The information in this preliminary offering memorandum is not complete and may be changed.

This preliminary offering memorandum is not an offer to sell

SUBJECT TO COMPLETION, DATED OCTOBER 10, 2017
PRELIMINARY OFFERING MEMORANDUM STRICTLY CONFIDENTIAL

Simmons Foods, Inc.

Simmons Prepared Foods, Inc. Simmons Pet Food, Inc.
Simmons Feed Ingredients, Inc. Simmons Energy Solutions, Inc.
these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

$550,000,000
% Second Lien Senior Secured Notes due 2024
THE COMPANY
• We are one of the leading vertically integrated poultry processors and the largest private label wet pet food producer in the United
States and Canada.
• We intend to use the net proceeds from this offering (i) to purchase any and all of our outstanding 7.875% Second Lien Senior
Secured Notes due 2021 (the “2021 Notes”) that are validly tendered by holders and accepted by us pursuant to a cash tender offer
we are currently conducting and to redeem or retire any 2021 Notes not purchased in the tender offer, (ii) to pay down outstanding
indebtedness under our first lien senior secured credit facility, (iii) for general corporate purposes, including future capital
expenditures and/or acquisitions, and (iv) to pay the fees and expenses associated with this offering and the tender offer. See “Use
of Proceeds.”
THE NOTES
• Interest on the notes will accrue at a rate per annum equal to % and will be payable semi-annually in cash in arrears on each
and . Interest on the notes will accrue from , 2017, and the first interest payment date for the notes will be
, 2018.
• The notes will mature on , 2024.
• We may redeem some or all of the notes at any time prior to , 2020, at a price equal to 100% of the principal amount of the
notes to be redeemed, plus a make-whole premium and accrued and unpaid interest to the redemption date. Thereafter, we may
redeem the notes at any time at the redemption prices set forth in this offering memorandum. At any time prior to , 2020, we
may redeem up to 35% of the notes from the proceeds of certain sales of equity securities. See “Description of Notes — Optional
Redemption.”
• The notes will be guaranteed, jointly and severally, on a second lien senior secured basis by our existing domestic subsidiaries and
certain future domestic subsidiaries which also secure the obligations under our senior secured credit facility, with limited
exceptions.
• The notes and the guarantees thereof will be our and the guarantors’ second lien senior secured obligations, ranking equally in right
of payment with all of our and the guarantors’ existing and future unsubordinated obligations, senior to all of our and the
guarantors’ existing and future subordinated obligations and effectively junior to all existing and future first lien senior secured
obligations to the extent of the value of the assets securing such obligations, including all our obligations under our senior secured
credit facility.
• The notes and the guarantees thereof will be secured by a second priority lien on all of our and the guarantors’ property and assets
that secure our first lien senior secured credit facility subject to certain exceptions and permitted liens. See “Description of Notes —
Security.”
• If we experience certain changes of control, we must offer to purchase the notes at 101% of their aggregate principal amount, plus
accrued and unpaid interest.
REGISTRATION AND TRADING
• The notes have not been and will not be registered with the Securities and Exchange Commission or any state securities
commission. The notes are not entitled to any registration rights, and we have no intention to register the notes in the future.
• We do not intend to list the notes on any national securities exchange or quotation system.
NOTICE TO INVESTORS
• Investing in the notes involves risks. You should see the Risk Factors beginning on page 17 of this offering memorandum for a
discussion of business and financial risks that you should consider carefully prior to investing.
• We have not registered the notes under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws.
The notes may not be offered or sold in the United States or to any U.S. persons unless the notes are registered under the Securities
Act or offered or sold pursuant to an exemption from the registration requirements of the Securities Act. Therefore, we are only
offering the notes to:
(1) persons reasonably believed to be a U.S. “qualified institutional buyer” as defined in Rule 144A under the Securities Act; or
(2) non-U.S. persons outside the U.S. pursuant to Regulation S adopted under the Securities Act.
Per Note(1) Total
Price to Investors % $
(1) Plus accrued interest, if any, from , 2017.
We expect that the notes will be ready for delivery in book-entry form only through The Depository Trust Company on or about
, 2017. See “Book-Entry, Settlement and Clearance.”

Sole Book-Running Manager

Wells Fargo Securities
The date of this offering memorandum is , 2017.
 TABLE OF CONTENTS
Page
Offering Memorandum Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Selected Historical Combined Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Management’s Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . 46
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Certain Relationships and Related Party Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Description of Other Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Description of Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Book-Entry, Settlement and Clearance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
Notice To Investors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 152
Certain U.S. Federal Income Tax Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154
Legal Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160
Independent Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160
Where You Can Find More Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160
Index to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1

Neither the Securities and Exchange Commission (the “SEC”) nor any state or other domestic or
foreign securities commission or regulatory authority has approved or disapproved of the notes
offered hereby or determined if this offering memorandum is truthful or complete. Any representation
to the contrary is a criminal offense.
You may rely only on the information contained in this offering memorandum. We have not, and Wells
Fargo Securities, LLC (the “Initial Purchaser”) has not, authorized anyone to provide you with
information different from that contained in this offering memorandum. When you make a decision
about whether to invest in the notes, you should not rely upon any information other than the
information contained in this offering memorandum. Neither the delivery of this offering
memorandum nor sale of the notes means that information contained in this offering memorandum is
correct after the date of this offering memorandum. This offering memorandum is not an offer to sell
or a solicitation of an offer to buy the notes in any circumstances under which the offer or solicitation
is unlawful.
You should not assume that the information contained in this offering memorandum is accurate as of
any date other than the date on the front cover of this offering memorandum. Our business, financial
condition, results of operations and prospects may have changed since that date.

