition and integration expenses for the Green
Giant, spices & seasonings, Victoria and Back to Nature acquisitions.
Acquisition/divestiture-related and non-recurring expenses for the first two quarters of 2019 primarily include acquisition expenses for the Clabber
Girl acquisition, divestiture expenses for the Pirate Brands sale and severance and other expenses primarily relating to a workforce reduction.
-
C
-
For
fiscal 2018, the inventory reduction plan impact of $66.3 million includes $51.1 million of fixed manufacturing, warehouse and other
corporate overhead costs associated with inventory purchased and converted into finished goods in fiscal 2017 and sold in fiscal 2018 and $15.2 million for the underutilization of our
manufacturing facilities as we reduced inventory during the implementation of the inventory reduction plan. For the first two quarters of 2018, the inventory reduction plan impact of
$35.4 million included fixed manufacturing, warehouse and other corporate overhead costs associated with inventory purchased and converted into finished goods in fiscal 2017 and sold in the
second quarter and first two quarters of 2018 as part of our inventory reduction plan. For the first two quarters of 2019, inventory reduction plan impact of $16.4 million includes the
underutilization of our manufacturing facilities as we reduced inventory during the implementation of an inventory reduction plan.
S-17
Table of Contents
-
D
-
See
note 3 in Summary Historical Consolidated Financial Data, above.
-
E
-
See
note 7 in Summary Historical Consolidated Financial Data, above.
-
F
-
Fiscal
2016 represents a loss on disposal of inventory related to the impairment of Rickland Orchards.
Fiscal 2017 represents a loss on disposal of inventory related to the write-off of discontinued and expired inventory from recent acquisitions. See note 7 in Summary Historical Consolidated Financial
Data, above.
-
G
-
See
note 6 in Summary Historical Consolidated Financial Data, above.
-
H
-
Distribution
restructuring expenses for fiscal 2015 and fiscal 2016 includes expenses relating to our transitioning of the operations of our then three
primary shelf-stable distribution centers and a new fourth primary shelf-stable distribution center in the United States to a third party logistics provider.
-
11
-
Cash
interest expense, calculated below, is equal to net interest expense less amortization of deferred financing and bond discount.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twenty-six Weeks Ended
|
|
|
|
Fiscal 2016
|
|
Fiscal 2017
|
|
Fiscal 2018
|
|
June 30, 2018
|
|
June 29, 2019
|
|
|
|
(in thousands, except ratios)
|
|
(unaudited)
|
|
Interest expense, net
|
|
$
|
74,456
|
|
$
|
91,784
|
|
$
|
108,334
|
|
$
|
55,913
|
|
$
|
46,253
|
|
Amortization of deferred financing and bond discount
|
|
|
(5,426
|
)
|
|
(5,812
|
)
|
|
(5,282
|
)
|
|
(2,976
|
)
|
|
(1,745
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash interest expense
|
|
$
|
69,030
|
|
$
|
85,972
|
|
$
|
103,052
|
|
$
|
52,937
|
|
$
|
44,508
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
291,624
|
|
$
|
290,181
|
|
$
|
397,385
|
|
|
|
|
|
|
|
EBITDA / cash interest expense
|
|
|
4.2x
|
|
|
3.4x
|
|
|
3.9x
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
$
|
322,040
|
|
$
|
333,201
|
|
$
|
314,182
|
|
|
|
|
|
|
|
Adjusted EBITDA / cash interest expense
|
|
|
4.7x
|
|
|
3.9x
|
|
|
3.0x
|
|
|
|
|
|
|
|
S-18
Table of Contents
RISK FACTORS
An investment in the notes involves a number of risks. Before deciding whether to purchase the notes, you should give
careful consideration to the risks discussed below and elsewhere in this prospectus supplement, including those set forth under the heading "Special Note Regarding Forward-Looking Statements" on
page S-27 of this prospectus supplement, and in our filings with the Securities and Exchange Commission ("SEC") that we have incorporated by reference in this prospectus supplement and the
accompanying prospectus. Additional risks and uncertainties not currently known to us or that we currently believe to be immaterial may also impair our business operations.
Any of the risks discussed below or elsewhere in this prospectus supplement or in our SEC filings incorporated by reference in this prospectus supplement and the
accompanying prospectus, and other risks we have not anticipated or discussed, could have a material impact on our business, consolidated financial condition, results of operations or liquidity. In
that case, you may lose all or part of your investment.
Risks Relating to this Offering
We have substantial indebtedness, which could restrict our ability to service the notes and impact our
financing options and liquidity position.
We currently have and following this offering will continue to have a significant amount of indebtedness. As of June 29, 2019, after
giving effect to the completion of this offering, the new term loan borrowings under our senior secured credit facility and the use of proceeds therefrom, including redemption of the 2021 notes, we
would have had $477.7 million principal amount of outstanding senior secured debt and $1.45 billion principal amount of outstanding senior unsecured debt. In addition, as of
June 29, 2019, after giving effect to the completion of this offering, the new term loan borrowings under our senior secured credit facility and the use of proceeds therefrom, we would have had
the ability to borrow up to $670.7 million under our revolving credit facility (net of $1.6 million reserved for issued and outstanding letters of credit).
The
degree to which we are leveraged on a consolidated basis could have important consequences to the holders of the notes, including:
-
-
our ability in the future to obtain additional financing for working capital, capital expenditures or acquisitions may be limited;
-
-
we may not be able to refinance our indebtedness on terms acceptable to us or at all;
-
-
a significant portion of our cash flow is likely to be dedicated to the payment of interest on our indebtedness, thereby reducing funds
available for future operations, capital expenditures and acquisitions; and
-
-
we may be more vulnerable to economic downturns and be limited in our ability to withstand competitive pressures.
Despite current indebtedness levels, we and our subsidiaries may still be able to incur substantially more
debt. This could further exacerbate the risks associated with our substantial indebtedness.
Although our credit agreement contains total leverage and cash interest coverage maintenance covenants and the indenture governing the 2025
notes contains and the indenture governing the notes will contain covenants that will restrict our ability to incur debt as described under "Description of Notes" and "Description of Certain
Indebtedness," as long as we meet these financial covenant tests we will be allowed to incur additional indebtedness. In addition, the indenture governing the 2025 notes allows us and the indenture
governing the notes will allow us to issue additional notes with terms identical (other than issuance date) to the notes we are currently offering under certain circumstances.
S-19
Table of Contents
See
"Key terms of the notes will be terminated if the notes achieve investment grade ratings and no default or event of default has occurred and is continuing."
To service our indebtedness, we will require a significant amount of cash. Our ability to generate cash
depends on many factors beyond our control. We may not be able to repay or refinance the notes, the 2025 notes or our credit agreement upon terms acceptable to us or at all.
Our ability to make payments on and to refinance our indebtedness, including the notes, the 2025 notes and indebtedness under our credit
agreement, and to fund planned capital expenditures and potential acquisitions will depend on our ability to generate cash flow from operations in the future. This ability, to a certain extent, is
subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.
A
significant portion of our cash flow from operations will be dedicated to servicing our debt requirements. In addition, we currently intend to continue distributing a significant
portion of any remaining cash flow to our stockholders as dividends. Moreover, prior to the maturity of the notes, we will not be required to make any payments of principal on the notes.
Our
ability to continue to expand our business will, to a certain extent, be dependent upon our ability to borrow funds under our revolving credit facility and to obtain other
third-party financing, including through the sale of securities or the issuance of other indebtedness. Our credit agreement is subject to periodic renewal or must otherwise be refinanced. If we are
unable to refinance our indebtedness, including our credit agreement, the 2025 notes or the notes, on commercially reasonable terms or at all, we would be forced to seek other alternatives,
including:
-
-
sales of assets;
-
-
sales of equity; and
-
-
negotiations with our lenders or noteholders to restructure the applicable debt.
In
addition, if we are unable to refinance our credit agreement, our failure to repay all amounts due on the maturity date would cause a default under the indentures governing the 2025 notes and the
notes.
If
we are forced to pursue any of the above options, our business or the value of your investment in the notes or both could be adversely affected.
We are a holding company and we rely on dividends, interest and other payments, advances and transfers of
funds from our subsidiaries to meet our debt service and other obligations.
We are a holding company and all of our assets are held by our direct and indirect subsidiaries. We will rely on dividends and other payments or
distributions from our subsidiaries to meet our debt service obligations and to enable us to pay dividends. The ability of our subsidiaries to pay dividends or make other payments or distributions to
us will depend on their respective operating results and may be restricted by, among other things, the laws of their jurisdiction of organization (which may limit the amount of funds available for the
payment of dividends), agreements of those subsidiaries, our credit agreement, the terms of the indentures governing the 2025 notes and the notes and the covenants of any future outstanding
indebtedness we or our subsidiaries incur.
S-20
Table of Contents
We will be subject to restrictive debt covenants and other requirements related to our debt that will limit
our business flexibility by imposing operating and financial restrictions on our operations.
The agreements governing our indebtedness impose significant operating and financial restrictions on us, subject to certain exceptions. These
restrictions prohibit or limit, among other things:
-
-
the incurrence of additional indebtedness and the issuance of certain preferred stock or redeemable capital stock;
-
-
a number of restricted payments, including investments;
-
-
specified sales of assets;
-
-
specified transactions with affiliates;
-
-
the creation of certain types of liens;
-
-
consolidations, mergers and transfers of all or substantially all of our assets; and
-
-
entry into sale and leaseback transactions.
Our
credit agreement requires us to maintain specified financial ratios and satisfy financial condition tests, including a maximum total leverage ratio and a minimum interest coverage
ratio.
Our
ability to comply with the ratios or tests may be affected by events beyond our control, including prevailing economic, financial and industry conditions. A breach of any of these
covenants, or failure to meet or maintain ratios or tests could result in a default under our credit agreement or the indentures governing the 2025 notes or the notes or all such agreements. In
addition, upon the occurrence of an event of default under our credit agreement or the indentures governing the 2025 notes or the notes, the lenders could elect to declare all amounts outstanding
under the credit agreement, the 2025 notes and the notes, together with accrued interest, to be immediately due and payable. If we were unable to repay those amounts, the credit agreement lenders
could proceed against the security granted to them to secure that indebtedness. If the lenders accelerate the payment of the indebtedness, our assets may not be sufficient to repay in full this
indebtedness and our other indebtedness, including the notes.
Key terms of the notes will be terminated if the notes achieve investment grade ratings and no default or
event of default has occurred and is continuing.
Some
of the covenants in the indenture governing the notes will be terminated if the notes are rated investment grade by Standard & Poor's and Moody's provided at such time no
default or event of default has occurred and is continuing, including those covenants that restrict, among other things, our ability to incur additional indebtedness. There can be no assurance that
the notes will ever be rated investment grade. However, termination of these covenants would allow us to engage in certain transactions that would not be permitted while these covenants were in force,
and the effects of any such transactions will be permitted to remain in place even if the notes are subsequently downgraded below investment grade. See "Description of NotesCertain
CovenantsEffectiveness of Covenants."
Our credit agreement and the indenture governing the 2025 notes permits us and the indenture governing the
notes will permit us to pay a significant portion of our free cash flow to stockholders in the form of dividends. Any amounts paid by us in the form of dividends to our stockholders will not be
available in the future to satisfy our obligations to the holders of the notes and our other indebtedness.
Although our credit agreement and the indenture governing the 2025 notes has and the indenture governing the notes will have some limitations on
our payment of dividends, they permit us to pay a significant portion of our free cash flow to stockholders in the form of dividends. We intend to
S-21
Table of Contents
continue
paying quarterly dividends on our common stock. Specifically, the indenture governing the 2025 notes permits us and the indenture governing the notes will permit us to use up to 100% of our
excess cash (which, as defined in the indenture, is consolidated cash flow, as defined in the indenture, minus the sum of cash income tax expense, cash interest expense, certain capital expenditures
and certain repayments of indebtedness) for the period (taken as one accounting period) from March 31, 2013 to the end of our most recent fiscal quarter for which internal financial statements
are available at the time of such payments, plus certain incremental funds described in the indenture for the payment of dividends, so long as the fixed charge coverage ratio for the four most recent
fiscal quarters for which internal financial statements are available is not less than 1.6 to 1.0, subject to certain limitations,
as more fully described in "Description of NotesCertain CovenantsRestricted Payments." Our credit agreement (subject to certain financial ratio requirements) permits us to
use up to 100% of our excess cash, as described in detail in "Description of NotesCertain Covenants" and "Description of Certain IndebtednessSenior Secured Credit Agreement"
plus certain other amounts under certain limited circumstances to fund dividends on our shares of common stock. Any amounts paid by us in the form of dividends will not be available in the future to
satisfy our obligations to the holders of our notes and our other indebtedness.
The realizable value of our assets upon liquidation may be insufficient to satisfy claims.
As of June 29, 2019, our total assets included goodwill and intangible assets in the amount of $2.2 billion, representing
approximately 70.0% of our total consolidated assets. The value of these intangible assets will continue to depend significantly upon the continued profitability of our brands. As a result, in the
event of a default on the notes or any bankruptcy or dissolution of our company, the realizable value of these assets may be substantially lower and may be insufficient to satisfy the claims of our
creditors.
We may not be able to repurchase the notes and the 2025 notes upon a change of control, as required by the
indentures governing the notes and the 2025 notes.
Upon the occurrence of specific kinds of change of control events, we will be required to offer to repurchase all outstanding notes and the
outstanding 2025 notes at 101% of their principal amount, plus accrued and unpaid interest.
We
may not be able to repurchase the notes or the 2025 notes upon a change of control because we may not have sufficient funds. Further, we may be contractually restricted under the
terms of our credit agreement from repurchasing all such notes tendered by holders upon a change of control. Accordingly, we may not be able to satisfy our obligations to purchase your notes and the
2025 notes unless we are able to refinance or obtain waivers under the credit agreement. Our failure to repurchase the notes or the 2025 notes upon a change of control would cause a default under the
indentures governing the notes and the 2025 notes and a cross default under the credit agreement. The credit agreement also provides that a change of control, as defined in such agreement, will be a
default that permits lenders to accelerate the maturity of borrowings thereunder and, if such debt is not paid, to enforce security interests in the collateral securing such debt, thereby limiting our
ability to raise cash to purchase the notes and the 2025 notes, and reducing the practical benefit of the offer to purchase provisions to the holders of the notes and the 2025 notes. Any of our future
debt agreements may contain similar provisions.
In
addition, the change of control provisions in the indenture may not protect you from certain important corporate events, such as a leveraged recapitalization (which would increase the
level of our indebtedness), reorganization, restructuring, merger or other similar transaction. Such a transaction may not involve a change in voting power or beneficial ownership or, even if it does,
may not involve a change that constitutes a "Change of Control" as defined in the indenture that would trigger our obligation to repurchase the notes. If an event occurs that does not constitute a
"Change of Control"
S-22
Table of Contents
as
defined in the indenture, we will not be required to make an offer to repurchase the notes and you may be required to continue to hold your notes despite the event. See "Description of Certain
Indebtedness" and "Description of NotesRepurchase at the Option of HoldersChange of Control."
You may not be able to determine when a change of control has occurred and may not be able to require us to
purchase the notes as a result of a change in the composition of the directors on our board of directors.
Legal uncertainty regarding what constitutes a change of control and the provisions of the indenture may allow us to enter into transactions,
such as acquisitions, refinancings or recapitalizations, that would not constitute a change of control but may increase our outstanding indebtedness or otherwise affect our ability to satisfy our
obligations under the notes. The definition of change of control includes a phrase relating to the transfer of "all or substantially all" of the assets of us and our subsidiaries taken as a whole.
Although there is a limited body of case law interpreting the phrase "substantially all," there is no precise established definition of the phrase under applicable law. Accordingly, your ability to
require us to repurchase notes as a result of a transfer of less than all of our assets to another person may be uncertain.
Although the notes are referred to as "senior" notes, your right to receive payments on these notes is
effectively subordinated to the rights of our existing and future secured creditors. Further, the guarantees of these notes are effectively subordinated to all the guarantors' existing and future
secured indebtedness.
Holders of our secured indebtedness and the secured indebtedness of the guarantors will have claims that are prior to your claims as holders of
the notes to the extent of the value of the assets securing that other indebtedness. Notably, we and certain of our subsidiaries,
including the guarantors, are parties to our credit agreement, which is secured by liens on substantially all of our and the guarantors' assets, other than our and the guarantors' real property. The
notes will be effectively subordinated to all of that secured indebtedness. In the event of any distribution or payment of our assets in any foreclosure, dissolution, winding-up, liquidation,
reorganization, or other bankruptcy proceeding, holders of secured indebtedness will have prior claim to those assets that constitute their collateral. Holders of the notes will participate ratably
with all holders of our unsecured indebtedness that is deemed to be of the same class as the notes, such as the 2025 notes, and potentially with all of our other general creditors, based upon the
respective amounts owed to each holder or creditor, in our remaining assets. In any of the foregoing events, we cannot assure you that there will be sufficient assets to pay amounts due on the notes.
As a result, holders of the notes may receive less, ratably, than holders of secured indebtedness.
As
of June 29, 2019, on an adjusted basis after giving effect to the completion of this offering, the new term loan borrowings under our senior secured credit facility and the use
of proceeds therefrom, the aggregate amount of our secured indebtedness and the secured indebtedness of our subsidiaries would have been $1.83 billion, and approximately $670.7 million
would have been available for new term loan borrowing under the revolving credit facility under our credit agreement (net of $1.6 million reserved for issued and outstanding letters of credit).
We will be permitted to borrow substantial additional indebtedness, including additional secured debt, in the future under the terms of the indenture. See "Description of Certain
IndebtednessSenior Secured Credit Agreement."
The notes will be structurally subordinated to all indebtedness of our existing or future subsidiaries that
are not guarantors of the notes.
You will not have any claim as a creditor against any of our existing or future subsidiaries that are not guarantors of the notes. Indebtedness
and other liabilities, including trade payables, whether secured or unsecured, of those subsidiaries will be effectively senior to your claims against those
S-23
Table of Contents
subsidiaries.
Our three foreign subsidiaries, B&G Foods Canada, ULC, B&G Foods Manufacturing Mexico, S. de R.L. de C.V. and Sirops Maple Grove Inc., will not be guarantors of the notes,
and any future foreign or partially-owned domestic subsidiaries will not be guarantors of the notes. As of June 29, 2019, the total assets and total liabilities of our non-guarantor
subsidiaries were approximately $123.9 million and $25.3 million, respectively, and, for the two quarters ended June 29, 2019, our non-guarantor subsidiaries generated
approximately $101.6 million and $2.5 million of our net sales and net income, respectively.
In
addition, the indenture governing the notes will, subject to certain limitations, permit these subsidiaries to incur additional indebtedness and will not contain any limitation on the
amount of other liabilities, such as trade payables, that may be incurred by these subsidiaries. Any such indebtedness will be effectively senior in right of payment to the notes.
United States Federal and state fraudulent transfer laws permit a court to void the notes and the guarantees,
and, if that occurs, you may not receive any payments on the notes or the guarantees.
The issuance of the notes and the guarantees may be subject to review under U.S. federal and state fraudulent transfer and conveyance
statutes. While the relevant laws may vary from state to state, under such laws the payment of consideration will generally be a fraudulent conveyance if (1) we paid the consideration with the
intent of hindering, delaying or defrauding creditors or (2) we or any of our guarantors, as applicable, received less than reasonably equivalent value or fair consideration in return for
issuing either the notes or a guarantee and, in the case of (2) only, one of the following is also true:
-
-
we or any of our guarantors were insolvent or rendered insolvent by reason of the incurrence of the indebtedness;
-
-
payment of the consideration left us or any of our guarantors with an unreasonably small amount of capital to carry on its business; or
-
-
we or any of our guarantors intended to, or believed that we or it would, incur debts beyond our or its ability to pay those debts as they
mature.
We
cannot be certain as to the standards a court would use to determine whether or not we or the guarantors were solvent at the relevant time. If a court were to find that the issuance
of the notes or a guarantee was a fraudulent conveyance, the court could void the payment obligations under the notes or such guarantee or subordinate the notes or such guarantee to presently existing
and future indebtedness of ours or such guarantor, or require the holders of the notes to repay any amounts received with respect to the notes or such guarantee. In the event of a finding that a
fraudulent conveyance occurred, you may not receive any repayment on the notes. Further, the voidance of the
notes could result in an event of default under our credit agreement that could result in acceleration of such indebtedness.
Generally,
an entity would be considered insolvent if at the time it incurred indebtedness:
-
-
the sum of its debts, including contingent liabilities, was greater than the fair saleable value of all its assets;
-
-
the present fair saleable value of its assets was less than the amount that would be required to pay its probable liability on its existing
debts and liabilities, including contingent liabilities, as they become absolute and mature; or
-
-
it could not pay its debts as they become due.
If
the guarantees were legally challenged, any guarantee could also be subject to the claim that, since the guarantee was incurred for our benefit, and only indirectly for the benefit of
the guarantor, the obligations of the applicable guarantor were incurred for less than fair consideration. A court could
S-24
Table of Contents
thus
void the obligations under the guarantees, subordinate them to the applicable guarantor's other debt or take other action detrimental to the holders of the notes.
Each
guarantee will contain a provision intended to limit the guarantor's liability to the maximum amount that it could incur without causing the incurrence of obligations under its
guarantee to be a fraudulent transfer. This provision may not be effective to protect the subsidiary guarantees from being voided under fraudulent transfer laws.
You may find it difficult to sell your notes.
You may find it difficult to sell your notes because an active trading market for the notes may not develop. The notes are a new issue of
securities for which there currently is no established trading market. We do not intend to apply for listing or quotation of the notes on any securities exchange. Therefore, we do not know the extent
to which investor interest will lead to the development of a trading market or how liquid that market might be. Although certain of the underwriters have advised us that they currently intend to make
a market in the notes, they are not obligated to do so. Accordingly, any market-making activities with respect to the notes may be discontinued at any time without notice.
If
a market for the notes does develop, it is possible that you will not be able to sell your notes at a particular time or that the prices that you receive when you sell will be
unfavorable. It is also possible that any trading market that does develop for the notes will not be liquid. Future trading prices of the notes will depend on many factors,
including:
-
-
our operating performance, financial condition and prospects, or the operating performance, financial condition and prospects of companies in
our industry generally;
-
-
the interest of securities dealers in making a market for the notes;
-
-
prevailing interest rates; and
-
-
the market for similar securities.
The market price for the notes may be volatile.
Historically, the market for non-investment grade debt has been subject to disruptions that have caused volatility in prices. If a market for
the notes develops, it is possible that the market for the notes will be subject to disruptions and price volatility. Any disruptions may adversely affect the value of your notes regardless of our
operating performance, financial condition and prospects.
Our credit ratings may not reflect all risks associated with an investment in the notes.
Credit rating agencies rate our debt securities on factors that include our results of operations, actions that we take, their view of the
general outlook for our industry and their view of the general outlook for the economy. The ratings may not reflect the potential impact of all risks related to the structure, market, additional risk
factors discussed herein and other factors that may affect the value of the notes. A credit rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or
withdrawal by the rating agency at any time. Actions taken by the rating agencies can include maintaining, upgrading, or downgrading the current rating or placing us on a watch list for possible
future downgrading. Downgrading the credit rating of the notes or placing us on a watch list for possible future downgrading would likely increase our cost of financing, limit our access to the
capital markets and have an adverse effect on the market price of our securities, including the notes offered hereby.
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Table of Contents
Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations
to increase significantly.
Borrowings under our credit agreement are at variable rates of interest and expose us to interest rate risk. As such, our results of operations
are sensitive to movements in interest rates. There are many economic factors outside our control that have in the past and may, in the future, impact rates of interest including publicly announced
indices that underlie the interest obligations related to a certain portion of our debt. Factors that impact interest rates include governmental monetary policies, inflation, recession, changes in
unemployment, the money supply,
international disorder and instability in domestic and foreign financial markets. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though
the amount borrowed remained the same, and our results of operations would be adversely impacted. Such increases in interest rates could have a material adverse effect on our financial conditions and
results of operations.
We could suffer adverse tax and other financial consequences if there are changes in tax laws or taxing
authorities do not agree with our interpretation of applicable tax laws, including if we are required to establish or adjust valuation allowances on deferred tax assets.
Tax laws and income tax rates are subject to change due to economic and political conditions. Our tax liabilities are based, in part, on our
corporate structure, interpretations of various U.S. and foreign tax laws, including withholding tax, application of changes in tax law to our operations and other relevant laws of applicable taxing
jurisdictions. From time to time, taxing authorities may conduct examinations of our income tax returns and other regulatory filings. We cannot assure you that the taxing authorities will agree with
our interpretations. If they do not agree, we may seek to enter into settlements with the taxing authorities. We may also appeal a taxing authority's determination to the appropriate governmental
authorities, but we cannot be sure we will prevail. If we do not prevail or if we enter into settlements with taxing authorities, we may have to make significant payments or otherwise record charges
(or reduce tax assets) that adversely affect our results of operations, financial condition and cash flows.
We
monitor on an ongoing basis our ability to utilize our deferred tax assets and whether there is a need for a related valuation allowance. In evaluating our ability to recover our
deferred tax assets, in the jurisdiction from which they arise, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future
taxable income, tax-planning strategies and results of recent operations.
The ultimate impact of the Tax Cuts and Jobs Act on our reported results in fiscal 2019 and beyond may differ
from the estimates provided, possibly materially.
On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act, which we refer to as the "U.S. Tax Act." The changes in
the U.S. Tax Act are broad and complex and we continue to examine the impact the U.S. Tax Act may have on our business and financial results. The U.S. Tax Act contains provisions with separate
effective dates but is generally effective for taxable years beginning after December 31, 2017. Under FASB Accounting Standards Codification (ASC) Topic 740, Income Taxes, we were required to
revalue any deferred tax assets or liabilities in the period of enactment of change in tax rates. The U.S. Tax Act lowered the federal corporate income tax rate from 35% to 21%. The U.S. Tax Act also
limits the deduction for net interest expense incurred by a corporate taxpayer to 30% of the taxpayer's adjusted taxable income. Although we currently expect
that our interest expense may exceed 30% of our adjusted taxable income, at this time we do not believe this limitation will have a material adverse impact on our business or financial results because
any interest that is non-deductible may be carried forward indefinitely.
The
ultimate impact of the U.S. Tax Act on our reported results in fiscal 2019 and beyond may differ from the estimates provided, possibly materially, due to, among other things, changes
in interpretations and assumptions we have made, guidance that may be issued, and other actions we may take as a result of the U.S. Tax Act different from that currently contemplated.
S-26
Table of Contents
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus and the documents incorporated or deemed to be incorporated herein or therein by
reference contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believes," "belief," "assumes," "could," "should," "potential,"
"seek," "predict," "may," "will," "anticipates," "plans," "expects," "intends," "estimates," "projects" and similar references to future periods are intended to identify forward-looking statements.
These forward looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance and achievements, or industry results, to be materially
different from any future results, performance, or achievements expressed or implied by any forward-looking statements. We believe important factors that could cause actual results to differ
materially from our expectations include the following:
-
-
our substantial leverage;
-
-
the effects of rising costs for our raw materials, packaging and ingredients;
-
-
crude oil prices and their impact on distribution, packaging and energy costs;
-
-
our ability to successfully implement sales price increases and cost saving measures to offset any cost increases;
-
-
intense competition, changes in consumer preferences, demand for our products and local economic and market conditions;
-
-
our continued ability to promote brand equity successfully, to anticipate and respond to new consumer trends, to develop new products and
markets, to broaden brand portfolios in order to compete effectively with lower priced products and in markets that are consolidating at the retail and manufacturing levels and to improve
productivity;
-
-
the risks associated with the expansion of our business;
-
-
our possible inability to identify new acquisitions or to integrate recent or future acquisitions or our failure to realize anticipated revenue
enhancements, cost savings or other synergies;
-
-
tax reform and legislation, including the effects of the U.S. Tax Act;
-
-
our ability to access the credit markets and our borrowing costs and credit ratings, which may be influenced by credit markets generally and
the credit ratings of our competitors;
-
-
unanticipated expenses, including, without limitation, litigation or legal settlement expenses;
-
-
the effects of currency movements of the Canadian dollar and the Mexican peso as compared to the U.S. dollar;
-
-
the effects of international trade disputes, tariffs, quotas, and other import or export restrictions on our international procurement, sales
and operations;
-
-
future impairments of our goodwill and intangible assets;
-
-
our ability to successfully complete the implementation and operate a new enterprise resource planning (ERP) system;
-
-
our ability to protect information systems against, or effectively respond to, a cybersecurity incident or disruption;
-
-
our sustainability initiatives and changes to environmental laws and regulations;
S-27
Table of Contents
-
-
other factors that affect the food industry generally, including:
-
-
recalls if products become adulterated or misbranded, liability if product consumption causes injury, ingredient disclosure and
labeling laws and regulations and the possibility that consumers could lose confidence in the safety and quality of certain food products;
-
-
competitors' pricing practices and promotional spending levels;
-
-
fluctuations in the level of our customers' inventories and credit and other business risks related to our customers operating in
a challenging economic and competitive environment; and
-
-
the risks associated with third-party suppliers and co-packers, including the risk that any failure by one or more of our
third-party suppliers or co-packers to comply with food safety or other laws and regulations may disrupt our supply of raw materials or certain finished goods products or injure our reputation;
-
-
our ability to complete the transactions described under "SummaryConcurrent Transactions"; and
-
-
other factors discussed under "Risk Factors" or elsewhere in this prospectus supplement, the accompanying prospectus and the documents
incorporated or deemed incorporated herein or therein by reference.
Developments
in any of these areas, which are more fully described elsewhere in this prospectus supplement, the accompanying prospectus and the documents incorporated or deemed
incorporated herein or therein by reference, could cause our results to differ materially from results that have been or may be projected by or on our behalf.
All
forward-looking statements included in this prospectus supplement are based on information available to us on the date of this prospectus supplement. We undertake no obligation to
publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to
us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained in this prospectus supplement.
We
caution that the foregoing list of important factors is not exclusive. There may be other factors that may cause our actual results to differ materially from the forward-looking
statements, including factors disclosed under the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on
Form 10-K for the year ended December 29, 2018 filed on February 26, 2019 and our subsequent reports filed with the SEC, which are incorporated herein by reference. You should
evaluate all forward-looking statements made in this report in the context of these risks and uncertainties. We urge you not to unduly rely on forward-looking statements contained in this prospectus
supplement.
S-28
Table of Contents
USE OF PROCEEDS
We estimate that the net proceeds from this offering will be approximately $542.6 million. "Net proceeds" is what we expect to receive
after paying the underwriting discounts and other expenses of this offering, including legal, accounting and printing fees.
We
intend to use the proceeds from this offering, together with the proceeds of the new term loan borrowings under our senior secured credit facility, (1) to redeem all of the
outstanding 2021 notes, (2) to repay certain borrowings under our revolving credit facility, (3) to pay related fees and expenses and (4) for general corporate purposes. Prior to the
redemption of the 2021 notes, we plan to use the proceeds from the offering to (1) repay certain borrowings under our revolving credit facility and pay related fees and expenses and
(2) invest the remainder in short-term investments, including cash, cash equivalents and/or marketable securities.
Affiliates
of certain of the underwriters will receive a portion of the proceeds of this offering. See "UnderwritingOther Relationships."
As
of the date of this prospectus supplement, $700 million aggregate principal amount of our 2021 notes was outstanding. The 2021 notes bear interest at a rate of 4.625% per
annum. The 2021 notes mature on June 1, 2021. See "Description of Certain Indebtedness."
Interest
under the revolving credit facility, including any outstanding letters of credit, is determined based on alternative rates that we may choose in accordance with the credit
agreement, including a base rate per annum plus an applicable margin ranging from 0.25% to 0.75%, and LIBOR plus an applicable margin ranging from 1.25% to 1.75%, in each case depending on our
consolidated leverage ratio. As of September 10, 2019, the average revolving credit facility interest rate was approximately 4.6%. The revolving credit facility matures on November 21,
2022. See "Description of Certain Indebtedness."
The
following table outlines the sources and uses of funds for this offering and the new term loan borrowings under our senior secured credit facility. Amounts in the table are in
millions of dollars and are estimated. Actual amounts may vary from the estimated amounts.
|
|
|
|
|
|
|
|
|
|
Sources of funds
|
|
|
|
Uses of funds
|
|
|
|
Notes offered hereby1
|
|
$
|
550
|
|
Redemption of 2021 notes3
|
|
$
|
700
|
|
New term loan borrowings under senior secured credit facility2
|
|
|
450
|
|
Repayment of certain borrowings under revolving credit facility4
|
|
|
187
|
|
|
|
|
|
|
Fees and expenses
|
|
|
14
|
|
|
|
|
|
|
General corporate purposes
|
|
|
99
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
1,000
|
|
Total
|
|
$
|
1,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
1
-
Before
discounts and expenses.
-
2
-
In
connection with this offering, we also intend to incur new term loan borrowings under our senior secured credit facility. The incurrence of the new
term loan borrowings under our senior secured credit facility is subject to completion of definitive agreements as well as customary closing conditions, and is subject to market conditions. There can
be no assurance that we will incur new term loan borrowings under our senior secured credit facility, or, if we do, as to the terms of those borrowings. This offering is not conditioned upon the
incurrence of new term loan borrowings under our senior secured credit facility. If this offering is completed, but the new term loan borrowings under our senior secured credit facility are not
incurred by the redemption date, we intend to use the net proceeds from this offering, together with cash on hand and/or borrowings under our revolving credit facility, to pay the redemption price of
the 2021 notes.
S-29
Table of Contents
-
3
-
On
September 10, 2019, we issued a conditional notice of redemption to the holders of our outstanding 2021 notes, notifying such holders that we
intend to redeem all of the outstanding 2021 notes on October 10, 2019. We intend to use the net proceeds from this offering, together with the proceeds of the new term loan borrowings under
our senior secured credit facility, (1) to redeem all of the outstanding 2021 notes, (2) to repay certain borrowings under our revolving credit facility, (3) to pay related fees
and expenses and (4) for general corporate purposes. If this offering is completed, but the new term loan borrowings under our senior secured credit facility are not incurred by the redemption date,
we intend to use the net proceeds from this offering, together with cash on hand and/or borrowings under our revolving credit facility, to pay the redemption price of the 2021 notes. The redemption
price of the 2021 notes is 100% of the principal amount, plus accrued and unpaid interest to the redemption date. As of the date of this prospectus supplement, we have $700.0 million principal
amount of 2021 notes outstanding. This prospectus supplement is not a notice to redeem the 2021 notes, and the completion of this offering is not conditioned upon redemption of the 2021 notes.
-
4
-
As
of September 10, 2019, there was approximately $310.0 million in outstanding borrowings under the revolving credit facility. Amounts
borrowed under the revolving credit facility were primarily used to finance the purchase price for the Clabber Girl acquisition, completed in May 2019,
and for general corporate purposes.
S-30
Table of Contents
CAPITALIZATION
The following table sets forth our cash and cash equivalents and capitalization as of June 29,
2019:
-
-
on an actual basis; and
-
-
on an as-adjusted basis as if this offering, the new term loan borrowings under our senior secured credit facility and the application of the
net proceeds therefrom in the manner described under "Use of Proceeds," including the redemption of the 2021 notes, had been completed on that date.
