BOB EVANS FARMS, INC. (NASDAQ:BOBE) Files An 8-K Entry into a Material Definitive Agreement

BOBEVANSFARMS,INC.

Date: January24, 2017

/s/ Colin M. Daly

Colin M. Daly

Executive Vice President, General Counsel and Secretary

ME Staff 8-k

8 years ago

BOB EVANS FARMS, INC. (NASDAQ:BOBE) Files An 8-K Entry into a Material Definitive Agreement

Item1.01.

Entry into a Material Definitive Agreement.

Purchase Agreement for the Sale of Bob Evans Restaurants
Business

On January24, 2017, Bob Evans Farms, Inc., a Delaware corporation
(the Company), entered into an Asset and Membership
Interest Purchase Agreement (the Purchase Agreement) with
BER Acquisition, LLC, a Delaware limited liability company formed
by affiliates of Golden Gate Capital (the Buyer). to the
Purchase Agreement, subject to the satisfaction or waiver of
certain conditions, the Buyer has agreed to purchase and acquire
the Companys Bob Evans Restaurants business (the Restaurants
Business) for an aggregate purchase price of $565.0million in
cash, subject to certain adjustments set forth in the Purchase
Agreement (the Transaction). The Transaction will be
effected by (i)the sale of the Restaurants Business assets by the
Companys affiliates to Buyer and (ii)the sale by the Company of
fifty percent of the equity interests in a newly formed special
purpose entity (the IPCo) that will hold specified
intellectual property assets used by both the Restaurants
Business and the Companys BEF Foods food production business (the
BEF Foods Business).

The Companys Board of Directors has unanimously approved the
Purchase Agreement and the transactions contemplated thereby,
including the Transaction. The Buyer has obtained equity
commitments for the full amount of the purchase price in the
Transaction from an affiliate of Golden Gate Capital, and the
obligations of the Buyer to the Purchase Agreement are not
subject to any financing condition. The closing of the
Transaction is anticipated to occur on or prior to April28, 2017,
subject to regulatory approvals and other closing conditions set
forth in the Purchase Agreement.

The Purchase Agreement contains customary representations,
warranties and covenants by each party, including, among others,
covenants with respect to the Companys operation of the
Restaurants Business during the interim period between the
execution of the Purchase Agreement and the consummation of the
Transaction. The consummation of the Transaction is subject to
customary closing conditions, including, but not limited to,
(i)the early termination or expiration of the applicable waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the HSR Act), (ii) the absence of
certain legal impediments to the consummation of the Transaction,
(iii)the receipt of specified consents and approvals, (iv)the
accuracy of the representations and warranties of the parties,
subject to materiality exceptions, and (v)compliance by the
parties with their respective obligations under the Purchase
Agreement.

Both the Company and the Buyer have agreed to indemnify the other
party for losses arising from certain breaches of the Purchase
Agreement and for certain other liabilities, subject to
applicable limitations set forth in the Purchase Agreement. In
connection with the Transaction, the Company and the Buyer (or
one or more of their respective affiliates) also will enter into
certain additional ancillary agreements, including (i)a
transition services agreement to which both the Company and the
Buyer will provide transition services to the other party at the
providers cost for a period of 18 months following the closing;
(ii)a five-year supply agreement to which the BEF Foods Business
will continue to supply food products to the Restaurants Business
following the closing; and (iii)intellectual property assignment,
contribution and license agreements to which certain intellectual
property rights of the Company and its affiliates will be
transferred to the Buyer or contributed to the IPCo entity that
will be jointly owned by affiliates of the Buyer and the Company
and will license such intellectual property rights to the Buyer
for use in the Restaurants Business and to the Company for use in
the BEF Foods Business following the closing.

For a period of 35 days following the date of the Purchase
Agreement (the Go-Shop
Period), the Company and its
affiliates and representatives may solicit proposals from, and
negotiate with, third parties for a sale of the Restaurants
Business in its entirety. The Buyer will have the right to match,
within a limited time, any alternative transaction proposal
received by the Company during the Go-Shop Period that the Board
determines in good faith to constitute a superior proposal. At
the end of the Go-Shop Period, the Company will cease such
activities, and will be subject to no-shop restrictions on its
ability to solicit or engage in discussions or negotiations with
third parties regarding an alternative transaction proposal. The
Purchase Agreement also contains certain termination rights for
each of the Company and the Buyer subject to the conditions set
forth in the Purchase Agreement. The Company will be obligated to
pay to Buyer a termination fee of $15.0million, plus
reimbursement of Buyers transaction expenses up to $5.0million,
in the event that the Purchase Agreement is terminated in certain
circumstances.