i
 IMPORTANT NOTICE TO READERS
We are offering the notes in reliance on an exemption from registration under the Securities Act, for
offers and sales of securities that do not involve a public offering. By purchasing notes, you will be deemed
to have made the acknowledgments, representations, warranties and agreements set forth under the
heading “Notice to Investors” in this offering memorandum. You should understand that you may be
required to bear the financial risks of your investment for an indefinite period of time.
We have prepared this offering memorandum solely for use in connection with the offer of the notes to
qualified institutional buyers under Rule 144A and to persons outside the United States under Regulation S.
We have submitted this offering memorandum confidentially to a limited number of qualified institutional
buyers and non-U.S. persons so that they can consider a purchase of the notes. We have not authorized its
use for any other purpose, and any other use is strictly prohibited. You agree that you will hold the
information contained in this offering memorandum and the transactions contemplated herein on a
confidential basis. This offering memorandum may not be copied or reproduced in whole or in part. You
may not distribute this offering memorandum to any person, other than a person retained to advise you in
connection with the purchase of the notes. By accepting delivery of this offering memorandum, you agree
to these restrictions. You should promptly return this offering memorandum, as well as any other materials
that we may subsequently provide to you, to Wells Fargo Securities, LLC, 550 South Tryon Street,
Charlotte, NC 28202, Attention: High Yield Capital Markets, if you decide not to participate in this offering
or if we terminate this offering. These undertakings and prohibitions are intended for our benefit and may
be enforced by us.
The Initial Purchaser makes no representation or warranty, express or implied, as to the accuracy or
completeness of the information contained in this offering memorandum. Nothing contained in this
offering memorandum is, or shall be relied upon as, a promise or representation by the Initial Purchaser as
to the past or future. We have furnished the information contained in this offering memorandum. The
Initial Purchaser has not independently verified any of the information contained herein (financial, legal or
otherwise) and assumes no responsibility for the accuracy or completeness of any such information.
This offering memorandum summarizes certain documents and other information in a manner we
believe to be accurate but we refer you to the actual documents for a more complete understanding of what
we discuss in this offering memorandum; we will make copies of the actual documents available to you
upon request. In making a decision to invest in the notes, you must rely on your own examination of our
company and the terms of this offering and the notes, including the merits and risks involved.
We are not and the Initial Purchaser is not making any representation to you regarding the legality of
an investment in the notes by you under any legal investment or similar laws or regulations. You should not
consider any information contained in this offering memorandum to be legal, business or tax advice. You
should consult your own attorney, business advisor and tax advisor for legal, business and tax advice
regarding an investment in the notes.
You should contact the Initial Purchaser with any questions about this offering or if you require
additional information to verify the information contained in this offering memorandum. We reserve the
right to withdraw this offering at any time. We and the Initial Purchaser also reserve the right to reject any
offer to purchase the notes in whole or in part for any reason, to sell less than the entire principal amount of
the notes offered by this offering memorandum or to allot to any prospective investor less than the full
amount of the notes for which it has subscribed.
Each prospective purchaser of the notes must comply with all applicable laws and regulations in force
in any jurisdiction in which it purchases, offers or sells the notes or possesses or distributes this offering
memorandum and must obtain any consent, approval or permission required by it for the purchase, offer or
sale by it of the notes under the laws and regulations in force in any jurisdiction to which it is subject or in
which it makes such purchases, offers or sales. Neither we nor the Initial Purchaser shall have any
responsibility therefor.

ii
 In connection with the offering of the notes, the Initial Purchaser may engage in transactions that
stabilize or maintain the market price of the notes at a higher level than the notes might otherwise achieve
in the open market. Such stabilizing, if commenced, may be discontinued at any time. A description of
these activities is set forth under the heading “Plan of Distribution” in this offering memorandum.
THE NOTES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY
NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. PROSPECTIVE PURCHASERS SHOULD BE AWARE THAT THEY MAY BE REQUIRED
TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
SEE “NOTICE TO INVESTORS.”

PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Except as otherwise indicated or the context otherwise requires, references in this offering
memorandum to “we,” “us,” “our” and similar terms, as well as references to “Simmons” or the “company,”
refer to Simmons Foods, Inc., Simmons Prepared Foods, Inc., Simmons Pet Food, Inc., Simmons Feed
Ingredients, Inc., and Simmons Energy Solutions, Inc., the co-issuers of the notes being offered hereby,
and their subsidiaries.
We define “EBITDA” as net income (loss) plus net interest expense, accrued income taxes,
depreciation and amortization expenses and non-cash hedging losses, less non-cash hedging gains. Each
of Simmons Foods, Inc., Simmons Prepared Foods, Inc., Simmons Pet Food, Inc., Simmons Feed
Ingredients, Inc., and Simmons Energy Solutions, Inc. has elected S corporation status for federal and state
income tax purposes and, as a result, does not pay federal or applicable state income taxes on its income
from operations because such income is included in its shareholders’ individual income tax returns.
Simmons Pet Food ON, Inc., a Canadian subsidiary of Simmons Pet Food, Inc., is subject to Canadian
income taxes; however, any foreign tax expense has not been significant during any reporting periods
presented in our accompanying combined financial statements. Accordingly, no provision for income taxes
related to current operations has been made for such companies in their combined financial statements
included in this offering memorandum. As presented herein, “Adjusted EBITDA” is defined as EBITDA
adjusted to exclude certain unusual, one-time or non-recurring transactions and events and to include
certain adjustments to EBITDA pursuant to the provisions of our first lien senior secured credit facility and
indenture governing the notes offered hereby as discussed further herein.
We present EBITDA and Adjusted EBITDA because we consider them important supplemental
measures of performance and believe they are frequently used by securities analysts, investors and other
interested parties in the evaluation of companies in our industry. EBITDA and Adjusted EBITDA have
several limitations which are discussed under the heading “Offering Memorandum Summary — Summary
Historical Combined Financial Data” in this offering memorandum, where we also include in footnote (3) a
quantitative reconciliation of EBITDA and Adjusted EBITDA to the most directly comparable U.S.
generally accepted accounting principles (“U.S. GAAP”) financial performance measure, which is net
income (loss). The SEC has adopted rules to regulate the use in filings with the SEC and public disclosures
and press releases of non-GAAP financial measures, such as EBITDA and Adjusted EBITDA, that are
derived on the basis of methodologies other than in accordance with GAAP. The non-GAAP financial
measures presented in this offering memorandum may not comply with these rules.

PRESENTATION OF FINANCIAL STATEMENTS

Our combined financial statements included in this offering memorandum have been prepared in
accordance with U.S. GAAP. All historical financial data included in this offering memorandum are in U.S.
dollars.