We
urge you to read this table in conjunction with "Use of Proceeds," the audited and unaudited consolidated financial statements and the notes to those statements and related
information, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere or incorporated by reference in this prospectus supplement and the
financial data set forth under "Summary Historical Consolidated Financial Data."
|
|
|
|
|
|
|
|
|
|
As of June 29, 2019
|
|
|
|
Actual
|
|
As Adjusted
|
|
|
|
(in thousands)
|
|
Cash and cash equivalents
|
|
$
|
19,911
|
|
$
|
118,659
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt:
|
|
|
|
|
|
|
|
Revolving credit facility1
|
|
|
215,000
|
|
|
27,721
|
|
Senior secured credit facility2
|
|
|
|
|
|
450,000
|
|
4.625% senior notes due 20213
|
|
|
700,000
|
|
|
|
|
5.25% senior notes due 2025
|
|
|
900,000
|
|
|
900,000
|
|
5.25% senior notes due 2027 offered hereby
|
|
|
|
|
|
550,000
|
|
Unamortized deferred financing costs
|
|
|
(15,475
|
)
|
|
(14,948
|
)
|
Unamortized premium (discount)
|
|
|
3,101
|
|
|
(8,471
|
)
|
|
|
|
|
|
|
|
|
Total long-term debt, net of unamortized deferred financing costs and discount
|
|
|
1,802,626
|
|
|
1,904,302
|
|
Current portion of long-term debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt, net of unamortized deferred financing costs and discount, and excluding current portion
|
|
$
|
1,802,626
|
|
$
|
1,904,302
|
|
Stockholders' equity:
|
|
|
|
|
|
|
|
Preferred stock$0.01 par value per share, 1,000,000 shares authorized; no shares issued and outstanding
|
|
|
|
|
|
|
|
Common stock$0.01 par value per share, 125,000,000 shares authorized; 65,375,514 shares issued and outstanding
|
|
|
654
|
|
|
654
|
|
Additional paid-in capital
|
|
|
46,284
|
|
|
46,284
|
|
Accumulated other comprehensive loss
|
|
|
(20,176
|
)
|
|
(20,176
|
)
|
Retained earnings
|
|
|
841,598
|
|
|
841,598
|
|
|
|
|
|
|
|
|
|
Total stockholders' equity
|
|
|
868,360
|
|
|
868,360
|
|
|
|
|
|
|
|
|
|
Total capitalization
|
|
$
|
2,670,986
|
|
$
|
2,772,662
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
1
-
As
of September 10, 2019, there was approximately $310.0 million in outstanding borrowings and $388.4 million available to be drawn
under the revolving credit facility (net of $1.6 million reserved for issued and outstanding letters of credit). We intend to use the net proceeds from this offering, together with the proceeds
of the new term loan borrowings under our senior secured credit facility, (1) to redeem all of the outstanding 2021 notes, (2) to repay certain borrowings under our revolving credit
facility, (3) to pay related fees and expenses and (4) for general corporate
S-31
Table of Contents
purposes.
As of September 10, 2019, the average revolving credit facility interest rate was approximately 4.6%. The revolving credit facility matures on November 21, 2022.
-
2
-
In
connection with this offering, we also intend to incur new term loan borrowings under our senior secured credit facility. The incurrence of the new
term loan borrowings under our senior secured credit facility is subject to completion of definitive agreements as well as customary closing conditions, and is subject to market conditions. There can
be no assurance that we will incur new term loan borrowings under our senior secured credit facility, or, if we do, as to the terms of those borrowings. This offering is not conditioned upon the
incurrence of new term loan borrowings under our senior secured credit facility. If this offering is completed, but the new term loan borrowings under our senior secured credit facility are not
incurred by the redemption date, we intend to use the net proceeds from this offering, together with cash on hand and/or borrowings under our revolving credit facility, to pay the redemption price of
the 2021 notes.
-
3
-
We
intend to use the net proceeds from this offering, together with the proceeds of the new term loan borrowings under our senior secured credit
facility, (1) to redeem all of the outstanding 2021 notes, (2) to repay certain borrowings under our revolving credit facility, (3) to pay related fees and expenses and (4) for
general corporate purposes. The 2021 notes bear interest at a rate of 4.625% per annum.
S-32
Table of Contents
SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA
The following selected historical consolidated financial data should be read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" in our Annual Report on Form 10-K for
the year ended December 31, 2018 and our Quarterly Report on
Form 10-Q for the quarter ended June 29, 2019, each of which is incorporated by reference into this prospectus supplement, and our audited and unaudited consolidated
financial statements and notes to those statements incorporated by reference into this prospectus supplement. Our selected historical consolidated statement of operations data for fiscal 2016, fiscal
2017 and fiscal 2018 have been derived from our audited consolidated financial statements incorporated by reference into this prospectus supplement. The selected historical consolidated statements of
operations data for fiscal 2014 and fiscal 2015 have been derived from our audited consolidated financial statements that are not incorporated by reference into this prospectus supplement. Our
selected historical consolidated balance sheet data for fiscal 2017 and fiscal 2018 have been derived from our audited consolidated financial statements incorporated by reference into this prospectus
supplement. Our selected historical consolidated balance sheet data as of the end of fiscal 2014, 2015 and 2016 have been derived from our audited consolidated financial statements that are not
incorporated by reference into this prospectus supplement. Our selected historical consolidated statements of operations data for the first two quarters of fiscal 2018 and the first two quarters of
fiscal 2019 have been derived from our unaudited consolidated financial statements incorporated by reference into this prospectus supplement. Our selected historical consolidated balance sheet data as
of June 30, 2018 have been derived from our unaudited consolidated financial statements that are not incorporated by reference into this prospectus supplement. Our selected historical
consolidated balance sheet data as of June 29, 2019 have been derived from our unaudited consolidated financial statements incorporated by reference into this prospectus supplement.
Our
unaudited consolidated financial statements have been prepared on the same basis as our audited financial statements and, in the opinion of our management, include all adjustments
(consisting of normal recurring adjustments) necessary for a fair presentation of the information for the unaudited
S-33
Table of Contents
interim
periods. The results for any interim period are not necessarily indicative of results that may be expected for a full year.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twenty-six
Weeks
Ended
|
|
Twenty-six
Weeks
Ended
|
|
|
|
Fiscal 2014
|
|
Fiscal 2015
|
|
Fiscal 2016
|
|
Fiscal 2017
|
|
Fiscal 2018
|
|
June 30,
2018
|
|
June 29,
2019
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
Consolidated Statement of Operations Data1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales2,3
|
|
$
|
837,336
|
|
$
|
958,879
|
|
$
|
1,372,307
|
|
$
|
1,646,387
|
|
$
|
1,700,764
|
|
$
|
820,107
|
|
$
|
783,931
|
|
Cost of goods sold4
|
|
|
600,246
|
|
|
676,794
|
|
|
943,295
|
|
|
1,205,809
|
|
|
1,351,264
|
|
|
635,578
|
|
|
603,985
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit2
|
|
|
237,090
|
|
|
282,085
|
|
|
429,012
|
|
|
440,578
|
|
|
349,500
|
|
|
184,529
|
|
|
179,946
|
|
Selling, general and administrative expenses2,5
|
|
|
84,267
|
|
|
99,250
|
|
|
157,028
|
|
|
183,448
|
|
|
167,389
|
|
|
79,840
|
|
|
78,153
|
|
Amortization expense6
|
|
|
12,692
|
|
|
11,255
|
|
|
13,803
|
|
|
17,611
|
|
|
18,343
|
|
|
9,218
|
|
|
9,092
|
|
Loss (gain) on sale of assets7
|
|
|
|
|
|
|
|
|
|
|
|
1,608
|
|
|
(176,386
|
)
|
|
|
|
|
|
|
Impairment of intangible assets8
|
|
|
34,154
|
|
|
|
|
|
5,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on change in fair value of contingent consideration9
|
|
|
(8,206
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income2
|
|
|
114,183
|
|
|
171,580
|
|
|
252,776
|
|
|
237,911
|
|
|
340,154
|
|
|
95,471
|
|
|
92,701
|
|
Interest expense, net
|
|
|
46,573
|
|
|
51,131
|
|
|
74,456
|
|
|
91,784
|
|
|
108,334
|
|
|
55,913
|
|
|
46,253
|
|
Loss on extinguishment of debt10
|
|
|
5,748
|
|
|
|
|
|
2,836
|
|
|
1,163
|
|
|
13,135
|
|
|
3,324
|
|
|
|
|
Other income2,11
|
|
|
(1,915
|
)
|
|
(790
|
)
|
|
(1,582
|
)
|
|
(3,098
|
)
|
|
(3,592
|
)
|
|
(1,666
|
)
|
|
(783
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax expense
|
|
|
63,777
|
|
|
121,239
|
|
|
177,066
|
|
|
148,062
|
|
|
222,277
|
|
|
37,900
|
|
|
47,231
|
|
Income tax expense
|
|
|
22,821
|
|
|
52,149
|
|
|
67,641
|
|
|
(69,401
|
)
|
|
49,842
|
|
|
9,377
|
|
|
12,189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
40,956
|
|
$
|
69,090
|
|
$
|
109,425
|
|
$
|
217,463
|
|
$
|
172,435
|
|
$
|
28,523
|
|
$
|
35,042
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Financial Data1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
$
|
99,126
|
|
$
|
128,479
|
|
$
|
289,661
|
|
$
|
37,799
|
|
$
|
209,456
|
|
$
|
104,804
|
|
$
|
16,846
|
|
Capital expenditures
|
|
|
(19,025
|
)
|
|
(18,574
|
)
|
|
(42,418
|
)
|
|
(59,802
|
)
|
|
(41,627
|
)
|
|
(17,208
|
)
|
|
(18,148
|
)
|
Cash payments for acquisition of businesses
|
|
|
(154,277
|
)
|
|
(873,811
|
)
|
|
(438,787
|
)
|
|
(162,965
|
)
|
|
(30,787
|
)
|
|
|
|
|
(82,430
|
)
|
Net cash provided by (used in) financing activities
|
|
$
|
71,619
|
|
$
|
767,444
|
|
$
|
216,005
|
|
$
|
359,336
|
|
$
|
(753,327
|
)
|
$
|
(232,249
|
)
|
$
|
91,901
|
|
Consolidated Balance Sheet Data (at end of period)1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
1,490
|
|
$
|
5,246
|
|
$
|
28,833
|
|
$
|
206,506
|
|
$
|
11,648
|
|
$
|
62,840
|
|
$
|
19,911
|
|
Total assets
|
|
|
1,632,165
|
|
|
2,543,620
|
|
|
3,043,505
|
|
|
3,561,038
|
|
|
3,054,799
|
|
|
3,355,113
|
|
|
3,171,767
|
|
Long-term debt, net of unamortized financing costs and discount, and including current portion
|
|
|
1,008,669
|
|
|
1,731,521
|
|
|
1,725,783
|
|
|
2,217,574
|
|
|
1,635,881
|
|
|
2,073,874
|
|
|
1,802,626
|
|
Total stockholders' equity
|
|
$
|
337,995
|
|
$
|
457,685
|
|
$
|
785,657
|
|
$
|
880,819
|
|
$
|
900,049
|
|
$
|
827,014
|
|
$
|
863,360
|
|
-
1
-
We
completed the Specialty Brands acquisition from affiliates of American Capital, Ltd., and certain individual sellers, on April 23, 2014.
We completed the Mama Mary's acquisition from Linsalata Capital Partners and certain other sellers on July 10, 2015.We completed the Green Giant
acquisition from General Mills, Inc., on November 2, 2015. We completed the spices & seasonings acquisition from ACH Food
Companies, Inc. on November 21, 2016. We completed the Victoria acquisition from Huron Capital Partners and certain other sellers on
December 2, 2016. We completed the Back to Nature acquisition from Brynwood Partners VI L.P., Mondelēz International and
certain other sellers on October 2, 2017. We completed the McCann's acquisition from TreeHouse Foods, Inc. on July 16, 2018. We
completed the sale of Pirate Brands to The Hershey Company on October 17, 2018. We completed the Clabber Girl acquisition from Hulman &
Company on May 15, 2019. Each of the acquisitions listed above has been accounted for using the acquisition method of accounting and, accordingly, the assets acquired, liabilities assumed and
results of operations of the acquired business is included in our consolidated financial statements from the date of acquisition.
S-34
Table of Contents
-
2
-
Net
sales, gross profit, selling, general and administrative expenses, operating income and other income for fiscal 2014, 2015, 2016 and 2017 have been
adjusted as a result of our retrospective adoption of new accounting standards relating to revenue recognition and the presentation of net periodic pension cost and net periodic post-retirement
benefit cost. We also reclassified a $1.6 million pre-tax loss on sale of assets for fiscal 2017 from selling, general and administrative expenses to loss on sale of assets. The adjustments
described above had no impact on net income or earnings per share.
-
3
-
Fiscal
2015, 2016, 2017 and 2018 each contained 52 weeks and fiscal 2014 contained 53 weeks. Net sales for fiscal 2014 and fiscal 2015 were
negatively impacted by $4.1 million and $1.2 million, respectively, of customer refunds, net of insurance recoveries, related to our November 2014 voluntary recall of certain Ortega and
Las Palmas products.
-
4
-
Fiscal
2014 includes $8.2 million of inventory write-off and other cost of goods sold charges, net of insurance recoveries, related to the Ortega and Las Palmas recall and a $4.5 million loss on disposal of inventory related to the
impairment of Rickland Orchards. Fiscal 2015 includes $6.1 million of amortization of acquisition-related inventory fair value step-up (for certain Green
Giant inventory acquired and sold during the period) and $0.5 million of charges, net of insurance recoveries, related to the Ortega and Las
Palmas recall. Fiscal 2016 includes $5.4 million of amortization of
acquisition-related inventory fair value step-up (for certain spices & seasonings business inventory acquired and sold during the period and certain Green
Giant inventory sold during the period) and a $0.8 million loss on disposal of inventory related to the impairment of Rickland
Orchards. Cost of goods sold for fiscal 2017 includes $2.4 million of amortization of acquisition -related inventory fair value step-up (for certain spices &
seasonings business and Back to Nature inventory acquired and sold during the period) and a $3.3 million loss on disposal of inventory related to
the write-off of discontinued and expired inventory from recent acquisitions. Cost of goods sold for fiscal 2018 includes $76.3 million of non-recurring expenses, including $66.3 million
relating to the non-cash accounting impact of our inventory reduction plan and $10.0 million of warehouse, delivery and other costs associated with our transition from certain of our existing
distribution centers to new distribution centers.
-
5
-
Selling,
general and administrative expenses for fiscal 2014 include $7.3 million of acquisition-related expenses for the Specialty Brands, Rickland Orchards and Pirate Brands acquisitions and
$0.5 million of administrative expenses, net of insurance recoveries, related to the Ortega and Las Palmas recall. Selling, general and administrative
expenses for fiscal 2015 include
$6.1 million of acquisition-related expenses for the Green Giant and Mama Mary's acquisitions,
$2.7 million of distribution restructuring expenses and $0.2 million of administrative expenses, net of insurance recoveries, related to the Ortega and Las
Palmas recall. Selling, general and administrative expenses for fiscal 2016 include
$17.5 million of acquisition-related expenses for the Victoria, spices & seasonings, Green
Giant and Mama Mary's acquisitions and $1.3 million of distribution restructuring expenses. Selling, general and
administrative expenses for fiscal 2017 include $35.6 million of acquisition-related and non-recurring expenses, including acquisition and integration expenses for the Green Giant,
spices & seasonings, Victoria and Back to
Nature acquisitions, severance and hiring costs and a non-recurring startup surcharge paid to a co-packer. Selling, general and administrative expenses for fiscal 2018 includes
$16.9 million of acquisition/divestiture-related and non-recurring expenses, including divestiture expenses for the Pirate Brands sale and acquisition and integration expenses for the McCann's,
Green Giant, spices & seasonings, Victoria
and Back to Nature acquisitions.
-
6
-
Amortization
expense includes the amortization of customer relationships, amortizable trademarks and other intangible assets acquired in the McCann's, Back to Nature,
Victoria, spices &
seasonings, Green Giant, Mama Mary's, Specialty Brands, Rickland
Orchards, Pirate Brands, TrueNorth and prior acquisitions.
-
7
-
During
fiscal 2017, we recorded a $1.6 million pre-tax loss as we sold to a third-party co-packer our Le Sueur, Minnesota research center,
including the seed technology assets, property, plant and equipment. During fiscal 2018, we recognized a pre-tax gain on the Pirate Brands sale of $176.4 million.
-
8
-
Impairment
of intangible assets for fiscal 2014 includes a $26.8 million loss for the impairment of amortizable trademarks and a
$7.4 million loss for the impairment of customer relationship intangibles, both relating to Rickland Orchards. Impairment of intangible assets for
fiscal 2016 includes a $4.5 million loss for the impairment of amortizable trademarks and a $0.9 million loss for the impairment of customer relationship intangibles, both relating to Rickland
Orchards.
-
9
-
In
addition to the base purchase price consideration paid at closing, the acquisition agreement for Rickland
Orchards required that we pay additional purchase price earn-out consideration contingent upon the achievement of revenue growth targets for fiscal 2014, 2015 and 2016. At the
time of acquisition, we established the fair value of the contingent consideration using revenue growth targets meant to achieve operating results in excess of base purchase price acquisition model
assumptions. As required, at June 28, 2014 we remeasured the fair value of the contingent consideration using actual operating results through June 28, 2014 and revised forecasted
operating results for the remainder of fiscal 2014, 2015 and 2016, and reduced the probability of achievement and the fair value of the contingent consideration to zero. This resulted in a non-cash
gain of $8.2 million that is included in gain on change in fair value of contingent consideration in fiscal 2014.
S-35
Table of Contents
-
10
-
Fiscal
2014 loss on extinguishment of debt includes the write-off of deferred debt financing costs of $5.4 million and the write-off of
unamortized discount of $0.3 million in connection with the termination of our prior credit agreement and the repayment of all outstanding obligations thereunder. Fiscal 2016 loss on
extinguishment of debt includes the write-off of deferred debt financing costs of $2.2 million and the write-off of unamortized discount of $0.6 million in connection with the repayment
of $40.1 million aggregate principal amount of our tranche A term loans and $109.9 million aggregate principal amount of our tranche B term loans. Fiscal 2017 loss on
extinguishment of debt includes the write-off of deferred debt financing costs of $0.9 million and the write-off of unamortized discount of $0.2 million in connection with the repayment
of all outstanding borrowings under the tranche A term loans and the write-off of deferred debt financing costs and the write-off of unamortized discount of less than $0.1 million in
connection with the refinancing of our tranche B term loans. Fiscal 2018 loss on extinguishment of debt includes the write-off of deferred debt financing costs and unamortized discount of
$11.1 million and $2.0 million, respectively, relating to the repayment of all outstanding borrowings under the tranche B term loans. Loss on extinguishment of debt for the first
two quarters of 2018 included the write-off of deferred debt financing costs and unamortized discount of $2.8 million and $0.5 million, respectively, relating to the prepayment of
borrowings under the tranche B term loans.
-
11
-
Other
income for fiscal 2014 includes the impact of the newly adopted presentation of net periodic pension cost and net periodic post-retirement benefit
costs below operating profit in the amount of $1.9 million. Other income for fiscal 2015 includes the impact of the newly adopted presentation of net periodic pension cost and net periodic
post-retirement benefit costs below operating profit in the amount of $0.8 million. Other income for fiscal 2016 includes remeasurement of monetary assets denominated in a foreign currency into
U.S. dollars of $0.4 million and includes the impact of the newly adopted presentation of net periodic pension cost and net periodic post-retirement benefit costs below operating profit in the
amount of $1.2 million. Other income for fiscal 2017 includes remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of $1.6 million and includes the impact
of the newly adopted presentation of net periodic pension cost and net periodic post-retirement benefit costs below operating profit in the amount of $1.5 million. Other income for fiscal 2018
includes remeasurement of monetary assets denominated in a foreign currency into U.S. dollars of $1.2 million and includes the impact of the newly adopted presentation of net periodic pension
cost and net periodic post-retirement benefit costs below operating profit in the amount of $2.4 million.
S-36
Table of Contents
DESCRIPTION OF CERTAIN INDEBTEDNESS
Senior Secured Credit Agreement
We have a senior secured credit agreement that includes a revolving credit facility and the capacity to incur tranche A term loans and
tranche B term loans. As of June 29, 2019, $215 million of revolving loans and no borrowings under term loans were outstanding under our credit agreement. We intend to use a
portion of the net proceeds from this offering and the new term loan borrowings under our senior secured credit facility to redeem all of the outstanding 2021 notes, to
repay a portion of our borrowings under our revolving credit facility, to pay related fees and expenses and for general corporate purposes.
As
of June 29, 2019, the available borrowing capacity under our revolving credit facility, net of outstanding letters of credit of $1.6 million, was $483.4 million.
Proceeds of the revolving credit facility may be used for general corporate purposes, including acquisitions of targets in the same or a similar line of business as our company, subject to specified
criteria. We are required to pay a commitment fee of 0.50% per annum on the unused portion of the revolving credit facility. The maximum letter of credit capacity under the revolving credit facility
is $50.0 million, with a fronting fee of 0.25% per annum of the drawable amount under all outstanding letters of credit and a letter of credit fee equal to the applicable margin for revolving
loans that are Eurodollar (LIBOR) loans. The revolving credit facility matures on November 21, 2022.
We
may permanently reduce the revolving credit facility commitment under the credit agreement at any time without premium or penalty (other than customary "breakage" costs with respect
to the early termination of LIBOR loans). Subject to certain exceptions, the credit agreement provides for mandatory prepayment upon certain asset dispositions or casualty events and certain
incurrence of indebtedness.
Interest
under the revolving credit facility, including any outstanding letters of credit is determined based on alternative rates that we may choose in accordance with the credit
agreement, including a base rate per annum plus an applicable margin ranging from 0.25% to 0.75%, and LIBOR plus an applicable margin ranging from 1.25% to 1.75%, in each case depending on our
consolidated leverage ratio. As of June 29, 2019, the revolving credit facility interest rate was approximately 5.3%.
In
connection with this offering, we intend to incur an additional $450 million in tranche B term loans. We expect that the tranche B term loans will mature seven
years from incurrence. Interest under the tranche B term loans will be determined based on alternative rates that we may choose in accordance with the credit agreement, including a base rate
per annum plus an applicable margin to be determined and LIBOR plus an applicable margin to be determined.
Our
obligations under the credit agreement are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of our existing and certain future domestic
subsidiaries. The credit agreement is secured by substantially all of our and our domestic subsidiaries' assets except our and our domestic subsidiaries' real property. The credit agreement contains
customary restrictive covenants, subject to certain permitted amounts and exceptions, including covenants limiting our ability to incur additional indebtedness, pay dividends and make other restricted
payments, repurchase shares of our outstanding stock and create certain liens.
The
credit agreement also contains certain financial maintenance covenants, which, among other things, specify a maximum consolidated leverage ratio and a minimum interest coverage
ratio, each ratio as defined in the credit agreement. Our consolidated leverage ratio (defined as the ratio of our
consolidated net debt, as of the last day of any period of four consecutive fiscal quarters to our adjusted EBITDA for such period), may not exceed 7.00 to 1.00. We are also required to maintain a
consolidated interest coverage ratio of at least 1.75 to 1.00 as of the last day of any period of four
S-37
Table of Contents
consecutive
fiscal quarters. As of June 29, 2019, we were in compliance with all of the covenants, including the financial covenants, in the credit agreement.
The
credit agreement also provides for an incremental term loan and revolving loan facility, pursuant to which we may request that the lenders under the credit agreement, and potentially
other lenders, provide unlimited additional amounts of term loans or revolving loans or both on terms substantially consistent with those provided under the credit agreement. Among other things, the
utilization of the incremental facility is conditioned on our ability to meet a maximum senior secured leverage ratio of 4.00 to 1.00, the financial maintenance covenants described above and a
sufficient number of lenders or new lenders agreeing to participate in the facility.
4.625% Senior Notes due 2021
As of the date of this prospectus supplement, we have $700.0 million principal amount of 4.625% senior notes due 2021 outstanding. On
September 10, 2019, we issued a conditional notice of redemption to the holders of our outstanding 2021 notes, notifying such holders that we intend to redeem all of the outstanding 2021 notes
on October 10, 2019. The redemption of the 2021 notes is conditioned upon the consummation of this offering and/or the new term loan borrowings under our senior secured credit facility and our
receipt of gross proceeds of not less than $700.0 million. We intend to use a portion of the net proceeds from this offering and the new term loan borrowings under our senior secured credit
facility to redeem all of the outstanding 2021 notes, to pay related fees and expenses and/or for general corporate purposes. If this offering is completed, but new term loan borrowings under our
senior secured credit facility are not incurred by the redemption date, we intend to use the net proceeds from this offering, together with cash on hand and/or borrowings under our revolving credit
facility, to pay the redemption price of the 2021 notes. The redemption price of the 2021 notes is 100% of the principal amount, plus accrued and unpaid interest to the redemption date. This
prospectus supplement is not a notice to redeem the 2021 notes, and the completion of this offering is not conditioned upon redemption of the 2021 notes.
5.25% Senior Notes due 2025
On April 3, 2017, we issued $500.0 million aggregate principal amount of 5.25% senior notes due 2025 at a price to the public of
100% of their face value. On November 20, 2017, we issued an additional $400.0 million aggregate principal amount of 2025 notes at a price to the public 101% of their face value plus
accrued interest from October 1, 2017, which equates to a yield to worst of 5.03%. The notes issued in November 2017 were issued as additional notes under the same indenture as our 2025 notes
that were issued in April 2017, and, as such, form a single series and trade interchangeably with the previously issued 2025 notes. Interest on the 2025 notes is payable on April 1 and
October 1 of each year. The 2025 notes will mature on April 1, 2025, unless earlier retired or redeemed as permitted or required by the terms of the indenture governing the 2025 notes as
described below.
Beginning
April 1, 2020, we may redeem some or all of the 2025 notes at a redemption price of 103.9375% of their principal amount, and thereafter at prices declining annually to
100% of their principal amount on or after April 1, 2023, plus accrued and unpaid interest to the date of redemption. In addition, if we undergo a change of control, we may be required to offer
to repurchase the 2025 notes at the repurchase price of 101% of their principal amount plus accrued and unpaid interest to the date of redemption.
We
may also, from time to time, seek to retire 2025 notes through cash repurchases, exchanges of 2025 notes for equity securities, open market purchases, privately negotiated
transactions or otherwise, including through the proceeds of this offering. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual
restrictions and other factors. The amounts involved may be material.
S-38
Table of Contents
Our
obligations under the 2025 notes are jointly and severally and fully and unconditionally guaranteed on a senior basis by all of our existing and certain future domestic subsidiaries.
The 2025 notes and the subsidiary guarantees are our and the guarantors' general unsecured obligations and are effectively junior in right of payment to all of our and the guarantors' secured
indebtedness and to the indebtedness and other liabilities of our non-guarantor subsidiaries; are pari passu in right of payment to all of our and the
guarantors' existing and future unsecured senior debt (including the notes offered hereby); and are senior in right of payment to all of our and the guarantors' future subordinated debt. Our foreign
subsidiaries are not guarantors, and any future foreign or partially-owned domestic subsidiaries will not be guarantors, of the 2025 notes.
The
indenture governing the 2025 notes contains covenants with respect to us and the guarantors and restricts the incurrence of additional indebtedness and the issuance of capital stock;
the payment of dividends or distributions on, and redemption of, capital stock; a number of other restricted payments, including certain investments; creation of specified liens, certain
sale-leaseback transactions and sales of certain specified assets; fundamental changes, including consolidation, mergers and transfers of all or substantially all of our assets; and specified
transactions with affiliates. Each of the covenants is subject to a number of important exceptions and qualifications. As of June 29, 2019, we were in compliance with all of the covenants in
the indenture governing the 2025 notes.
S-39
Table of Contents
DESCRIPTION OF NOTES
You can find the definitions of certain terms used in this description under the subheading "Certain Definitions." In this description, the
words "B&G Foods" refers only to B&G Foods, Inc. and its successor in accordance with the terms of the indenture, and not to any of its Subsidiaries.
B&G
Foods will issue the notes under an indenture, dated as of June 4, 2013 (the "Base Indenture"), as supplemented by a
supplemental indenture establishing the form and terms of the notes (the "Tenth Supplemental Indenture" and, together with the Base Indenture, the
"indenture") among itself, the Guarantors and The Bank of New York Mellon, as trustee. See "Notice to Investors." The terms of the notes will include
those stated in the indenture and those made part of the indenture by reference to the Trust Indenture Act of 1939, as amended.
This
"Description of Notes," together with the "Description of Our Debt Securities" included in the accompanying base prospectus, is only a summary of the material provisions of the
indenture. It does not restate the indenture in its entirety. We urge you to read the indenture because it, and not this description, defines your rights as a holder of the notes. A copy of the Base
Indenture is incorporated by reference as an exhibit to the registration statement that includes the accompanying base prospectus. This "Description of Notes" supersedes the "Description of Debt
Securities" in the accompanying base prospectus to the extent it is inconsistent with such "Description of Debt Securities." Copies of the Base Indenture and the Tenth Supplemental Indenture are
available as set forth below under "Additional Information." Certain defined terms used in this description but not defined below under "Certain Definitions" have the
meanings assigned to them in the indenture.
The
registered holder of a note will be treated as the owner of it for all purposes. Only registered holders will have rights under the indenture.
Brief Description of the Notes and the Note Guarantees
The Notes
The notes:
-
-
will be general unsecured obligations of B&G Foods;
-
-
will be pari passu in right of payment with all existing (including the 2025 Senior Notes) and
any future unsecured senior Indebtedness of B&G Foods;
-
-
will be senior in right of payment to all existing and any future subordinated Indebtedness of B&G Foods; and
-
-
will be fully and unconditionally guaranteed by the Guarantors.
However,
the notes will be effectively subordinated to all borrowings under the Credit Agreement (including the new term loan borrowings and any obligations under the revolving credit
facility), which as of the date of the indenture are secured by substantially all of the assets of B&G Foods and the Guarantors, other than the real estate of B&G Foods and the Guarantors. See "Risk
FactorsAlthough the notes are referred to as "senior" notes, your right to receive payments on these notes is effectively subordinated to the rights of our existing and future secured
creditors. Further, the guarantees of these notes are effectively subordinated to all the guarantors' existing and future secured indebtedness."
The Note Guarantees
The notes will be jointly and severally and fully and unconditionally guaranteed by all of B&G Foods' Domestic Subsidiaries.
S-40
Table of Contents
Each
guarantee of the notes:
-
-
will be a general unsecured obligation of the Guarantor;
-
-
will be pari passu in right of payment with all existing (including that Guarantor's guarantee
of the 2025 Senior Notes) and any future unsecured senior Indebtedness of that Guarantor; and
-
-
will be senior in right of payment to all existing and any future subordinated Indebtedness of that Guarantor.
Not
all of our Subsidiaries will guarantee the notes. In the event of a bankruptcy, liquidation or reorganization of any of these non-Guarantor Subsidiaries, the non-Guarantor
Subsidiaries will pay the holders of their debt and trade creditors before they will be able to distribute any of their assets to us. The Guarantor Subsidiaries generated substantially all of our net
sales for the 26 weeks ended June 29, 2019 and owned virtually all of our consolidated assets as of June 29, 2019. As of the date of the indenture, our non-Guarantor Subsidiaries
will be B&G Foods Canada, ULC, B&G Foods Manufacturing Mexico, S. de R.L. de C.V. and Sirops Maple Grove Inc.
As
of the date of the indenture, all of our Subsidiaries will be "Restricted Subsidiaries." However, under the circumstances described below under the caption "Certain
CovenantsDesignation of Restricted and Unrestricted Subsidiaries," we will be permitted to designate certain of our Subsidiaries as "Unrestricted Subsidiaries." Our Unrestricted
Subsidiaries will not guarantee the notes and will not be subject to many of the restrictive covenants in the indenture.
Principal, Maturity and Interest
B&G Foods will issue $550 million in aggregate principal amount of notes in this offering. B&G Foods may issue additional notes under the
indenture ("Additional Notes") from time to time after this offering. Any issuance of Additional Notes is subject to all of the covenants in the
indenture, including the covenant described below under the caption "Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock." The notes and any
Additional Notes subsequently issued under the indenture will be treated as a single class for all purposes under the indenture, including, without limitation, waivers, amendments, redemptions and
offers to purchase; provided that if any additional notes subsequently issued are not fungible with any notes previously issued for U.S. federal income tax purposes, such additional notes will have a
separate CUSIP number. B&G Foods will issue notes in denominations of $2,000 and integral multiples of $1,000 in excess thereof. The notes will mature on September 15, 2027.
Interest
on the notes will accrue at the rate of 5.25% per annum and will be payable semi-annually in arrears on March 15 and September 15, commencing on March 15,
2020. Interest on overdue principal and interest, if any, will accrue at a rate that is 1% higher than the then applicable interest rate on the notes. B&G Foods will make each interest payment to the
holders of record on the immediately preceding March 1 and September 1.
Interest
on the notes will accrue from the date of original issuance or, if interest has already been paid, from the date it was most recently paid or provided for. Interest will be
computed on the basis of a 360-day year comprised of twelve 30-day months.
Methods of Receiving Payments on the Notes
If a holder of notes has given wire transfer instructions to B&G Foods, B&G Foods will pay, or cause to be paid, all principal, interest and
premium, if any, on that holder's notes in accordance with those instructions. All other payments on the notes will be made at the office or agency of the paying agent and registrar within the City
and State of New York unless B&G Foods elects to make interest payments by check mailed to the noteholders at their address set forth in the register of holders.
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Paying Agent and Registrar for the Notes
The trustee will initially act as paying agent and registrar. B&G Foods may change the paying agent or registrar without prior notice to the
holders of the notes, and B&G Foods or any of its Restricted Subsidiaries may act as paying agent or registrar.
Transfer and Exchange
A holder may transfer or exchange notes in accordance with the indenture. The registrar and the trustee may require a holder, among other
things, to furnish appropriate endorsements and transfer documents in connection with a transfer of notes and holders will be required to pay all taxes due on transfer. B&G Foods will not be required
to transfer or exchange any
note selected for redemption. Also, B&G Foods will not be required to transfer or exchange any note for a period of 15 days before a selection of notes to be redeemed.
Note Guarantees
The notes will be guaranteed by each of B&G Foods' current and future Domestic Subsidiaries. The Note Guarantees will be joint and several
obligations of the Guarantors and those obligations will be limited as necessary to prevent that Note Guarantee from constituting a fraudulent conveyance under applicable law. See "Risk
FactorsUnited States Federal and state fraudulent transfer laws permit a court to void the notes and the guarantees, and, if that occurs, you may not receive any payments on the notes or
the guarantees."
A
Guarantor may not sell or otherwise dispose of all or substantially all of its assets to, or consolidate with or merge with or into (whether or not such Guarantor is the surviving
Person) another Person, other than (i) B&G Foods or another Guarantor or (ii) an affiliate of B&G Foods solely for the purpose of reincorporating or reorganizing in the United States or
any state thereof), unless:
(1) immediately
after giving effect to that transaction, no Default or Event of Default exists; and
(2) either:
(a) the
Person acquiring the property in any such sale or disposition or the Person formed by or surviving any such consolidation or merger (if other than such Guarantor)
assumes all the obligations of that Guarantor under the indenture, its Note Guarantee pursuant to a supplemental indenture satisfactory to the trustee; or
(b) the
Net Proceeds of such sale or other disposition are applied in accordance with the "Asset Sale" provisions of the indenture.