A copy of the
Purchase Agreement is attached as Exhibit 2.1 to this Current
Report on Form 8-K and incorporated herein by reference. The
foregoing summary of the Purchase Agreement and the transactions
contemplated thereby does not purport to be complete and is
subject to, and qualified in its entirety by, the full text of
the Purchase Agreement.

Discontinued
Operations

The Company will
classify the Restaurants Business as held for sale beginning in
the third quarter of fiscal 2017, and the results of the
Restaurants Business will be presented as discontinued operations
in the Companys Quarterly Report on Form10-Q for the quarter
ending January27, 2017. As a result of the classification of the
disposal group as held for sale, under the Financial Accounting
Standards Board Accounting Standards Codification 360-10-35, long
lived assets held for sale are measured at the lower of carrying
amount or fair value less costs to sell. Upon the closing of the
Transaction, the Company expects to record a gain on the sale,
net of taxes.

Purchase
Agreement for the Acquisition of Pineland Farms Potato Company,
Inc.

On January24,
2017, the Companys subsidiary BEF Foods, Inc. (BEF Foods)
entered into a Stock Purchase Agreement (the PFPC
Agreement) with Pineland Farms Potato Company, Inc., a Maine
corporation (PFPC), the stockholders of PFPC party thereto
(collectively, the Sellers), and Libra Foundation, as the
Sellers Representative, and, solely for the purposes of
guaranteeing the payment and performance obligations of BEF Foods
thereunder, the Company. to the PFPC Agreement, subject to the
satisfaction or waiver of certain conditions, BEF Foods has
agreed to purchase and acquire from the Sellers all of the equity
interests of PFPC outstanding immediately prior to the closing
(the Acquisition), in exchange for (i) $115.0million in
cash, subject to certain adjustments set forth in the PFPC
Agreement, and (ii)up to an additional $25.0million in cash as
potential earn-out consideration, the payment of which is subject
to the achievement of certain operating EBITDA performance
milestones over a consecutive twelve-month period during the 24
months following the closing.

The Companys Board
of Directors has unanimously approved the PFPC Agreement and the
transactions contemplated thereby, including the Acquisition. The
closing of the Acquisition is anticipated to occur on or about
April 28, 2017, subject to regulatory approvals and other closing
conditions set forth in the PFPC Agreement.

The PFPC Agreement
contains customary representations, warranties and covenants by
each party, including, among others, covenants with respect to
the conduct of PFPCs business during the interim period between
the execution of the PFPC Agreement and the consummation of the
Acquisition. The PFPC Agreement also contemplates that, prior to
the closing of the Acquisition, all of the assets and liabilities
of PFPC exclusively related to its cheese business will be
distributed to the Sellers or one or more parties designated by
the Sellers. The consummation of the Acquisition is subject to
customary closing conditions, including, but not limited to,
(i)the early termination or expiration of the applicable waiting
period under the HSR Act, (ii)the absence of certain legal
impediments to the consummation of the Acquisition, (iii)the
accuracy of the representations and warranties of the parties,
subject to materiality exceptions, and (iv)compliance by the
parties with their respective obligations under the PFPC
Agreement.

Both BEF Foods and
the Sellers have agreed to indemnify the other party for losses
arising from certain breaches of the PFPC Agreement and for
certain other liabilities, subject to applicable limitations set
forth in the PFPC Agreement. In connection with the Acquisition,
BEF Foods will enter into, or cause PFPC to enter into, certain
additional ancillary agreements, including a transition services
agreement, an intellectual property license agreement, an escrow
agreement, and an employment agreement with one of PFPCs
executive officers.

A copy of the PFPC
Agreement is attached as Exhibit 2.2 to this Current Report on
Form 8-K and incorporated herein by reference. The foregoing
summary of the PFPC Agreement and the transactions contemplated
thereby does not purport to be complete and is subject to, and
qualified in its entirety by, the full text of the PFPC
Agreement.