iii
 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This offering memorandum contains forward-looking statements that are based on our management’s
beliefs and assumptions and on information currently available to us. The use of any words such as
“anticipate,” “continue,” “estimate,” “expect,” “may,” “might,” “will,” “project,” “should,” “believe,” “intend,”
“continue,” “could,” “plan” and “predict” and negatives of these words and similar expressions are intended
to identify forward-looking statements. In particular, statements about our expectations, beliefs, plans,
objectives, assumptions or future events or performance contained in this offering memorandum are
forward-looking statements. These statements are based on, but not limited to, management’s assessment
of such factors as expected consumer demand, resource supply and competitive environment. These
assessments could prove to be inaccurate.
We have based these forward-looking statements on our current expectations, assumptions, estimates
and projections. While we believe these expectations, assumptions, estimates and projections are
reasonable, such forward-looking statements are only predictions and involve known and unknown risks
and uncertainties, many of which are beyond our ability to control. These and other important factors,
including those discussed in this offering memorandum under the headings “Offering Memorandum
Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of
Operations” and “Business” may cause our actual results, performance or achievements to differ materially
from any future results, performance or achievements expressed or implied by these forward-looking
statements. Some of the key factors that could cause actual results to differ from our expectations include:
• the effect of, or changes in, general economic conditions;
• changes in the market price for our finished poultry and pet food products, feed grains and other raw
materials, all of which fluctuate substantially and exhibit cyclical characteristics typically associated
with commodity markets;
• outbreak of a livestock disease (such as avian influenza), which could have an adverse effect on the
livestock flocks we own, consumer perception and demand for our products and our ability to access
certain domestic and foreign markets;
• issues related to food safety, including costs resulting from product recalls, regulatory compliance
and any related claims or litigation;
• compliance with and changes to laws and regulations, or changed interpretations thereof, including
changes in environmental, and occupational, health and safety laws;
• changes in political climate, trade policies, laws and regulations of foreign countries to which we or
other companies in the poultry industry ship product and other changes that may restrict access to
foreign markets;
• changes in and effects of competition, which is significant in all markets in which we operate;
• adverse results from litigation;
• risks associated with our substantial leverage, including cost increases due to rising interest rates;
• changes in the availability and cost of labor and contract growers; and
• other risks and uncertainties detailed elsewhere in this offering memorandum, including those
described under “Risk Factors.”
Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-
looking statements. The forward-looking statements included in this offering memorandum are made only
as of the date hereof. We do not undertake and specifically decline any obligation to update any such
statements or to publicly announce the results of any revisions to any such statements to reflect future
events or developments.

iv
 MARKETS, RANKING AND OTHER DATA
The information and statistics included in this offering memorandum regarding Simmons and the
markets in which Simmons operates are generally based on independent industry publications or
databases, reports of governmental agencies or other published industry sources, including Euromonitor,
WATT Poultry USA, the United States Department of Agriculture, the National Chicken Council, the
National Restaurant Association, IBISWorld and the National Renderers Association. Some information is
also based on our good faith estimates, which are derived from our review of internal surveys, information
from our customers and vendors, trade and business organizations and other contacts in markets in which
we operate, and our management’s knowledge and experience. Although we believe that each of these
studies and publications is reliable, neither we nor the Initial Purchaser has independently verified such
data and neither we nor the Initial Purchaser make any representation as to the accuracy or completeness of
such information. Similarly our internal research is based upon our understanding of industry conditions
and we believe it to be reliable but it has not been verified by any independent sources.

TRADEMARKS
In this offering memorandum, we refer (without the ownership notation after the initial use) to several
registered trademarks that we own, including Simmons®, Twin Pet®, Strongheart® and Healthy By Design®.
All brand names or other trademarks appearing in this offering memorandum are the property of their
respective owners. Solely for convenience, the trademarks and service marks referred to in this offering
memorandum may be listed without the®,™, andSM symbols.

v
 OFFERING MEMORANDUM SUMMARY
The following summary highlights selected information contained elsewhere in this offering
memorandum, but may not contain all of the information that may be important to you. You should read
this entire offering memorandum, including the information described under the heading “Risk Factors”
and the financial statements and related notes beginning on page F-1 of this offering memorandum, before
making an investment decision. Except as otherwise indicated or the context otherwise requires, references
in this offering memorandum to “we,” “us,” “our” and similar terms, as well as references to “Simmons” or
the “company,” refer to Simmons Foods, Inc. (“Simmons Foods”), Simmons Prepared Foods, Inc. (“Simmons
Prepared Foods”), Simmons Pet Food, Inc. (“Simmons Pet Food”), Simmons Feed Ingredients, Inc.
(“Simmons Feed Ingredients”), and Simmons Energy Solutions, Inc. (“Simmons Energy” and, together with
Simmons Foods, Simmons Prepared Foods, Simmons Pet Food and Simmons Feed Ingredients, the
“Issuers”), and their subsidiaries.

Overview
We are one of the leading vertically integrated poultry processors and the largest private label wet pet
food producer in the United States and Canada. Our company was founded in 1949 and is privately held,
with headquarters in Siloam Springs, Arkansas and operations in Arkansas, Oklahoma, Missouri, Kansas,
New Jersey and Ontario, Canada. We operate in three primary business segments: (i) Poultry, (ii) Pet Food
and (iii) Protein.
Our integrated Poultry segment consists of hatching egg production, hatching, feed production,
raising chicks to marketable age (“grow-out”) primarily via contract growers, processing, further
processing, marketing and transportation of chicken. We produce a wide range of value-added, frozen,
refrigerated and fresh chicken products targeted primarily to foodservice and retail customers, where the
vast majority of our products are sold under private label. We sell our poultry products to the foodservice
industry for end use primarily by national and regional chain restaurants and to the retail industry,
primarily the mass merchandiser and warehouse club store channels. Within our Pet Food segment, we
produce wet and dry pet food for dogs and cats and pet treats for dogs. We sell our pet food products to
grocery store chains, dollar and discount stores, farm and feed stores, mass merchandisers, club store
retailers, e-commerce retailers, pet specialty stores for their private label products and to a limited number
of pet food brand owners on a contract manufacturing basis. We believe that we are a top three supplier of
private label wet pet food to Wal-Mart for its Ol’ Roy brand pet food, a leading pet food brand in the United
States. We have supplied wet pet food to Wal-Mart for over 30 years, and in early 2010 we began producing
private label dry pet food for Wal-Mart. We have now expanded that customer base to multiple customers.
We intend to continue to expand our pet food product portfolio to sell more products to our existing
customers and to help us attract new customers. Our Protein segment is in the business of converting, or
rendering, raw material by-products of protein processing operations into prime feed ingredient products
for the pet food, aquaculture, and livestock markets. Our feed ingredient products include poultry meal,
feather meal, poultry fat and wet pet food ingredients. For the twelve months ended July 1, 2017, we
generated net sales and Adjusted EBITDA of $1,517.6 million and $121.0 million, respectively.
See “—Summary Historical Combined Financial Data.”