The
Note Guarantee of a Guarantor will be automatically released:
(1) in
connection with any sale or other disposition of all or substantially all of the assets of that Guarantor (including by way of merger or consolidation) to a Person
that is not (either before or after
giving effect to such transaction) B&G Foods or a Restricted Subsidiary of B&G Foods, if the sale or other disposition complies with the "Asset Sale" provisions of the indenture;
(2) in
connection with any sale or other disposition of all of the Capital Stock of that Guarantor to a Person that is not (either before or after giving effect to such
transaction) B&G Foods or a Restricted Subsidiary of B&G Foods, if the sale or other disposition complies with the "Asset Sale" provisions of the indenture;
(3) if
B&G Foods designates any Restricted Subsidiary that is a Guarantor to be an Unrestricted Subsidiary in accordance with the applicable provisions of the indenture;
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(4) upon
legal defeasance, covenant defeasance or satisfaction and discharge of the indenture as provided below under "Legal Defeasance and Covenant Defeasance"
and "Satisfaction and Discharge";
(5) if
such Guarantor no longer constitutes a Domestic Subsidiary; or
(6) if
it is determined in good faith by B&G Foods that a liquidation, dissolution or merger out of existence of such Guarantor is in the best interests of B&G Foods and is
not materially disadvantageous to the holders.
See
"Repurchase at the Option of HoldersAsset Sales."
Optional Redemption
Except as described below, the notes will not be redeemable at B&G Foods' option prior to March 1, 2022. At any time prior to
March 1, 2022, B&G Foods may on any one or more occasions redeem up to 40% of the aggregate principal amount of notes issued under the indenture
(including Additional Notes, if any), upon not less than 30 nor more than 60 days' notice, at a redemption price equal to 105.25% of the principal amount of the notes redeemed, plus accrued and
unpaid interest, if any, to the redemption date, (subject to the rights of holders of notes on the relevant record date to receive interest on the relevant interest payment date) in an amount not to
exceed the net cash proceeds of one or more Equity Offerings of B&G Foods; provided that:
(1) at
least 50% of the aggregate principal amount of notes originally issued under the indenture (excluding notes held by B&G Foods and its Subsidiaries) remains
outstanding immediately after the occurrence of such redemption; and
(2) the
redemption occurs within 90 days of the date of the closing of such Equity Offering.
At
any time prior to March 1, 2022, B&G Foods may on any one or more occasions redeem all or a part of the notes, upon not less than 30 nor more than 60 days' notice, at a
redemption price equal to 100% of the principal amount of the notes redeemed, plus the Applicable Premium as of, and accrued and unpaid interest, if any, to the date of redemption, subject to the
rights of holders of notes on the relevant record date to receive interest due on the relevant interest payment date.
On
or after March 1, 2022, B&G Foods may on any one or more occasions redeem all or a part of the notes upon not less than 30 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth below plus accrued and unpaid interest, if any, on the notes redeemed, to the applicable redemption date, if redeemed during
the twelve-month period beginning on March 1 of the years indicated below, subject to the rights of holders of notes on the relevant record date to receive interest on the relevant interest
payment date:
|
|
|
|
|
Year
|
|
Percentage
|
|
2022
|
|
|
103.938
|
%
|
2023
|
|
|
102.625
|
%
|
2024
|
|
|
101.313
|
%
|
2025 and thereafter
|
|
|
100.000
|
%
|
Any
redemption or notice of any redemption may, at B&G Foods' discretion, be subject to one or more conditions precedent, including, but not limited to, completion of an Equity Offering,
other offering or other corporate transaction or event. In addition, we may provide in any notice of redemption that payment of the redemption price and the performance of our obligations with respect
to such redemption may be performed by another person; provided, however, that B&G Foods shall remain obligated to pay the redemption price and perform
its obligations with respect to such
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redemption
in the event such other person fails to do so. Notice of any redemption in respect of an Equity Offering may be given prior to completion thereof.
Unless
B&G Foods defaults in the payment of the redemption price, interest will cease to accrue on the notes or portions thereof called for redemption on the applicable redemption date.
Mandatory Redemption
B&G Foods is not required to make mandatory redemption or sinking fund payments with respect to the notes. However, under certain circumstances,
B&G Foods may be required to offer to purchase Notes as described under the caption "Repurchase at the Option of Holders." We may at any time and from time to time purchase notes in the
open market or otherwise.
Repurchase at the Option of Holders
Change of Control
If a Change of Control occurs, each holder of notes will have the right to require B&G Foods to repurchase all or any part (equal to $2,000 or
an integral multiple of $1,000 in excess thereof) of that holder's notes pursuant to a Change of Control Offer on the terms set forth in the indenture. In the Change of Control Offer (subject to the
conditions required by applicable law, if any), B&G Foods will offer a Change of Control Payment in cash equal to 101% of the aggregate principal amount of notes repurchased plus accrued and unpaid
interest, if any, on the notes repurchased to the date of purchase, subject to the rights of holders of notes on the relevant record date to receive interest due on the relevant interest payment date.
Within 30 days following any Change of Control, B&G Foods will mail a notice to each holder describing the transaction or transactions that constitute the Change of Control and offering to
repurchase notes on the Change of Control Payment Date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed,
pursuant to the procedures required by the indenture and described in such notice. Holders electing to have a note purchased pursuant to a Change of Control Offer will be required to surrender the
note, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the note completed, to the paying agent at the address specified in the notice of Change of Control Offer prior to
the close of business on the third business day prior to the Change of Control Payment Date.
Any
Change of Control Offer will be made in compliance with all applicable laws, rules and regulations, including, if applicable, Regulation 14e-1 under the Exchange Act and the
rules thereunder and all other applicable Federal and state securities laws in connection with the repurchase of notes pursuant to the Change of Control Offer. To the extent that the provisions of any
securities laws or regulations conflict with the provisions of this covenant, B&G Foods' compliance with those laws and regulations will not in and of itself cause a breach of its obligations under
this covenant.
On
the Change of Control Payment Date, B&G Foods will, to the extent lawful:
(1) accept
for payment all notes or portions of notes properly tendered pursuant to the Change of Control Offer;
(2) deposit
with the paying agent an amount equal to the Change of Control Payment in respect of all notes or portions of notes properly tendered; and
(3) deliver
or cause to be delivered to the trustee the notes properly accepted together with an Officers' Certificate stating the aggregate principal amount of notes or
portions of notes being purchased by B&G Foods.
The
paying agent will promptly mail to each holder of notes properly tendered the Change of Control Payment for such notes, and the trustee will promptly authenticate and mail (or cause
to be transferred by book entry) to each holder a new note equal in principal amount to any unpurchased
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portion
of the notes surrendered, if any. B&G Foods will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.
The
provisions described above that require B&G Foods to make a Change of Control Offer following a Change of Control will be applicable whether or not any other provisions of the
indenture are applicable. Except as described above with respect to a Change of Control, the indenture does not contain provisions that permit the holders of the notes to require that B&G Foods
repurchase or redeem the notes in the event of a takeover, recapitalization or similar transaction.
B&G
Foods will not be required to make a Change of Control Offer upon a Change of Control if
(1) a
third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the indenture applicable to a
Change of Control Offer made by B&G Foods and purchases all notes properly tendered and not withdrawn under the Change of Control Offer, or (2) notice of redemption has been given pursuant to
the indenture as described above under the caption "Optional Redemption," unless and until there is a default in payment of the applicable redemption price. Notwithstanding anything to
the contrary contained herein, a Change of Control Offer may be made in advance of a Change of Control, conditioned upon the consummation of such Change of Control, if a definitive agreement is in
place for the Change of Control at the time the Change of Control Offer is made.
The
occurrence of the events constituting a Change of Control under the indenture could result in an event of default under the Credit Agreement and under B&G Foods' or its Subsidiaries'
other Credit Facilities and debt instruments. The definition of "change of control" under the Credit Agreement is substantially the same as that in the indenture. Following such an event of default
under the Credit Agreement, the lenders under the Credit Agreement or such other Credit Facilities and debt instruments would have the right to require the immediate repayment of the Indebtedness
thereunder in full, and might have the right to require such repayment prior to the Change of Control Payment Date on which B&G Foods would be required to repurchase the notes.
No
assurances can be given that B&G Foods will have funds available or otherwise will be able to purchase any notes upon the occurrence of a Change of Control. The provisions of the
indenture relating to a Change of Control in and of themselves may not afford holders of the notes protection in the event of a highly leveraged transaction, reorganization, restructuring, merger or
similar transaction involving us that may adversely affect holders of the notes if such transaction is not the type of transaction included within the definition of a Change of Control. A transaction
involving management or Affiliates of B&G Foods likewise will result in a Change of Control only if it is the type of transaction specified by the definition. The existence of the foregoing provisions
relating to a Change of Control may or may not deter a third party from seeking to acquire us in a transaction which constitutes a Change of Control and may or may not discourage or make more
difficult the removal of incumbent management.
The
definition of Change of Control includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other disposition of "all or substantially all" of the
properties or assets of B&G Foods and its Subsidiaries taken as a whole. Although there is a limited body of case law interpreting the phrase "substantially all," there is no precise established
definition of the phrase under applicable law. Accordingly, the ability of a holder of notes to require B&G Foods to repurchase its notes as a result of a sale, lease, transfer, conveyance or other
disposition of less than all of the assets of B&G Foods and its Subsidiaries taken as a whole to another Person or group may be uncertain.
The
provisions of the indenture related to B&G Foods' obligations to make a Change of Control Offer may be waived or modified with the written consent of the holders of a majority in
aggregate principal amount of the notes then outstanding.
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Asset Sales
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:
(1) B&G
Foods (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the Fair Market Value (measured as of
the date of the definitive agreement with respect to such Asset Sale), as determined in good faith by B&G Foods, of the assets or Equity Interests issued or sold or otherwise disposed of; and
(2) at
least 75% of the consideration received in the Asset Sale by B&G Foods or such Restricted Subsidiary is in the form of cash or Cash Equivalents. For purposes of this
provision, each of the following will be deemed to be cash:
(a) any
liabilities, as shown on B&G Foods' most recent consolidated balance sheet, of B&G Foods or any Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the notes or any Note Guarantee) that are assumed by the transferee of any such assets and B&G Foods or such Restricted Subsidiary is released from
further liability;
(b) any
securities, notes or other obligations received by B&G Foods or any such Restricted Subsidiary from such transferee that are converted by B&G Foods or such
Restricted Subsidiary into cash within 180 days after such Asset Sale, to the extent of the cash received in that conversion;
(c) any
Designated Non-cash Consideration received by B&G Foods or such Restricted Subsidiary in such Asset Sale having an aggregate Fair Market Value, taken together with
all other Designated Non-cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of (i) $100.0 million or
(ii) 3.0% of Total Assets, with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and with giving effect to subsequent changes in
value; and
(d) any
stock or assets of the kind referred to in clauses (2) or (4) of the next paragraph of this covenant.
Any
Asset Sale pursuant to a condemnation, appropriation or other similar taking, including by deed in lieu of condemnation, or pursuant to the foreclosure or other enforcement of a
Permitted Lien or exercise by the related lienholder of rights with respect to any of the foregoing, including by deed or
assignment in lieu of foreclosure, will not be required to satisfy the conditions set forth in the preceding paragraph. Within 360 days after the receipt of any Net Proceeds from an Asset Sale,
B&G Foods (or the applicable Restricted Subsidiary, as the case may be) may apply such Net Proceeds, at its option:
(1) to
repay, prepay or purchase Indebtedness and other Obligations under a Credit Facility and, if the Indebtedness repaid is revolving credit Indebtedness, to
correspondingly reduce commitments with respect thereto;
(2) to
acquire all or substantially all of the assets of another Permitted Business, or to acquire any Capital Stock of another Permitted Business, if, after giving effect
to any such acquisition of Capital Stock, the Permitted Business is or becomes a Restricted Subsidiary of B&G Foods;
(3) to
make a capital expenditure;
(4) to
acquire other assets that are not classified as current assets under GAAP and that are used or useful in a Permitted Business; or
(5) any
combination of the foregoing clauses (1) through (4).
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In the case of clauses (2) and (4) above, B&G Foods will be deemed to have complied with its obligations in the preceding paragraph if it enters
into a binding commitment to acquire such assets or Capital Stock prior to 360 days after the receipt of the applicable Net Proceeds; provided
that such binding commitment will be subject only to customary conditions and such acquisition is completed within 180 days following the expiration of the aforementioned 360 day period.
If the acquisition contemplated by such binding commitment is not consummated on or before such 180th day, and B&G Foods has not applied the applicable Net Proceeds for another purpose
permitted by the preceding paragraph on or before such 180th day, such commitment shall be deemed not to have been a permitted application of Net Proceeds. Pending the final application of any
Net Proceeds, B&G Foods may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by the indenture.
Any
Net Proceeds from Asset Sales that are not applied or invested as provided in the second paragraph of this covenant will constitute "Excess Proceeds." When the aggregate amount of
Excess Proceeds exceeds $25.0 million, within 30 days thereof, B&G Foods will make an Asset Sale Offer to all holders of notes and all holders of other Indebtedness that is pari passu with
the notes (containing provisions similar to those set forth in the indenture with respect to offers) to purchase, prepay or redeem with
the proceeds of sales of assets to purchase, prepay or redeem the maximum principal amount of notes and such other pari passu Indebtedness (plus all
accrued interest on the Indebtedness
and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased, prepaid or redeemed out of the Excess Proceeds. The offer price in any Asset Sale
Offer will be equal to 100% of the principal amount plus accrued and unpaid interest, if any, to the date of purchase, prepayment or redemption, subject to the rights of holders of notes on the
relevant record date to receive interest due on the relevant interest payment date, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, B&G Foods may
use those Excess Proceeds for any purpose not otherwise prohibited by the indenture. If the aggregate principal amount of notes and other pari passu
Indebtedness tendered into (or required to be prepaid or redeemed in connection with) such Asset Sale Offer exceeds the amount of Excess Proceeds, the trustee will select the notes and such other pari passu Indebtedness to be purchased on a pro rata basis, based on the amounts tendered or required
to be prepaid or redeemed. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
Any
Asset Sale Offer will be made in compliance with all applicable laws, rules and regulations, including, if applicable, Regulation 14e-1 under the Exchange Act and the rules
thereunder and all other applicable Federal and state securities laws. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this covenant, B&G Foods'
compliance with those laws and regulations will not in and of itself cause a breach of its obligations under this covenant.
The
agreements governing B&G Foods' other Indebtedness contain, and future agreements may contain, prohibitions of certain events, including events that would constitute an Asset Sale.
The exercise by the holders of notes of their right to require B&G Foods to repurchase the notes upon an Asset Sale could cause a default under these other agreements, even if the Asset Sale itself
does not, due to the financial effect of such repurchases on B&G Foods. In the event an Asset Sale occurs at a time when B&G Foods is prohibited from purchasing notes, B&G Foods could seek the consent
of its senior lenders to purchase notes or could attempt to refinance the borrowings that contain such prohibition. If B&G Foods does not obtain a consent or repay those borrowings, B&G Foods will
remain prohibited from purchasing notes. In that case, B&G Foods' failure to purchase tendered notes would constitute an Event of Default under the indenture which could, in turn, constitute a default
under the other indebtedness. Finally, B&G Foods' ability to pay cash to the holders of notes upon a repurchase may be limited by B&G Foods' then existing financial resources.
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Selection and Notice
If less than all of the notes are to be redeemed or purchased in an offer to purchase at any time, the trustee will select notes for redemption
on a pro rata basis (or, in the case of
notes issued in global form as discussed under "Book-Entry, Delivery and Form," based on a method that most nearly approximates a pro rata
selection as the trustee may deem appropriate) unless otherwise required by law or applicable stock exchange or depositary requirements.
No
notes of $2,000 or less can be redeemed in part. Notices of redemption will be transmitted at least 30 but not more than 60 days before the redemption date to each holder of
notes to be redeemed at its address last shown upon the registry books of B&G Foods' registrar, except that redemption notices may be mailed more than 60 days prior to a redemption date if the
notice is issued in connection with a defeasance of the notes or a satisfaction and discharge of the indenture.
If
any note is to be redeemed in part only, the notice of redemption that relates to that note will state the portion of the principal amount of that note that is to be redeemed; provided that the
principal amount specified must be $2,000 or integral multiples of $1,000 in excess thereof. A new note in principal amount equal to
the unredeemed portion of the original note will be issued in the name of the holder of notes upon cancellation of the original note. Notes called for redemption, unless such redemption is conditioned
upon the happening of a future event, become due on the date fixed for redemption. On and after the redemption date, interest ceases to accrue on notes or portions of notes called for redemption.
Certain Covenants
Restricted Payments
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly:
(1) declare
or pay any dividend or make any other payment or distribution on account of B&G Foods' or any of its Restricted Subsidiaries' Equity Interests (including,
without limitation, any payment in connection with any merger or consolidation involving B&G Foods or any of its Restricted Subsidiaries) or to the direct or indirect holders of B&G Foods' or any of
its Restricted Subsidiaries' Equity Interests in their capacity as such (other than dividends or distributions payable in Equity Interests (other than Disqualified Stock) of B&G Foods and other than
dividends or distributions payable to B&G Foods or a Restricted Subsidiary of B&G Foods);
(2) purchase,
redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving B&G Foods) any Equity
Interests (other than any such Equity Interest owned by a wholly owned Restricted Subsidiary of B&G Foods) of B&G Foods or any direct or indirect parent of B&G Foods;
(3) make
any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness of B&G Foods or any Guarantor that is
contractually subordinated to the notes or to any Note Guarantee (excluding any intercompany Indebtedness between or among B&G Foods and any of its Restricted Subsidiaries), except a payment of
interest or principal on, or the purchase, repurchase or other acquisition of, such Indebtedness in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in
each case due within one year of the date of such payment, purchase, repurchase or other acquisition; or
(4) make
any Restricted Investment (all such payments and other actions set forth in these clauses (1) through (4) being collectively referred to as
"Restricted Payments"), unless, at the time
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of
and after giving effect to such Restricted Payment, no Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment and:
(1) if
the Fixed Charge Coverage Ratio for B&G Foods' four most recent fiscal quarters for which internal financial statements are available is not less than 1.6 to 1.0,
such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by B&G Foods and its Restricted Subsidiaries since the date of the indenture (except for Restricted
Payments made pursuant to clauses (1) (so long as such Restricted Payment was previously included for purposes of this calculation (to the extent required to be so included) at the time of its
declaration), (2), (3), (4), (6), (7), (8), (9), (10), (11) or (12) of the next succeeding paragraph), is less than the sum of $150.0 million and, without duplication:
(a) Excess
Cash of B&G Foods for the period (taken as one accounting period) from March 31, 2013 to the end of B&G Foods' most recently ended fiscal quarter for which
internal financial statements are available at the time of such Restricted Payment; plus
(b) 100%
of the aggregate net cash proceeds received by B&G Foods since June 4, 2013 as a contribution to its common equity capital or from the issue or sale of
Equity Interests of B&G Foods (other than Disqualified Stock) or from the issue or sale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of B&G Foods
that have been converted into or exchanged for such Equity Interests (other than Equity Interests (or Disqualified Stock or debt securities) sold to a Subsidiary of B&G Foods); plus
(c) 100%
of the Fair Market Value as of the date of issuance of any Equity Interests (other than Disqualified Stock) issued since June 4, 2013 by B&G Foods as
consideration for the purchase by B&G Foods or any of its Restricted Subsidiaries of all or substantially all of the assets of, or a majority of the Voting Stock of, another Permitted Business
(including by means of a merger, consolidation or other business combination permitted under the indenture); plus
(d) to
the extent that any Restricted Investment that was made after June 3, 2014 is sold for cash or other property or otherwise liquidated or repaid for cash, the
lesser of (i) the cash return of capital with respect to such Restricted Investment or the Fair Market Value of such other property (less the cost of disposition, if any) and (ii) the
initial amount of such Restricted Investment; plus
(e) to
the extent that any Unrestricted Subsidiary of B&G Foods designated as such after June 4, 2013 is redesignated as a Restricted Subsidiary after June 4,
2013 or merges or consolidates with or into, or is liquidated into, B&G Foods or any of its Restricted Subsidiaries, the lesser of (i) the Fair Market Value of B&G Foods' Investment in such
Subsidiary as of the date of such redesignation or (ii) such Fair Market Value as of the date on which such Subsidiary was originally designated as an Unrestricted Subsidiary after
June 4, 2013.
As
of June 30, 2019, the amount available for Restricted Payments pursuant to this clause (1) was approximately $0.8 billion.
The
preceding provisions will not prohibit:
(1) the
payment of any dividend or the consummation of any irrevocable redemption within 90 days after the date of declaration of the dividend or giving of the
redemption notice, as the case may be, if at the date of declaration or notice, the dividend or redemption payment would have complied with the provisions of the indenture;
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(2) the
making of any Restricted Payment in exchange for, or out of the net cash proceeds of the sale within 10 business days (other than to a Subsidiary of B&G
Foods) of, Equity Interests of B&G Foods (other than Disqualified Stock) or from the contribution of common equity capital to B&G Foods within 10 business days; provided that the amount of any
such net cash proceeds that are utilized for any such Restricted Payment will be excluded from clause (1)(b) of
the preceding paragraph;
(3) the
repurchase, redemption, defeasance or other acquisition or retirement for value of Indebtedness of B&G Foods or any Guarantor that is contractually subordinated to
the notes or to any Note Guarantee with the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness or issuance of Disqualified Stock permitted to be issued by the covenant
described below under the caption "Incurrence of Indebtedness and Issuance of Preferred Stock" within 10 business days from such incurrence or issuance;
(4) the
payment of any dividend (or, in the case of any partnership or limited liability company, any similar distribution) by a Restricted Subsidiary of B&G Foods to the
holders of its Equity Interests on a pro rata basis;
(5) so
long as no Default has occurred and is continuing or would be caused thereby, the repurchase, redemption or other acquisition or retirement for value of any Equity
Interests of B&G Foods or any Restricted Subsidiary of B&G Foods held by any current or former officer, director or employee of B&G Foods or any of its Restricted Subsidiaries pursuant to any equity
subscription agreement, stock option plan or any other management or employee benefit plan or agreement, shareholders' agreement or similar agreement; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests may not exceed $15.0 million in
any calendar year (provided that B&G Foods may carry over and make in a subsequent calendar year, in addition to the amounts permitted for such calendar
year, up to $5.0 million of unutilized capacity under this clause (5) attributable to the immediately preceding calendar year); provided,
further, that such amount in any calendar year may be increased by an amount not to exceed the cash proceeds received by B&G Foods or any of its Restricted Subsidiaries (to the
extent contributed to B&G Foods) from sales of Equity Interests (other than Disqualified Stock) of B&G Foods to officers, directors or employees of B&G Foods or any of its Restricted Subsidiaries that
occur after the date of the indenture (provided that the amount of such cash proceeds used for any such repurchase, redemption, acquisition or
retirement will not increase the amount available for Restricted Payments under clause (1)(b) of the preceding paragraph and provided that B&G
Foods may elect to apply all or any portion of the aggregate increase contemplated by this proviso in any calendar year); provided, further, that
cancellation of Indebtedness owing to B&G Foods from members of management of B&G Foods or any Restricted Subsidiary in connection with a repurchase of Equity Interests of B&G Foods will not be deemed
to constitute a Restricted Payment;
(6) the
repurchase of Equity Interests deemed to occur upon the exercise of stock options to the extent such Equity Interests represent a portion of the exercise price of
those stock options;
(7) so
long as no Default has occurred and is continuing or would be caused thereby, the declaration and payment of regularly scheduled or accrued dividends to holders of
any class or series of Disqualified Stock of B&G Foods or any Restricted Subsidiary of B&G Foods issued on or after the date of the indenture in accordance with the covenant described below under the
caption "Incurrence of Indebtedness and Issuance of Preferred Stock";
(8) so
long as no Default has occurred and is continuing or would be caused thereby, upon the occurrence of an Asset Sale or a Change of Control and within 60 days
after the completion of the related Asset Sale Offer or Change of Control Offer, any purchase or redemption of Indebtedness of B&G Foods or any Guarantor that is contractually subordinated to the
notes or to
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any
Note Guarantee required pursuant to the terms thereof as a result of such Asset Sale or Change of Control at a purchase or redemption price not to exceed 101% of the outstanding principal amount
thereof, plus accrued and unpaid interest thereon, if any; provided, however, that such purchase or redemption is not made, directly or indirectly, from
the proceeds of (or made in anticipation of) any issuance of Indebtedness by B&G Foods or any of its Restricted Subsidiaries;
(9) payments
of dividends to B&G Foods solely to enable it to make payments to holders of its Capital Stock in lieu of the issuance of fractional shares of its Capital
Stock;
(10) the
acquisition of any shares of Disqualified Stock of B&G Foods in exchange for other shares of Disqualified Stock of B&G Foods or with the net cash proceeds from an
issuance of Disqualified Stock by B&G Foods within 10 business days of such issuance, in each case that is permitted to be issued under the covenant described below under the caption
"Incurrence of Indebtedness and Issuance of Preferred Stock";
(11) the
repurchase, redemption, defeasance or other acquisition or retirement for value of the 2025 Senior Notes, including any call premium paid in connection therewith;
and
(12) so
long as no Default has occurred and is continuing or would be caused thereby, other Restricted Payments in an aggregate amount at the time outstanding not to exceed
the greater of (i) $125.0 million or (ii) 4.0% of Total Assets.
For
purposes of this covenant, the amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities
proposed to be transferred or issued by B&G Foods or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. For purposes of determining compliance with this covenant, in
the event that a Restricted Payment meets the criteria of more than one of the exceptions described in clauses (1) through (12) above or is entitled to be made pursuant to the first
paragraph of this covenant, B&G Foods will be permitted, in its sole discretion, to classify the Restricted Payment, or later reclassify the Restricted Payment, in any manner that complies with this
covenant.
Incurrence of Indebtedness and Issuance of Preferred Stock
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise, (collectively, "incur") with respect to any Indebtedness (including
Acquired Debt), and B&G Foods will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided,
however, that B&G Foods may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Guarantors may incur Indebtedness (including Acquired Debt) or
issue preferred stock, if the Fixed Charge Coverage Ratio for B&G Foods' most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the
date on which such additional Indebtedness is incurred or such Disqualified Stock or such preferred stock is issued, as the case may be, would have been at least 2.0 to 1.0, determined on a pro forma
basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Disqualified Stock or the preferred stock had been issued, as the
case may be, at the beginning of such four-quarter period.
The
first paragraph of this covenant will not prohibit the incurrence of any of the following items of Indebtedness (collectively, "Permitted
Debt"):
(1) the
incurrence by B&G Foods and any of its Restricted Subsidiaries of Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any
one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of B&G Foods and its Restricted Subsidiaries
thereunder)
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not
to exceed the greater of (x) $200.0 million and (y) the amount of the Borrowing Base as of the date of such incurrence;
(2) the
incurrence by B&G Foods and its Restricted Subsidiaries of the Existing Indebtedness;
(3) the
incurrence by B&G Foods and the Guarantors of Indebtedness represented by the notes and the related Note Guarantees to be issued on the date of the indenture;
(4) the
incurrence by B&G Foods or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money
obligations, in each case incurred for the purpose of financing all or any part of the purchase price or cost of design, construction, installation or improvement of property, plant or equipment used
in the business of B&G Foods or any of its Restricted Subsidiaries (whether through the direct purchase of assets or the Equity Interests of any Person owning such assets), in an aggregate principal
amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (4), not to exceed
the greater of (i) 4.0% of Total Assets or (ii) $125.0 million at any time outstanding;
(5) the
incurrence by B&G Foods or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew,
refund, refinance, replace, defease or discharge any Indebtedness (other than intercompany Indebtedness or the 2025 Senior Notes) that was permitted by the indenture to be incurred under the first
paragraph of this covenant or clauses (2), (3), (4), (5), (16) or (17) of this paragraph;
(6) the
incurrence by B&G Foods or any of its Restricted Subsidiaries of intercompany Indebtedness between or among B&G Foods and any of its Restricted Subsidiaries; provided, however, that:
(a) if
B&G Foods or any Guarantor is the obligor on such Indebtedness and the payee is not B&G Foods or a Guarantor, such Indebtedness must be expressly subordinated to the
prior payment in full in cash of all Obligations then due with respect to the notes, in the case of B&G Foods, or the Note Guarantee, in the case of a Guarantor; and
(b) (i)
any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than B&G Foods or a Restricted Subsidiary
of B&G Foods and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either B&G Foods or a Restricted Subsidiary of B&G Foods, will be deemed, in each case, to
constitute an incurrence of such Indebtedness by B&G Foods or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);
(7) the
issuance by any of B&G Foods' Restricted Subsidiaries to B&G Foods or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however, that:
(a) any
subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than B&G Foods or a Restricted Subsidiary
of B&G Foods; and
(b) any
sale or other transfer of any such preferred stock to a Person that is not either B&G Foods or a Restricted Subsidiary of B&G Foods, will be deemed, in each case, to
constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (7);
(8) the
incurrence by B&G Foods or any of its Restricted Subsidiaries of Hedging Obligations in the ordinary course of business;
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(9) the
guarantee by B&G Foods or any of its Restricted Subsidiaries of Indebtedness of B&G Foods or a Restricted Subsidiary of B&G Foods that was permitted to be incurred
by another provision of this covenant; provided that if the Indebtedness being guaranteed is subordinated to or pari
passu with the notes, then the Guarantee shall be subordinated or pari passu, as applicable, to the same extent as the
Indebtedness guaranteed;
(10) the
incurrence by B&G Foods or any of its Restricted Subsidiaries of Indebtedness in respect of bankers' acceptances, performance, bid and surety bonds and completion
guarantees provided in the ordinary course of business;
(11) the
incurrence by B&G Foods or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft
or similar instrument inadvertently drawn against insufficient funds in the ordinary course of business;
(12) the
incurrence of Indebtedness arising from agreements of B&G Foods or any of its Restricted Subsidiaries providing for indemnification, adjustment of purchase price or
similar obligations, in each case, incurred in connection with the disposition of any business, assets or a Restricted Subsidiary, other than the Guarantees of Indebtedness incurred by any Person
acquiring all or any portion of such business, assets or a Restricted Subsidiary for the purpose of financing such acquisition; provided, however, that
the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the Fair Market Value of such non-cash proceeds being
measured at the time received and without giving effect to any subsequent changes in value) actually received by B&G Foods and Restricted Subsidiaries in connection with such disposition;
(13) the
incurrence of Indebtedness owed to any Person in connection with worker's compensation, self-insurance, health, disability or other employee benefits or property,
casualty or liability insurance provided by such Person to B&G Foods or any of its Restricted Subsidiaries, pursuant to reimbursement or indemnification obligations to such Person, in each case
incurred in the ordinary course of business and consistent with past practices;
(14) pledges,
deposits or payments made or given in the ordinary course of business in connection with or to secure statutory, regulatory or similar obligations, including
obligations under health, safety or environmental obligations, or arising from guarantees to suppliers, lessors, licenses, contractors, franchisees or customers of obligations, other than
Indebtedness, made in the ordinary course of business;
(15) the
incurrence of Indebtedness by B&G Foods or any of its Restricted Subsidiaries issued to directors, officers or employees of B&G Foods or any of its Restricted
Subsidiaries in connection with the redemption or purchase of Capital Stock that, by its terms, is subordinated to the notes, is not secured by any assets of B&G Foods or any of its Restricted
Subsidiaries and does not require cash payments prior to the Stated Maturity of the notes, in an aggregate principal amount at any time outstanding not to exceed $5.0 million;
(16) the
incurrence of Indebtedness by B&G Foods or any Restricted Subsidiary to finance the acquisition (including, without limitation, by way of a merger) of Capital Stock
of any Person engaged in, or assets used or useful in, a Permitted Business; provided that the Fixed Charge Coverage Ratio for B&G Foods' most recently
ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such Indebtedness is incurred would have been at least 1.75 to 1.0,
determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the Indebtedness had been incurred at the beginning of such four-quarter period; and
(17) the
incurrence by B&G Foods or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable) at any
time
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outstanding,
including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (17), not to
exceed the greater of (i) 4.0% of Total Assets or (ii) $125.0 million.
B&G
Foods will not incur, and will not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other
Indebtedness of B&G Foods or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the notes and the applicable Note Guarantee on substantially identical
terms; provided, however, that no Indebtedness will be deemed to be contractually subordinated in right of payment to any other Indebtedness of B&G
Foods solely by virtue of being unsecured or by virtue of being secured on a first or junior priority basis.
For
purposes of determining compliance with this "Incurrence of Indebtedness and Issuance of Preferred Stock" covenant, in the event that an item of proposed Indebtedness meets the
criteria of more than one of the categories of Permitted Debt described in clauses (1) through (17) above, or is entitled to be incurred pursuant to the first paragraph of this covenant,
B&G Foods will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with
this covenant. Indebtedness under Credit Facilities outstanding on the date on which notes are first issued and authenticated under the indenture will initially be deemed Existing Indebtedness. The
accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the
reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of
Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant. Notwithstanding any other provision of this covenant, the
maximum amount of Indebtedness that B&G Foods or any Restricted Subsidiary may incur pursuant to this covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates
or currency values.
The
amount of any Indebtedness outstanding as of any date will be:
(1) the
accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;
(2) the
principal amount of the Indebtedness, in the case of any other Indebtedness; and
(3) in
respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:
(a) the
Fair Market Value of such assets at the date of determination; and
(b) the
amount of the Indebtedness of the other Person.
Liens
B&G Foods will not, and will not permit any Guarantor to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind
(other than Permitted Liens) to secure Indebtedness of any kind on any asset now owned or hereafter acquired, unless all payments due under the indenture and the notes are secured on an equal and
ratable basis with the obligations so secured (or, if such obligations are subordinated by their terms to the notes or the Note Guarantees, prior to the obligations so secured) until such time as such
obligations are no longer secured by a Lien.
Any
Lien created for the benefit of the holders of the notes pursuant to the preceding paragraph shall provide by its terms that such Lien shall be automatically and unconditionally
released and discharged upon the release and discharge of the Lien that gave rise to the obligation to so secure the notes or the Note Guarantees.
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Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:
(1) pay
dividends or make any other distributions on its Capital Stock to B&G Foods or any of its Restricted Subsidiaries, or with respect to any other interest or
participation in, or measured by, its profits, or pay any Indebtedness owed to B&G Foods or any of its Restricted Subsidiaries;
(2) make
loans or advances to B&G Foods or any of its Restricted Subsidiaries; or
(3) transfer
any of its properties or assets to B&G Foods or any of its Restricted Subsidiaries.
However,
the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of:
(1) agreements
governing Existing Indebtedness and any other agreement, including the Credit Agreement and the 2025 Senior Notes Indenture, as in effect on the date of the
indenture and any amendments, restatements, modifications, renewals, increases, supplements, refundings, replacements or refinancings of those agreements; provided that the amendments, restatements,
modifications, renewals, increases, supplements, refundings, replacements or refinancings are not materially
more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in those agreements on the date of the indenture;
(2) the
indenture, the notes and the Note Guarantees;
(3) applicable
law, rule, regulation or order;
(4) any
instrument governing Indebtedness or Capital Stock of a Person acquired by B&G Foods or any of its Restricted Subsidiaries as in effect at the time of such
acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any
Person, or the properties or assets of any
Person, other than the Person, or the property or assets of the Person, so acquired; provided that, in the case of Indebtedness, such Indebtedness was
permitted by the terms of the indenture to be incurred;
(5) customary
non-assignment provisions in contracts, licenses and other commercial agreements entered into in the ordinary course of business;
(6) purchase
money obligations for property acquired in the ordinary course of business and Capital Lease Obligations that impose restrictions on the property purchased or
leased of the nature described in clause (3) of the preceding paragraph;
(7) any
agreement for the sale or other disposition of all or substantially all of the Capital Stock or assets of a Restricted Subsidiary that restricts distributions by
that Restricted Subsidiary pending its sale or other disposition;
(8) Permitted
Refinancing Indebtedness; provided that the encumbrances or restrictions contained in the agreements governing
such Permitted Refinancing Indebtedness are, in the good faith judgment of the senior management or Board of Directors of B&G Foods, not materially more restrictive, taken as a whole, than those
contained in the agreements governing the Indebtedness being refinanced;
(9) any
restriction on the transfer of assets under any Lien permitted under the indenture imposed by the holder of the Lien;
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(10) provisions
limiting the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, sale-leaseback agreements, stock sale
agreements and other similar agreements entered into in the ordinary course of business or with the approval of B&G Foods' Board of Directors, which limitation is applicable only to the assets that
are the subject of such agreements;
(11) restrictions
on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;
(12) any
other agreement governing Indebtedness incurred after the date of the indenture that contains encumbrances or other restrictions that are, in the good faith
judgment of B&G Foods, no more restrictive in any material respect taken as a whole than those encumbrances and other restrictions that are customary in comparable financings.