The Purchase
Agreement and the PFPC Agreement (collectively, the
Agreements) are not intended to modify or supplement any
factual disclosures about the Company in its public reports filed
with the Securities and Exchange Commission and are not intended
to be, and should not be relied upon as, disclosures regarding
any facts and circumstances relating to the Company. In
particular, the representations, warranties and covenants set
forth in the Agreements (i)were made solely for purposes of the
Transaction or the Acquisition, as applicable, and solely for the
benefit of the contracting parties (except with respect to the
rights of specific third parties enumerated in the Agreements),
(ii) may be subject to limitations agreed upon by the contracting
parties, including certain disclosure schedules, (iii)are
qualified in certain circumstances by a materiality standard
which may differ from what may be viewed as material by
investors, (iv)were made only as of the date(s) specified in the
Agreements, and (v)may have been included in such Agreement(s)
for the purpose of allocating risk between the parties rather
than establishing matters as facts. Investors are not third-party
beneficiaries under the Agreements and should not rely on the
representations, warranties and covenants or any descriptions
thereof as characterizations of the actual state of facts or
conditions of the parties. Moreover, information concerning the
subject matter of the representations and warranties may change
after the respective dates of the Agreements.

Item5.02.Departure of
Directors or Certain Officers; Election of Directors; Appointment
of Certain Officers; Compensatory Arrangements of Certain
Officers.

Management
Changes

On January24,
2017, President and Chief Executive Officer Saed Mohseni notified
the Companys Board of Directors (the Board) that he
intends to accept employment with the Buyer in connection with
the consummation of the Transaction. Mr.Mohseni will resign from
his position with the Company and as a member of the Board
effective as of, and contingent upon, the closing of the
Transaction. Mr.Mohsenis employment agreement with the Company,
dated November14, 2015, will terminate concurrently with his
resignation.

On January24,
2017, the current President of BEF Foods, J. Michael Townsley,
was appointed by the Board to serve as President and Chief
Executive Officer of the Company effective as of, and contingent
upon, the effectiveness of Mr.Mohsenis resignation upon the
consummation of the Transaction. In connection with Mr.Townsleys
promotion, the Board, acting on the recommendation of the
Compensation Committee of the Board (the Compensation
Committee), has approved the Companys entry upon the closing
of the Transaction into an employment agreement with Mr.Townsley,
the material terms of which are described below. For information
regarding Mr.Townsleys business experience, please see his
biographical information disclosed under the heading Executive
Officers of Bob Evans Farms, Inc. in Part I of the Companys
Annual Report on Form 10-K for the fiscal year ended April29,
2016, which biographical information is incorporated herein by
reference.

There are no
arrangements or understandings between Mr.Townsley and any other
persons to which Mr.Townsley was or is to be selected as an
officer of the Company. There are no family relationships between
Mr.Townsley and any director, executive officer or person
nominated or chosen by the Company to become a director or
executive officer, and there are no related person transactions
involving the Company and Mr.Townsley.

Executive
Employment Agreements

On January24,
2017, upon the recommendation of the Compensation Committee, the
Board approved employment agreements to be entered into with J.
Michael Townsley, Mark E. Hood and Colin M. Daly in connection
with, and contingent upon, the closing of the Transaction
(collectively, the Employment Agreements). to these
agreements, Mr.Townsley will serve as the Companys President and
Chief Executive Officer, Mr.Hood will continue to serve in his
current capacity as Chief Financial Officer and Chief
Administrative Officer, and Mr.Daly will continue to serve in his
current capacity as Executive Vice President, General Counsel and
Corporate Secretary. In addition, Mr.Townsleys Employment
Agreement will require that the Company annually nominate him for
election to the Companys Board of Directors.

Each of the
Employment Agreements has an initial five-year term and will be
automatically extended unless either the Company or the
applicable executive gives at least 90 days notice of
non-extension. The Employment Agreements will provide for the
following compensation:

Mr.Townsley will receive an annual base salary of $500,000
and an annual cash bonus with a target of 65% of his base
salary;

Mr.Hood will continue to receive an annual base salary of
$480,000 and an annual cash bonus with a target of 65% of his
base salary; and

Mr.Daly will continue to receive an annual base salary of
$325,000 and an annual cash bonus with a target of 60% of his
base salary.