Our Business Segments

Poultry (Approximately 57% of Simmons revenue for the twelve months ended July 1, 2017) — Our
poultry operations constitute our largest business segment. We are a vertically integrated poultry
processing company engaged in the production, marketing and distribution of fully cooked, ready to cook
breaded, frozen and fresh chicken products. We supply primarily private label and proprietary products to
our customers, with the exception of limited direct retail items sold under the Simmons® brand. We sell our
products to the foodservice industry for end use by restaurants, including quick service restaurants and

1
casual dining restaurants, such as Chick-fil-A, KFC and Taco Bell, and to the retail industry, primarily the
mass merchandiser and warehouse club stores, such as Wal-Mart and Sam’s Club. A small portion of our
revenue each year (generally less than 10%) is derived from exports of commodity chicken products to
international markets, including Africa, Mexico, Iraq and 51 other countries. Over the years, we have grown
as the result of expanding markets, increased market penetration and various acquisitions of farming
operations and poultry processors. As a vertically integrated company, we control all phases of the
production of our products. We believe this vertical integration has allowed us to be one of the leading
producers of chicken products in North America. During 2016, we processed approximately 203.8 million
chickens, or approximately 3.9 million chickens per week. Through Simmons Energy, we distribute
approximately 4.7 million gallons of propane gas per year to commercial and residential customers in
Oklahoma, Arkansas and Missouri, with approximately 90% of our sales being to poultry farm operators.
Pet Food (Approximately 37% of Simmons revenue for the twelve months ended July 1, 2017) — We
believe we are one of the ten largest pet food producers in the United States and Canada and the largest
private label wet pet food producer in the United States and Canada. We began producing wet pet food in
1964, dry pet food in 2010 and pet treats in 2013. Our pet food sales are categorized into two product
market areas: (i) private label and (ii) contract manufacturing. Private label customers primarily include
mass merchandisers, grocery chains, e-commerce retailers, farm and feed companies and pet specialty
stores. Private label accounts include customers such as Wal-Mart, Dollar General, Tractor Supply, Kroger,
Publix and numerous others. We also maintain certain proprietary brands, such as Twin Pet®, Strongheart®,
Bolo™ and Healthy By Design®, which we sell to retailers that are either too small or do not wish to maintain
their own private label programs. Select contract manufacturing customers include Blue Buffalo and
Wellpet for whom we believe we produce and package either all or a significant portion of their wet pet food
products.
Protein (Approximately 6% of Simmons revenue for the twelve months ended July 1, 2017) — Our
Protein segment is in the business of converting, or rendering, raw material by-products into prime feed
ingredient products for the pet food, aquaculture, and livestock markets. Our feed ingredient products
include poultry meal products, feather meal, poultry fat and wet pet food ingredients. Applications for our
feed ingredients include, among others, enhancing animal and poultry diets, providing a source of high
energy and improved palatability in large and small animal feed formulations and providing a raw material
input for pet food and treats. We also produce Pro*Cal, a proprietary product manufactured from multiple
by-product streams. Pro*Cal is a unique high protein, high fat, dry feed supplement used as an additive in
animal feed to meet dietary, protein and energy requirements and is primarily sold to the dairy feed market.
Our business is vertically integrated within the Poultry segment, and our other segments are
complementary to our Poultry business. We enjoy production efficiencies in our feed ingredients and
protein feed supplements businesses as a result of the nature of the raw material inputs and finished good
outputs of these businesses, which have overlapping end-use markets. In addition to our headquarters in
Siloam Springs, Arkansas, we operate facilities in ten other locations, including facilities for hatcheries,
feed mills, processing plants, feed ingredients and pet food production. As of July 1, 2017, we had
approximately 5,874 employees. In addition to Wal-Mart, some of our other large customers and end-users
include, among others, Yum! Brands (including KFC, Taco Bell and Pizza Hut), H.J. Heinz and Sysco
Corporation.
Changes in the price of commodities, such as grains and broilers, present market risks for our
operating results. To address these risks, we sometimes engage in certain commodity risk management
activities in which we use derivative financial instruments, primarily futures and options, to reduce the
effect of changing commodity input prices and as a mechanism to procure the underlying commodity.

2
 Our Industries

Poultry

The U.S. chicken industry is the world’s largest producer and second largest exporter of chicken. The
U.S. chicken industry has grown for the last ten years at a compounded annual growth rate of 1.4%, from
35.5 billion pounds of chicken produced in 2006 to 40.7 billion pounds produced in 2016. This growth
resulted from increasing domestic and international per capita consumption of chicken and population
growth. The USDA states that per capita consumption of chicken in the United States grew from 80 pounds
in 2009 to 91 pounds in 2016. From 2006 to 2016, annual per capita consumption of chicken in the
United States grew at a compounded annual growth rate of 0.5%, while annual per capita consumption of
beef declined at a compound rate of 1.5% and annual per capita consumption of pork increased 0.2%. Per
capita consumption of chicken in the United States surpassed that of pork in 1986 and that of beef in 1994.
We believe these favorable trends will continue over the long-term due to consumers’ continued awareness
of the health benefits, convenience, cost advantages and versatility of chicken.

We expect several favorable trends that the chicken industry has experienced over the last several
years to continue. These include increasing consumer demand for high-quality chicken products in the
United States and globally, as well as consolidation within the U.S. chicken industry. Since 2008, head
count for small and medium size birds has declined, and increasing average bird weights has led to
production growth. Higher bird weights and consolidation within the industry have both been driven by a
desire for enhanced cost efficiencies. In lieu of capacity increases, many integrated processors responded to
growth expectations by increasing bird weight and subsequently pound throughput; thereby gaining
advantages through better overhead absorption and reduced labor cost per processed pound. This has
come during a time of intense customer food cost pressure and resistance to higher shelf and menu pricing
in the current economy. Pressure has also come from intensifying environmental, food safety, labor and
other regulations governing the chicken industry. However, given the reality of tight family food budgets,
we believe demand will remain robust for our products vis-à-vis competing proteins.

The chicken industry has two major customer categories or markets: foodservice and retail. The
majority of our U.S. chicken sales are derived from products sold to the foodservice market. Foodservice
customers principally include chain and independent restaurants, the emerging food preparation
operations of retailers (e.g., service deli, ‘grocerants’, c-stores), distributors and certain other institutions
located throughout the continental United States. The retail market consists primarily of grocery store
chains, wholesale clubs and other retail distributors. According to the USDA, between 1980 to 2014,
consumer spending through food away from home channels (i.e., foodservice) grew from 39% to 50% of total
food spending. Foodservice sales, defined as consumer food-away-from-home expenditures, continue to
demonstrate growth, increasing approximately 4.9% and 5.0% in 2015 and 2016, respectively, according to
the National Restaurant Association. Furthermore, this growth trend is estimated to continue with
forecasted growth of 4.3% in 2017.