Merger, Consolidation or Sale of Assets
B&G Foods will not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not B&G Foods is the
surviving entity); or (2) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets (such amounts to be computed on a consolidated basis) of
B&G Foods and its Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person, unless:
(1) either:
(a) B&G Foods is the surviving corporation; or (b) the Person formed by or surviving any such consolidation or merger (if other than B&G Foods) or
to which such sale, assignment, transfer, conveyance or other disposition has been made is either (i) a corporation organized or existing under the laws of the United States, any state of the
United States or the District of Columbia or (ii) a partnership or limited liability company organized or existing under the laws of the United States, any state of the United States or the
District of Columbia that has at least one Restricted Subsidiary that is a corporation organized or existing under the laws of the United States, any state of the United States or the District of
Columbia, which corporation becomes the co-issuer of the notes pursuant to a supplemental indenture reasonably satisfactory to the trustee;
(2) the
Person formed by or surviving any such consolidation or merger (if other than B&G Foods) or the Person to which such sale, assignment, transfer, conveyance or other
disposition has been made assumes all the obligations of B&G Foods under the notes and the indenture pursuant to agreements reasonably satisfactory to the trustee;
(3) immediately
after such transaction, no Default or Event of Default exists; and
(4) B&G
Foods or the Person formed by or surviving any such consolidation or merger (if other than B&G Foods), or to which such sale, assignment, transfer, conveyance or
other disposition has been made would, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the
applicable four-quarter period, either:
(a) be
permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant
described above under the caption "Incurrence of Indebtedness and Issuance of Preferred Stock"; or
(b) have
a Fixed Charge Coverage Ratio that is equal to or greater than the Fixed Charge Coverage Ratio of B&G Foods immediately prior to such consolidation, merger, sale,
assignment, transfer, conveyance or other disposition.
In
addition, B&G Foods will not, directly or indirectly, lease all or substantially all of the properties and assets of it and its Restricted Subsidiaries taken as a whole, in one or
more related
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transactions,
to any other Person, other than in compliance with this "Merger, Consolidation or Sale of Assets" covenant.
This
"Merger, Consolidation or Sale of Assets" covenant will not apply to:
(1) a
merger of B&G Foods with an Affiliate solely for the purpose of reincorporating B&G Foods in another jurisdiction; or
(2) any
consolidation or merger, or any sale, assignment, transfer, conveyance, lease or other disposition of assets between or among B&G Foods and its Restricted
Subsidiaries.
Transactions with Affiliates
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, on or after the date of the indenture, make any payment to, or
sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement,
understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate of B&G Foods (each, an "Affiliate Transaction") involving aggregate consideration in excess of $5.0 million, unless:
(1) the
Affiliate Transaction is on terms that are not materially less favorable to B&G Foods or the relevant Restricted Subsidiary than those that would have been obtained
in a comparable transaction by B&G Foods or such Restricted Subsidiary with a Person that is not an Affiliate of B&G Foods; and
(2) B&G
Foods delivers to the trustee:
(a) with
respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $25.0 million, a resolution
of the Board of Directors of B&G Foods set forth in an Officers' Certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate Transaction has been
approved by a majority of the disinterested members of the Board of Directors of B&G Foods or, if none, a disinterested representative appointed by the Board of Directors for such purpose; and
(b) with
respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $50.0 million, an opinion as
to the fairness to B&G Foods or such Subsidiary of such Affiliate Transaction from a financial point of view or that such Affiliate Transaction is not less favorable to B&G Foods and its Restricted
Subsidiaries than could reasonably be expected to be obtained in a comparable transaction with a Person that is not an Affiliate of B&G Foods, as issued by an accounting, appraisal or investment
banking firm of national standing.
The
following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of the prior paragraph:
(1) any
employment agreement, officer or director indemnification agreement or any similar arrangement entered into by B&G Foods or any of its Restricted Subsidiaries in the
ordinary course of business and payments pursuant thereto;
(2) transactions
between or among B&G Foods and/or its Restricted Subsidiaries;
(3) transactions
with a Person (other than an Unrestricted Subsidiary of B&G Foods) that is an Affiliate of B&G Foods solely because B&G Foods owns, directly or through a
Restricted Subsidiary, an Equity Interest in, or controls, such Person;
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(4) fees
and compensation paid to officers and employees of B&G Foods or any Restricted Subsidiaries, to the extent such fees and compensation are reasonable and customary,
and payment of reasonable directors' fees to Persons who are not otherwise Affiliates of B&G Foods;
(5) any
issuance or sale of Equity Interests (other than Disqualified Stock) of B&G Foods to Affiliates, employees, officers and directors of B&G Foods or any of its
Restricted Subsidiaries;
(6) Restricted
Payments that are permitted by the provisions of the indenture described above under the caption "Restricted Payments";
(7) maintenance
in the ordinary course of business of customary benefit programs or arrangements for employees, officers or directors, including vacation plans, health and
life insurance plans, deferred compensation plans and retirement or savings plans and similar plans;
(8) loans
or advances to employees that are permitted by the provisions of the indenture under the definition of "Permitted Investments";
(9) any
agreement as in effect and entered into as of the date of the indenture, or any amendment thereto or any transaction contemplated thereby (including pursuant to any
amendment thereto) in any replacement agreement thereto so long as any such amendment or replacement agreement is not more disadvantageous to the holders of the notes in any material respect than the
original agreement as in effect on the date of the indenture;
(10) any
transaction or series of transactions between B&G Foods or any Restricted Subsidiary and any of their Joint Ventures; provided that (a) such transaction or series of transactions is in the
ordinary course of business between B&G Foods or such Restricted
Subsidiary and such Joint Venture and (b) with respect to any such Affiliate Transaction involving aggregate consideration in excess of $25.0 million, such Affiliate Transaction complies
with clause (1) of the preceding paragraph and such Affiliate Transaction has been approved by the Board of Directors of B&G Foods; and
(11) any
service, purchase, lease, supply or similar agreement entered into in the ordinary course of business between B&G Foods or any Restricted Subsidiary and any
Affiliate that is a customer, client,
supplier or purchaser or seller of goods or services, so long as the senior management or Board of Directors of B&G Foods determines in good faith that any such agreement is on terms not materially
less favorable to B&G Foods or such Restricted Subsidiary than those that could be obtained in a comparable arms'-length transaction with an entity that is not an Affiliate.
Business Activities
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, engage in any business other than Permitted Businesses, except to
such extent as would not be material to B&G Foods and its Restricted Subsidiaries taken as a whole, as reasonably determined in good faith by the Board of Directors of B&G Foods.
Additional Note Guarantees
If B&G Foods or any of its Restricted Subsidiaries acquires or creates another Domestic Subsidiary after the date of the indenture, then that
newly acquired or created Domestic Subsidiary will become a Guarantor and execute a supplemental indenture and deliver an opinion of counsel (subject to customary assumptions and exceptions)
satisfactory to the trustee within 10 business days of the date on which it was acquired or created; provided that any Domestic Subsidiary that
constitutes an Immaterial Subsidiary need not become a Guarantor until such time as it ceases to be an Immaterial Subsidiary.
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Designation of Restricted and Unrestricted Subsidiaries
The Board of Directors of B&G Foods may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause
a Default. If a Restricted
Subsidiary is designated as an Unrestricted Subsidiary the aggregate Fair Market Value of all outstanding Investments owned by B&G Foods and its Restricted Subsidiaries in the Subsidiary designated as
Unrestricted will be deemed to be an Investment made as of the time of the designation and will reduce the amount available for Restricted Payments under the covenant described above under the caption
"Restricted Payments" or under the definition of Permitted Investments, as determined by B&G Foods. That designation will only be permitted if the Investment would be permitted at that
time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. The Board of Directors of B&G Foods may redesignate any Unrestricted Subsidiary to be a Restricted
Subsidiary if that redesignation would not cause a Default.
Any
designation of a Subsidiary of B&G Foods as an Unrestricted Subsidiary will be evidenced to the trustee by filing with the trustee a certified copy of a resolution of the Board of
Directors giving effect to such designation and an Officers' Certificate certifying that such designation complied with the preceding conditions and was permitted by the covenant described above under
the caption "Restricted Payments." If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be
an Unrestricted Subsidiary for purposes of the indenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of B&G Foods as of such date and, if such
Indebtedness is not permitted to be incurred as of such date under the covenant described under the caption "Incurrence of Indebtedness and Issuance of Preferred Stock," B&G Foods will be
in default of such covenant. The Board of Directors of B&G Foods may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary of B&G Foods; provided that such designation
will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of B&G Foods of any outstanding
Indebtedness of such Unrestricted Subsidiary, and such designation will only be permitted if (1) such Indebtedness is permitted under the covenant described under the caption
"Incurrence of Indebtedness and Issuance of Preferred Stock," calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period;
and (2) no Default or Event of Default would result following such designation.
Limitation on Sale and Leaseback Transactions
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction; provided
that B&G Foods or any Guarantor may enter into a sale and leaseback transaction if:
(1) B&G
Foods or that Guarantor, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback
transaction under the Fixed Charge Coverage Ratio test in the first paragraph of the covenant described above under the caption "Incurrence of Indebtedness and Issuance of Preferred
Stock" and
(a) incurred
a Lien to secure such Indebtedness pursuant to the covenant described above under the caption "Liens";
(2) the
gross cash proceeds of that sale and leaseback transaction are at least equal to the Fair Market Value of the property that is the subject of that sale and leaseback
transaction; and
(3) the
transfer of assets in that sale and leaseback transaction is permitted by, and B&G Foods applies the proceeds of such transaction in compliance with, the covenant
described above under the caption "Repurchase at the Option of HoldersAsset Sales."
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Effectiveness of Covenants
If after the date of the indenture, (1) the notes have an Investment Grade Rating from two of the Rating Agencies and (2) no
Default has occurred and is continuing under this Indenture, then, B&G Foods and its Restricted Subsidiaries will not be subject to the provisions of the Indenture summarized under the following
headings (collectively, the "Suspended Covenants" and such date shall be the "Suspension
Date"):
-
-
"Change of Control," "Asset Sales," "Restricted Payments,"
-
-
"Incurrence of Indebtedness and Issuance of Preferred Stock,"
-
-
Clause (4) of the first paragraph of "Merger, Consolidation or Sale of Assets," "Transactions with
Affiliates," and "Dividend and other Payment Restrictions affecting Restricted Subsidiaries."
If
at any time the notes' credit rating is downgraded from an Investment Grade Rating by any Rating Agency, then the Suspended Covenants will thereafter be reinstated with respect to
future events (the "Reinstatement Date"), unless and until the notes subsequently attain an Investment Grade Rating from two of the Ratings Agencies and
no Default or Event of Default is in existence (in which event the Suspended Covenants shall no longer be in effect for such time that the notes maintain an Investment Grade Rating from two of the
Ratings Agencies and no Default or Event of Default is in existence); provided, however, that no Default, Event of Default or breach of any kind shall
be deemed to exist under the Indenture, the notes or the Guarantees with respect to the Suspended Covenants based on, and none of B&G Foods or any of its Subsidiaries shall bear any liability for, any
actions taken or events occurring during the Suspension Period (as defined below), or any actions taken at any time pursuant to any contractual obligation arising prior to the Reinstatement Date,
regardless of whether such actions or events would have been permitted if the applicable Suspended Covenants remained in effect during such period. The period of time between the date of suspension of
the covenants and the Reinstatement Date is referred to as the "Suspension Period." B&G Foods will notify the trustee of the commencement or termination of any Suspension Period.
In
the event of any reinstatement, all Indebtedness Incurred during the Suspension Period will be classified to have been Incurred pursuant to clause (2) of the second paragraph
of "Incurrence of Indebtedness and Issuance of Preferred Stock" and all Restricted Payments made after such reinstatement will be calculated as though the limitations contained in
"Restricted Payments" had been in effect prior to, but not during, the Suspension Period.
For
purposes of the "Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries" covenant, on the Reinstatement Date, any consensual encumbrances or
restrictions of the type specified in clause (1), (2) or (3) of that covenant entered into during the Suspension Period will be deemed to have been in effect on the date of the
Indenture, so that they are permitted under clause (1) of the second paragraph under "Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries."
For
purposes of the "Transactions with Affiliates" covenant, any Affiliate Transaction (as defined below) entered into after the Reinstatement Date pursuant to a contract, agreement,
loan, advance or guaranty with, or for the benefit of, any Affiliate of the Issuer entered into during the Suspension Period will be deemed to have been in effect as of the date of the Indenture for
purposes of clause (6) under "Transactions with Affiliates."
During
any period when the Suspended Covenants are suspended, the Board of Directors of the Issuer may not designate any of the Issuer's Subsidiaries as Unrestricted Subsidiaries
pursuant to the Indenture.
There
can be no assurance that the notes will ever achieve or maintain Investment Grade Ratings.
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Payments for Consent
B&G Foods will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration
to or for the benefit of any holder of notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of the indenture or the notes unless such consideration is
offered to be paid and is paid to all holders of the notes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or
agreement.
Reports
Whether or not required by the rules and regulations of the SEC, so long as any notes are outstanding, B&G Foods will furnish to the holders of
notes or cause the trustee to furnish to the holders of notes, within the time periods specified in the SEC's rules and regulations:
(1) all
quarterly and annual reports that would be required to be filed with the SEC on Forms 10-Q and 10-K if B&G Foods were required to file such reports; and
(2) all
current reports that would be required to be filed with the SEC on Form 8-K if B&G Foods were required to file such reports; provided,
however, that the availability of the foregoing materials on the SEC's EDGAR service or on B&G Foods' website shall be deemed to satisfy B&G Foods' delivery obligations
hereunder.
All
such reports will be prepared in all material respects in accordance with all of the rules and regulations applicable to such reports. Each annual report on Form 10-K will
include a report on B&G Foods' consolidated financial statements by B&G Foods' independent registered public accounting firm. In addition, B&G Foods will file a copy of each of the reports
referred to in clauses (1) and (2) above with the SEC for public availability within the time periods specified in the rules and regulations applicable to such reports (unless the SEC
will not accept such a filing) and will make such information available to securities analysts and prospective investors upon request.
If
at any time B&G Foods is no longer subject to the periodic reporting requirements of the Exchange Act for any reason, B&G Foods will nevertheless continue filing the reports specified
in the preceding paragraphs of this covenant with the SEC within the time periods specified above unless the SEC will not accept such a filing. B&G Foods will not take any action for the purpose of
causing the SEC not to accept any such filings. If, notwithstanding the foregoing, the SEC will not accept B&G Foods' filings for any reason, B&G Foods will post the reports referred to in the
preceding paragraphs on its website within the time periods that would apply if B&G Foods were required to file those reports with the SEC.
If
B&G Foods has designated any of its Subsidiaries as Unrestricted Subsidiaries, then the quarterly and annual financial information required by the preceding paragraphs will include a
reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, and in Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial condition and results of operations of B&G Foods and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted
Subsidiaries of B&G Foods.
In
addition, B&G Foods and the Guarantors agree that, for so long as any notes remain outstanding, if at any time they are not required to file the reports required by the preceding
paragraphs, they will furnish to the holders of notes and to securities analysts and prospective investors, upon their request, the information required to be delivered pursuant to
Rule 144A(d)(4) under the Securities Act.
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Events of Default and Remedies
Each of the following will be an "Event of Default" under the indenture:
(1) default
for 30 consecutive days in the payment when due of interest on the notes;
(2) default
in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the notes;
(3) failure
by B&G Foods or any of its Restricted Subsidiaries for 60 days after written notice to B&G Foods by the trustee or the holders of at least 25% in
aggregate principal amount of the notes then outstanding voting as a single class to comply with any of the agreements in the indenture;
(4) default
under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by
B&G Foods or any of its Restricted Subsidiaries (or the payment of which is guaranteed by B&G Foods or any of its Restricted Subsidiaries), whether such Indebtedness or Guarantee now exists, or is
created after the date of the indenture, if that default:
(a) is
caused by a failure to pay principal of, or interest or premium, if any, on, such Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "Payment Default"); or
(b) results
in the acceleration of such Indebtedness prior to its express maturity,
and,
in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the
maturity of which has been so accelerated, aggregates $20.0 million or more;
(5) failure
by B&G Foods or any of its Restricted Subsidiaries to pay final judgments entered by a court or courts of competent jurisdiction aggregating in excess of
$20.0 million (net of any amount covered by insurance from an insurer that has not denied liability therefor), which judgments are not paid, discharged or stayed for a period of 60 days
after their entry;
(6) except
as permitted by the indenture, any Note Guarantee is held in any judicial proceeding to be unenforceable or invalid or ceases for any reason to be in full force
and effect, or any Guarantor, or any Person acting on behalf of any Guarantor, denies or disaffirms its obligations under its Note Guarantee; and
(7) certain
events of bankruptcy or insolvency described in the indenture with respect to B&G Foods or any of its Restricted Subsidiaries that is a Significant Subsidiary or
any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary.
In
the case of an Event of Default arising from certain events of bankruptcy or insolvency, with respect to B&G Foods, any Restricted Subsidiary of B&G Foods that is a Significant
Subsidiary or any group of Restricted Subsidiaries of B&G Foods that, taken together, would constitute a Significant Subsidiary, all outstanding notes will become due and payable immediately without
further action or notice. If any other Event of Default occurs and is continuing, the trustee or the holders of at least 25% in aggregate principal amount of the then outstanding notes may declare all
the notes to be due and payable immediately.
Holders
of the notes may not enforce the indenture or the notes except as provided in the indenture. Subject to certain limitations, holders of a majority in aggregate principal amount
of the then outstanding notes may direct the trustee in its exercise of any trust or power. The trustee may withhold from holders of the notes notice of any continuing Default or Event of Default if
it
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determines
that withholding notice is in their interest, except a Default or Event of Default relating to the payment of principal, interest or premium, if any.
Subject
to the provisions of the indenture relating to the duties of the trustee, in case an Event of Default occurs and is continuing, the trustee will be under no obligation to
exercise any of the rights or powers under the indenture at the request or direction of any holders of notes unless such holders have offered to the trustee indemnity or security satisfactory to it
against any loss, liability or expense.
Except
to enforce the right to receive payment of principal, premium, if any, or interest, if any, when due, no holder of a note may pursue any remedy with respect to the indenture or
the notes unless:
(1) such
holder has previously given the trustee notice that an Event of Default is continuing;
(2) holders
of at least 25% in aggregate principal amount of the then outstanding notes have requested the trustee to pursue the remedy;
(3) such
holders have offered the trustee security or indemnity satisfactory to it against any loss, liability or expense;
(4) the
trustee has not complied with such request within 60 days after the receipt of the request and the offer of security or indemnity; and
(5) holders
of a majority in aggregate principal amount of the then outstanding notes have not given the trustee a direction inconsistent with such request within such
60-day period.
The
holders of a majority in aggregate principal amount of the then outstanding notes by notice to the trustee may, on behalf of the holders of all of the notes, rescind an acceleration
or waive any existing Default or Event of Default and its consequences under the indenture except a continuing Default or Event of Default in the payment of interest or premium, if any, on, or the
principal of, the notes. In the event of any Event of Default specified in clause (4) above, such Event of Default and all consequences thereof (excluding any resulting payment default, other
than as a result of acceleration of the notes) shall be annulled, waived and rescinded, automatically and without any action by the trustee
or the holders, if within 30 days (or such longer period as may be provided for cure of the default in the agreement under which such default may arise) after such Event of Default arose:
(1) the
Indebtedness or guarantee that is the basis for such Event of Default has been discharged;
(2) holders
thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default; or
(3) the
default that is the basis for such Event of Default has been cured.
B&G
Foods is required to deliver to the trustee annually a statement regarding compliance with the indenture. Upon becoming aware of any Default or Event of Default, B&G Foods is
required to deliver to the trustee a statement specifying such Default or Event of Default.
No Personal Liability of Directors, Officers, Employees, Affiliates and Stockholders
No past, present or future director, officer, employee, direct or indirect incorporator, Affiliate, stockholder or controlling Person, of B&G
Foods or any Guarantor, as such, or any successor entity, will have any liability for any obligations of B&G Foods or the Guarantors under the notes, the indenture, the Note Guarantees or for any
claim based on, in respect of, or by reason of, such obligations or their creation. Each holder of notes by accepting a note waives and releases all such liability. The waiver and release are part of
the consideration for issuance of the notes. The waiver may not be effective to waive liabilities under the federal securities laws.
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Legal Defeasance and Covenant Defeasance
B&G Foods may at its option and at any time, elect to have all of its obligations discharged with respect to the outstanding notes and all
obligations of the Guarantors discharged with respect to their Note Guarantees ("Legal Defeasance"). If Legal Defeasance occurs, B&G Foods and the
Guarantors will be deemed to have paid and discharged all amounts owed under the notes and the Note Guarantees, and the indenture will cease to be of further effect as to the notes and Note
Guarantees, except for:
(1) the
rights of holders of outstanding notes to receive payments in respect of the principal of, or interest or premium, if any, on, such notes when such payments are due
from the trust referred to below;
(2) B&G
Foods' obligations with respect to the notes concerning issuing temporary notes, registration of notes, mutilated, destroyed, lost or stolen notes and the
maintenance of an office or agency for payment and money for security payments held in trust;
(3) the
rights, powers, trusts, duties and immunities of the trustee, and B&G Foods' and the Guarantors' obligations in connection therewith; and
(4) the
Legal Defeasance provisions of the indenture.
In
addition, B&G Foods may, at its option and at any time, elect to have the obligations of B&G Foods and the Guarantors released with respect to certain covenants (including its
obligation to make Change of Control Offers and Asset Sale Offers) that are described in the indenture ("Covenant Defeasance") and thereafter any
omission to comply with those covenants will not constitute a Default or Event of Default with respect to the notes. In the event Covenant Defeasance occurs, certain events (not including non-payment,
bankruptcy, receivership, rehabilitation and insolvency events) described under "Events of Default and Remedies" will no longer constitute an Event of Default with respect to the notes.
In
order to exercise either Legal Defeasance or Covenant Defeasance:
(1) B&G
Foods must irrevocably deposit with the trustee, in trust, for the benefit of the holders of the notes, cash in U.S. dollars, non-callable Government Securities, or
a combination of cash in U.S.
dollars and non-callable Government Securities, in amounts as will be sufficient, in the opinion of a nationally recognized investment bank, appraisal firm or independent registered public accounting
firm, to pay the principal of, or interest and premium, if any, on, the outstanding notes on the stated date for payment thereof or on the applicable redemption date, as the case may be, and B&G Foods
must specify whether the notes are being defeased to such stated date for payment or to a particular redemption date;
(2) in
the case of Legal Defeasance, B&G Foods must deliver to the trustee an opinion of counsel (subject to customary assumptions and exceptions) reasonably acceptable to
the trustee confirming that (a) B&G Foods has received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the date of the indenture, there has been
a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion of counsel (subject to customary assumptions and exceptions) will confirm that, the
holders of the outstanding notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
(3) in
the case of Covenant Defeasance, B&G Foods must deliver to the trustee an opinion of counsel (subject to customary assumptions and exceptions) reasonably acceptable
to the trustee confirming that the holders of the outstanding notes will not recognize income, gain or loss for
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federal
income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case
if such Covenant Defeasance had not occurred;
(4) no
Default or Event of Default has occurred and is continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of funds
to be applied to such deposit and any similar and simultaneous deposit relating to other Indebtedness, and in each case the granting of Liens in connection therewith) and the deposit will not result
in a breach or violation of, or constitute a default under, any other material instrument to which B&G Foods or any Guarantor is a party or by which B&G Foods or any Guarantor is bound;
(5) such
Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under, any material agreement or instrument (other than
the indenture and
agreements governing other Indebtedness being defeased, discharged or replaced) to which B&G Foods or any of its Subsidiaries is a party or by which B&G Foods or any of its Subsidiaries is bound;
(6) B&G
Foods must deliver to the trustee an Officers' Certificate stating that the deposit was not made by B&G Foods with the intent of preferring the holders of notes over
the other creditors of B&G Foods with the intent of defeating, hindering, delaying or defrauding any creditors of B&G Foods or others; and
(7) B&G
Foods must deliver to the trustee an Officers' Certificate and an opinion of counsel (subject to customary assumptions and exceptions), each stating that all
conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.
Amendment, Supplement and Waiver
Except as provided in the next two succeeding paragraphs, the indenture or the notes or the Note Guarantees may be amended, modified or
supplemented with the consent of the holders of at least a majority in aggregate principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with a
purchase of, or tender offer or exchange offer for, notes), and any past or existing Default or Event of Default or compliance with any provision of the indenture or the notes or the Note Guarantees
may be waived with the consent of the holders of a majority in aggregate principal amount of the then outstanding notes (including, without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, notes).
Without
the consent of each holder of notes affected, an amendment, modification, supplement or waiver may not (with respect to any notes held by a non-consenting holder):
(1) reduce
the principal amount of notes whose holders must consent to an amendment, supplement or waiver;
(2) reduce
the principal of or change the fixed maturity of any note or alter the provisions with respect to the redemption of the notes (other than provisions relating to
the covenants described above under the caption "Repurchase at the Option of Holders");
(3) reduce
the rate of or change the time for payment of interest, including default interest, on any note;
(4) waive
a Default or Event of Default in the payment of principal of, or interest or premium, if any, on, the notes (except a rescission of acceleration of the notes by
the holders of at least a majority in aggregate principal amount of the then outstanding notes and a waiver of the payment default that resulted from such acceleration);
(5) make
any note payable in money other than that stated in the notes;
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(6) make
any change in the provisions of the indenture relating to waivers of past Defaults or the rights of holders of notes to receive payments of principal of, or
interest or premium, if any, on, the notes;
(7) waive
a redemption payment with respect to any note (other than a payment required by one of the covenants described above under the caption "Repurchase at
the Option of Holders");
(8) release
any Guarantor from any of its obligations under its Note Guarantee or the indenture, except in accordance with the terms of the indenture; or
(9) make
any change in the preceding amendment, supplement and waiver provisions that requires each holder's consent.
The
consent of the holders of notes is not necessary under the indenture to approve the particular form of any proposed amendment. It is sufficient if such consent approves the substance
of the proposed amendment.
After
an amendment under the indenture becomes effective, B&G Foods is required to mail to holders of notes a notice briefly describing such amendment. However, the failure to
give such notice to all holders of notes, or any defect therein, will not impair or affect the validity of the amendment.
Notwithstanding
the preceding, without the consent of any holder of notes, B&G Foods, the Guarantors and the trustee may amend, modify or supplement the indenture or the notes or the
Note Guarantees:
(1) to
cure any ambiguity, omission, defect or inconsistency;
(2) to
provide for uncertificated notes in addition to or in place of certificated notes;
(3) to
provide for the assumption of B&G Foods' or a Guarantor's obligations to holders of notes and Note Guarantees in the case of a merger or consolidation or sale of all
or substantially all of B&G Foods' or such Guarantor's assets, as applicable;
(4) to
make any change that would provide any additional rights or benefits to the holders of notes or that does not adversely affect the legal rights under the indenture,
the notes or the Note Guarantees of any such holder;
(5) to
comply with requirements of the SEC in order to effect or maintain the qualification of the indenture under the Trust Indenture Act;
(6) to
conform the text of the indenture, the Note Guarantees or the notes to any provision of this Description of Notes to the extent that such provision in this
Description of Notes was intended to be a verbatim recitation of a provision of the indenture, the Note Guarantees or the notes, which intent may be evidenced by an Officers' Certificate to that
effect;
(7) to
provide for the issuance of Additional Notes in accordance with the limitations set forth in the indenture as of the date of the indenture;
(8) to
comply with the provisions of DTC or the trustee with respect to the provisions of the indenture and the notes relating to transfers and exchanges of notes or
beneficial interests in the notes; or
(9) to
evidence the release of any Guarantor permitted to be released under the terms of the indenture or to allow any Guarantor to execute a supplemental indenture and/or a
Note Guarantee with respect to the Notes.
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Satisfaction and Discharge
The indenture will be discharged and will cease to be of further effect as to all notes issued thereunder, when:
(1) either:
(a) all
notes that have been authenticated, except lost, stolen or destroyed notes that have been replaced or paid and notes for whose payment money has been deposited in
trust or segregated and held in trust by B&G Foods or any Guarantor and thereafter repaid to B&G Foods or discharged from their trust, have been delivered to the trustee for cancellation; or
(b) all
notes that have not been delivered to the trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or
will become due and payable within one year and B&G Foods or any Guarantor has irrevocably deposited or caused to be deposited with the trustee as trust funds in trust solely for the benefit of the
holders, cash in U.S. dollars, non-callable Government Securities, or a combination of cash in U.S. dollars and non-callable Government Securities, in amounts as will be sufficient, without
consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the notes not delivered to the trustee for cancellation for principal, premium, if any, and accrued
interest to the date of maturity or redemption;
(2) no
Default or Event of Default has occurred and is continuing on the date of the deposit (other than a Default or Event of Default resulting from the borrowing of funds
to be applied to such deposit) and the deposit will not result in a breach or violation of, or constitute a default under, any other material instrument to which B&G Foods or any Guarantor is a party
or by which B&G Foods or any Guarantor is bound;
(3) B&G
Foods or any Guarantor has paid or caused to be paid all sums payable by it under the indenture; and
(4) B&G
Foods has delivered irrevocable instructions to the trustee under the indenture to apply the deposited money toward the payment of the notes at maturity or on the
redemption date, as the case may be.
In
addition, B&G Foods must deliver an Officers' Certificate and an opinion of counsel (subject to customary assumptions and exceptions) to the trustee stating that all conditions
precedent to satisfaction and discharge have been satisfied.
Concerning the Trustee
If the trustee becomes a creditor of B&G Foods or any Guarantor, the indenture limits the right of the trustee to obtain payment of claims in
certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The trustee will be permitted to engage in other transactions; however, if it acquires
any conflicting interest it must eliminate such conflict within 90 days, apply to the SEC for permission to continue as trustee (if the indenture has been qualified under the Trust Indenture
Act) or resign.
The
holders of a majority in aggregate principal amount of the then outstanding notes will have the right to direct the time, method and place of conducting any proceeding for exercising
any remedy available to the trustee, subject to certain exceptions. The indenture provides that in case an Event of Default occurs and is continuing, the trustee will be required, in the exercise of
its power, to use the degree of care of a prudent man in the conduct of his own affairs. Subject to such provisions, the trustee will be under no obligation to exercise any of its rights or powers
under the indenture at the
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request
of any holder of notes, unless such holder has offered to the trustee security and indemnity satisfactory to it against any loss, liability or expense.
Additional Information
Anyone who receives this prospectus supplement may obtain a copy of each of the Base Indenture and the Tenth Supplemental Indenture without
charge by writing to at B&G Foods, Inc., Four Gatehall Drive, Suite 110, Parsippany, N.J. 07054, Attention: General Counsel.
Book-Entry, Delivery and Form
Except as set forth below, the notes will be issued in registered, global form in minimum denominations of $2,000 and integral multiples of
$1,000 in excess thereof. Notes will be issued at the closing of this offering only against payment in immediately available funds.
The
notes initially will be represented by one or more notes in registered, global form without interest coupons (collectively, the "Global
Notes"). The Global Notes will be deposited upon issuance with the trustee as custodian for The Depository Trust Company
("DTC"), in New York, New York, and registered in the name of DTC or its nominee, in each case, for credit to an account of a direct or indirect
participant in DTC as described below.
Except
as set forth below, the Global Notes may be transferred, in whole but not in part, only to another nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in
the Global Notes may not be exchanged for definitive notes in registered certificated form ("Certificated Notes") except in the limited circumstances
described below. See "Exchange of Global Notes for Certificated Notes." Except in the limited circumstances described below, owners of beneficial interests in the Global Notes will not be
entitled to receive physical delivery of notes in certificated form.
Transfers
of beneficial interests in the Global Notes will be subject to the applicable rules and procedures of DTC and its direct or indirect participants, which may change from time to
time.
Depository Procedures
The following operations and procedures are solely within the control of DTC's settlement system and are subject to changes by it. B&G Foods
takes no responsibility for these operations and procedures and urges investors to contact the system or their participants directly to discuss these matters. However, B&G Foods will remain
responsible for any actions DTC and participants take in accordance with instructions provided by B&G Foods.
DTC
has advised B&G Foods that DTC is a limited-purpose trust company created to hold securities for its participating organizations (collectively, the
"Participants") and to facilitate the clearance and settlement of transactions in those securities between the Participants through electronic
book-entry changes in accounts of its Participants. The Participants include securities brokers and dealers (including the initial purchasers), banks, trust companies, clearing corporations and
certain other organizations. Access to DTC's system is also available to other entities such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with
a Participant, either directly or indirectly (collectively, the "Indirect Participants"). Persons who are not Participants may beneficially own
securities held by or on behalf of DTC only through the Participants or the Indirect Participants. The ownership interests in, and transfers of ownership interests in, each security held by or on
behalf of DTC are recorded on the records of the Participants and Indirect Participants.
DTC
has also advised B&G Foods that, pursuant to procedures established by it:
(1) upon
deposit of the Global Notes, DTC will credit the accounts of the Participants designated by the initial purchasers with portions of the principal amount of the
Global Notes; and
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(2) ownership
of these interests in the Global Notes will be shown on, and the transfer of ownership of these interests will be effected only through, records maintained by
DTC (with respect to the Participants) or by the Participants and the Indirect Participants (with respect to other owners of beneficial interest in the Global Notes).
Investors
who are Participants may hold their interests therein directly through DTC. Investors who are not Participants may hold their interests therein indirectly through organizations
which are Participants.
All interests in a Global Note may be subject to the procedures and requirements of DTC. The laws of some states require that certain Persons take physical delivery in definitive form of securities
that they own. Consequently, the ability to transfer beneficial interests in a Global Note to such Persons will be limited to that extent. Because DTC can act only on behalf of the Participants, which
in turn act on behalf of the Indirect Participants, the ability of a Person having beneficial interests in a Global Note to pledge such interests to Persons that do not participate in the DTC system,
or otherwise take actions in respect of such interests, may be affected by the lack of a physical certificate evidencing such interests.
Except
as described below, owners of interests in the Global Notes will not have notes registered in their names, will not receive physical delivery of notes in certificated form and
will not be considered the registered owners or "holders" thereof under the indenture for any purpose.
Payments
in respect of the principal of, and interest and premium, if any, on, a Global Note registered in the name of DTC or its nominee will be payable to DTC in its capacity as the
registered holder under the indenture. Under the terms of the indenture, B&G Foods and the trustee will treat the Persons in whose names the notes, including the Global Notes, are registered as the
owners of the notes for the purpose of receiving payments and for all other purposes. Consequently, neither B&G Foods, the trustee nor any agent of B&G Foods or the trustee has or will have any
responsibility or liability for:
(1) any
aspect of DTC's records or any Participant's or Indirect Participant's records relating to or payments made on account of beneficial ownership interest in the Global
Notes or for maintaining, supervising or reviewing any of DTC's records or any Participant's or Indirect Participant's records relating to the beneficial ownership interests in the Global Notes; or
(2) any
other matter relating to the actions and practices of DTC or any of its Participants or Indirect Participants.