In addition,
Messrs. Townsley, Hood and Daly will participate in the Companys
equity compensation plan at a target value of 80%, 75% and 50% of
base salary, respectively. They also will be eligible to
participate in the Companys benefit plans and programs to the
extent generally available to all employees.

Each of the
Employment Agreements may be terminated with 14 days notice by
the Company without any liability either for Cause or if the
applicable executive terminates his employment without Good
Reason (as such terms are defined in the Employment Agreements).
If the Company terminates the Employment Agreement other than for
Cause, if the executive terminates for Good Reason, or with
respect to Messrs. Hood and Daly, if the executive voluntarily
terminates his employment at least 30 months after the date of
his Employment Agreement but before the end of the five-year
initial term, then the Company will be required to pay such
executive: (i)any base salary that is accrued but unpaid, (ii)any
rights or benefits accrued under the Companys plans, (iii)any
prior year earned, but unpaid bonus, (iv)his base salary for a
period of 24 months, (v)a pro-rated bonus for the then-current
fiscal year based on the actual achievement of the applicable
performance goals for such fiscal year (without pro-ration of
such performance goals), and (vi)an amount equal to the Companys
estimated obligation for the cost of premiums, and related
administrative fees, for group health (medical, dental and/or
vision) for a period equal to 18 months, and an amount up to
$25,000 for life insurance. If the executive dies during the term
of his Employment Agreement, the Company is required to pay to
his estate any base salary that is accrued but unpaid and any
business expenses that are unreimbursed, all as of the date of
termination of employment, and any vested rights and benefits
provided under plans and programs of the Company in which he was
participating immediately prior to his death, determined in
accordance with the applicable terms and provisions of such plans
and programs.

Messrs. Townsley,
Hood and Daly will continue to be participants in the Companys
change in control and severance plan, which provides that in the
event of a change in control (CIC), and the subsequent
termination of the executives position within the 24 months, with
respect to Mr.Townsley, or 12 months, with respect to Messrs.
Hood and Daly, following the CIC, he would be entitled to receive
the following: (i)payment of an amount equal to three times base
salary and bonus amount for Mr.Townsley or two times base salary
and bonus amount for Messrs. Hood and Daly; and (ii)continuation
of life, medical, dental and/or vision programs in which the
executive and his family were participating at the time of
termination for a period of 18 months, or the cash equivalent to
such benefits.

The Employment
Agreements contain certain business protection provisions that
will require the executive: (i)not to disclose confidential
information or trade secrets of the Company; (ii)during the term
of the Employment Agreement and for 24 months following
termination of employment, neither hold any position with any
Competing Foods Business (as defined in the Employment
Agreements) nor solicit employees of the Company to leave their
employment; and (iii)for two years following the closing date of
the Transaction, not to hold any position with any Competing
Restaurant Business (as defined in the Employment
Agreements).

Accelerated
Vesting of Outstanding Equity Awards

On January24,
2017, the Compensation Committee of the Board of Directors
approved (i)certain modifications to outstanding equity awards
held by employees of the Company, including the Companys named
executive officers, and (ii)the treatment of such equity awards
upon the completion of the Transaction. In accordance with the
authority and power granted to the Compensation Committee under
the terms of the Amended and Restated Bob Evans Farms, Inc. 2010
Equity and Cash Incentive Plan (the Equity Plan), the
Compensation Committee determined to accelerate the vesting of
all unvested restricted stock units (RSUs), restricted
stock awards (RSAs) and market-based performance stock
units (PSUs) then outstanding under the Equity Plan and
that the performance criteria applicable to each PSU will be
deemed satisfied, in each case contingent upon and effective as
of the closing of the Transaction and delivery by the participant
of a written agreement with the Company containing a general
release of claims and certain restrictive covenants. The
Compensation Committees decision applies to all of the Companys
outstanding RSUs, RSAs and PSUs that remain unvested.

Item7.01.

Regulation FD Disclosure.