Pet Food

Pet food (in this industry overview, pet food means dog food and cat food) is sold through various
distribution channels, including supermarkets, mass merchandisers, pet specialty retailers, online
e-commerce retailers, dollar and discount stores, farm and feed stores, veterinarians and kennels. We
currently participate in the U.S. and Canadian dry and wet pet food markets. According to Euromonitor, in
2016, retail sales of pet food in the United States were approximately $28.6 billion, an increase of 3.6%
compared to 2015 sales of $27.6 billion. From 2012 to 2016, U.S. pet food industry sales increased at a
compounded annual growth rate of 3.8%.

3
 The pet food market is generally broken down into three product segments: wet, dry and treats &
mixers. Each of these segments has a great diversity of offerings with respect to product and packaging
formats. Dry pet food is the largest segment of the U.S. market, accounting for approximately 59% of sales
in 2016, according to Euromonitor. Wet pet food is the second largest segment of the U.S. market,
accounting for approximately 24% of sales, and treats & mixers is the smallest segment with 17% of sales.
Dry Products Segment — Dry pet food was estimated to account for approximately $16.9 billion of total
pet food sales in the United States in 2016, an increase of 2.4% over 2015 sales of $16.5 billion. Dry pet food
is generally available in a number of formats, including kibbles, meal and expanded particles. We began
producing dry pet food in early 2010.
Wet Products Segment — Wet pet food was estimated to account for approximately $6.9 billion of total
pet food sales in the United States in 2016, an increase of 4.2% over 2015 sales of approximately
$6.6 billion. Wet pet food is sold in cans (aluminum and steel), pouches, trays and cups. We have
participated in this segment for over 50 years.
Treats & Mixers Segment — The treats & mixers segment of pet food was estimated to account for
approximately $4.9 billion of total pet food sales in the United States in 2016, an increase of 8.8% over 2015
sales of $4.5 billion. Treats include meat, biscuit, cereal, fish or yeast-based products. Treats are those
products marketed and fed not as a pet’s primary meal but as a reward or indulgence. We began
manufacturing pet treats for dogs (primarily the chicken jerky style products) in late 2013.
We expect that continued growth in pet food sales in our markets will be primarily driven by (i) an
increasing pet population, (ii) a continuing customer shift toward premium products and (iii) higher prices
due to rising costs for raw and packaging materials and increasing costs of production. According to
Euromonitor, there were 69.2 million dogs and 74.7 million cats in the United States in 2016. This
represented a decrease of 1.0% in the dog population and a 0.7% increase in the cat population from 2015.
Furthermore, the pet population is expected to grow at an average annual rate of 3.9% from 2017 to 2022
according to IBIS World.
Over the last ten years, the pet food market has seen the introduction of an increasing number of
products that represent premium product alternatives to traditional pet food choices, including food keyed
to the age-stages of pets, low-calorie foods, organic foods, foods that discourage certain ailments and
nutraceutical products (foods or naturally occurring food supplements believed to have beneficial health
effects for animals). We believe we have benefited from this trend through the introduction of premium
products by our respective private label and contract manufacturing customers seeking to capitalize on
these trends in the pet food market.

Protein (Rendering Industry)

Through Simmons Feed Ingredients, we are in the business of converting, or rendering, raw material
by-products into prime feed ingredient products for the pet food, aquaculture, and livestock markets. The
USDA Livestock Slaughter estimates that approximately 9 billion chickens, 232 million turkeys,
116 million hogs, 29 million cattle, 28 million ducks, and 2 million sheep and lambs are slaughtered and
processed in the United States annually. According to the National Chicken Council and National Turkey
Federation the United States is the largest producer of poultry products in the world. Poultry, when
processed into edible meat, results in the generation of raw material by-products that include offal, fat,
skin, bones, feathers, blood and other miscellaneous parts. Rendering is a heating process that extracts
usable ingredients from the poultry raw material by-products, such as poultry meals and fats that are
valuable ingredients in the pet food and animal feed industries. The pet food and other animal feed
industries are highly dependent upon the rendering industry for the supply of animal-based protein and fat
ingredients in order to meet the demand for pet food and other animal feed products.

4
 Our Competitive Strengths
We believe that our competitive strengths will enable us to maintain our position as a leading poultry
processor and pet food producer and to capitalize on future growth opportunities. Our competitive
strengths include:
Diversified Business Model — Our broad product offering, end markets and customer base across
business segments diversify our sources of revenue and cash flow, provide stability in our business and
provide us with multiple growth opportunities. For the 12 months ended July 1, 2017, our largest business
segment, Poultry, represented approximately 57% of net sales and our next largest segment, Pet Food,
accounted for approximately 37%. Additionally, certain underlying industry fundamentals for pet food,
including the relative stability of raw material input costs and the relative inelasticity of consumer demand,
are more favorable than those for the poultry market. Furthermore, our products have varying demand
drivers that diversify exposure away from any single economic factor. For example, poultry processors
generally decrease flock sizes and production when chicken prices are low. As a result, the supply of the
poultry processing by-product inputs to animal feed ingredient producers decreases, while demand for
these products generally remains strong due to the diversity of end markets for their use, including pet
food, dairy, beef, pork, poultry and aquaculture. The relatively stable demand for animal feed ingredients
relative to the reduced supply of the poultry by-product inputs generally results in an increase in prices for
animal feed ingredients. We believe that our end market, product and customer diversity will help us to
maintain our operating performance through economic and industry cycles and changing market
conditions.
Strong Market Positions — We maintain a strong presence in many of our end markets and believe we
have leading shares in several targeted market niches. We are one of the largest private label manufacturers
of wet pet food and have significant scale in our pet food operations, with six dedicated pet food production
plants across the United States and Canada. We believe that we are the only U.S. and Canadian private
label wet pet food supplier manufacturing pouch and cup formats on a commercial scale. We believe our
leadership position, broad product offering and manufacturing expertise enable us to continue to further
penetrate the private label and contract manufacturing pet food market and better serve our customers as
they compete with the many branded pet food manufacturers. Our pet food and poultry operations are
supported by leading niche positions in our other complementary businesses, namely feed ingredients and
Pro*Cal. In the Poultry segment, we are one of the top 20 integrated poultry producers in the United States
based on production data for ready-to-cook volume in 2016.
Blue Chip and Diverse Customer Base — We benefit from a large and diverse customer base that
includes a number of well known, blue chip customers such as Wal-Mart, Yum! Brands, Mars, H.J. Heinz
and Sysco Corporation, each of which is a leader in its respective market. We have long-standing, stable
business relationships of more than ten years with five of our ten largest customers. As an example of our
strong customer relationships, we have been recognized with a number of supplier awards, including 2016
Chick-fil-A Supplier of the Year, 2016 Cheddar’s Supplier of the Year, 2016 BJs Brewery Supplier of the
Year, 2015 Raising Cane’s Supplier of the Year, 2015 Taco Bell Star Award for Innovation, and 2015 KFC
Star Award for Quality. Due to our high level of product quality and customer service, we believe we will
continue to play a meaningful role in helping our customers develop their product and brand strategies.
History of Product Innovation — With over 60 years of experience in the poultry business, we have a
long history of developing and marketing products on behalf of and for the benefit of our customers. Unlike
most other large integrated chicken producers, we specifically produce only proprietary and private label
products, allowing us to meet our customers’ evolving needs. As a result, we do not have to invest in and
maintain an expensive brand management infrastructure (e.g., advertising expenses, consumer marketing
expenses and slotting fees to retailers). With our modern facilities and vertical integration, we can expedite
new custom products from idea to commercialization in as little as 30 days. By controlling every stage of
poultry production, we are able to customize our operations to meet unique customer needs. We intend to