DTC
has advised B&G Foods that its current practice, upon receipt of any payment in respect of securities such as the notes (including principal and interest), is to credit the accounts
of the relevant Participants with the payment on the payment date unless DTC has reason to believe that it will not receive payment on such payment date. Each relevant Participant is credited with an
amount proportionate to its beneficial ownership of an interest in the principal amount of the relevant security as shown on the records of DTC. Payments by the Participants and the Indirect
Participants to the beneficial owners of notes will be governed by standing instructions and customary practices and will be the responsibility of the Participants or the Indirect Participants and
will not be the responsibility of DTC, the trustee or B&G Foods. Neither B&G Foods nor the trustee will be liable for any delay by DTC or any of the Participants or the Indirect Participants in
identifying the beneficial owners of the notes, and B&G Foods and the trustee may conclusively rely on and will be protected in relying on instructions from DTC or its nominee for all purposes.
Transfers
between the Participants will be effected in accordance with DTC's procedures, and will be settled in same-day funds.
DTC
has advised B&G Foods that it will take any action permitted to be taken by a holder of notes only at the direction of one or more Participants to whose account DTC has credited the
interests in the Global Notes and only in respect of such portion of the aggregate principal amount of the notes as to which such Participant or Participants has or have given such direction. However,
if there is an Event of Default under the notes, DTC reserves the right to exchange the Global Notes for legended notes in certificated form, and to distribute such notes to its Participants.
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Although DTC has agreed to the foregoing procedures to facilitate transfers of interests in the Global Notes among participants in DTC, it is under no obligation
to perform or to continue to perform such procedures, and may discontinue such procedures at any time. Except for actions taken by DTC or its Participants or indirect Participants or their respective
agents in accordance with our instructions, none of B&G Foods, the trustee and any of their respective agents will have any responsibility for the performance by DTC or its participants or indirect
participants of their respective obligations under the rules and procedures governing their operations.
Exchange of Global Notes for Certificated Notes
A Global Note is exchangeable for Certificated Notes if:
(1) DTC
(a) notifies B&G Foods that it is unwilling or unable to continue as depositary for the Global Notes or (b) has ceased to be a clearing agency
registered under the Exchange Act and, in either case, B&G Foods fails to appoint a successor depositary within 120 days after the date of such notice from the depository;
(2) B&G
Foods, at its option, notifies the trustee in writing that it elects to cause the issuance of the Certificated Notes; or
(3) there
has occurred and is continuing a Default or Event of Default with respect to the notes.
In
addition, beneficial interests in a Global Note may be exchanged for Certificated Notes upon prior written notice given to the trustee by or on behalf of DTC in accordance with the
indenture. In all cases, Certificated Notes delivered in exchange for any Global Note or beneficial interests in Global Notes will be registered in the names, and issued in any approved denominations,
requested by or on behalf of the depositary (in accordance with its customary procedures).
Same Day Settlement and Payment
B&G Foods will make, or cause to be made, payments in respect of the notes represented by the Global Notes (including principal, premium, if
any, and interest, if any) by wire transfer of immediately available funds to the accounts specified by DTC or its nominee. B&G Foods will make all payments of principal, interest and premium, if any,
with respect to Certificated Notes by wire transfer of immediately available funds to the accounts specified by the holders of the Certificated Notes or, if no such account is specified, by mailing a
check to each such holder's registered address. The notes represented by the Global Notes are expected to be eligible to trade in DTC's Same-Day Funds Settlement System, and any permitted secondary
market trading activity in such notes will, therefore, be required by DTC to be settled in immediately available funds. B&G Foods expects that secondary trading in any Certificated Notes will also be
settled in immediately available funds.
Certain Definitions
Set forth below are certain defined terms used in the indenture. Reference is made to the indenture for a full disclosure of all defined terms
used therein, as well as any other capitalized terms used herein for which no definition is provided.
"2021 Senior Notes" means B&G Foods 4.625% Senior Notes due 2021.
"2025 Senior Notes" means B&G Foods 5.25% Senior Notes due 2025.
"2025 Senior Notes Indenture" means the indenture relating to the 2025 Senior Notes dated June 4, 2013, as supplemented by a
Seventh Supplemental Indenture dated as of April 3, 2017.
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"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness
of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of such specified Person, whether or not such
Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Restricted Subsidiary of, such specified Person; and
(2) Indebtedness
secured by a Lien encumbering any asset acquired by such specified Person, provided that the amount of
Acquired Debt only at the time so acquired will include the accreted value together with any interest thereon that is more than 30 days past due; provided,
further, that Indebtedness of such other Person that is redeemed, defeased, retired or otherwise repaid at the time, or immediately upon consummation, of the transaction by
which such other Person is merged with or into or became a Restricted Subsidiary of such Person will not be Acquired Debt.
"Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition, "control," as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the Voting Stock of a Person will be deemed to be control. For purposes of this definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.
"Applicable Premium" means, with respect to any note on any redemption date, the greater of:
(1) 1.0%
of the principal amount of the note; or
(2) the
excess of:
(a) the
present value at such redemption date of (i) the redemption price of the note at March 1, 2022, (such redemption price being set forth in the table
appearing above under the caption "Optional Redemption") plus (ii) all required interest payments due on the note through March 1, 2022, (excluding accrued but unpaid
interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over
(b) the
principal amount of the note. "Asset Sale" means:
(3) the
sale, lease, conveyance or other disposition of any assets or rights; provided that the sale, lease, conveyance or
other disposition of all or substantially all of the assets of B&G Foods and its Restricted Subsidiaries taken as a whole will be governed by the provisions of the indenture described above under the
caption "Repurchase at the Option of HoldersChange of Control" and/or the provisions described above under the caption "Certain CovenantsMerger,
Consolidation or Sale of Assets" and not by the provisions of the Asset Sale covenant; and
(4) the
issuance or sale of Equity Interests in any of B&G Foods' Restricted Subsidiaries (other than directors' qualifying shares or shares required by applicable law to be
held by a Person other than B&G Foods or a Restricted Subsidiary).
Notwithstanding
the preceding, none of the following items will be deemed to be an Asset Sale:
(1) any
single transaction or series of related transactions that involves (a) assets having a Fair Market Value of less than $5.0 million or (b) net
proceeds of less than $5.0 million;
(2) a
transfer of assets between or among B&G Foods and its Restricted Subsidiaries;
(3) an
issuance of Equity Interests by a Restricted Subsidiary of B&G Foods to B&G Foods or to a Restricted Subsidiary of B&G Foods;
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(4) the
sale, lease, conveyance or other disposition of products, services, inventory, equipment or accounts receivable in the ordinary course of business, including any
sale or other disposition of damaged, worn-out, obsolete, negligible or surplus assets in the ordinary course of business;
(5) the
sale or other disposition of cash or Cash Equivalents;
(6) the
surrender or waiver of contract rights, the settlement, release or surrender of contract, tort or other litigation claims in the ordinary course of business, and the
granting of (or permitted realization of) Liens not prohibited by the indenture;
(7) a
Restricted Payment that complies with the covenant described above under the caption "Certain CovenantsRestricted Payments" or a Permitted
Investment;
(8) sales
or grants of licenses or sublicenses of intellectual property, and licenses, leases or subleases of other assets, of B&G Foods or any of its Restricted
Subsidiaries to the extent not materially interfering with the business of B&G Foods and its Restricted Subsidiaries;
(9) any
exchange of like-kind property pursuant to Section 1031 of the Code that are used or useful in a Permitted Business;
(10) the
abandonment of intellectual property rights in the ordinary course of business, which in the reasonable good faith determination of B&G Foods or any of its
Restricted Subsidiaries are not material to the conduct of the business of B&G Foods and its Restricted Subsidiaries taken as a whole;
(11) foreclosures,
condemnation or any similar action on assets or the granting of a Lien that is permitted under the covenant described above under "Certain
CovenantsLiens";
(12) any
liquidation or dissolution of a Restricted Subsidiary, provided that such Restricted Subsidiary's direct parent is
also either B&G Foods or a Restricted Subsidiary of the B&G Foods and immediately becomes the owner of such Restricted Subsidiary's assets;
(13) any
issuance or sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;
(14) any
financing transaction with respect to real property constructed, acquired, replaced, repaired or improved (including any reconstruction, refurbishment, renovation
and/or development of real property) by B&G Foods or any Restricted Subsidiary after the date of the indenture, including Sale and Lease-Back Transactions permitted by the indenture; and
(15) sales,
transfers and other dispositions of Investments in joint ventures to the extent required by customary buy/sell arrangements between the joint venture parties as
set forth in joint venture agreements.
"Asset Sale Offer" has the meaning assigned to that term in the indenture governing the notes. "Attributable Debt" in respect of a sale
and leaseback transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such sale
and leaseback transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended. Such present value shall be calculated using a discount rate
equal to the rate of interest implicit in such transaction, determined in accordance with GAAP; provided, however, that if such sale and leaseback transaction results in a Capital Lease Obligation,
the amount of Indebtedness represented thereby will be determined in accordance with the definition of "Capital Lease Obligation."
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in
calculating the beneficial ownership of any particular "person" (as that term is used in Section 13(d)(3) of the Exchange Act), such "person" will be deemed to have beneficial
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ownership
of all securities that such "person" has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only after the
passage of time. The terms "Beneficially Owns" and "Beneficially Owned" have a corresponding meaning.
"Board of Directors" means:
(1) with
respect to a corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such board;
(2) with
respect to a partnership, the Board of Directors of the general partner of the partnership;
(3) with
respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and
(4) with
respect to any other Person, the board or committee of such Person serving a similar function.
"Borrowing Base" means, as of any date, an amount equal to:
(1) 85%
of the face amount of all accounts receivable owned by B&G Foods and its Restricted Subsidiaries as of the end of the most recent fiscal quarter preceding such date
that were not more than 90 days past due; plus
(2) 50%
of the book value of all inventory, net of reserves, owned by B&G Foods and its Restricted Subsidiaries as of the end of the most recent fiscal quarter preceding
such date, in each case determined in accordance with GAAP. "Capital Lease Obligation" means, at the time any determination is to be made, the amount of the liability in respect of a capital lease
that would at that time be required to be capitalized on a balance sheet prepared in accordance with GAAP, and the Stated Maturity thereof shall be the date of the last payment of rent or any other
amount due under such lease prior to the first date upon which such lease may be prepaid by the lessee without payment of a penalty.
"Capital
Stock" means:
(1) in
the case of a corporation, corporate stock;
(2) in
the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;
(3) in
the case of a partnership or limited liability company, partnership interests or membership interests (whether general or limited); and
(4) any
other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing
Person, but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock.
"Cash
Equivalents" means:
(1) United
States dollars and Canadian dollars;
(2) securities
issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality of the United States government
(provided that the full faith and credit of the United States is pledged in support of those securities) having maturities of not more than one year
from the date of acquisition;
(3) certificates
of deposit and eurodollar time deposits with maturities of six months or less from the date of acquisition, bankers' acceptances with maturities not
exceeding six months and
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overnight
bank deposits, in each case, with any domestic commercial bank having capital and surplus in excess of $500.0 million and a Thomson Bank Watch Rating of "B" or better;
(4) repurchase
obligations with a term of not more than seven days for underlying securities of the types described in clauses (2) and (3) above entered into
with any financial institution meeting the qualifications specified in clause (3) above;
(5) commercial
paper having one of the two highest ratings obtainable from Moody's or S&P and, in each case, maturing within one year after the date of acquisition;
(6) money
market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (1) through (5) of this definition;
and
(7) readily
marketable direct obligations issued by any State of the United States of America or any political subdivision thereof having maturities of not more than one
year from the date of acquisition and having one of the two highest rating categories obtainable from either Moody's or S&P.
"Change of Control" means the occurrence of any of the following:
(1) the
direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions,
of all or substantially all of the properties or assets of B&G Foods and its Subsidiaries taken as a whole to any "person" (as that term is used in Section 13(d)(3) of the Exchange Act) other
than a Principal or a Related Party of a Principal;
(2) the
adoption of a plan relating to the liquidation or dissolution of B&G Foods; or
(3) the
consummation of any transaction (including, without limitation, any merger or consolidation), the result of which is that any "person" (as defined above), other than
the Principals and their Related Parties, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of B&G Foods, measured by voting power rather than number of
shares.
"Change of Control Offer" has the meaning assigned to that term in the indenture governing the notes.
"Change of Control Payment Date" has the meaning assigned to that term in the indenture governing the notes.
"Code" means the Internal Revenue Code of 1986, as amended from time to time.
"Consolidated Cash Flow" means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such
period plus, without duplication:
(1) an
amount equal to any extraordinary loss plus any net loss realized by such Person or any of its Restricted Subsidiaries in connection with an Asset Sale, to the extent
such losses were deducted in computing such Consolidated Net Income; plus
(2) provision
for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was deducted
in computing such Consolidated Net Income; plus
(3) the
Fixed Charges of such Person and its Restricted Subsidiaries for such period, to the extent that such Fixed Charges were deducted in computing such Consolidated Net
Income; plus
(4) depreciation,
amortization (including amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period
and including, without limitation, any marking to market of derivative securities or securities held in any deferred
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compensation
plan) and other non-cash expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of
a prepaid cash expense that was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash expenses
were deducted in computing such Consolidated Net Income; plus
(5) fees
and expenses related to the Transactions not to exceed $25.0 million in the aggregate actually incurred within three months of the date of the indenture;
plus
(6) charges
incurred within 180 days of the date of the indenture attributable to the write-off of bond discount and the write-off of deferred financing fees and
costs, relating to the pay off of existing Indebtedness in an amount not to exceed $17.5 million; minus
(7) non-cash
items increasing such Consolidated Net Income for such period (including, without limitation, any marking to market of derivative securities or securities held
in any deferred compensation plan), other than the accrual of revenue in the ordinary course of business;
in
each case, on a consolidated basis and determined in accordance with GAAP.
"Consolidated Net Income" means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and
its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that:
(1) the
Net Income (but not loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting will be included only to the
extent of the amount of dividends or similar distributions paid in cash to the specified Person or a Restricted Subsidiary of the Person;
(2) the
Net Income of any Restricted Subsidiary will be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted
Subsidiary of that Net Income to such Person and its Restricted Subsidiaries is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or,
directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted
Subsidiary or its stockholders;
(3) the
cumulative effect of a change in accounting principles will be excluded;
(4) any
unrealized gains and with respect to Hedging Obligations for such period will be excluded;
(5) any
unrealized gains and losses related to fluctuations in currency exchange rates for such period will be excluded;
(6) any
gains and losses from any early extinguishment of Indebtedness will be excluded;
(7) any
gains and losses from any redemption or repurchase premiums paid with respect to the notes will be excluded; and
(8) any
deferred financing costs (including the amortization of original issue discount) associated with Indebtedness of B&G Foods will be excluded.
"continuing" means, with respect to any Default or Event of Default, that such Default or Event of Default has not been cured or waived.
"Credit Agreement" means that certain Amended and Restated Credit Agreement, dated as of October 2, 2015 by and among B&G Foods,
Barclays Bank PLC, as administrative agent and collateral agent, and the lenders from time to time party thereto, including any related notes, Guarantees,
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collateral
documents, instruments and agreements executed in connection therewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced in any manner (whether upon or after
termination or otherwise) or refinanced (including by means of sales of debt securities to institutional investors) in whole or in part from time to time, including by that certain First Amendment to
Credit Agreement, dated as of March 30, 2017, and that certain Second Amendment to Credit Agreement, dated as of November 20, 2017.
"Credit Facilities" means, one or more debt facilities (including, without limitation, the Credit Agreement) or other financing
arrangements (including, without limitation, commercial paper facilities or indentures) providing for revolving credit loans, term loans, receivables financing (including through the sale of
receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables), letters of credit or other long-term indebtedness including any notes,
mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements, refundings
or replacements in any manner (whether upon or after termination or otherwise) or refinancings thereof (including by means of sales of debt securities to institutional investors) in whole or in part
from time to time and any debt facilities or other financing arrangements (including, without limitation, commercial paper facilities or indentures) that replace, refund or refinance any part of the
loans, notes, other credit facilities or commitments thereunder including any such replacement, refunding or refinancing facility or indenture that increases the amount permitted to be borrowed
thereunder or alters the maturity thereof (provided that such increase is permitted under the covenant "Incurrence of Indebtedness and
Issuance of Preferred Stock") or adds Restricted Subsidiaries as additional borrowers or guarantors thereunder and whether by the same or any other agent, lender or group of lenders.
"Default" means any event that is, or with the passage of time or the giving of written notice or both would be, an Event of Default.
"Designated Non-cash Consideration" means the Fair Market Value of non-cash consideration received by B&G Foods or a Restricted Subsidiary
in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officers' Certificate, setting forth the basis of such valuation, executed by the principal
financial officer of B&G Foods, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of or collection on such Designated Non-cash Consideration.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case, at the option of the holder of the Capital Stock), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91 days after the date on which the notes mature.
Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders of the Capital Stock have the right to require B&G Foods to repurchase
such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that B&G Foods may not repurchase or
redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with the covenant described above under the caption "Certain
CovenantsRestricted Payments." The amount of Disqualified Stock deemed to be outstanding at any time for purposes of the indenture will be the maximum amount that B&G Foods and its
Restricted Subsidiaries may become obligated to pay upon the maturity of, or pursuant to any mandatory redemption provisions of, such Disqualified Stock, exclusive of accrued dividends.
"Domestic Subsidiaries" means any Restricted Subsidiary of B&G Foods that was formed under the laws of the United States or any state of
the United States or the District of Columbia.
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"Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security
that is convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means a public or private sale either (1) of Equity Interests of B&G Foods by B&G Foods (other than Disqualified
Stock and other than to a Subsidiary of B&G Foods or pursuant to a registration statement on Form S-8 or otherwise relating to equity securities issuable under any employee benefit plan of B&G
Foods) or (2) of Equity Interests of a direct or indirect parent entity of B&G Foods (other than to B&G Foods or a Subsidiary of B&G Foods) to the extent that the net proceeds therefrom are
contributed to the common equity capital of B&G Foods.
"Excess Cash" means, with respect to any specified Person for any period, the Consolidated Cash Flow of that Person for such period, minus
the sum of the following, each determined for such period on a consolidated basis:
(1) cash
income taxes paid for such Person and its Restricted Subsidiaries; plus
(2) cash
interest expense paid by such Person and its Restricted Subsidiaries, whether or not capitalized (including, without limitation, the interest component of all
payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or
bankers' acceptance financings, and net of the effect of all payments made or received pursuant to Hedging Obligations in respect of interest rates); plus
(3) additions
to property, plant and equipment and other capital expenditures of such Person and its Restricted Subsidiaries that are (or would be) set forth in a
consolidated statement of cash flows of such Person and its Restricted Subsidiaries for such period prepared in accordance with GAAP, except to the extent financed by the incurrence of Indebtedness;
plus
(4) the
aggregate principal amount of long-term Indebtedness repaid by such Person and its Restricted Subsidiaries and the repayment by such Person and any Restricted
Subsidiary of any short-term Indebtedness that financed capital expenditures referred to in clause (3) above, excluding any such repayments (a) under working capital facilities (except
to the extent that such Indebtedness so repaid was incurred to finance capital expenditures as described in clause (3) above, (b) out of Net Proceeds of Assets Sales as provided in
"Repurchase at the Option of HoldersAsset Sales," (c) through a refinancing involving the incurrence of new long-term Indebtedness and (d) to the extent not
included in clause (c), of the 2021 Senior Notes and revolving loans under the Credit Agreement with the proceeds of this offering on or about the date of the indenture; provided that the aggregate
amount of repayments made pursuant to clause (d) does not exceed the amount of the net proceeds received in
connection with this offering.
"Existing Indebtedness" means Indebtedness of B&G Foods and its Restricted Subsidiaries (including pursuant to the 2025 Senior Notes and
the Credit Agreement, to the extent outstanding immediately following the execution of the Indenture) in existence on the date of the Indenture, reduced to the extent such amounts are repaid,
refinanced or retired.
"Fair Market Value" means the value that would be paid by a willing buyer to an unaffiliated willing seller in a transaction not involving
distress or necessity of either party, determined in good faith by B&G Foods (unless otherwise provided in the indenture).
"Fixed Charge Coverage Ratio" means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such
Person for such period to the Fixed Charges of such Person for such period. In the event that the specified Person or any of its Restricted Subsidiaries incurs, assumes, guarantees, repays,
repurchases, redeems, defeases or otherwise discharges any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases or redeems preferred stock subsequent
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to
the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed Charge Coverage
Ratio is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated giving pro forma effect to such incurrence, assumption, Guarantee, repayment, repurchase, redemption,
defeasance or other discharge of Indebtedness, or such issuance, repurchase or redemption of preferred stock, and the use of the proceeds therefrom, as if the same had occurred at the beginning of the
applicable four-quarter reference period.
In
addition, for purposes of calculating the Fixed Charge Coverage Ratio:
(1) acquisitions
that have been made by the specified Person or any of its Restricted Subsidiaries, including through mergers or consolidations, or any Person or any of its
Restricted Subsidiaries acquired by the specified Person or any of its Restricted Subsidiaries, and including any related financing transactions and including increases in ownership of Restricted
Subsidiaries, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date will be given pro forma effect as if they had occurred on the
first day of the four-quarter reference period, and Consolidated Cash Flow for such reference period will be calculated on a pro forma basis (including with respect to any cost savings so long as such
cost savings are factually supportable and expected to have a continuing effect on such Person or any of its Restricted Subsidiaries);
(2) the
Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses (and ownership interests therein)
disposed of prior to the Calculation Date, will be excluded;
(3) the
Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses (and ownership interests therein) disposed
of prior to the Calculation Date, will be excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the specified Person or any of its
Restricted Subsidiaries following the Calculation Date;
(4) any
Person that is a Restricted Subsidiary on the Calculation Date will be deemed to have been a Restricted Subsidiary at all times during such four-quarter period;
(5) any
Person that is not a Restricted Subsidiary on the Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during such four-quarter
period; and
(6) if
any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will be calculated as if the rate in effect on the Calculation Date had
been the applicable rate for the entire period (taking into account any Hedging Obligation applicable to such Indebtedness if such Hedging Obligation has a remaining term as at the Calculation Date in
excess of 12 months).
"Fixed Charges" means, with respect to any specified Person for any period, the sum, without duplication, of:
(1) the
consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, including, without limitation, non-cash
interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to
Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net of the effect of all payments made or received
pursuant to Hedging Obligations in respect of interest rates; (but excluding amortization of deferred financing costs, original issue discount and any redemption or repurchase premiums paid with
respect to the notes); plus
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(2) the
consolidated interest expense of such Person and its Restricted Subsidiaries that was capitalized during such period; plus
(3) any
interest on Indebtedness of another Person that is guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or
one of its Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon; plus
(4) the
product of (a) all dividends, whether paid or accrued and whether or not in cash, on any series of preferred stock of such Person or any of its Restricted
Subsidiaries, other than dividends on Equity Interests payable solely in Equity Interests of B&G Foods (other than Disqualified Stock) or to B&G Foods or a Restricted Subsidiary of B&G Foods, times
(b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory tax rate of such Person, expressed as a
decimal, in each case, determined on a consolidated basis in accordance with GAAP; minus
(5) charges
attributable to the amortization of expenses relating to the Transactions incurred within 180 days of the date of the indenture.
"GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting profession in the United States, which are in effect on the date of the indenture. At any time after the date of the
indenture, B&G Foods may elect to apply IFRS accounting principles in lieu of GAAP and, upon any such election, references herein to GAAP shall thereafter be construed to mean IFRS (except as
otherwise provided herein); provided that calculations or determinations herein that require the application of GAAP for periods that include fiscal
quarters ended prior to B&G Foods' election to apply IFRS shall remain as previously calculated or determined in accordance with GAAP. B&G Foods will provide notice of any such election made in
accordance with this definition to the trustee and the holders of notes.
"Government Securities" means direct obligations of, or obligations guaranteed by, the United States of America (including any agency or
instrumentality thereof) for the payment of which obligations or guarantees the full faith and credit of the United States of America is pledged and which are not callable or redeemable at the
issuer's option and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such Government Securities
or a specific payment of principal of or interest on any such Government Securities held by such custodian for the account of the holder of such depository receipt; provided that (except as required by
law) such custodian is not authorized to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal of or interest on the Government Securities evidenced by such
depository receipt.
"Guarantee" means a guarantee other than by endorsement of negotiable instruments for collection or standard contractual indemnities in
the ordinary course of business, direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to take or pay
or to maintain financial statement conditions or otherwise).
"Guarantors" means each of:
(1) B&G
Foods North America, Inc., B&G Foods Snacks, Inc., Back To Nature Foods Company, LLC, Back To Nature Foods ServCo, LLC, Bear Creek
Country Kitchens, LLC, BTN
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ServCo Corporation, BTN Holdco, Inc., Clabber Girl Corporation, Spartan Foods of America, Inc., Victoria Fine Foods, LLC and William Underwood Company; and
(2) any
other Subsidiary of B&G Foods that executes a Note Guarantee in accordance with the provisions of the indenture, and their respective successors and assigns, in each
case, until the Note Guarantee of such Person has been released in accordance with the provisions of the indenture.
"Hedging Obligations" means, with respect to any specified Person, the obligations of such Person under:
(1) interest
rate swap agreements (whether from fixed to floating or from floating to fixed), interest rate cap agreements and interest rate collar agreements;
(2) other
agreements or arrangements designed to manage interest rates or interest rate risk; and
(3) other
agreements or arrangements designed to protect such Person against fluctuations in currency exchange rates or commodity prices.
"IFRS" means International Financial Reporting Standards.
"Immaterial Subsidiary" means, as of any date, any Restricted Subsidiary whose total assets, as of that date, are less than $100,000 and
whose total revenues for the most recent 12-month period do not exceed $100,000; provided that a Restricted Subsidiary will not be considered to be an
Immaterial Subsidiary if it, directly or indirectly, guarantees or otherwise provides direct credit support for any Indebtedness of B&G Foods.
"Indebtedness" means, with respect to any specified Person, any indebtedness of such Person (excluding accrued expenses and trade
payables), whether or not contingent:
(1) in
respect of borrowed money;
(2) evidenced
by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);
(3) in
respect of banker's acceptances;
(4) representing
Capital Lease Obligations or Attributable Debt in respect of sale and leaseback transactions;
(5) representing
the balance deferred and unpaid of the purchase price of any property or services, which purchase price is due more than six months after the date of
placing such property in service or taking delivery and title thereto, except any such balance that constitutes an accrued expense or trade payable or any similar obligation to trade creditors; or
(6) representing
any Hedging Obligations,
if
and to the extent any of the preceding items (other than letters of credit, Attributable Debt and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term "Indebtedness" includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such
Indebtedness is assumed by the specified Person; provided that if the holder of such Indebtedness has no recourse to such Person other than to the
asset, the amount of such Indebtedness will be deemed to equal the lesser of the value of such asset and the amount of the obligation so secured) and, to the extent not otherwise included, the
Guarantee by the specified Person of any Indebtedness of any other Person.
"Investment Grade Rating" means a rating equal to or higher than Baa3 (or the equivalent) by Moody's and BBB (or the
equivalent) by S&P, or an equivalent rating by any other Rating Agency.
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"Investments" means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates)
in the forms of loans (including Guarantees or other obligations), advances or capital contributions (excluding accounts receivable, trade credit and advances to customers in the ordinary course of
business and commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. If B&G Foods or any Subsidiary of B&G Foods
sells or otherwise disposes of any Equity Interests of any direct or indirect Subsidiary of B&G Foods such that, after giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of B&G Foods, B&G Foods will be deemed to have made an Investment on the date of any such sale or disposition equal to the Fair Market Value of B&G Foods' Investments in such Subsidiary
that were not sold or disposed of in an amount determined as provided in the final paragraph of the covenant described above under the caption "Certain CovenantsRestricted
Payments." The acquisition by B&G Foods or any Subsidiary of B&G Foods of a Person that holds an Investment in a third Person will not be deemed to be an Investment by B&G Foods or such Subsidiary in
such third Person if the purpose of such acquisition by B&G Foods or such Subsidiary was not the Investment in such third Person. Except as otherwise provided in the indenture, the amount of an
Investment will be determined at the time the Investment is made and without giving effect to subsequent changes in value.
"Joint Venture" means any joint venture between B&G Foods and/or any Restricted Subsidiary and any other Person if such joint venture is:
(1) owned
50% or less by B&G Foods and/or any of its Restricted Subsidiaries; and
(2) not
directly or indirectly controlled by or under direct or indirect common control of B&G Foods and/or any of its Restricted Subsidiaries.
"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of
such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option
or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement relating to a lien on an asset under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction.
"Moody's" means Moody's Investors Service, Inc. and any successor to its rating agency business. "Net
Income" means, with respect to any specified Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of preferred
stock dividends, excluding, however:
(1) any
gain or loss, together with any related provision for taxes on such gain or loss, realized in connection with: (a) any Asset Sale; or (b) the
disposition of any securities by such Person or any of its
Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and
(2) any
extraordinary gain or loss, together with any related provision for taxes on such extraordinary gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by B&G Foods or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of the direct costs relating to such Asset Sale,
including, without limitation, legal, accounting and investment banking fees, and sales commissions, and any relocation expenses incurred as a result of the Asset Sale, taxes paid or payable as a
result of the Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, and amounts required to be applied to the repayment of
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Indebtedness,
other than Indebtedness under a Credit Facility, secured by a Lien on the asset or assets that were the subject of such Asset Sale or any reserve for adjustment in respect of the sale
price of such asset or assets established in accordance with GAAP or in respect of liabilities associated with the asset disposed of and retained by B&G Foods or its Restricted Subsidiaries.
"Non-Recourse Debt" means Indebtedness:
(1) as
to which neither B&G Foods nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including any undertaking, agreement or instrument
that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise, or (c) constitutes the lender;
(2) no
default with respect to which (including any rights that the holders of the Indebtedness may have to take enforcement action against an Unrestricted Subsidiary) would
permit upon notice, lapse of time or both any holder of any other Indebtedness of B&G Foods or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or cause the payment
of the Indebtedness to be accelerated or payable prior to its Stated Maturity; and
(3) as
to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of B&G Foods or any of its Restricted Subsidiaries.
"Note Guarantee" means the Guarantee by each Guarantor of B&G Foods' obligations under the indenture and the notes, executed pursuant to
the provisions of the indenture.
"Obligations" means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness.
"Officers' Certificate" means the officers' certificate to be delivered upon the occurrence of specified events as set forth in the
indenture.
"Permitted Business" means the business of B&G Foods and its Subsidiaries as existing on the date of the indenture and any other
businesses that are the same, similar or reasonably related, ancillary or complementary thereto and reasonable extensions thereof.
"Permitted Investments" means:
(1) any
Investment in B&G Foods or in a Restricted Subsidiary of B&G Foods;
(2) any
Investment in Cash Equivalents;
(3) any
Investment by B&G Foods or any Restricted Subsidiary of B&G Foods in a Person, if as a result of such Investment:
(a) such
Person becomes a Restricted Subsidiary of B&G Foods; or
(b) such
Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, B&G Foods or a
Restricted Subsidiary of B&G Foods;
(4) any
Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the covenant described above
under the caption "Repurchase at the Option of HoldersAsset Sales";
(5) any
acquisition of assets or Capital Stock solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of B&G Foods;
(6) any
Investments received (a) in compromise or resolution of (i) obligations of trade creditors or customers that were incurred in the ordinary course of
business of B&G Foods or any of its Restricted Subsidiaries, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer
or (ii) litigation,
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arbitration
or other disputes with Persons who are not Affiliates; or (b) in satisfaction of judgments;
(7) Investments
represented by Hedging Obligations;
(8) loans
or advances to directors, officers, employees and consultants made in the ordinary course of business of B&G Foods or the Restricted Subsidiary of B&G Foods in an
aggregate principal amount not to exceed $5.0 million at any one time outstanding;
(9) repurchases
of the notes;
(10) intercompany
loans to the extent permitted by the covenant described above under the caption "Certain CovenantsIncurrence of Indebtedness and
Issuance of Preferred Stock";
(11) loans
by B&G Foods in an aggregate principal amount not exceeding $5.0 million to employees of B&G Foods or its Restricted Subsidiaries to finance the sale of
B&G Foods' Capital Stock by B&G Foods to such employees; provided that the net cash proceeds from such sales respecting such loaned amounts will not be
included in the calculation described in clause (1)(b) of the first paragraph of the covenant described above under the caption "Certain CovenantsRestricted Payments";
(12) any
Investment in existence on the date of the indenture;
(13) receivables
owing to B&G Foods or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with
customary trade terms;
(14) any
Investment in any Person to the extent the Investment consists of prepaid expenses, negotiable instruments held for collection and lease, utility and workers'
compensation, performance and other similar deposits made in the ordinary course of business by B&G Foods or any of its Restricted Subsidiaries;
(15) guarantees
otherwise permitted by the terms of the indenture, including guarantees of Indebtedness, performance guarantees and guarantees of operating leases or other
obligations that do not constitute Indebtedness, in each case entered into in the ordinary course of business; and
(16) other
Investments in any Person having an aggregate Fair Market Value (measured on the date each such Investment was made and without giving effect to subsequent
changes in value), when taken together with all other Investments made pursuant to this clause (16) that are at the time outstanding, not to exceed the greater of (i) 4.0% of Total
Assets and (ii) $125.0 million at the time of such Investment (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent
changes in value); provided that if an Investment made pursuant to this clause (16) is made in any Person that is not a Restricted Subsidiary of
B&G Foods at the date of the making of the Investment and such Person becomes a Restricted Subsidiary after such date, such Investment will thereafter be deemed to have been made pursuant to
clause (1) above and shall cease to have been made pursuant to this clause (16).