On January24,
2017, the Company issued a press release announcing the execution
of the Purchase Agreement and the PFPC Agreement. A copy of the
press release is furnished as Exhibit 99.1 to this Current Report
on Form 8-K.

The information,
including the press release attached hereto, furnished under this
Item 7.01 shall not be deemed filed for the purposes of Section18
of the Securities Exchange Act of 1934, as amended (the
Exchange Act), or otherwise subject to the liabilities of
that section, and shall not be deemed incorporated by reference
into any other filing by the Company under the Exchange Act or
the Securities Act of 1933, as amended, except as otherwise
expressly stated in such filing.

Forward-Looking
Statements

This Current
Report on Form 8-K contains statements that are not historical
facts but rather forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements include those that address activities,
events or developments that the Company or its management
believes or anticipates may occur in the future, including the
closing of the Transaction and the Acquisition. All
forward-looking statements are based upon the Companys current
expectations, various assumptions, and data available from third
parties. The Companys expectations and assumptions are expressed
in good faith and the Company believes there is a reasonable
basis for them. However, there can be no assurance that such
forward-looking statements will materialize or prove to be
correct as forward-looking statements are inherently subject to
known and unknown risks, uncertainties and other factors which
may cause actual future results, performance or achievements to
differ materially from the future results, performance or
achievements expressed in or implied by such forward-looking
statements. Numerous risks, uncertainties and other factors may
cause actual results to differ materially from those set out in
the forward-looking statements. The Company undertakes no
obligation to update publicly or revise any forward-looking
statements in light of new information or future events. For any
forward-looking statements contained in this or any other
document, the Company claims the protection of the safe harbor
for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995, and the Company assumes
no obligation to update any such statement.

Item9.01.

Financial Statements and Exhibits.

(d)

Exhibits


Exhibit No.		Description

2.1		Asset and Membership Interest Purchase Agreement, dated as of January24, 2017, by and between Bob Evans Farms, Inc. and BER Acquisition, LLC.*

2.2		Stock Purchase Agreement, dated as of January24, 2017, by and among BEF Foods, Inc., Pineland Farms Potato Company, Inc., the selling stockholders party thereto, Libra Foundation, in its capacity as the Sellers Representative, and Bob Evans Farms, Inc.*

99.1		Press Release issued by Bob Evans Farms, Inc., dated January24, 2017.

*	Schedules to the agreement have been omitted to Item 601(b)(2) of Regulation S-K. The Company hereby undertakes to furnish supplementally copies of any of the omitted schedules to the Securities and Exchange Commission upon request.

to the
requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.

EXHIBIT
INDEX


Exhibit No.		Description

2.1		Asset and Membership Interest Purchase Agreement, dated as of January24, 2017, by and between Bob Evans Farms, Inc. and BER Acquisition, LLC.*

2.2		Stock Purchase Agreement, dated as of January24, 2017, by and among BEF Foods, Inc., Pineland Farms Potato Company, Inc., the selling stockholders party thereto, Libra Foundation, in its capacity as the Sellers Representative, and Bob Evans Farms, Inc.*

99.1		Press Release issued by Bob Evans Farms, Inc., dated January24, 2017.

*	Schedules to the agreement have been omitted

About BOB EVANS FARMS, INC. (NASDAQ:BOBE)
Bob Evans Farms, Inc. (Bob Evans) is a full-service restaurant company. The Company produces and distributes pork sausage products and a range of home-style refrigerated side dishes and frozen food items under the Bob Evans, Owens and Country Creek brand names. These food products are distributed to customers throughout the United States. Additionally, the Company manufactures and sells similar products to foodservice customers, including Bob Evans Restaurants and other restaurants and food sellers. The Company operates in two segments: Bob Evans Restaurants and BEF Foods. As of April 29, 2016, the Company operated 527 Bob Evans Restaurants in 18 states. The BEF Foods segment offers a range of wholesome food products to retail and foodservice customers. The Company produces food products in its four manufacturing facilities. It produces sausage products at its plants located in Hillsdale, Michigan, and Xenia, Ohio. BOB EVANS FARMS, INC. (NASDAQ:BOBE) Recent Trading Information
BOB EVANS FARMS, INC. (NASDAQ:BOBE) closed its last trading session up +11.18 at 59.13 with 195,341 shares trading hands.