5
continue to drive organic growth from existing businesses by leveraging our proven capacity for innovation
and product extensions in our two primary business segments, Poultry and Pet Food. Furthermore, our Pet
Food business entered into the pet treats market segment in late 2013 with the introduction of our new pet
treat product line.
Seasoned and Proven Management Team — Our management team is among the most experienced
in the poultry and pet food industries. Our senior management team, led by Vice Chairman and Chief
Executive Officer M. Todd Simmons, has an average of approximately 29 years of experience in the poultry
and pet food industries. Our management team successfully led us through the challenging poultry market
conditions in 2008 and 2011, which resulted from rising commodity input prices, an oversupply of chicken
products in the United States and weakened overall product demand due to the economic recession. Other
of our senior operating executives have backgrounds with leading poultry and pet food companies,
including Tyson Foods, Inc., Wayne Farms, LLC, Foster Farms and Mars Pet Care, among others. We
believe that this combination of backgrounds and experience will enable us to maintain and strengthen
long-term relationships with customers and help us to grow our business in the future.

Our Business Strategy

Our objectives are to: (i) generate sustainable and predictable earnings; (ii) enhance our position as a
market leader and preferred supplier of chicken products; and (iii) become the preferred provider of private
label and contract manufactured pet food products (wet, dry and treats). To achieve these objectives, we are
pursuing the following strategies:
Increase Our Status as a Full-Service Provider of Pet Food Products — We are continuing our goal
of becoming a full-service pet food provider by expanding our product offering to further penetrate both the
dry pet food and treat markets. Through these initiatives, we hope to closely mirror the overall pet food
market and become a major one-stop source for private label manufacturing. We started this process in
2010 when we expanded beyond wet pet food production and entered the dry pet food market. Since that
time, we have actively sought to expand our dry pet food operations and have succeeded in adding new
customers. These new customers filled and then exceeded our dry pet food plant capacity, which led to our
completion of a second dry pet food plant in Decatur, Arkansas, in 2015. Our current customer demand is
nearing our dry food manufacturing capacity, causing us to consider installing an additional line. In late
2013, we further expanded our pet food platform by opening our first dedicated pet treats facility. We
entered into a multi-year contract with an anchor customer that committed to the majority of our pet treat
plant capacity. This expansion enables our current and future customers to source their wet, dry and pet
treats manufacturing needs with our company.
Focus on Customer Needs and Private Label Growth — Customer relationships are very important for
us, since our products often bear our customers’ brand names. We will continue to provide our retail
partners with high quality products and services at an attractive value. We believe our focus on our
customers’ needs will enable us to expand our existing relationships and attract new customers in existing
and new markets. For example, we created an entry-level price point dry pet food product line at Wal-Mart,
which we market under the brand name Twin Pet. Private label industry leadership requires a high level of
coordination with retail customers in areas such as supply chain management, product development,
manufacturing and customer service, among others. In addition to efficiently managing increased product
manufacturing complexity, we have a proven track record of maintaining high service levels across our
customer base. We also partner closely with customers on supply chain planning and execution to
minimize freight costs, reduce working capital requirements and increase in-store product availability.
Continue Our Commitment to Quality and Safety — We emphasize an ongoing commitment to
quality and safety in all business segments. We take extensive precautions to ensure that our poultry flocks
are healthy and our processing plants and other facilities operate in a sanitary and environmentally sound

6
manner. Our facilities and operations are subject to regulation by various federal and state agencies,
including, but not limited to, the United States Food and Drug Administration (“FDA”), the USDA, the
Environmental Protection Agency (“EPA”), the Occupational Safety and Health Administration (“OSHA”)
and corresponding state agencies. Our chicken processing plants are subject to continuous on-site
inspection by the USDA. Our prepared chicken plants operate under the USDA’s Total Quality Control
Program, which is a self-inspection plan written in cooperation with and monitored by the USDA. The FDA
also inspects the production at our feed mills. The FDA regulates our Pet Food segment. While the FDA has
no requirement that pet food products have pre-market approval, it does ensure that the ingredients used in
pet food are safe and have an appropriate function in the pet food. The FDA also regulates the labeling of
pet food products.
Enhance Market Positions — We intend to grow our business by increasing penetration in existing
markets and selectively evaluating opportunities to expand into new markets. We believe that
opportunities exist for us to enhance our scale, reduce fixed manufacturing costs and broaden our product
portfolio through internal investment and the pursuit of select acquisitions and/or joint ventures. We will
continue to evaluate and pursue strategic opportunities if we believe such opportunities would (i) provide
additional product, manufacturing and technical capabilities; (ii) broaden our geographic coverage and
strengthen our ability to supply products internationally; (iii) add new customers; (iv) have leading and
unique market positions; and/or (v) provide additional economies of scale that would further reduce costs
and improve profits.

Recent Developments
Tender Offer for the 2021 Notes
Concurrently with the commencement of this offering, we commenced a tender offer (the “Tender
Offer”) to purchase any and all of our outstanding 2021 Notes. As of July 1, 2017, we had $415.0 million in
aggregate principal amount of outstanding 2021 Notes. The Tender Offer is conditioned upon, among
other things, the closing of this offering. Nothing in this offering memorandum and the concurrent
transactions should be construed as an offer to purchase any outstanding 2021 Notes, as the Tender Offer
is being made only to the recipients of an Offer to Purchase and Consent Solicitation Statement, upon the
terms and subject to the conditions set forth therein. We expect to redeem any 2021 Notes not tendered to
us and simultaneously discharge the indenture governing the 2021 Notes. In connection with the Tender
Offer, we are also soliciting consents from holders of the 2021 Notes to amend the indenture pursuant to
which the 2021 Notes were issued to, among other things, remove a significant portion of the restrictive
covenants and certain events of default contained in that indenture and reduce the number of days prior to
any redemption date that Simmons must send a notice of redemption. In addition, the proposed
amendments to the indenture governing the 2021 Notes would include a release of all collateral securing
our and the guarantors’ obligations under the 2021 Notes. If irrevocable tenders and consents representing
at least a majority of the outstanding principal amount of the 2021 Notes are obtained, then a supplement
to the indenture governing the 2021 Notes will be executed that will amend the indenture to eliminate most
of the restrictive covenants and certain events of default contained in that indenture and reduce the number
of days prior to any redemption date that Simmons must send a notice of redemption. If irrevocable tenders
and consents representing at least two-thirds of the outstanding principal amount of the 2021 Notes are
obtained, then we will effect the release of liens on collateral securing the 2021 Notes.