"Permitted Liens" means:
(1) Liens
on assets of B&G Foods or any of its Restricted Subsidiaries securing Indebtedness and other Obligations under Credit Facilities that were permitted by the terms
of the indenture to be incurred and/or securing certain Hedging Obligations;
(2) Liens
in favor of B&G Foods or the Guarantors;
(3) Liens
on property of a Person existing at the time such Person is merged with or into or consolidated with B&G Foods or any Subsidiary of B&G Foods; provided that such Liens were not incurred in
contemplation of such merger or consolidation and do not extend to any assets other than those of the
Person merged into or consolidated with B&G Foods or the Subsidiary;
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(4) Liens
on property (including Capital Stock) existing at the time of acquisition of the property by B&G Foods or any Subsidiary of B&G Foods; provided that such Liens were not incurred in contemplation
of, such acquisition;
(5) Liens
to secure the performance of statutory obligations, surety or appeal bonds, performance bonds, deposits to secure the performance of bids, trade contracts,
government contracts, warranty requirements, leases or licenses or other obligations of a like nature or incurred in the ordinary course of business (including, without limitation, landlord Liens on
leased real property and rights of offset and set-off);
(6) Liens
to secure Indebtedness (including Capital Lease Obligations) permitted by clause (4) of the second paragraph of the covenant entitled "Certain
CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock" covering only the assets acquired with or financed by such Indebtedness;
(7) Liens
existing on the date of the indenture;
(8) Liens
for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded; provided that any reserve or other appropriate provision as is required in conformity with GAAP has been made
therefor;
(9) Liens
imposed by law, such as carriers', warehousemen's, landlord's, materialmen's, repairmen's and mechanics' Liens, in each case, incurred in the ordinary course of
business;
(10) survey
exceptions, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other
similar purposes, or zoning or other restrictions as to the use of real property that were not incurred in connection with Indebtedness and that do not in the aggregate materially adversely affect the
value of said properties or materially impair their use in the operation of the business of such Person;
(11) Liens
created for the benefit of (or to secure) the notes (or the Note Guarantees);
(12) Liens
to secure any Permitted Refinancing Indebtedness permitted to be incurred under the indenture; provided, however,
that:
(a) the
new Lien is limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could
secure the original Lien (plus improvements and accessions to, such property or proceeds or distributions thereof); and
(b) the
Indebtedness secured by the new Lien is not increased to any amount greater than the sum of (x) the outstanding principal amount, or, if greater, committed
amount, of the Indebtedness renewed, refunded, refinanced, replaced, defeased or discharged with such Permitted Refinancing Indebtedness and (y) an amount necessary to pay any fees and
expenses, including premiums, related to such renewal, refunding, refinancing, replacement, defeasance or discharge;
(13) Liens
in favor of customs and revenue authorities to secure payment of customs duties in connection with the importation of goods in the ordinary course of business and
other similar Liens arising in the ordinary course of business;
(14) Liens
securing reimbursement obligations with respect to commercial letters of credit which encumber documents and other property relating to such letters of credit and
products and proceeds thereof;
(15) Liens
upon specific items of inventory or other goods and proceeds of any Person securing such Person's obligations in respect of bankers' acceptances issued or created
for the
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account
of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(16) leases
or subleases granted to third Persons not interfering with the ordinary course of business of B&G Foods or any of its Restricted Subsidiaries;
(17) Liens
(other than any Lien imposed by ERISA or any rule or regulation promulgated thereunder) incurred or deposits made in the ordinary course of business in connection
with workers' compensation, unemployment insurance, and other types of social security;
(18) deposits
made in the ordinary course of business to secure liability to insurance carriers;
(19) Liens
under licensing agreements for use of intellectual property entered into in the ordinary course of business;
(20) judgment
Liens not giving rise to an Event of Default;
(21) Liens
on the assets of a Restricted Subsidiary of B&G Foods that is not a Guarantor securing Indebtedness of that Restricted Subsidiary; provided that such Indebtedness was permitted to be incurred by the
covenant described above under the caption "Certain
CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock";
(22) Liens
arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by B&G Foods or any of its Restricted
Subsidiaries in the ordinary course of business;
(23) Liens
solely on any cash earnest money deposits made by B&G Foods or any of its Restricted Subsidiaries in connection with any letter of intent or purchase agreement
permitted under the indenture;
(24) Liens
arising from Uniform Commercial Code (or equivalent statute) financing statement filings regarding operating leases entered into in the ordinary course of
business; and
(25) Liens
incurred in the ordinary course of business of B&G Foods or any Restricted Subsidiary of B&G Foods with respect to obligations that do not exceed
$30.0 million at any one time outstanding.
"Permitted Refinancing Indebtedness" means any Indebtedness of B&G Foods or any of its Restricted Subsidiaries issued in exchange for, or
the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge other Indebtedness of B&G Foods or any of its Restricted Subsidiaries (other than intercompany
Indebtedness); provided that:
(1) the
principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if
applicable) of the Indebtedness renewed, refunded, refinanced, replaced, defeased or discharged (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including
premiums, incurred in connection therewith);
(2) such
Permitted Refinancing Indebtedness has a final maturity date later than or the same as the final maturity date of, and has a Weighted Average Life to Maturity that
is (a) equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged or (b) more than
90 days after the final maturity date of the notes;
(3) if
the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged is subordinated in right of payment to the notes, such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the notes on terms at least as favorable to the holders of notes as those
contained in the
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documentation
governing the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged; and
(4) such
Indebtedness is incurred either by B&G Foods or by the Restricted Subsidiary who is the obligor on the Indebtedness being renewed, refunded, refinanced, replaced,
defeased or discharged.
"Person" means any individual, corporation, limited liability company, joint stock company, joint venture, partnership, limited liability
partnership, association, unincorporated organization, trust, governmental regulatory entity, country, state, agency or political subdivision thereof, municipality, county, parish or other entity.
"Principals" means the members of management of B&G Foods or any of B&G Foods' Restricted Subsidiaries as of the date of the indenture.
"Rating Agencies" means Moody's and S&P or if Moody's or S&P or both shall not make a rating on the notes publicly available, a nationally
recognized statistical rating organization or organizations, as the case may be, selected by B&G Foods which shall be substituted for Moody's or S&P or both, as the case may be.
"Related Party" means:
(1) any
controlling stockholder, 662/3% or more owned Subsidiary, or immediate family member (in the case of an individual) of any Principal; or
(2) any
trust, corporation, partnership, limited liability company or other entity, the beneficiaries, stockholders, partners, members, owners or Persons beneficially
holding a 662/3% or more controlling interest of which consist of any one or more Principals and/or such other Persons referred to in the immediately preceding clause (1).
"Restricted Investment" means an Investment other than a Permitted Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary.
"S&P" means Standard & Poor's, a division of The McGraw-Hill Companies, Inc., and any successor to its rating agency
business.
"Significant Subsidiary" means any Restricted Subsidiary that would be a "significant subsidiary" as defined in Article 1,
Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date of the indenture.
"Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the
payment of interest or principal was scheduled to be paid in the documentation governing such Indebtedness as of the date of the indenture, and will not include any contingent obligations to repay,
redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any specified Person:
(1) any
corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency and after giving effect to any voting agreement or stockholders' agreement that effectively transfers voting power) to vote in the election of directors, managers or
trustees of the corporation, association or other business entity 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); and
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(2) any
partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general
partners of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).
"Total Assets" means the total assets of B&G Foods and its Restricted Subsidiaries on a consolidated basis, as shown on the most recent
balance sheet of B&G Foods.
"Total Debt" means as at any date of determination, the aggregate amount of all outstanding Indebtedness of B&G Foods and its Restricted
Subsidiaries on a consolidated basis consisting of Indebtedness for borrowed money, Obligations in respect of Capitalized Lease Obligations and debt obligations evidenced by promissory notes and
similar instruments, in each case determined in accordance with GAAP. "Transactions" means the issuance of the notes and the application of the proceeds therefrom.
"Treasury Rate" means, as of any redemption date, the yield to maturity as of such redemption date of United States Treasury securities
with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two business days prior to the
redemption date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to
March 1, 2022; provided, however, that if the period from the redemption date to March 1, 2022, is less than one year, the weekly average
yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.
"Unrestricted Subsidiary" means any Subsidiary of B&G Foods that is designated by the Board of Directors of B&G Foods as an Unrestricted
Subsidiary pursuant to a resolution of the Board of Directors, but only to the extent that such Subsidiary:
(1) has
no Indebtedness other than Non-Recourse Debt;
(2) except
as permitted by the covenant described above under the caption "Certain CovenantsTransactions with Affiliates," is not party to any
agreement, contract, arrangement or understanding with B&G Foods or any Restricted Subsidiary of B&G Foods unless the terms of any such agreement, contract, arrangement or understanding are no less
favorable to B&G Foods or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of B&G Foods;
(3) is
a Person with respect to which neither B&G Foods nor any of its Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe for additional
Equity Interests or (b) to maintain or preserve such Person's financial condition or to cause such Person to achieve any specified levels of operating results; and
(4) has
not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of B&G Foods or any of its Restricted Subsidiaries.
"Voting Stock" of any specified Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the
election of the Board of Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including
payment at final maturity, in respect of the Indebtedness, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment;
by (2) the then outstanding principal amount of such Indebtedness.
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MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
This section is a discussion of certain material U.S. federal income tax considerations relating to the purchase, ownership, and disposition of
the notes. This section does not provide a complete analysis of all potential tax considerations. The information provided below is based on the Internal Revenue Code of 1986, as amended (the "Code"),
U.S. Treasury Regulations, Internal Revenue Service ("IRS") rulings and pronouncements, and judicial decisions all as now in effect and all of which are subject to change or differing interpretations,
possibly with retroactive effect. There can be no assurances that the IRS will not challenge one or more of the tax consequences described herein, and we have not obtained, nor do we intend to obtain,
a ruling from the IRS with respect to the U.S. federal income tax consequences of purchasing, owning or disposing of the notes. This section generally applies only to beneficial owners of the notes
that purchase their notes in this offering for an amount equal to the issue price of the notes, which is the first price at which a substantial amount of the notes is sold for money to the public (not
including sales to bond houses, brokers or similar persons or organizations acting in the capacity of initial purchasers, placement agents or wholesalers), and that hold the notes as capital assets.
This discussion does not purport to deal with all aspects of U.S. federal income taxation that may be relevant to a particular beneficial owner in light of the beneficial owner's
circumstances (for example, persons subject to the alternative minimum tax provisions of the Code, or a U.S. Holder (as defined below) whose "functional currency" is not the U.S. dollar). Also, it is
not intended to be applicable to all categories of investors, some of whom may be subject to special rules (such as dealers in securities or currencies, traders in securities that elect to use a
mark-to-market method of accounting, banks, thrifts or other financial institutions, regulated investment companies, real estate investment trusts, insurance companies, tax-exempt entities, any entity
or arrangement that is treated as a partnership for U.S. federal income tax purposes, tax-deferred or other retirement accounts, a beneficial owner of the notes subject to the special tax accounting
rules under Section 451(b) of the Code, certain former citizens or residents of the United States, persons holding notes as part of a hedging, conversion or integrated transaction or a
straddle, or persons deemed to sell notes under the constructive sale provisions of the Code). The amortizable bond premium or market discount rules may apply to any investor who purchases notes at a
price other than the issue price and pursuant to this offering memorandum, and investors should consult their own tax advisors regarding this possibility. Finally, this section does not describe the
effect of the U.S. federal estate and gift tax laws or the effects of any applicable foreign, state or local laws.
THIS
SECTION IS FOR GENERAL INFORMATION AND IS NOT TAX ADVICE WITH RESPECT TO ANY SPECIFIC INVESTOR IN LIGHT OF SUCH INVESTOR'S PARTICULAR CIRCUMSTANCES. INVESTORS CONSIDERING THE
PURCHASE OF THE NOTES SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AND THE CONSEQUENCES OF U.S. FEDERAL ESTATE OR
GIFT TAX LAWS, FOREIGN, STATE AND LOCAL LAWS, AND TAX TREATIES.
As
used herein, the term "U.S. Holder" means a beneficial owner of the notes that, for U.S. federal income tax purposes, is (1) an individual who is a citizen or resident of the
United States, (2) a corporation, or an entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States or any state of the
United States, including the District of Columbia, (3) an estate the income of which is subject to U.S. federal income taxation regardless of its source, or (4) a trust if (x) a
U.S. court can exercise primary supervision over the trust's administration and one or more United States persons (as defined in the Code) are authorized to control all substantial decisions of the
trust or (y) it has a valid election in effect under applicable U.S. Treasury Regulations to be treated as a United States person.
A
"Non-U.S. Holder" is a beneficial owner of the notes that is, for U.S. federal income tax purposes, an individual, corporation, estate or trust that is not a U.S. Holder.
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If
a partnership (including an entity or arrangement, domestic or foreign, treated as a partnership for U.S. federal income tax purposes) is a beneficial owner of the notes, the tax
treatment of a partner in
the partnership will depend upon the status of the partner and the activities of the partnership. A beneficial owner of the notes that is a partnership, and partners in such partnership, should
consult their own tax advisors about the U.S. federal income tax consequences to them of purchasing, owning and disposing of the notes indirectly through ownership of their partnership interests.
Payments Subject to Certain Contingencies
In certain circumstances described in the "Description of NotesOptional Redemption" and "Description of
NotesRepurchase at the Option of Holders," we may be obligated to pay holders of notes amounts in excess of the stated principal and interest payable on the notes. We intend to take the
position that the likelihood that such payments will be made is remote and that the additional payments are incidental, and therefore the notes are not subject to certain rules governing contingent
payment debt instruments. This determination will be binding on a holder unless such holder explicitly discloses on a statement attached to such holder's timely filed U.S federal income tax return for
the taxable year that includes the acquisition date of the note that such holder's determination is different. It is possible, however, that the IRS may take a contrary position from that described
above, in which case the tax consequences to a holder could differ materially and adversely from those described below. The remainder of this disclosure assumes that the notes will not be treated as
contingent payment debt instruments.
Consequences to U.S. Holders
A U.S. Holder will be required to recognize as ordinary income any interest paid or accrued on the notes, in accordance with the U.S. Holder's
regular method of accounting.
Sale, Exchange, Redemption or Other Taxable Disposition of Notes
A U.S. Holder will recognize gain or loss if the U.S. Holder disposes of the notes in a sale, exchange, redemption or other taxable disposition.
A U.S. Holder's gain or loss generally will equal the difference between the proceeds received by the U.S. Holder (other than amounts representing accrued but unpaid interest, which will be taxed as
ordinary income to the extent not previously included in income) and the U.S. Holder's adjusted tax basis in the note. A U.S. Holder's adjusted tax basis in a note generally will equal the amount the
U.S. Holder paid for the note. The gain or loss recognized by a U.S. Holder on a disposition of the note will be capital gain or loss, and will be long-term capital gain or loss if the note has been
held for more than one year at the time of the sale, exchange, redemption or other taxable disposition. Long-term capital gains of non-corporate taxpayers are currently eligible for reduced rates of
taxation. The deductibility of capital losses is subject to limitations.
Certain non-corporate U.S. Holders are subject to an additional 3.8% tax, in addition to regular tax on income and gains, on some or all of
their "net investment income," (or "undistributed net investment income," in the case of estates and trusts) which generally will include interest on the notes and gain recognized with respect to the
sale, exchange, redemption or other taxable disposition of the notes. U.S. Holders should consult their own tax advisors regarding the applicability of this additional tax in respect of their notes.
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Consequences to Non-U.S. Holders
The following discussion applies only to Non-U.S. Holders (as defined above).
Subject to the discussion below under "Income or Gains Effectively Connected with a U.S. Trade or Business," payments of interest
to Non-U.S. Holders are generally subject to U.S. federal income tax at a rate of 30 percent (or a reduced or zero rate under the terms of an applicable income tax treaty between the United
States and the Non-U.S. Holder's country of residence), collected by means of withholding by the payor. Subject to the discussions of backup withholding and FATCA below, payments of interest on the
notes to a Non-U.S. Holder that qualify as "portfolio interest" will be exempt from U.S. federal income tax, including withholding of such tax, if the Non-U.S. Holder certifies its nonresident status
as described below. The portfolio interest exception will not apply to payments of interest to a Non-U.S. Holder that:
-
-
owns, actually or constructively, shares of our stock representing at least 10 percent of the total combined voting power of all classes
of our stock entitled to vote;
-
-
is a "controlled foreign corporation" that is related, actually or constructively, to us through sufficient stock ownership;
-
-
is a bank receiving the interest pursuant to a loan agreement entered into in the ordinary course of the Non-U.S. Holder's trade or business;
or
-
-
does not certify its nonresident status as described below, or the applicable withholding agent has actual knowledge or reason to know the
holder is a United States person.
In
general, a foreign corporation is a controlled foreign corporation if more than 50 percent of its stock (by either voting power or value) is owned, actually or constructively,
by one or more United States
persons that each owns, actually or constructively, at least 10 percent of its stock (by either voting power or value).
The
portfolio interest exception, entitlement to treaty benefits and several of the special rules for Non-U.S. Holders described below apply only if the holder certifies its nonresident
status under penalties of perjury. A Non-U.S. Holder can generally meet this certification requirement by providing a properly completed and executed IRS Form W-8BEN, IRS Form W-8BEN-E,
or other applicable IRS Form W-8 or appropriate substitute form to our paying agent prior to the payment. If treaty benefits are claimed, the Non-U.S. Holder may be required to provide a
taxpayer identification number on IRS Form W-8BEN or IRS Form W-8BEN-E. If the Non-U.S. Holder holds its notes through a financial institution or other agent acting on the holder's
behalf, the holder will be required to provide appropriate documentation to the agent. The Non-U.S. Holder's agent will then be required to provide certification to our paying agent, either directly
or through other intermediaries. For payments made to a foreign partnership (including an entity or arrangement treated as a partnership for U.S. federal income tax purposes), the certification
requirements generally apply to the partners rather than the partnership, and the partnership must provide the partners' documentation to us or our paying agent.
Sale, Exchange, Redemption or Other Taxable Disposition of Notes
Non-U.S. Holders generally will not be subject to U.S. federal income tax on any gain realized on the sale, exchange, redemption or other
taxable disposition of notes (other than with respect to payments attributable to accrued interest, which will be taxed as described under "Taxation of
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Interest"
above). This general rule, however, is subject to several exceptions. For example, the gain would be subject to U.S. federal income tax if:
-
-
the gain is effectively connected with the conduct by the Non-U.S. Holder of a U.S. trade or business (and, if an income tax treaty applies,
the gain is attributable to a U.S. permanent establishment maintained by the Non-U.S. Holder), in which case it would be subject to tax as described below under "Income or Gains
Effectively Connected with a U.S. Trade or Business;" or
-
-
subject to certain exceptions, the Non-U.S. Holder is an individual who is present in the United States for 183 days or more in the
taxable year of the disposition and certain other conditions are satisfied, in which case, except as otherwise provided by an applicable income tax treaty, the gain would be subject to a flat
30 percent tax, which may be offset by certain U.S. source capital losses, even if the individual is not considered a resident of the U.S., provided the Non-U.S. Holder has timely filed U.S.
federal income tax returns with respect to such losses.
The preceding discussion of the U.S. federal income and withholding tax considerations of the purchase, ownership or disposition of the notes by
a Non-U.S. Holder assumes that any interest on the notes or any gain realized on the sale, exchange, redemption or other taxable disposition of the notes is not effectively connected with a trade or
business in the United States, if any, conducted by the Non-U.S. Holder. If any interest on the notes or gain from the sale, exchange, redemption or other taxable disposition of the notes is
effectively connected with a U.S. trade or business conducted by the Non-U.S. Holder, then the income or gain will be subject to U.S. federal income tax at regular graduated rates in the same manner
as the income or gain of a U.S. Holder. If the Non-U.S. Holder is eligible for the benefits of an applicable income tax treaty between the U.S. and the holder's country of residence, any "effectively
connected" income or gain will generally be subject to U.S. federal income tax only if it is also attributable to a permanent establishment maintained by the holder in the United States. Payments of
interest that are effectively connected with a U.S. trade or business (and, if an income tax treaty applies, attributable to a U.S. permanent establishment maintained by the Non-U.S. Holder), and
therefore included in the gross income of a Non-U.S. Holder, will not be subject to the 30 percent withholding tax described above; provided, that the holder claims exemption from withholding.
To claim exemption from withholding in the case of U.S. trade or business income, or to claim the benefits of an applicable income tax treaty, the Non-U.S. Holder must certify its qualification, which
generally can be done by filing a properly completed and executed IRS Form W-8ECI (in the case of a U.S. trade or business income) or properly completed and executed IRS Form W-8BEN or
IRS Form W-8BEN-E (in the case of a treaty), or any successor form as the IRS designates, as applicable, prior to the payment of interest. If the Non-U.S. Holder is a corporation, that portion
of its earnings and profits that is effectively connected with its U.S. trade or business may also be subject to an additional "branch profits tax" at a 30% rate (or, if applicable, a lower income tax
treaty rate).
Under the Foreign Account Tax Compliance Act and the U.S. Treasury Regulations and administrative guidance promulgated thereunder ("FATCA"),
withholding taxes may apply to certain types of payments made to "foreign financial institutions" (as specially defined in the Code) and certain other non-U.S. entities, including foreign financial
institutions and other entities acting as an intermediary. Specifically, a 30% withholding tax may be imposed on interest on notes paid to a foreign financial institution or to a non-financial foreign
entity, unless (1) the foreign financial institution undertakes certain diligence and reporting, (2) the non-financial foreign entity either certifies it does not have any substantial
United States owners or furnishes identifying information regarding each substantial United States owner, or (3) the foreign financial institution or non-financial foreign entity
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otherwise
qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in clause (1) above, then,
pursuant to an agreement between it and the U.S. Treasury, it must, among other things, identify accounts held by certain United States persons or United States-owned foreign entities, annually report
certain information about such accounts, and withhold 30% on payments to non-compliant foreign financial institutions and certain other account holders.
Under
the applicable U.S. Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of interest on a note. While withholding under FATCA
would have applied also to payments of gross proceeds from the sale or other disposition of a note on or after January 1, 2019, recently proposed U.S. Treasury Regulations eliminate FATCA
withholding on payments of gross proceeds entirely. Taxpayers generally may rely on these proposed U.S. Treasury Regulations until final U.S. Treasury Regulations are issued.
Foreign
financial institutions located in jurisdictions that have entered into an intergovernmental agreement with the United States with respect to FATCA may be subject to different
rules. Holders should consult their own tax advisors regarding FATCA, the U.S. Treasury Regulations thereunder and any applicable intergovernmental agreements with respect to FATCA.
Information Reporting and Backup Withholding
Payments of interest to U.S. Holders and payments to U.S. Holders upon a sale, exchange, redemption or other taxable disposition of the notes
generally will be subject to information reporting on IRS Form 1099, and will be subject to backup withholding, unless the U.S. Holder provides the applicable payor or its agent with a correct
taxpayer identification number, certified under penalties of perjury, as well as certain other information, or otherwise establishes an exemption from backup withholding. Backup withholding is not an
additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against that U.S. Holder's U.S. federal income tax liability provided that the required
information is timely furnished to the IRS.
Backup withholding and information reporting on IRS Form 1099 will not apply to payments of interest to a Non-U.S. Holder provided that
the Non-U.S. Holder is (1) the beneficial owner of the notes and certifies to the applicable payor or its agent, under penalties of perjury, that the holder not a United States person and
provides a duly executed IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable (or a suitable substitute form), (2) a securities clearing organization, bank or other financial
institution, that holds customers' securities in the ordinary course of its trade or business (a "financial institution") and that certifies under penalties of perjury that such an IRS
Form W-8BEN or IRS Form W-8BEN-E (or a suitable substitute form) has been received from the beneficial owner by it or by a financial institution between it and the beneficial owner and
furnishes the payor with a copy thereof, or (C) otherwise exempt from backup withholding and information reporting (provided that the applicable withholding agent does not have actual knowledge
or reason to know that the holder is a United States person or that the conditions of any other exemptions are not in fact satisfied).
Information
reporting and backup withholding generally will not apply to a payment of the proceeds of a sale, exchange, redemption or other taxable disposition of notes effected outside
the United States by a foreign office of a foreign broker. However, information reporting requirements (but not backup
withholding) will apply to a payment of the proceeds of a sale, redemption, retirement or other taxable disposition of notes effected outside the United States by a foreign office of a broker if the
broker (i) is a United States person, (ii) derives 50% or more of its gross income for certain periods from the conduct of a trade or business in the United States, (iii) is a
"controlled foreign
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corporation"
for U.S. federal income tax purposes, or (iv) is a foreign partnership that, at any time during its taxable year is 50% or more (by income or capital interest) owned by United
States persons or is engaged in the conduct of a U.S. trade or business, unless in any such case the broker has documentary evidence in its records that the holder is a Non-U.S. holder and certain
conditions are met, or the holder otherwise establishes an exemption. Payment of the proceeds of a sale, exchange, redemption or other taxable disposition of notes by a United States office of a
broker will be subject to both backup withholding and information reporting unless the holder certifies its non-U.S. status under penalties of perjury or otherwise establishes an exemption.
Information returns are required to be filed by the IRS in connection with any interest paid to the Non-U.S. Holder, regardless of whether any tax was withheld.
Backup
withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against that Non-U.S. Holder's U.S. federal
income tax liability provided the required information is timely furnished to the IRS.
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UNDERWRITING
Barclays Capital Inc. is acting as the representative of the underwriters and a book-running manager of this offering. Under the terms of
an underwriting agreement, among us and the underwriters, each of the underwriters named below has severally agreed to purchase from us the principal amount of the notes set forth opposite their names
below:
|
|
|
|
|
Underwriters
|
|
Principal Amount
of Notes
|
|
Barclays Capital Inc.
|
|
$
|
110,000,000
|
|
Deutsche Bank Securities Inc.
|
|
|
82,500,000
|
|
RBC Capital Markets, LLC
|
|
|
82,500,000
|
|
BofA Securities, Inc.
|
|
|
48,125,000
|
|
BMO Capital Markets Corp.
|
|
|
48,125,000
|
|
Goldman Sachs & Co. LLC
|
|
|
48,125,000
|
|
J.P. Morgan Securities LLC
|
|
|
48,125,000
|
|
Capital One Securities, Inc.
|
|
|
13,750,000
|
|
Citigroup Global Markets Inc.
|
|
|
13,750,000
|
|
Citizens Capital Markets, Inc.
|
|
|
13,750,000
|
|
Credit Suisse Securities (USA) LLC
|
|
|
13,750,000
|
|
Rabo Securities USA, Inc.
|
|
|
13,750,000
|
|
TD Securities (USA) LLC
|
|
|
13,750,000
|
|
|
|
|
|
|
Total
|
|
$
|
550,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
underwriting agreement provides that the underwriters' obligation to purchase the notes depends on the satisfaction of the conditions contained in the underwriting agreement
including:
-
-
the obligation to purchase all of the notes offered hereby, if any of the notes are purchased;
-
-
the representations and warranties made by us and the guarantors to the underwriters are true;
-
-
there is no material change in our or the guarantors' business or the financial markets; and
-
-
we and the guarantors deliver customary closing documents to the underwriters.
Commissions and Expenses
The underwriters will purchase the notes at the discount from the offering price indicated on the cover of this prospectus supplement and
propose initially to offer and sell the notes at the offering price set forth on the front of this prospectus supplement. If all the notes are not sold at the initial offering price following the
initial offering, the underwriters may change the initial public offering price and other selling terms.
The
following table shows the underwriting discount that we will pay to the underwriters in connection with this offering, expressed as a percentage of the principal amount of the notes
and in total:
|
|
|
|
|
|
|
|
|
|
Per Note
|
|
Total
|
|
Underwriting discount
|
|
|
1.125
|
%
|
$
|
6,187,500
|
|
We
estimate that our share of the total expenses of the offering, excluding the underwriting discount, will be approximately $1.2 million.
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David
Wenner, a director of our company and our former president and chief executive officer, holds $1.25 million principal amount of our 2021 notes being redeemed with the
proceeds of the offering and has indicated an interest to purchase $1.25 million principal amount of the notes.
Lock-Up
We and the guarantors have agreed that we will not offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, or
file with the SEC a registration statement under the Securities Act relating to United States dollar-denominated debt securities issued or guaranteed by us or any guarantor and having a maturity of
more than one year from the date of issue, or publicly disclose the intention to make any such offer, sale, pledge, disposition or filing, without the prior written consent of Barclays
Capital Inc. for a period beginning on the date of this prospectus supplement and ending 90 days after the closing date.
Indemnification
We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act, and to contribute to
payments that the underwriters may be required to make in respect of those liabilities.
Stabilization and Short Positions
In connection with this offering, the underwriters may engage in certain transactions that stabilize, maintain or otherwise affect the price of
the notes. Specifically, the underwriters may overallot in connection with the offering of the notes, creating a syndicate short position. In addition, the underwriters may bid for and purchase notes
in the open market to cover syndicate short positions or to stabilize the price of the notes. Any of these activities may stabilize or maintain the market price of the notes above what it would be in
the absence of such activities. The underwriters are not required to engage in any of these activities, and they may end any of them at any time. We and the underwriters make no representation as to
the direction or magnitude of any effect that the transactions described above may have on the price of the notes. In addition, we and the underwriters make no representation that anyone will engage
in such transactions or that such transactions, once commenced, will not be discontinued without notice.
Settlement
We expect that delivery of the notes will be made against payment therefor on or about the closing date specified on the coverage page of this
prospectus, which will be the tenth day following the date of pricing of the notes (this settlement cycle being referred to as "T+10"). Under Rule 15c6-1 of the Securities Exchange Act of 1934,
as amended, trades in the secondary market generally are required to settle in two business days, unless the parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to
trade notes on the date of pricing or the seven succeeding business days will be required, by virtue of the fact that the notes initially will settle T+10, to specify an alternate settlement cycle at
the time of any such trade to prevent a failed settlement. Purchasers of notes who wish to trade notes on the date of pricing or the seven succeeding business days should consult their own advisors.
Electronic Distribution
A prospectus in electronic format may be made available on the Internet sites or through other online services maintained by one or more of the
underwriters and/or selling group members participating in this offering, or by their affiliates. In those cases, prospective investors may view offering terms online and, depending upon the
particular underwriter or selling group member,
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prospective
investors may be allowed to place orders online. The underwriters may agree with us to allocate a specific number of notes for sale to online brokerage account holders. Any such allocation
for online distributions will be made by the representative on the same basis as other allocations.
Other
than the prospectus in electronic format, the information on any underwriter's or selling group member's web site and any information contained in any other web site maintained by
an underwriter or selling group member is not part of the prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or any
underwriter or selling group member in its capacity as underwriter or selling group member and should not be relied upon by investors.
Other Relationships
The underwriters and certain of their respective affiliates are full service financial institutions engaged in various activities, which may
include securities sales and trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, market making, brokerage and
other financial and non-financial activities and services. The underwriters and certain of their respective affiliates have, from time to time, performed, and may in the future perform, various
commercial and investment banking and financial advisory services for the issuer, its affiliates, and other persons and entities with relationships with the issuer, for which they have received or may
in the future receive customary fees and expenses. Affiliates of certain of the underwriters serve as a lender, arranger and/or agent under our credit agreement and, as a result, those that are
lenders under our revolving credit facility under our credit agreement will receive a portion of the net proceeds of this offering, as described above. Certain of the underwriters and/or their
affiliates may hold some of the 2021 notes and may therefore receive a portion of the net proceeds of this offering to the extent used to repay the 2021 notes.
In
the ordinary course of their various business activities, the underwriters and certain of their affiliates may make or hold a broad array of investments and actively trade debt and
equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers, and such investment and securities
activities may involve securities and/or instruments of the issuer or its affiliates. If the underwriters or their affiliates have a lending relationship with us, certain of those underwriters or
their affiliates routinely hedge, and certain other of those underwriters or their affiliates may hedge, their credit exposure to us consistent with their customary risk management policies.
Typically, the underwriters and their affiliates would hedge such exposure by entering into transactions which consist of either the purchase of credit default swaps or
the creation of short positions in our securities or the securities of our affiliates, including potentially the notes offered hereby. Any such credit default swaps or short positions could adversely
affect future trading prices of the notes offered hereby. The underwriters and certain of their affiliates may also communicate independent investment recommendations, market color or trading ideas
and/or publish or express independent research views in respect of such securities or instruments and may at any time hold, or recommend to clients that they acquire, long and/or short positions in
such securities and instruments.
Selling Restrictions
Canada
The notes may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in
National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as
defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale
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of
the notes must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws.
Securities
legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus supplement or the accompanying
prospectus (including any amendment hereto or thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit
prescribed by the securities legislation of the purchaser's province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser's province or
territory for particulars of these rights or consult with a legal advisor.
Pursuant
to section 3A.3 of National Instrument 33-105 Underwriting Conflicts (NI 33-105), the underwriters are not required to comply with the disclosure
requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.
United Kingdom
This prospectus supplement and the accompanying base prospectus have not been approved by an authorized person for the purposes of
section 21 of the Financial Services and Markets Act 2000 ("FSMA") and are, accordingly, only being distributed in the United Kingdom to, and are only directed at (i) investment
professionals falling within the description of persons in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Financial Promotion
Order"); or (ii) high net worth companies and other persons falling within Article 49(2)(a) to (d) of the Financial Promotion Order; or (iii) to any other person to whom
they may otherwise lawfully be communicated or made in accordance with the Financial Promotion Order (all such persons together being referred to as "relevant persons").
The
notes are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such notes will be engaged in only with, relevant persons. Any person
who is not a relevant person should not act or rely on this document or any of its contents.
An
invitation or inducement to engage in investment activity (within the meaning of Section 21 of FSMA) in connection with the issue or sale of any notes which are the subject of
the offering contemplated by this prospectus will only be communicated or caused to be communicated in circumstances in which Section 21(1) of FSMA does not apply to us.
EEA
The notes are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any
retail investor in the European Economic Area. For these purposes a retail investor means a person who is one (or more) of:
-
-
a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, "MiFID II");
-
-
a customer within the meaning of Directive (EU) 2016/97, where that customer would not qualify as a professional client as defined in point
(10) of Article 4(1) of MiFID II; or
-
-
not a qualified investor as defined in Regulation (EU) 2017/1129 (as amended or superseded, the "Prospectus Regulation").
Consequently,
no key information document required by Regulation (EU) No 1286/2014 (as amended, the "PRIIPs Regulation") for offering or selling the notes or otherwise making them
available to retail investors in the European Economic Area has been prepared and therefore offering or selling the notes or otherwise making them available to any retail investor in the European
Economic Area may be unlawful under the PRIIPs Regulation.
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Table of Contents
This
prospectus supplement and accompanying base prospectus have been prepared on the basis that any offer of notes in any Member State of the European Economic Area will be made
pursuant to an exemption under the Prospectus Regulation from the requirement to publish a prospectus for offers of notes. Neither this prospectus supplement nor the accompanying base prospectus is a
prospectus for purposes of the Prospectus Regulation.
Hong Kong
The notes may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the
public within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), or (ii) to "professional investors" within the meaning of the
Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a "prospectus" within the
meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation or document relating to the notes may be issued or may be in the possession of any person for the
purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to
do so under the laws of Hong Kong) other than with respect to notes which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" within the meaning
of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.
Singapore
This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other
document or material in connection with the offer or sale, or invitation for subscription or purchase, of the notes offered hereby may not be circulated or distributed, nor may the notes be offered or
sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under
Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the "SFA"), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to
Section 275(1A), and in accordance with the conditions specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other
applicable provision of the SFA, in each case subject to compliance with conditions set forth in the SFA.
Where
the notes offered hereby are subscribed or purchased under Section 275 of the SFA by a relevant person which is:
-
-
a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold
investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or
-
-
a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an
individual who is an accredited investor,
shares,
debentures and units of shares and debentures of that corporation or the beneficiaries' rights and interest (howsoever described) in that trust shall not be transferred within six months after
that corporation or that trust has acquired the notes offered hereby pursuant to an offer made under Section 275 of the SFA except:
-
-
to an institutional investor (for corporations, under Section 274 of the SFA) or to a relevant person defined in Section 275(2)
of the SFA, or to any person pursuant to an offer that is made on terms that such shares, debentures and units of shares and debentures of that corporation or such rights and interest in that trust
are acquired at a consideration of not less than S$200,000 (or its equivalent in a foreign currency) for each transaction, whether such amount is to be paid
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Table of Contents
Solely
for the purposes of its obligations pursuant to sections 309B(1)(a) and 309B(1)(c) of the SFA, we have determined, and hereby notify all relevant persons (as defined in
Section 309A of the SFA) that the notes offered hereby are "prescribed capital markets products" (as defined in the Securities and Futures (Capital Markets Products) Regulations 2018)
and Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on Investment Products).
Japan
The notes offered hereby have not been and will not be registered under the Financial Instruments and Exchange Law of Japan. The notes offered
hereby have not been offered or sold and will not be offered or sold, directly or indirectly, in Japan or to or for the account of any resident of Japan (including any corporation or other entity
organized under the laws of Japan), except (i) pursuant to an exemption from the registration requirements of the Financial Instruments and Exchange Law and (ii) in compliance with any
other applicable requirements of Japanese law.
LEGAL MATTERS
The validity of the notes and subsidiary guarantees offered hereby will be passed upon for us by Dechert LLP, Philadelphia, Pennsylvania
with respect to certain guarantors and Ice Miller LLP will pass on certain matters of state law in connection with the guarantees. Certain legal matters relating to this offering will be passed
upon for the underwriters by Latham & Watkins LLP, New York, New York.
EXPERTS
The consolidated financial statements and schedule of B&G Foods, Inc. and subsidiaries as of December 29, 2018 and
December 30, 2017, and for the years ended December 29, 2018, December 30, 2017 and December 31, 2016, and management's assessment of the effectiveness of internal control
over financial reporting as of December 29, 2018 have been incorporated by reference herein in reliance upon the reports of KPMG LLP, independent registered public accounting firm,
incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Exchange Act. In accordance with the Exchange Act, we file periodic reports, proxy
statements and information statements and other information with the SEC.
We
have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the securities offered hereby. This prospectus supplement does not contain
all of the information set forth in the registration statement and the exhibits and schedules to the registration statement. For further information with respect to our company and the securities
offered hereby, reference is made to the registration statement and the exhibits and schedules filed as a part of the registration statement. Statements contained in this prospectus supplement
concerning the contents of any contract or any other document are not necessarily complete; reference is made in each instance to the copy of such contract or any other document filed as an exhibit to
the registration statement. Each such statement is qualified in all respects by such reference to such exhibit.
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Table of Contents
The
SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file with the SEC. The site's Internet address is
www.sec.gov. Our SEC filings are also available to the public, free of charge, from our website at www.bgfoods.com. We will furnish without charge to each person to whom a copy of this prospectus
supplement is delivered, upon written or oral request, a copy of any and all of these filings (except exhibits, unless they are specifically incorporated by reference into this prospectus supplement).
Please direct any requests for copies to:
B&G
Foods, Inc.
Four Gatehall Drive
Parsippany, NJ 07054
Attention: Corporate Secretary
Telephone: 973.401.6500
Fax: 973.630.6550
E-Mail: corporatesecretary@bgfoods.com
INCORPORATION BY REFERENCE
The SEC allows us to incorporate by reference in this prospectus supplement the information we file with the SEC, which means that we can
disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be a part of this prospectus supplement. We incorporate by
reference in this prospectus supplement the
information contained in the following documents (other than any portions of the respective filings that were furnished under applicable SEC rules rather than
filed):
-
-
our annual report on
Form 10-K for the year ended December 29, 2018 filed on February 26, 2019;
-
-
our quarterly reports on Form 10-Q for the quarter ended March 30, 2019 filed on
May 7, 2019 and the quarter ended June 29, 2019 filed on
August 6, 2019;
-
-
our current reports on Form 8-K filed on
January 29, 2019 (as amended by
Amendment No. 1 to such Form 8-K, filed on March 1, 2019),
March 1, 2019,
March 18, 2019,
May 28, 2019 and
September 10, 2019; and
-
-
Part III of our annual
report on Form 10-K for the year ended December 29, 2018 filed on February 26, 2019.
We
are also incorporating by reference all other reports that we will file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (other than any portions
of the respective filings that will be furnished under applicable SEC rules rather than filed) until all the securities that may be offered under this prospectus supplement are sold. The information
that we file with the SEC after the date of this prospectus supplement and prior to the completion of the offering of the securities under this prospectus supplement will update and supersede the
information contained in this prospectus supplement and incorporated filings. You will be deemed to have notice of all information incorporated by reference in this prospectus supplement as if that
information was included in this prospectus supplement.
You
may obtain copies of these documents from us, free of cost, by contacting us at the address or telephone number provided in "Where You Can Find More Information" immediately above.
S-100
PROSPECTUS
Common Stock
Preferred Stock
Debt Securities
Warrants
Units
We may offer and sell, from time to time in one or more offerings, together or separately, common stock, preferred stock, debt securities,
warrants or units. This prospectus also covers subsidiary guarantees, if any, of our payment obligations under any debt securities, which may be given by our subsidiaries, on terms to be determined at
the time of the offering.
We
will provide the specific terms of these securities in supplements to this prospectus. The prospectus supplement may also add, update or change information in this prospectus. Before
you invest, we urge you to read carefully this prospectus and any prospectus supplement, as well as the documents incorporated by reference or deemed to be incorporated by reference into this
prospectus.
We
will sell these securities directly, or through agents, dealers or underwriters as designated from time to time, or through a combination of these methods. The prospectus supplement
for each offering of securities will describe in detail the plan of distribution for that offering. For general information about the distribution of securities offered, please see "Plan of
Distribution" in this prospectus. If our agents or any dealers or underwriters are involved in the sale of the securities, the applicable prospectus supplement will set forth any applicable
commissions or discounts. Our net proceeds from the sale of securities also will be set forth in the applicable prospectus supplement.
This prospectus may not be used to offer or sell our securities unless accompanied by a prospectus supplement.
Shares
of our common stock are traded on the New York Stock Exchange under the symbol "BGS." Each prospectus supplement will indicate if the securities offered thereby will be listed on
the New York Stock Exchange or any other securities exchange.
The
mailing address of our principal executive offices is Four Gatehall Drive, Parsippany, NJ 07054, and our telephone number is 973.401.6500.
Investing in our securities involves a high degree of risk which is described in the "Risk Factors" section beginning on page iii of this
prospectus. We urge you to carefully read the "Risk Factors" section before you make your investment decision.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is August 7, 2019
TABLE OF CONTENTS
i
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission (SEC) using a "shelf" registration
process. Under this shelf registration process, we may offer from time to time, in one or more offerings, together or separately, common stock, preferred stock, debt securities, warrants or units.
Each time we offer securities, we will provide you with a prospectus supplement that describes the specific amounts, prices and terms of the securities we offer. The prospectus supplement also may
add, update or change information contained in this prospectus. You should read carefully both this prospectus and any prospectus supplement together with additional information described below under
the caption "Where You Can Find More Information."
This
prospectus does not contain all the information provided in the registration statement we filed with the SEC. For further information about us or our securities offered hereby, you
should refer to that registration statement, which you can obtain from the SEC as described below under the heading "Where You Can Find More Information."
We
have not authorized anyone to provide information or to make any representations other than those contained in this prospectus or a prospectus supplement. We take no responsibility
for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is not an offer to sell securities, and it is not soliciting an offer to buy
securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or any prospectus supplement, as well as information we
have previously filed with
the SEC and incorporated by reference, is accurate as of the date on the front of those documents only. Our business, financial condition, results of operations and prospects may have changed since
those dates.
We
may sell securities through underwriters or dealers, through agents, directly to purchasers or through a combination of these methods. We and our agents reserve the sole right to
accept or reject, in whole or in part, any proposed purchase of securities. The prospectus supplement, which we will provide to you each time we offer securities, will set forth the names of any
underwriters, dealers, agents or others involved in the sale of securities and any applicable fee, commission or discount arrangements with them. See the information described below under the heading
"Plan of Distribution."
The
terms "B&G Foods," "our," "we" and "us," as used in this prospectus, refer to B&G Foods, Inc. and its wholly-owned subsidiaries, except where it is clear that the term refers
only to the parent company.
ii
RISK FACTORS
Before making an investment decision, you should carefully consider the risks described under "Risk Factors" in the applicable prospectus
supplement and in our most recent Annual Report on Form 10-K, or any updates in our Quarterly Reports on Form 10-Q, together with all of the other information appearing in this
prospectus or incorporated or deemed to be incorporated by reference into this prospectus and any applicable prospectus supplement, in light of your particular investment objectives and financial
circumstances. Our business, financial condition or results of operations could be materially adversely affected by any of these risks. The trading price of our securities could decline due to any of
these risks, and you may lose all or part of your investment.
iii
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated or deemed to be incorporated by reference in this prospectus, and each prospectus supplement
relating to a particular offering of securities, contain forward-looking statements. The words "believes," "belief," "expects," "projects," "intends," "anticipates," "assumes," "could," "should,"
"estimates," "potential," "seek," "predict," "may," "will" or "plans" and similar references to future periods are intended to identify forward-looking statements. These forward-looking statements
involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance and achievements, or industry results, to be materially different from any future
results, performance, or achievements expressed or implied by any forward-looking statements. We believe important factors that could cause actual results to differ materially from our expectations
include the following:
-
-
our substantial leverage;
-
-
the effects of rising costs for our raw materials, packaging and ingredients;
-
-
crude oil prices and their impact on distribution, packaging and energy costs;
-
-
our ability to successfully implement sales price increases and cost saving measures to offset any cost increases;
-
-
intense competition, changes in consumer preferences, demand for our products and local economic and market conditions;
-
-
our continued ability to promote brand equity successfully, to anticipate and respond to new consumer trends, to develop new products and
markets, to broaden brand portfolios in order to compete effectively with lower priced products and in markets that are consolidating at the retail and manufacturing levels, and to improve
productivity;
-
-
the risks associated with the expansion of our business;
-
-
our possible inability to identify new acquisitions or to integrate recent or future acquisitions or our failure to realize anticipated revenue
enhancements, cost savings or other synergies;
-
-
tax reform legislation, including the effects of the U.S. Tax Cuts and Jobs Act;
-
-
our ability to access the credit markets and our borrowing costs and credit ratings, which may be influenced by credit markets generally and
the credit ratings of our competitors;
-
-
unanticipated expenses, including, without limitation, litigation or legal settlement expenses;
-
-
the effects of currency movements of the Canadian dollar and the Mexican peso as compared to the U.S. dollar;
-
-
the effects of international trade disputes, tariffs, quotas, and other import or export restrictions on our international procurement, sales
and operations;
-
-
future impairments of our goodwill and intangible assets;
-
-
our ability to successfully complete the implementation of and operate a new enterprise resource planning (ERP) system;
-
-
our ability to protect information systems against, or effectively respond to, a cybersecurity incident or other disruption;
-
-
our sustainability initiatives and changes to environmental laws and regulations;
iv
-
-
other factors that affect the food industry generally, including:
-
-
recalls if products become adulterated or misbranded, liability if product consumption causes injury, ingredient disclosure and
labeling laws and regulations and the possibility that consumers could lose confidence in the safety and quality of certain food products;
-
-
competitors' pricing practices and promotional spending levels;
-
-
fluctuations in the level of our customers' inventories and credit and other business risks related to our customers operating in
a challenging economic and competitive environment; and
-
-
the risks associated with third-party suppliers and co-packers, including the risk that any failure by one or more of our
third-party suppliers or co-packers to comply with food safety or other laws and regulations may disrupt our supply of raw materials or certain finished goods products or injure our reputation; and
-
-
other factors discussed under "Risk Factors" or elsewhere in this prospectus and the documents incorporated or deemed incorporated herein by
reference.
Developments
in any of these areas, which are more fully described elsewhere in this prospectus and the documents incorporated or deemed to be incorporated by reference in this
prospectus, and each applicable prospectus supplement, could cause our results to differ materially from results that have been or may be projected by us or on our behalf.
All
forward-looking statements included in this prospectus are based on information available to us on the date of this prospectus. We undertake no obligation to publicly update or
revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to us or persons
acting on our behalf are expressly qualified in their entirety by the cautionary statements contained in this prospectus.
We
caution that the foregoing list of important factors is not exclusive. There may be other factors that may cause our actual results to differ materially from the forward-looking
statements, including factors disclosed elsewhere in this prospectus or incorporated or deemed to be incorporated by reference in this prospectus or any applicable prospectus supplement. You should
evaluate all forward-looking statements in the context of these risks and uncertainties. We urge you not to unduly rely on forward-looking statements contained or incorporated or deemed to be
incorporated by reference in this prospectus or any applicable prospectus supplement.
v
THE COMPANY
We manufacture, sell and distribute a diverse portfolio of branded, high quality, shelf-stable and frozen food and household products across the
United States, Canada and Puerto Rico. Many of our branded products have leading regional or national market shares. In general, we position our branded products to appeal to the consumer desiring a
high quality and reasonably priced product. We complement our branded product retail sales with institutional and foodservice sales and private label sales.
Our
company has been built upon a successful track record of acquisition-driven growth. Our goal is to continue to increase sales, profitability and cash flows through strategic
acquisitions, new product development and organic growth. We intend to implement our growth strategy through the following initiatives: expanding our brand portfolio with disciplined acquisitions of
complementary branded businesses, continuing to develop new products and delivering them to market quickly, leveraging our multiple-channel sales and distribution system and continuing to focus on
higher growth customers and distribution channels. Since 1996, we have successfully acquired and integrated more than 50 brands into our company.
Our
products include frozen and canned vegetables, oatmeal and other hot cereals, fruit spreads, canned meats and beans, bagel chips, spices, seasonings, hot sauces, wine vinegar, maple
syrup, molasses, salad dressings, pizza crusts, Mexican-style sauces, dry soups, taco shells and kits, salsas, pickles, peppers, tomato-based products, cookies and crackers, nut clusters and other
specialty products. Our products are marketed under many recognized brands, including Ac'cent, B&G, B&M, Back to Nature, Baker's Joy,
Bear Creek Country Kitchens, Brer Rabbit, Canoleo, Cary's, Clabber Girl, Cream of Rice, Cream of Wheat, Davis, Devonsheer,
Don Pepino, Durkee, Emeril's, Grandma's Molasses, Green Giant, JJ Flats, Joan of Arc, Las Palmas, Le Sueur, MacDonald's, Mama Mary's,
Maple Grove Farms of Vermont, McCann's, Molly McButter, Mrs. Dash, New York Flatbreads, New York Style,
Old London, Ortega, Polaner, Red Devil, Regina, Rumford, Sa-són, Sclafani, SnackWell's, Spice Islands, Spring Tree, Sugar Twin, Tone's, Trappey's,
TrueNorth, Underwood, Vermont Maid, Victoria, Weber and Wright's. We also sell and distribute Static Guard,
a household product brand. We compete in the retail grocery, foodservice, specialty, private label, club and mass merchandiser channels of distribution. We sell and distribute our products directly
and via a network of independent brokers and distributors to supermarket chains, foodservice outlets, mass merchants, warehouse clubs, non-food outlets and specialty distributors.
B&G
Foods, including our subsidiaries and predecessors, has been in business for over 125 years. We were incorporated in Delaware on November 25, 1996 under the name B
Companies Holdings Corp. On August 11, 1997, we changed our name to B&G Foods Holdings Corp. On October 14, 2004, simultaneously with the completion of our initial public
offering, B&G Foods, Inc., then our wholly owned subsidiary, was merged with and into us and we were renamed B&G Foods, Inc. Our executive offices are located at Four
Gatehall Drive, Parsippany, NJ, 07054, and our telephone number is 973.401.6500. We maintain a website at www.bgfoods.com. The information on our
website is not a part of this prospectus or incorporated by reference herein.
USE OF PROCEEDS
Except as otherwise provided in a prospectus supplement, we will use the net proceeds from the sale of the securities for general corporate
purposes, which may include reducing or refinancing our outstanding indebtedness, increasing our working capital or financing acquisitions and capital expenditures. When a particular series of
securities is offered, the prospectus supplement relating to that offering will set forth our intended use of the net proceeds received from the sale of those securities. Pending the application of
the net proceeds for these purposes, we expect to invest the proceeds in short-term, interest-bearing instruments or other investment-grade securities.
GENERAL DESCRIPTION OF THE SECURITIES WE MAY OFFER
We, directly or through agents, dealers or underwriters designated from time to time, may offer, issue and sell, together or
separately:
-
-
shares of our common stock;
-
-
shares of our preferred stock;
-
-
debt securities, in one or more series, and which may be guaranteed by certain of our subsidiaries;
-
-
warrants to purchase our debt or equity securities; or
-
-
any combination of the foregoing, either individually or as units consisting of one or more of the foregoing, each on terms to be determined at
the time of sale.
We
may issue debt securities that are exchangeable for or convertible into shares of our common stock or our preferred stock. The preferred stock may also be exchangeable for and/or
convertible into shares of our common stock or another series of our preferred stock.
When
a particular series of securities is offered, a supplement to this prospectus will be delivered with this prospectus, which will set forth the terms of the offering and sale of the
offered securities, as well
as complete descriptions of the security or securities to be offered pursuant to the prospectus supplement. The summary descriptions of securities included in this prospectus are not meant to be
complete descriptions of each security.
DESCRIPTION OF CAPITAL STOCK
General
The following description of common stock and preferred stock, together with the additional information we include in any applicable prospectus
supplements, summarizes the material terms and provisions of the common stock and preferred stock that we may offer under this prospectus. For the complete terms of our common stock and preferred
stock, please refer to our certificate of incorporation, as amended from time to time, any certificates of designation for our preferred stock, and our bylaws, as amended from time to time. The
Delaware General Corporation Law may also affect the terms of these securities. While the terms we have summarized below will apply generally to any future common stock or preferred stock that we may
offer, we will describe the particular terms of any series of these securities in more detail in the applicable prospectus supplement. If we so indicate in a prospectus supplement, the terms of any
common stock or preferred stock we offer under that prospectus supplement may differ from the terms we describe below.
Our
authorized capital stock consists of:
-
-
125,000,000 shares of common stock, par value $0.01 per share; and
-
-
1,000,000 shares of preferred stock, par value $0.01 per share.
As
of August 6, 2019, there are 65,375,514 shares of our common stock outstanding. There are no shares of preferred stock outstanding.
Common Stock
Voting. The holders of our common stock are entitled to one vote per share with respect to each matter on which the holders of our
common stock are
entitled to vote.
No Cumulative Voting Rights. The holders of our common stock are not entitled to cumulate their votes in the election of our directors.
2
Rights to Dividends and on Liquidation, Dissolution or Winding Up. The holders of our common stock are entitled to receive dividends as
they may be
lawfully declared from time to time by our board of directors, subject to any preferential rights of holders of any outstanding shares of preferred stock. In the event of any liquidation, dissolution
or winding up of our company, common stockholders are entitled to share ratably in our assets available for distribution to the stockholders, subject to the prior rights of holders of any outstanding
preferred stock.
Our
dividend policy reflects a basic judgment that our stockholders are better served when we distribute a substantial portion of our cash available to pay dividends to them instead of
retaining it in our business. Under this policy, a substantial portion of the cash generated by our company in excess of operating needs, interest and principal payments on indebtedness, capital
expenditures sufficient to maintain our properties and other assets is distributed as regular quarterly cash dividends to the holders of our common stock and not retained by us.
We
have paid dividends every quarter since our initial public offering in October 2004. Our current quarterly dividend rate is $0.475 per share. The following table sets forth the
dividends per share we have declared in each of the quarterly periods of 2017 and 2018 and the first three quarterly periods of 2019:
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|
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|
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Fiscal 2019
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|
Fiscal 2018
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|
Fiscal 2017
|
|
Fourth Quarter
|
|
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N/A
|
|
$
|
0.475
|
|
$
|
0.465
|
|
Third Quarter
|
|
$
|
0.475
|
|
$
|
0.475
|
|
$
|
0.465
|
|
Second Quarter
|
|
$
|
0.475
|
|
$
|
0.475
|
|
$
|
0.465
|
|
First Quarter
|
|
$
|
0.475
|
|
$
|
0.465
|
|
$
|
0.465
|
|
However,
notwithstanding the dividend policy, the amount of dividends, if any, for each dividend payment date will be determined by our board of directors on a quarterly basis after
taking into account various factors, including our results of operations, cash requirements, financial condition, the dividend restrictions set forth in our debt agreements, provisions of applicable
law and other factors that our board of directors may deem relevant. Our dividend policy is based upon our current assessment of our business and the environment in which we operate, and that
assessment could change
based on competitive or other developments (which could, for example, increase our need for capital expenditures or working capital), new acquisition opportunities or other factors. Our board of
directors is free to depart from or change our dividend policy at any time and could do so, for example, if it was to determine that we have insufficient cash to take advantage of growth
opportunities.
We cannot assure you that we will continue to pay dividends at the historical level set forth above or at all. Dividend payments are not mandatory or guaranteed,
and holders of our common stock do not have any legal right to receive, or require us to pay, dividends. Our board of directors may, in its sole discretion, amend or repeal this dividend policy at any
time. Furthermore, our board of directors may decrease the level of dividends below the rate historically paid or discontinue entirely the payment of dividends.
Preemptive and Other Subscription Rights. Common stockholders do not have preemptive, subscription or redemption rights and are not
subject to
further calls or assessments.
Additional Issuance of Our Authorized Common Stock. Additional shares of our authorized common stock may be issued, as determined by
the board of
directors of our company from time to time, without approval of holders of our common stock, except as may be required by applicable law or the rules of any stock exchange or automated quotation
system on which our securities may be listed or traded.
3
Preferred Stock
Our certificate of incorporation provides that we may issue up to 1,000,000 shares of our preferred stock in one or more series as may be
determined by our board of directors.
Our
board of directors has broad discretionary authority with respect to the rights of issued series of our preferred stock and may take several actions without any vote or action of the
holders of our common stock, including:
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determining the number of shares to be included in each series;
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fixing the designation, powers, preferences and relative rights of the shares of each series and any qualifications, limitations or
restrictions with respect to each series, including provisions related to dividends, conversion, voting, redemption and liquidation, which may be superior to those of our common stock; and
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increasing or decreasing the number of shares of any series.
The
board of directors may authorize, without approval of holders of our common stock, the issuance of preferred stock with voting and conversion rights that could adversely affect the
voting power and other rights of holders of our common stock. For example, our preferred stock may rank prior to our common stock as to dividend rights, liquidation preferences or both, may have full
or limited voting rights and may be convertible into shares of our common stock. The number of authorized shares of our preferred stock may be increased or decreased (but not below the number of
shares then outstanding) by the affirmative vote of the holders of at least a majority of our common stock, without a vote of the holders of any other class or series of our preferred stock unless
required by the terms of such class or series of preferred stock.
Our
preferred stock could be issued quickly with terms designed to delay or prevent a change in the control of our company or to make the removal of our management more difficult. This
could have the effect of discouraging third-party bids for our common stock or may otherwise adversely affect the market price of our common stock.
We
believe that the ability of our board of directors to issue one or more series of our preferred stock will provide us with flexibility in structuring possible future financings and
acquisitions, and in meeting other corporate needs that might arise. The authorized shares of our preferred stock, as well as shares of our common stock, will be available for issuance without action
by our common stockholders, unless such action is required by applicable law or the rules of any stock exchange or automated quotation system on which our securities may be listed or traded.
Although
our board of directors has no intention at the present time of doing so, it could issue a series of our preferred stock that could, depending on the terms of such series, be
used to implement a stockholder rights plan or otherwise impede the completion of a merger, tender offer or other takeover attempt of our company. Our board of directors could issue preferred stock
having terms that could discourage an acquisition attempt through which an acquiror may be able to change the composition of the board of directors, including a tender offer or other transaction that
some, or a majority, of our stockholders might believe to be in their best interests or in which stockholders might receive a premium for their stock over the then current market price.
Composition of Board of Directors; Election and Removal of Directors
In accordance with our bylaws, the number of directors comprising our board of directors will be as determined from time to time by our board of
directors. We currently have nine directors. Each director is to hold office until his or her successor is duly elected and qualified. Directors are elected for a term that will expire at the annual
meeting of stockholders immediately succeeding their election.
4
Directors
may be removed from office with or without cause by the affirmative vote of the holders of at least a majority of the voting power of all then-outstanding shares of our capital
stock that are entitled to vote generally in the election of our directors, voting together as a single class. Subject to the rights of the holders of any series of preferred stock, our certificate of
incorporation provides that in the case of any vacancies among the directors such vacancy will be filled with a candidate approved by the vote of a majority of the remaining directors, even if less
than a quorum (and not by stockholders).
The
filling of vacancies could have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from attempting to acquire, control of us.
At
any meeting of our board of directors, a majority of the total number of directors then in office will constitute a quorum for all purposes.
Stockholder Action
Stockholders may act by written consent, without a meeting and without notice or a vote. This provision enables stockholders to act on matters
subject to a stockholder vote without waiting until the next annual or special meeting of stockholders.
Special Meetings of Stockholders
Our certificate of incorporation provides that special meetings of the stockholders may be called at any time by the board of directors, the
chairman of the board of directors or the holders of at least 20% of the outstanding shares of our common stock.
Section 203 of the Delaware General Corporation Law
Our company is subject to Section 203 of the Delaware General Corporation Law. In general, Section 203 prohibits a publicly held
Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a three-year period following the time that this stockholder becomes an interested stockholder,
unless the business combination is approved in a prescribed manner. A "business combination" includes a merger, asset sale or other transaction resulting in a financial benefit to the interested
stockholder. An "interested stockholder" is a person who, together with affiliates and associates, owns (or, in some cases, within three years prior, did own) 15% or more of the corporation's voting
stock. Under Section 203, a business combination between the corporation and an interested stockholder is prohibited unless it satisfies one of the following
conditions:
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the board of directors must have previously approved either the business combination or the transaction which resulted in the stockholder
becoming an interested stockholder;
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upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at
least 85% of the voting stock of the corporation outstanding at the time the transaction commenced (excluding, for purposes of determining the number of our shares outstanding, shares owned by
(a) persons who are directors and also officers and (b) employee stock plans, in some instances); or
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the business combination is approved by the board of directors of the corporation and authorized at an annual or special meeting of the
stockholders by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder.
The
existence of this provision may have an anti-takeover effect with respect to transactions not approved in advance by our board of directors, including discouraging takeover attempts
that might result in a premium over the market price for the shares of our common stock.
5
Other Anti-Takeover Provisions of Our Certificate of Incorporation and Bylaws
Our certificate of incorporation and bylaws contain several provisions, in addition to those pertaining to the issuance of additional shares of
our authorized common stock and preferred stock without the approval of the holders of our common stock that could delay or make more difficult the acquisition of our company through a hostile tender
offer, open market purchases, proxy contest, merger or other takeover attempt that a stockholder might consider in his or her best interest, including those attempts that might result in a premium
over the market price of our common stock. Such provisions, which are described below, include advance notice procedures regarding any proposal of stockholder business to be discussed at a
stockholders meeting.
Advance Notice Procedure for Director Nominations and Stockholder Proposals. Our bylaws provide that, subject to the rights of holders
of any
outstanding shares of our preferred stock, a stockholder may nominate one or more persons for election as directors at a meeting only if written notice of the stockholder's nomination has been given,
either by personal delivery or certified mail, to our corporate secretary not less than 120 days nor more than 150 days before the first anniversary of the date of our proxy statement in
connection with our last annual meeting of stockholders. Each notice must contain:
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the name, age, business address and, if known, residential address of each nominee;
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the principal occupation or employment of each nominee;
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a statement of the particular experience, qualifications, attributes or skills of the proposed nominee;
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the class, series and number of our shares beneficially owned by each nominee;
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any other information relating to each nominee required by the SEC's proxy rules; and
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the written consent of each nominee to be named in our proxy statement and to serve as director if elected.
Our
corporate secretary will deliver all notices to the nominating committee of our board of directors for review. After review, the nominating committee will make its recommendation
regarding nominees to our board of directors. Defective nominations will be disregarded.
For
business to be properly brought before an annual meeting by a stockholder, the stockholder must have given timely notice of the proposed business in writing to our corporate
secretary. To be timely, a stockholder's notice must be given, either by personal delivery or by certified mail, to our corporate secretary not less than 120 days nor more than 150 days
before the first anniversary of the date of our proxy statement in connection with our last annual meeting of stockholders. Each notice must contain:
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-
a brief description of the business desired to be brought before the annual meeting and the reasons for conducting the business at the annual
meeting;
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the name and address of the stockholder proposing the business as they appear on our stock transfer books;
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a representation that the stockholder is a stockholder of record and intends to appear in person or by proxy at the annual meeting to bring the
business proposed in the notice before the meeting;
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-
the class, series and number of our shares beneficially owned by the stockholder; and
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-
any material interest of the stockholder in the business.
Business
brought before an annual meeting without complying with these provisions will not be transacted.
6
Although
our bylaws do not give the board the power to approve or disapprove stockholder nominations of candidates or proposals regarding other business to be conducted at a special or
annual meeting, our bylaws may have the effect of precluding the consideration of some business at a meeting if the proper procedures are not followed or may discourage or defer a potential acquiror
from conducting a solicitation of proxies to elect its own slate of directors or otherwise attempting to obtain control of us.
Amendment of Our Certificate of Incorporation
The affirmative vote of the holders of at least a majority of the voting power of all then-outstanding shares of our capital stock that are
entitled to vote generally in the election of our directors, voting together as a single class, is required to amend, alter, change or repeal the provisions of our certificate of incorporation.
Amendment of Our Bylaws
Our certificate of incorporation provides that our bylaws can be amended only by either our board of directors or the affirmative vote of the
holders of at least a majority of the voting power of all then-outstanding shares of our capital stock that are entitled to vote generally in the election of our directors, voting together as a single
class.
Limitation of Liability and Indemnification
Our certificate of incorporation provides that, to the full extent from time to time permitted by law, no director shall be personally liable
for monetary damages for breach of any duty as a director. As required under current Delaware law, our certificate of incorporation currently provides that this waiver may not apply to
liability:
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for any breach of the director's duty of loyalty to us or our stockholders;
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for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;
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under Section 174 of the Delaware General Corporation Law (pertaining to certain prohibited act including unlawful payment of dividends
or unlawful purchase or redemption of our capital stock); or
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-
for any transaction from which the director derived any improper personal benefit.
However,
in the event the Delaware General Corporation Law is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the
liability of our directors will be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law, as so amended. Neither the amendment or repeal of this provision of
our certificate of incorporation, nor the adoption of any provision of our certificate of incorporation which is inconsistent with this provision, shall eliminate or reduce the protection afforded by
this provision with respect to any matter which occurred, or any suit or claim which, but for this provision would have accrued or arisen, prior to such amendment, repeal or adoption.
Our
bylaws also provide that we shall, to the fullest extent from time to time permitted by law, indemnify our directors and officers against all liabilities and expenses in any suit or
proceeding, arising out of their status as an officer or director or their activities in these capacities. Our bylaws also require us to indemnify any person who, at our request, is or was serving as
a director, officer or trustee of another corporation, joint venture, employee benefit plan trust or other enterprise.
7
The
right to be indemnified includes the right of an officer or a director to be paid expenses in advance of the final disposition of any proceeding, if we receive an undertaking to
repay such amount if it shall be determined that he or she is not entitled to be indemnified.
Our
board of directors may take such action as it deems necessary to carry out these indemnification provisions, including adopting procedures for determining and enforcing
indemnification rights and purchasing insurance policies. Our board of directors may also adopt bylaws, resolutions or contracts implementing indemnification arrangements as may be permitted by law.
Neither the amendment or repeal of these indemnification provisions, nor the adoption of any provision of our certificate of incorporation inconsistent with these indemnification provisions, shall
eliminate or reduce any rights to indemnification relating to their status or any activities prior to such amendment, repeal or adoption.
We
believe these provisions will assist in attracting and retaining qualified individuals to serve as directors.
Listing
Our shares of common stock are listed on the New York Stock Exchange under the trading symbol "BGS."
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is Computershare Trust Company, N.A.
DESCRIPTION OF DEBT SECURITIES
As used in this prospectus, debt securities means the debentures, notes, bonds and other evidences of indebtedness that we may issue from time
to time. The debt securities may be either secured or unsecured and will either be our senior debt securities or our subordinated debt securities. The debt securities may be issued under the
indenture, dated as of June 4, 2013, between us and the Bank of New York Mellon, as trustee, or may be issued under an indenture to be entered into between us and one or more trustees named in
the applicable prospectus supplement, a form of which is attached as an exhibit to the registration statement of which this prospectus forms a part. Any debt securities that we issue under this
prospectus will be governed by the applicable indenture and a separate supplemental indenture setting out the particular terms of a series of debt securities.
This
section describes certain general terms and provisions that we expect would be applicable to our debt securities. When we offer to sell a particular series of debt securities, we
will describe the specific terms of that series in a supplement to this prospectus. The following description of debt securities will apply to the debt securities offered by this prospectus unless we
provide otherwise in the applicable prospectus supplement. The applicable prospectus supplement for a particular series of debt securities may specify different or additional terms.
The
statements and descriptions in this prospectus or in any prospectus supplement regarding provisions of the indentures and debt securities are summaries thereof, do not purport to be
complete and are subject to, and are qualified in their entirety by reference to, all of the provisions of the indentures (and any amendments or supplements we may enter into from time to time which
are permitted under each indenture) and the debt securities, including the definitions therein of certain terms.
8
General
Unless otherwise specified in a prospectus supplement, the debt securities will be direct unsecured obligations of B&G Foods. The senior debt
securities will rank equally with any of our other senior and unsubordinated debt. The subordinated debt securities will be subordinate and junior in right of payment to any senior indebtedness.
Unless
otherwise specified in a prospectus supplement, the indentures do not limit the aggregate principal amount of debt securities that we may issue and provide that we may issue debt
securities from time to time at par or at a discount, and in the case of the new indentures, if any, in one or more series, with the same or various maturities. Unless indicated in a prospectus
supplement, we may issue additional debt securities of a particular series without the consent of the holders of the debt securities of such series outstanding at the time of the issuance. Any such
additional debt securities, together with all other outstanding debt securities of that series, will constitute a single series of debt securities under the applicable indenture.
Each
prospectus supplement will describe the terms relating to the specific series of debt securities being offered. These terms will include some or all of the
following:
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the title of debt securities and whether they are subordinated debt securities or senior debt securities;
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any limit on the aggregate principal amount of the debt securities;
-
-
the ability to issue additional debt securities of the same series;
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-
the price or prices at which we will sell the debt securities;
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whether the debt securities of the series will be guaranteed and the terms of any such guarantee;
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the maturity date or dates of the debt securities;
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the rate or rates of interest, if any, which may be fixed or variable, at which the debt securities will bear interest, or the method of
determining such rate or rates, if any;
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-
the date or dates from which any interest will accrue or the method by which such date or dates will be determined;
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-
the right, if any, to extend the interest payment periods and the duration of any such deferral period, including the maximum consecutive
period during which interest payment periods may be extended;
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whether the amount of payments of principal of (and premium, if any) or interest on the debt securities may be determined with reference to any
index, formula or other method, such as one or more currencies, commodities, equity indices or other indices, and the manner of determining the amount of such payments;
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the dates on which we will pay interest on the debt securities and the regular record date for determining who is entitled to the interest
payable on any interest payment date;
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the place or places where the principal of (and premium, if any) and interest on the debt securities will be payable, where any securities may
be surrendered for registration of transfer, exchange or conversion, as applicable, and notices and demands may be delivered to or upon us pursuant to the indenture;
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if we possess the option to do so, the periods within which and the prices at which we may redeem the debt securities, in whole or in part,
pursuant to optional redemption provisions, and the other terms and conditions of any such provisions;
9
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our obligation, if any, to redeem, repay or purchase debt securities by making periodic payments to a sinking fund or through an analogous
provision or at the option of holders of the debt securities, and the period or periods within which and the price or prices at which we will redeem, repay or purchase the debt securities, in whole or
in part, pursuant to such obligation, and the other terms and conditions of such obligation;
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the denominations in which the debt securities will be issued, if other than denominations of $2,000 and integral multiples of $1,000 in excess
thereof;
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the portion, or methods of determining the portion, of the principal amount of the debt securities which we must pay upon the acceleration of
the maturity of the debt securities in connection with an event of default (as described below), if other than the full principal amount;
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the currency, currencies or currency unit in which we will pay the principal of (and premium, if any) or interest, if any, on the debt
securities, if not U.S. dollars;
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provisions, if any, granting special rights to holders of the debt securities upon the occurrence of specified events;
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any deletions from, modifications of or additions to the events of default or our covenants with respect to the applicable series of debt
securities, and whether or not such events of default or covenants are consistent with those contained in the applicable indenture;
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any limitation on our ability to incur debt, redeem shares, sell our assets or other restrictions;
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the application, if any, of the terms of the indenture relating to defeasance and covenant defeasance (which terms are described below) to the
debt securities;
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whether the subordination provisions summarized below or different subordination provisions will apply to the debt securities;
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the terms, if any, upon which the holders may convert or exchange the debt securities into or for our common stock, preferred stock or other
securities or property;
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whether any of the debt securities will be issued in global form and, if so, the terms and conditions upon which global debt securities may be
exchanged for certificated debt securities;
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any change in the right of the trustee or the requisite holders of debt securities to declare the principal amount thereof due and payable
because of an event of default;
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-
the depository for global or certificated debt securities;
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-
any special tax implications of the debt securities;
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any trustees, authenticating or paying agents, transfer agents or registrars, or other agents with respect to the debt securities; and
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any other terms of the debt securities not inconsistent with the provisions of the applicable indenture, as amended or supplemented.