Announcement of New Poultry Processing Plant

On September 27, 2017, Simmons Prepared Foods announced its plans to build a new poultry
processing plant in Benton County, Arkansas. The plant will produce fresh and frozen chicken products for
retail and restaurant customers and is expected to have the capacity to produce approximately 850 million
pounds of poultry meat annually at full production. The entire facility will be developed in stages, with

7
initial operations estimated to commence in 2019. We expect to invest approximately $300 million to fully
complete all planned stages of the facility over the course of the next five or six years. We intend to seek
State and local economic incentives in connection with our investment in the new poultry processing plant,
including, without limitation, a payment in lieu of taxes, or PILOT, incentive agreement with Benton
County, Arkansas (the “County”), which could provide for an abatement of up to 65% of annual ad valorem
taxes on the plant facility for a term of up to 30 years (the actual abatement percentage and term of
abatement is subject to the mutual agreement of the parties and will set forth in the definitive agreement, if
any). In the event we participate in the PILOT arrangement, we will be required to transfer to the County
when acquired, bare legal title to the land, improvements, equipment and other assets used in the facility,
subject to liens securing the obligations under our senior secured credit facility and the notes offered
hereby, and the County will issue industrial development revenue bonds (“PILOT Bonds”) with respect to
the payments in lieu of taxes for the term of such abatement. The PILOT Bonds will be purchased by one of
the Issuers or a subsidiary guarantor of the notes offered hereby. In addition, we will be required to enter
into a lease with the County to lease back the assets transferred to the County in exchange for lease
payments sufficient to pay the principal of and any applicable interest on the PILOT Bonds. These lease
payments to the County are to be used to make the payments required under the PILOT Bonds. All of the
foregoing payments are to be “net settled” with no cash transfers. We will also have an option to repurchase
the assets transferred to the County for a nominal purchase price at any time in connection with a
redemption of the PILOT Bonds, which we may cause at any time. We would continue to operate as the de
facto beneficial and tax owner of all assets transferred to the County. There is no assurance that we will
build the plant or enter into the PILOT arrangement or, in the event we do enter into a PILOT arrangement,
what the definitive terms of the PILOT arrangement will be.

8
 Organizational Structure

The following chart depicts our organizational structure.

Simmons Shareholders

Simmons Simmons Simmons Simmons Simmons

Foods, Inc. Prepared Energy Pet Food, Feed
Foods, Inc. Solutions, Inc. Ingredients,
Inc. Inc.
(Issuer) (Issuer) (Issuer) (Issuer) (Issuer)

Poultry Segment Pet Food Segment Protein Segment

Simmons Simmons Pet

Pet Food Food ON, Inc
Holdings,
Inc.
(non-guarantor)

Canadian
Simmons Simmons Subsidiaries
Pet Food Pet Food
NJ, Inc. KS, Inc. (non-guarantors)

(guarantor) (guarantor)

Shading denotes Issuers and guarantors of the notes offered hereby.

• Each of Simmons Foods, Inc., Simmons Prepared Foods, Inc., Simmons Energy Solutions, Inc.,
Simmons Pet Food, Inc., and Simmons Feed Ingredients, Inc. are, jointly and severally, the Issuers
of the notes offered hereby and are U.S. co-borrowers under our senior secured credit facility and are
guarantors of the Canadian subfacility thereunder. Each such entity has elected S corporation status
for federal and state income tax purposes.
• Simmons Pet Food Holdings, Inc. and all of its existing subsidiaries and certain future domestic
subsidiaries of the Issuers guarantee the notes offered hereby and our obligations under our senior
secured credit facility.
• Simmons Pet Food ON, Inc. and its subsidiaries will not be guarantors of the notes offered hereby.
Simmons Pet Food ON, Inc.is obligated as a borrower for any borrowings under a Canadian
subfacility under our senior secured credit facility and its subsidiaries (other than certain excluded
subsidiaries) are guarantors of such subfacility.

9
 The Offering
The summary below describes selected terms of the notes. Certain of the terms and conditions
described below are subject to important limitations and exceptions. A more detailed description of the
terms and conditions of the notes is set forth under the heading “Description of Notes” in this offering
memorandum.
Issuers . . . . . . . . . . . . . . . . . . . . . . . . . . . Each of Simmons Foods, Inc., Simmons Prepared Foods, Inc.,
Simmons Pet Food, Inc., Simmons Feed Ingredients, Inc., and
Simmons Energy Solutions, Inc., jointly and severally.
Notes Offered . . . . . . . . . . . . . . . . . . . . . $550,000,000 aggregate principal amount of % Second Lien
Senior Secured Notes due 2024.
Maturity Date . . . . . . . . . . . . . . . . . . . . . , 2024.
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest on the notes will accrue at a rate per annum equal to %.
Guarantees . . . . . . . . . . . . . . . . . . . . . . . The notes will be guaranteed, jointly and severally, on a second
lien senior secured basis by our existing domestic subsidiaries
and certain future domestic subsidiaries which also secure the
obligations under our senior secured credit facility, with limited
exceptions. See “Description of Notes — Note Guaranties.”
Interest Payment Dates . . . . . . . . . . . . . . and of each year, beginning , 2018.
Ranking . . . . . . . . . . . . . . . . . . . . . . . . . . The notes and the guarantees thereof will be our and the
guarantors’ second lien senior secured obligations, ranking
equally in right of payment with all of our and the guarantors’
existing and future unsubordinated obligations, senior to all of
our and the guarantors’ existing and future subordinated
obligations and effectively junior to all existing and future first
lien senior secured obligations to the extent of the value of the
assets securing such obligations. See “Description of Notes—
Ranking.”
As of July 1, 2017, after giving effect to the sale of the notes
offered hereby and the application of the net proceeds therefrom
as set forth under “Use of Proceeds,” we would have had no
indebtedness outstanding under our senior secured credit
facility. We would have had, however, approximately
$247.2 million of unused availability after taking into account
our borrowing base and outstanding letters of credit under our
senior secured credit facility as of August 31, 2017, all of which
would effectively rank senior to the notes to the extent of the
value of the assets securing such obligations. See “Description of
Other Indebtedness.”
Collateral . . . . . . . . . . . . . . . . . . . . . . . . . The notes and the guarantees will be secured by a second
priority lien on the issuers’ and the guarantors’ property and
assets that secure our senior secured credit facility subject to
certain exceptions and permitted liens. See “Description of
Notes — Security.”
The value of collateral at any time will depend on market and
other economic conditions, including the availability of suitable