Unless
otherwise specified in the applicable prospectus supplement, the debt securities will not be listed on any securities exchange.
Unless
otherwise specified in the applicable prospectus supplement, the debt securities will be issued in fully-registered form without coupons.
Debt
securities may be sold at a substantial discount below their stated principal amount or bearing no interest or interest at a rate which at the time of issuance is below market
rates. The applicable prospectus supplement will describe the federal income tax consequences and special considerations applicable to any such debt securities. The debt securities may also be issued
as indexed securities or securities denominated in foreign currencies, currency units or composite currencies, as described in more detail in the prospectus supplement relating to any of the
particular debt securities.
10
Guarantees
Debt securities may be guaranteed by certain of our domestic subsidiaries if so provided in the applicable prospectus supplement. The prospectus
supplement will describe the terms of any guarantees, including, among other things, the method for determining the identity of the guarantors and the conditions under which guarantees will be added
or released. Any guarantees will be joint and several obligations of the guarantors. The obligations of each guarantor under its guarantee will be limited as necessary to prevent that guarantee from
constituting a fraudulent conveyance or fraudulent transfer under applicable law.
Subordination
The prospectus supplement relating to any offering of subordinated debt securities will describe the specific subordination provisions. However,
unless otherwise noted in the prospectus supplement, subordinated debt securities will be subordinate and junior in right of payment to any existing senior indebtedness.
Unless
otherwise specified in the applicable prospectus supplement, under the applicable indenture, "senior indebtedness" means all amounts due on obligations in connection with any of
the following, whether outstanding at the date of execution of the applicable indenture, or thereafter incurred or created:
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the principal of (and premium, if any) and interest due on our indebtedness for borrowed money and indebtedness evidenced by bonds, notes,
debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);
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all of our capital lease obligations or attributable debt (as will be defined in the applicable indenture) in respect of sale and leaseback
transactions;
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-
all obligations representing the balance deferred and unpaid of the purchase price of any property or services, which purchase price is due
more than six months after the date of placing such property in service or taking delivery and title thereto, except any such balance that constitutes an accrued expense or trade payable or any
similar obligation to trade creditors;
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all of our obligations in respect of interest rate swap agreements (whether from fixed to floating or from floating to fixed), interest rate
cap agreements and interest rate collar agreements; other agreements or arrangements designed to manage interest rates or interest rate risk; and other agreements or arrangements designed to protect
against fluctuations in currency exchange rates or commodity prices;
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all obligations of the types referred to above of other persons for the payment of which we are responsible or liable as obligor, guarantor or
otherwise; and
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all obligations of the types referred to above of other persons secured by any lien on any property or asset of ours (whether or not such
obligation is assumed by us).
However,
senior indebtedness does not include:
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any indebtedness which expressly provides that such indebtedness shall not be senior in right of payment to the subordinated debt securities,
or that such indebtedness shall be subordinated to any other of our indebtedness, unless such indebtedness expressly provides that such indebtedness shall be senior in right of payment to the
subordinated debt securities;
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any of our obligations to our subsidiaries or of a subsidiary guarantor to us or any other of our other subsidiaries;
11
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any liability for federal, state, local or other taxes owed or owing by us or any subsidiary guarantor;
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any accounts payable or other liability to trade creditors arising in the ordinary course of business (including guarantees thereof or
instruments evidencing such liabilities);
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any obligations with respect to any capital stock;
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any indebtedness incurred in violation of the applicable indenture, provided that indebtedness under our credit facilities will not cease to be
senior indebtedness under this bullet point if the lenders of such indebtedness obtained an officer's certificate as of the date of incurrence of such indebtedness to the effect that such indebtedness
was permitted to be incurred by the indenture; and
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any of our indebtedness in respect of the subordinated debt securities.
Senior
indebtedness shall continue to be senior indebtedness and be entitled to the benefits of the subordination provisions irrespective of any amendment, modification or waiver of any
term of such senior indebtedness.
Unless
otherwise noted in an accompanying prospectus supplement, if we default in the payment of any principal of (or premium, if any) or interest on any senior indebtedness when it
becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise, then, unless and until such default is cured or waived or ceases to exist, we will make
no direct or indirect payment (in cash, property, securities, by set-off or otherwise) in respect of the principal of or interest on the subordinated debt securities or in respect of any redemption,
retirement, purchase or other requisition of any of the subordinated debt securities.
In
the event of the acceleration of the maturity of any subordinated debt securities, the holders of all senior debt securities outstanding at the time of such acceleration, subject to
any security interest, will first be entitled to receive payment in full of all amounts due on the senior debt securities before the holders of the subordinated debt securities will be entitled to
receive any payment of principal (and premium, if any) or interest on the subordinated debt securities.
If
any of the following events occurs, we will pay in full all senior indebtedness before we make any payment or distribution under the subordinated debt securities, whether in cash,
securities or other property, to any holder of subordinated debt securities:
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any dissolution or winding-up or liquidation or reorganization of B&G Foods, whether voluntary or involuntary or in bankruptcy, insolvency or
receivership;
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any general assignment by us for the benefit of creditors; or
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any other marshaling of our assets or liabilities.
In
such event, any payment or distribution under the subordinated debt securities, whether in cash, securities or other property, which would otherwise (but for the subordination
provisions) be payable or deliverable in respect of the subordinated debt securities, will be paid or delivered directly to the holders of senior indebtedness in accordance with the priorities then
existing among such holders until all senior indebtedness has been paid in full. If any payment or distribution under the subordinated debt securities is received by the trustee of any subordinated
debt securities in contravention of any of the terms of the applicable indenture and before all the senior indebtedness has been paid in full, such payment or distribution will be received in trust
for the benefit of, and paid over or delivered and transferred to, the holders of the senior indebtedness at the time outstanding in accordance with the priorities then existing among such holders for
application to the payment of all senior indebtedness remaining unpaid to the extent necessary to pay all such senior indebtedness in full.
12
Unless
otherwise indicated in an applicable prospectus supplement, the applicable indenture will not limit the issuance of additional senior indebtedness.
Unless
otherwise indicated in an applicable prospectus supplement, if any series of subordinated debt securities is guaranteed by certain of our subsidiaries, then the guarantee will be
subordinated to the senior indebtedness of such guarantor to the same extent as the subordinated debt securities are subordinated to the senior indebtedness.
Consolidation, Merger, Sale of Assets and Other Transactions
Unless an accompanying prospectus supplement states otherwise, we may not (1) merge with or into or consolidate with another corporation
or sell, assign, transfer, lease or convey all or substantially all of our properties and assets to, any other corporation other than a direct or indirect wholly-owned subsidiary of ours, and
(2) no corporation may merge with or into or consolidate with us or, except for any direct or indirect wholly-owned subsidiary of ours, sell, assign, transfer, lease or convey all or
substantially all of its properties and assets to us, unless:
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we are the surviving corporation or the corporation formed by or surviving such merger or consolidation or to which such sale, assignment,
transfer, lease or conveyance has been made, if other than us, has expressly assumed by supplemental indenture all of our obligations under the applicable indenture;
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immediately after giving effect to such transaction, no default or event of default has occurred and is continuing;
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we or the corporation formed by or surviving such merger or consolidation or to which such sale, assignment, transfer, lease or conveyance has
been made (if other than us) would, on the date of such transaction after giving pro forma effect to the transaction and any related financing transactions as if the same had occurred at the beginning
of the applicable four-quarter period, either:
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be permitted to incur at least $1.00 of additional indebtedness pursuant to the fixed charge coverage ratio test set forth in the
applicable indenture; or
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have a fixed charge coverage ratio that is equal to or greater than our fixed charge coverage ratio immediately prior to the
consolidation, merger, sale, assignment, transfer, conveyance or other disposition; and
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we deliver to the trustee an officers' certificate and an opinion of counsel, each stating that the supplemental indenture complies with the
applicable indenture.
Events of Default, Notice and Waiver
Unless an accompanying prospectus supplement states otherwise, the following shall constitute "events of default" under the applicable indenture
with respect to each series of debt securities:
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we default for 30 consecutive days in the payment when due of interest on the debt securities;
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we default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on the debt securities;
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our failure to observe or perform any other of our covenants or agreements with respect to such debt securities for 60 days after we
receive notice of such failure;
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except as permitted by the applicable indenture, if debt securities are guaranteed, any guarantee shall be held in any judicial proceeding to
be unenforceable or invalid or shall cease for any
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reason
to be in full force and effect or any guarantor, or any person acting on behalf of any guarantor, shall deny, or disaffirm its obligations under its guarantee;
-
-
certain events of bankruptcy, insolvency or reorganization of B&G Foods; or
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any other event of default provided with respect to securities of that series.
Unless
an accompanying prospectus supplement states otherwise, if an event of default with respect to any debt securities of any series outstanding under any indenture shall occur and be
continuing, the
trustee under such indenture or the holders of at least 25% (or at least 10%, in respect of a remedy (other than acceleration) for certain events of default relating to the payment of dividends) in
aggregate principal amount of the debt securities of that series outstanding may declare, by notice as provided in the applicable indenture, the principal amount (or such lesser amount as may be
provided for in the debt securities of that series) of all the debt securities of that series outstanding to be due and payable immediately; provided that, in the case of an event of default involving
certain events in bankruptcy, insolvency or reorganization, acceleration is automatic; and, provided further, that after such acceleration, but before a judgment or decree based on acceleration, the
holders of a majority in aggregate principal amount of the outstanding debt securities of that series may, under certain circumstances, rescind and annul such acceleration if all events of default,
other than the nonpayment of accelerated principal, have been cured or waived. Upon the acceleration of the maturity of original issue discount securities, an amount less than the principal amount
thereof will become due and payable. Reference is made to the prospectus supplement relating to any original issue discount securities for the particular provisions relating to acceleration of
maturity thereof.
Any
past default under an indenture with respect to debt securities of any series, and any event of default arising therefrom, may be waived by the holders of a majority in principal
amount of all debt securities of such series outstanding under such indenture, except in the case of (1) default in the payment of the principal of (or premium, if any) or interest on any debt
securities of such series or (2) certain events of default relating to the payment of dividends.
The
trustee is required within 90 days after the occurrence of a default (which is known to the trustee and is continuing), with respect to the debt securities of any series
(without regard to any grace period or notice requirements), to give to the holders of the debt securities of such series notice of such default.
The
trustee, subject to its duties during default to act with the required standard of care, may require indemnification satisfactory to it by the holders of the debt securities of any
series with respect to which a default has occurred before proceeding to exercise any right or power under the applicable indenture at the request of the holders of the debt securities of such series.
Subject to such right of indemnification and to certain other limitations, the holders of a majority in principal amount of the outstanding debt securities of any series under any indenture may direct
the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee with respect to the debt securities of such
series, provided that such direction shall not be in conflict with any rule of law or with the applicable indenture and the trustee may take any other action deemed proper by the trustee which is not
inconsistent with such direction.
No
holder of a debt security of any series may institute any action against us under any indenture (except actions for payment of overdue principal of (and premium, if any) or interest
on such debt security or for the conversion or exchange of such debt security in accordance with its terms) unless (1) the holder has given to the trustee written notice of an event of default
and of the continuance thereof with respect to the debt securities of such series specifying an event of default, as required under the applicable indenture, (2) the holders of at least 25% in
aggregate principal amount of the debt securities of that series then outstanding under such indenture shall have requested the trustee to institute such action and offered to the trustee indemnity
reasonably satisfactory to it against the costs,
14
expenses
and liabilities to be incurred in compliance with such request; (3) the trustee shall not have instituted such action within 60 days of such request and (4) no direction
inconsistent with such written request has been given to the trustee during such 60-day period by the holders of a majority in principal amount of the debt securities of that series.
We
will be required to furnish annually to the trustee statements as to our compliance with all conditions and covenants under each indenture.
Discharge, Defeasance and Covenant Defeasance
We may discharge or defease our obligations under each indenture as set forth below, unless otherwise indicated in the applicable prospectus
supplement.
We
or, if applicable, any guarantor may discharge certain obligations to holders of any series of debt securities issued under any indenture which have not already been delivered to the
trustee for cancellation by irrevocably depositing with the trustee money in an amount sufficient to pay and discharge the entire indebtedness on such debt securities not previously delivered to the
trustee for cancellation, for principal and any premium and interest to the date of such deposit (in the case of debt securities which have become due and payable) or to the stated maturity or
redemption date, as the case may be, and we or, if applicable, any guarantor, have paid all other sums payable under the applicable indenture.
If
indicated in the applicable prospectus supplement, we, or, if applicable, the guarantors, may elect either (1) to defease and be discharged from any and all obligations with
respect to the debt securities of or within any series and all obligations with respect to guarantees in the case of guarantors (except in all cases as otherwise provided in the relevant indenture)
("legal defeasance") or (2) to be released from our obligations with respect to certain covenants applicable to the debt securities of or within any series ("covenant defeasance"), upon the
deposit with the relevant indenture trustee, in trust for such purpose, of money and/or government obligations which through the payment of principal and interest in accordance with their terms will
provide money in an amount sufficient to pay the principal of (and premium, if any) or interest on such debt securities to maturity or redemption, as the case may be, and any mandatory sinking fund or
analogous payments thereon. As a condition to legal defeasance or covenant defeasance, we must deliver to the trustee an opinion of counsel to the effect that the holders of such debt securities will
not recognize income, gain or loss for federal income tax purposes as a
result of such legal defeasance or covenant defeasance and will be subject to federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such
legal defeasance or covenant defeasance had not occurred. Such opinion of counsel, in the case of legal defeasance under clause (1) above, must refer to and be based upon a ruling of the
Internal Revenue Service or a change in applicable federal income tax law occurring after the date of the relevant indenture. In addition, in the case of either legal defeasance or covenant
defeasance, we shall have delivered to the trustee (1) if applicable, an officer's certificate to the effect that the relevant debt securities exchange(s) have informed us that neither such
debt securities nor any other debt securities of the same series, if then listed on any securities exchange, will be delisted as a result of such deposit and (2) an officer's certificate and an
opinion of counsel, each stating that all conditions precedent with respect to such legal defeasance or covenant defeasance have been complied with.
We
may exercise our legal defeasance option with respect to such debt securities notwithstanding our prior exercise of our covenant defeasance option.
Modification and Waiver
Under the applicable indenture, unless an accompanying prospectus supplement states otherwise, we and the applicable trustee may supplement the
indenture for certain purposes which would not materially adversely affect the interests or rights of the holders of debt securities of a series without the
15
consent
of those holders. We and the applicable trustee may also modify the indenture or any supplemental indenture in a manner that affects the interests or rights of the holders of debt securities
with the consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of each affected series issued under the indenture. However, the indenture will
require the consent of each holder of debt securities that would be affected by any modification which would:
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-
reduce the principal amount of debt securities whose holders must consent to an amendment, supplement or waiver;
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-
reduce the principal of or change the fixed maturity of any debt security or, except as provided in any prospectus supplement, alter or waive
any of the provisions with respect to the redemption of the debt securities;
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-
reduce the rate of or change the time for payment of interest, including default interest, on any debt security;
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-
waive a default or event of default in the payment of principal of or interest or premium, if any, on, the debt securities (except a rescission
of acceleration of the debt securities by the holders of at least a majority in aggregate principal amount of the then outstanding debt securities and a waiver of the payment default that resulted
from such acceleration);
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make any debt security payable in money other than that stated in the debt securities;
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-
make any change in the provisions of the applicable indenture relating to waivers of past defaults or the rights of holders of the debt
securities to receive payments of principal of, or interest or premium, if any, on, the debt securities;
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-
waive a redemption payment with respect to any debt security (except as otherwise provided in the applicable prospectus supplement);
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-
except in connection with an offer by us to purchase all debt securities, (1) waive certain events of default relating to the payment of
dividends or (2) amend certain covenants relating to the payment of dividends and the purchase or redemption of certain equity interests;
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-
release any applicable guarantor from any of its obligations under its guarantee or the indenture, except in accordance with the indenture;
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-
make any change to the subordination or ranking provisions of the indenture or the related definitions that adversely affect the rights of any
holder; or
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-
make any change in the preceding amendment and waiver provisions.
The
indenture will permit the holders of at least a majority in aggregate principal amount of the outstanding debt securities of any series issued under the indenture which is affected
by the modification or amendment to waive our compliance with certain covenants contained in the indenture.
Payment and Paying Agents
Unless otherwise indicated in the applicable prospectus supplement, payment of interest on a debt security on any interest payment date will be
made to the person in whose name a debt security is registered at the close of business on the applicable record date.
Unless
otherwise indicated in the applicable prospectus supplement, principal, interest and premium on the debt securities of a particular series will be payable at the office of such
paying agent or paying agents as we may designate for such purpose from time to time. Notwithstanding the foregoing, at our option, payment of any interest may be made by check mailed to the address
of the person entitled thereto as such address appears in the security register.
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Unless
otherwise indicated in the applicable prospectus supplement, a paying agent designated by us will act as paying agent for payments with respect to debt securities of each series.
All paying agents initially designated by us for the debt securities of a particular series will be named in the applicable prospectus supplement. We may at any time designate additional paying agents
or rescind the designation of any paying agent or approve a change in the office through which any paying agent acts, except that we will be required to maintain a paying agent in each place of
payment for the debt securities of a particular series.
All
moneys paid by us to a paying agent for the payment of the principal, interest or premium on any debt security which remain unclaimed at the end of two years after such principal,
interest or premium has become due and payable will be repaid to us upon request, and the holder of such debt security thereafter may look only to us for payment thereof.
Denominations, Registrations and Transfer
Unless an accompanying prospectus supplement states otherwise, debt securities will be represented by one or more global certificates registered
in the name of a nominee for The Depository Trust Company, or DTC. In such case, each holder's beneficial interest in the global securities will be shown on the records of DTC and transfers of
beneficial interests will only be effected through DTC's records.
A
holder of debt securities may only exchange a beneficial interest in a global security for certificated securities registered in the holder's name
if:
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we deliver to the trustee notice from DTC that it is unwilling or unable to continue to act as depository or that it is no longer a clearing
agency registered under the Securities Exchange Act of 1934, as amended (the Exchange Act) and, in either case, a successor depositary is not appointed by us within 120 days after the date of
such notice from DTC;
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we in our sole discretion determine that the debt securities (in whole but not in part) should be exchanged for definitive debt securities and
deliver a written notice to such effect to the trustee; or
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there has occurred and is continuing a default or event of default with respect to the debt securities.
If
debt securities are issued in certificated form, they will only be issued in the minimum denomination specified in the accompanying prospectus supplement and integral multiples of
such denomination. Transfers and exchanges of such debt securities will only be permitted in such minimum denomination. Transfers of debt securities in certificated form may be registered at the
trustee's corporate office or at the offices of any paying agent or trustee appointed by us under the applicable indenture. Exchanges of debt securities for an equal aggregate principal amount of debt
securities in different denominations may also be made at such locations.
Governing Law
Each indenture and applicable debt securities will be governed by, and construed in accordance with, the internal laws of the State of New York,
without regard to its principles of conflicts of laws.
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Trustee
The trustee under each indenture will be set forth in any applicable prospectus supplement.
Conversion or Exchange Rights
The prospectus supplement will describe the terms, if any, on which a series of debt securities may be convertible into or exchangeable for our
common stock, preferred stock or other debt securities. These terms will include provisions as to whether conversion or exchange is mandatory, at the option of the holder or at our option. These
provisions may allow or require the number of shares of our common stock or other securities to be received by the holders of such series of debt securities to be adjusted.
DESCRIPTION OF WARRANTS
The following description, together with the additional information we may include in any applicable prospectus supplements, summarizes the
material terms and provisions of the warrants that we may offer under this prospectus and the related warrant agreements and warrant certificates. While the terms summarized below will apply generally
to any warrants that we may offer, we will describe the particular terms of any series of warrants in more detail in the applicable prospectus supplement. If we so indicate in the prospectus
supplement, the terms of any warrants offered under that prospectus supplement may differ from the terms described below. Specific warrant agreements will contain additional important terms and
provisions and will be incorporated by reference into the registration statement which includes this prospectus.
General
We may issue warrants for the purchase of common stock, preferred stock and/or debt securities in one or more series. We may issue warrants
independently or together with common stock, preferred stock and/or debt securities, and the warrants may be attached to or separate from these securities.
We
will evidence each series of warrants by warrant certificates that we may issue under a separate agreement. We may enter into the warrant agreement with a warrant agent. Each warrant
agent may be a bank that we select which has its principal office in the United States and a combined capital and surplus of at least $50,000,000. We will indicate the name and address of any such
warrant agent in the applicable prospectus supplement relating to a particular series of warrants.
We
will describe in the applicable prospectus supplement the terms of the series of warrants, including:
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the offering price and aggregate number of warrants offered;
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the currency for which the warrants may be purchased, if not U.S. dollars;
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if applicable, the designation and terms of the securities with which the warrants are issued and the number of warrants issued with each such
security or each principal amount of such security;
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if applicable, the date on and after which the warrants and the related securities will be separately transferable;
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in the case of warrants to purchase debt securities, the principal amount of debt securities purchasable upon exercise of one warrant and the
price at, and currency, if not U.S. dollars, in which, this principal amount of debt securities may be purchased upon such exercise;
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in the case of warrants to purchase common stock or preferred stock, the number of shares of common stock or preferred stock, as the case may
be, purchasable upon the exercise of one warrant and the price at which these shares may be purchased upon such exercise;
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the effect of any merger, consolidation, sale or other disposition of our business on the warrant agreement and the warrants;
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the terms of any rights to redeem or call the warrants;
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any provisions for changes to or adjustments in the exercise price or number of securities issuable upon exercise of the warrants;
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the dates on which the right to exercise the warrants will commence and expire;
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the manner in which the warrant agreement and warrants may be modified;
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federal income tax consequences of holding or exercising the warrants;
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the terms of the securities issuable upon exercise of the warrants; and
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any other specific terms, preferences, rights or limitations of or restrictions on the warrants.
Before
exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable upon such exercise,
including:
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in the case of warrants to purchase debt securities, the right to receive payments of principal of, or premium, if any, or interest on, the
debt securities purchasable upon exercise or to enforce covenants in the applicable indenture; or
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in the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any, or, payments upon our liquidation,
dissolution or winding up or to exercise voting rights, if any.
Exercise of Warrants
Each warrant will entitle the holder to purchase the securities that we specify in the applicable prospectus supplement at the exercise price
that we describe in the applicable prospectus supplement. Unless we otherwise specify in the applicable prospectus supplement, holders of the warrants may exercise the warrants at any time up to
5:00 P.M. Eastern Time on the expiration date that we set forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become
void.
Holders
of the warrants may exercise the warrants by delivering the warrant certificate representing the warrants to be exercised together with specified information, and paying the
required amount to the warrant agent in immediately available funds, as provided in the applicable prospectus supplement. We will set forth on the reverse side of the warrant certificate and in the
applicable prospectus supplement the information that the holder of the warrant will be required to deliver to the warrant agent.
Upon
receipt of the required payment and the warrant certificate properly completed and duly executed at the corporate trust office of the warrant agent or any other office indicated in
the applicable prospectus supplement, we will issue and deliver the securities purchasable upon such exercise. If fewer than all of the warrants represented by the warrant certificate are exercised,
then we will issue a new warrant certificate for the remaining amount of warrants. If we so indicate in the applicable prospectus supplement, holders of the warrants may surrender securities as all or
part of the exercise price for warrants.
Enforceability of Rights by Holders of Warrants
Any warrant agent will act solely as our agent under the applicable warrant agreement and will not assume any obligation or relationship of
agency or trust with any holder of any warrant. A single bank or trust company may act as warrant agent for more than one issue of warrants. A warrant agent will
19
have
no duty or responsibility in case of any default by us under the applicable warrant agreement or warrant, including any duty or responsibility to initiate any proceedings at law or otherwise, or
to make any demand upon us. Any holder of a warrant may, without the consent of the related warrant agent or the holder of any other warrant, enforce by appropriate legal action its right to exercise,
and receive the securities purchasable upon exercise of, its warrants.
If
a warrant holder exercises only part of the warrants represented by a single certificate, the warrant agent will issue a new warrant certificate for any warrants not exercised. Unless
the prospectus supplement states otherwise, no fractional shares will be issued upon exercise of warrants, but we will pay the cash value of any fractional shares otherwise issuable.
The
exercise price and the number of shares of common stock for which each warrant can be exercised will be adjusted upon the occurrence of events described in the warrant agreement,
including the issuance of a common stock dividend or a combination, subdivision or reclassification of common stock.
Unless
the prospectus supplement states otherwise, no adjustment will be required until cumulative adjustments require an adjustment of at least 1% in the exercise price. From time to
time, we may reduce the exercise price as may be provided in the warrant agreement.
Unless
the prospectus supplement states otherwise, if we enter into any consolidation, merger, or sale or conveyance of our property as an entirety, the holder of each outstanding
warrant will have the right to acquire the kind and amount of shares, other securities, property or cash receivable by a holder of the number of shares of common stock into which the warrants were
exercisable immediately prior to the occurrence of the event.
Modification of the Warrant Agreement
The warrant agreements may permit us and the warrant agent, if any, without the consent of the warrant holders, to supplement or amend the
agreement in the following circumstances:
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to cure any ambiguity;
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to correct or supplement any provision which may be defective or inconsistent with any other provisions; or
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to add new provisions regarding matters or questions that we and the warrant agent may deem necessary or desirable and which do not adversely
affect the interests of the warrant holders.
DESCRIPTION OF UNITS
We may issue units comprised of one or more of the other securities described in this prospectus in any combination. Each unit will be issued so
that the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder of each included security. The unit
agreement under which a unit is issued may provide that the securities included in the unit may not be held or transferred separately, at any time or at any time before a specified date or occurrence.
The
applicable prospectus supplement may describe:
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-
the designation and terms of the units and of the securities comprising the units, including whether and under what circumstances those
securities may be held or transferred separately;
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-
any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units; and
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whether the units will be issued in fully-registered or global form.
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The
applicable prospectus supplement will describe the terms of any units. The preceding description and any description of units in the applicable prospectus supplement does not purport
to be complete and is subject to and is qualified in its entirety by reference to the unit agreement and, if applicable, collateral arrangements and depository arrangements relating to such units.
PLAN OF DISTRIBUTION
We may sell the securities described in this prospectus through underwriters or dealers, through agents, or directly to one or more purchasers
or through a combination of these methods. The applicable prospectus supplement will describe the terms of the offering of the securities, including:
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-
the name or names of any underwriters and, if required, any dealers or agents;
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-
the purchase price of the securities and the proceeds we will receive from the sale;
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-
any underwriting discounts and other items constituting underwriters' compensation;
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-
any discounts or concessions allowed or reallowed or paid to dealers; and
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any securities exchange or market on which the securities may be listed.
We
may distribute the securities from time to time in one or more transactions at:
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-
a fixed price or prices, which may be changed;
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-
market prices prevailing at the time of sale;
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-
varying prices determined at the time of sale related to such prevailing market prices; or
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-
negotiated prices.
Offerings
of our equity securities pursuant to this prospectus may also be made into an existing trading market for such securities in transactions at other than a fixed price,
either:
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-
on or through the facilities of any national securities exchange or quotation service on which such securities may be listed or quoted at the
time of sale; or
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-
to or through a market maker otherwise than on such exchanges.
Such
at-the-market offerings will be conducted by underwriters acting as our principal or agent, who may also be third-party sellers of securities as described above.
Only
underwriters named in the prospectus supplement will be underwriters of the securities offered by the prospectus supplement. If we use underwriters in the sale, they will acquire
the securities for their own account and may resell the securities from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying
prices determined at the time of sale. We may offer the securities to the public through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. Any public
offering price and any discounts or concessions allowed or reallowed or paid to dealers may change from time to time.
We
may sell the securities directly. In this case, no underwriters or agents would be involved. We may also sell the securities through agents we designate from time to time. We will
name any agent involved in the offering and sale of securities and we will describe any commissions we will pay the agent in the prospectus supplement.
We
may authorize agents or underwriters to solicit offers by institutional investors to purchase securities from us at the public offering price set forth in the prospectus supplement
pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. We will
describe the conditions to these contracts and the commissions we must pay for solicitation of these contracts in the prospectus supplement.
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In
addition, we may sell some or all of the securities covered by this prospectus through:
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-
purchases by a dealer, as principal, who may then resell those securities to the public for its account at varying prices determined by the
dealer at the time of resale;
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-
block trades in which a dealer will attempt to sell as agent, but may position or resell a portion of the block, as principal, in order to
facilitate the transaction; or
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-
ordinary brokerage transactions and transactions in which a broker-dealer solicits purchasers.
We
will include in the applicable prospectus supplement the names of any dealers and the terms of the transaction.
In
connection with the sale of the securities, underwriters, dealers or agents may receive compensation from us or from purchasers of the securities for whom they act as agents in the
form of discounts, concessions or commissions. Underwriters may sell the securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters or commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that participate in the distribution of the securities, and any
institutional investors or others that purchase securities directly and then resell the securities, may be deemed to be underwriters, and any discounts or commissions received by them from us and any
profit on the resale
of the securities by them may be deemed to be underwriting discounts and commissions under the Securities Act of 1933, as amended (the Securities Act).
We
may provide agents and underwriters with indemnification against particular civil liabilities, including liabilities under the Securities Act, or contribution with respect to payments
that the agents or underwriters may make with respect to such liabilities. Agents and underwriters may engage in transactions with, or perform services for, us in the ordinary course of business.
In
addition, we may enter into derivative transactions with third parties (including the writing of options), or sell securities not covered by this prospectus to third parties in
privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with such a transaction, the third parties may, pursuant to this prospectus and the applicable
prospectus supplement, sell securities covered by this prospectus and the applicable prospectus supplement. If so, the third party may use securities borrowed from us or others to settle such sales
and may use securities received from us to close out any related short positions. We may also loan or pledge securities covered by this prospectus and the applicable prospectus supplement to third
parties, who may sell the loaned securities or, in an event of default in the case of a pledge, sell the pledged securities pursuant to this prospectus and the applicable prospectus supplement. The
third party in such sale transactions will be an underwriter and will be identified in the applicable prospectus supplement or in a post-effective amendment.
Offered
securities may also be offered and sold, if so indicated in the applicable prospectus supplement, in connection with a remarketing upon their purchase, in accordance with a
redemption or repayment pursuant to their terms, or otherwise, by one or more remarketing firms, acting as principals for their own accounts or as agents for us. Any remarketing firm will be
identified and the terms of its agreements, if any, with us and its compensation will be described in the applicable prospectus supplement.
To
facilitate an offering of a series of securities, persons participating in the offering may engage in transactions that stabilize, maintain, or otherwise affect the market price of
the securities. This may include over-allotments or short sales of the securities, which involves the sale by persons participating in the offering of more securities than have been sold to them by
us. In those circumstances, such persons would cover such over-allotments or short positions by purchasing in the open market or by exercising the over-allotment option granted to those persons. In
addition, those persons may stabilize
22
or
maintain the price of the securities by bidding for or purchasing securities in the open market or by imposing penalty bids, whereby selling concessions allowed to underwriters or dealers
participating in any such offering may be reclaimed if securities sold by them are repurchased in connection with
stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might otherwise prevail in the open market.
Such transactions, if commenced, may be discontinued at any time. We make no representation or prediction as to the direction or magnitude of any effect that the transactions described above, if
implemented, may have on the price of our securities.
Some
or all of the securities that we offer through this prospectus may be new issues of securities with no established trading market. Any underwriters to whom we sell our securities
for public offering and sale may make a market in those securities, but they will not be obligated to do so and they may discontinue any market making at any time without notice. Accordingly, we
cannot assure you of the liquidity of, or continued trading markets for, any securities that we offer.
LEGAL MATTERS
In connection with particular offerings of our securities in the future, unless otherwise stated in the applicable prospectus supplement, the
validity of those securities will be passed upon for us by Dechert LLP, Philadelphia, Pennsylvania. If the securities are being distributed in an underwritten offering, certain legal matters
will be passed upon for the underwriters by counsel identified in the related prospectus supplement.
EXPERTS
The consolidated financial statements and schedule of B&G Foods, Inc. and subsidiaries as of December 29, 2018 and
December 30, 2017, and for the years ended December 29, 2018, December 30, 2017 and December 31, 2016, and management's assessment of the effectiveness of internal control
over financial reporting as of December 29, 2018 have been incorporated by reference herein in reliance upon the reports of KPMG LLP, independent registered public accounting firm,
incorporated by reference herein, and upon the authority of said firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Exchange Act. In accordance with the Exchange Act, we file periodic reports, proxy
statements and information statements and other information with the SEC.
We
have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the securities offered hereby. This prospectus does not contain all of the
information set forth in the registration statement and the exhibits and schedules to the registration statement. For further information with respect to our company and the securities offered hereby,
reference is made to the registration statement and the exhibits and schedules filed as a part of the registration statement. Statements contained in this prospectus concerning the contents of any
contract or any other document are not necessarily complete; reference is made in each instance to the copy of such contract or any other document filed as an exhibit to the registration statement.
Each such statement is qualified in all respects by such reference to such exhibit.
The
SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers
that file with the SEC. B&G Foods' SEC filings are also available to the public, free of charge, from our website at www.bgfoods.com.
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We
will furnish without charge to each person to whom a copy of this prospectus is delivered, upon written or oral request, a copy of any and all of these filings (except exhibits,
unless they are specifically incorporated by reference into this prospectus). Please direct any requests for copies to:
B&G
Foods, Inc.
Four Gatehall Drive
Parsippany, NJ 07054
Attention: Corporate Secretary
Telephone: 973.401.6500
Fax: 973.630.6550
INCORPORATION BY REFERENCE
The SEC allows us to incorporate by reference in this prospectus the information we file with the SEC, which means that we can disclose
important information to you by referring you to those documents. The information incorporated by reference is considered to be a part of this prospectus. We incorporate by reference in this
prospectus the information contained in the following documents (other than any portions of the respective filings that were furnished under applicable SEC rules rather than
filed):
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-
our annual report on
Form 10-K for the fiscal year ended December 29, 2018 filed on February 26, 2019;
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-
our quarterly reports on Form 10-Q for the quarter ended March 30, 2019 filed on
May 7, 2019 and the quarter ended June 29, 2019 filed on
August 6, 2019;
-
-
our current reports on Form 8-K filed on
January 29, 2019 (as
amended by Amendment No. 1 to such Form 8-K, filed on March 1,
2019), March 1, 2019,
March 18, 2019,
May 15, 2019 and
May 28, 2019; and
-
-
the description of our common stock contained in our registration statement on
Form 8-A (Registration No. 001-32316) filed on May 16,
2007, as amended by Item 5.03 of our Current Report on Form 8-K
filed on August 13, 2010, and including any future amendment or report filed for the purpose of updating such description.
We
are also incorporating by reference all other reports that we will file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (other than any portions
of the respective filings that will be furnished under applicable SEC rules rather than filed) after the date of this prospectus and prior to the completion of the offering of any securities covered
by this prospectus. The information that we file with the SEC after the date of this prospectus and prior to the completion of the offering of any securities covered by this prospectus will update and
supersede the information contained in this prospectus and incorporated filings. You will be deemed to have notice of all information incorporated by reference in this prospectus as if that
information was included in this prospectus.
You
may obtain copies of these documents from us, free of cost, by contacting us at the address or telephone number provided in "Where You Can Find More Information" immediately above.
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