10
 buyers for the collateral. The liens on the collateral may be
released without the consent of the holders of notes if collateral is
disposed of in a transaction that complies with the indenture and
related security documents or in accordance with the provisions
of the intercreditor agreement. In the event of a liquidation of the
collateral, the proceeds may not be sufficient to satisfy the
obligations under the notes. See “Risk Factors — Risks Related to
the Notes” and “Description of Notes — Security.”
Intercreditor Agreement . . . . . . . . . . . . . The trustee and the collateral agent under the indenture
governing the notes and the administrative agent and the
collateral agent under the senior secured credit facility will enter
into an intercreditor agreement as to the relative priorities of
their respective security interests in the assets securing the notes
and borrowings under the senior secured credit facility and
certain other matters relating to the administration of security
interests. See “Description of Notes — Security — Intercreditor
Agreement.”
Optional Redemption . . . . . . . . . . . . . . . We may redeem some or all of the notes at any time prior to
, 2020, at a price equal to 100% of the principal amount of
the notes to be redeemed, plus a make-whole premium and
accrued and unpaid interest to the redemption date. Thereafter,
we may redeem some or all of the notes at the redemption prices
listed under “Description of Notes — Optional Redemption” plus
accrued and unpaid interest to the date of redemption. At any
time prior to , 2020, we may redeem up to 35% of the
notes from proceeds of certain sales of equity securities. See
“Description of Notes — Optional Redemption.”
Change of Control . . . . . . . . . . . . . . . . . . Upon the occurrence of a change of control (as described under
“Description of Notes — Change of Control”), we must offer to
repurchase the notes at 101% of the principal amount, plus
accrued and unpaid interest to the date of repurchase.
Basic Covenants of the Indenture . . . . . The indenture governing the notes will contain certain
covenants limiting our ability and the ability of our restricted
subsidiaries to, under certain circumstances:
• incur additional debt;
• pay dividends or make other distributions on, redeem or
repurchase, capital stock;
• make investments or other restricted payments;
• enter into transactions with affiliates;
• sell all, or substantially all, of our assets;
• create liens on assets to secure debt; or
• effect a consolidation or merger.
These covenants are subject to important exceptions and
qualifications as described in this offering memorandum under
the caption “Description of Notes — Certain Covenants.”

11
 Additionally, if the notes are assigned an investment grade
rating by S&P Global Ratings and Moody’s Investors Service,
Inc. and no default or event of default has occurred or is
continuing, certain covenants will be suspended. If the ratings
on the notes should subsequently decline to below investment
grade, the suspended covenants will be reinstated. See
“Description of Notes — Certain Covenants.”
No Registration Rights . . . . . . . . . . . . . . The notes will not have any registration rights.
Transfer Restrictions . . . . . . . . . . . . . . . . We have not registered the notes under the Securities Act or any
other securities law. The notes are subject to restrictions on
transfer and may only be offered or sold in transactions exempt
from, or not subject to, the registration requirements of these
securities laws. See “Notice to Investors.”
Use of Proceeds . . . . . . . . . . . . . . . . . . . . We intend to use the proceeds from this offering (i) to purchase
any and all of our outstanding 2021 Notes that are validly
tendered by holders and accepted by us pursuant to the Tender
Offer and redeem or retire any 2021 Notes not purchased in the
Tender Offer, (ii) to pay down indebtedness under our senior
secured credit facility, (iii) for general corporate purposes,
including future capital expenditures and/or acquisitions, and
(iv) to pay the fees and expenses associated with the Tender
Offer and the offering of the notes hereby. See “Use of Proceeds.”

Risk Factors
An investment in the notes involves risks. You should carefully consider all of the information in this
offering memorandum. In particular, you should evaluate the specific risk factors set forth under the
heading “Risk Factors” in this offering memorandum.

Corporate Information
Our principal executive offices are located at 601 North Hico, Siloam Springs, Arkansas, 72761. Our
telephone number is (479) 524-8151. Our website address is http://simfoods.simmonsglobal.com/. The
information contained on our website does not constitute a part of this offering memorandum.

12
 SUMMARY HISTORICAL COMBINED FINANCIAL DATA
The following table shows summary historical combined financial data for the periods indicated. The
balance sheet data as of December 27, 2014, January 2, 2016, and December 31, 2016 and the combined
statement of operations data for each of the years then ended are derived from our audited combined
financial statements included elsewhere in this offering memorandum. The balance sheet data as of
July 2, 2016 and July 1, 2017 and combined statement of operations data for the six-month periods ended
July 2, 2016 and July 1, 2017 have been derived from our unaudited combined financial statements
included elsewhere in this offering memorandum and include all adjustments, consisting only of normal
recurring accruals, that management considers necessary for the fair presentation of the combined financial
position and results of operations for these periods. The combined statement of operations data for the
twelve months ended July 1, 2017 are derived from our unaudited combined financial statements for the six
months ended July 2, 2016 and July 1, 2017, and our audited combined financial statements for the year
ended December 31, 2016, all of which are included elsewhere in this offering memorandum.
The as adjusted data as of and for the twelve months ended July 1, 2017, give effect to the sale of the
notes offered hereby and the application of the net proceeds therefrom as described in “Use of Proceeds” as
if such transactions had occurred on July 3, 2016, in the case of the as adjusted data set forth below other
than net debt and, in the case of net debt, as if such transactions occurred on July 1, 2017.

13
 The following information should be read together with “Selected Historical Combined Financial
Data,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the
financial statements and the notes related to those statements included elsewhere in this offering
memorandum. The financial information included in this offering memorandum may not be indicative of
our future results or operations.
Year ended Six months ended Twelve
December 27, January 2, December 31, July 2, July 1, months ended
2014 2016 2016 2016 2017 July 1, 2017
(unaudited)
(in thousands)
Combined Statement of Operations
Data:
Net sales . . . . . . . . . . . . . . . . . . . . . . . . $1,409,392 $1,413,735 $1,469,229 $727,419 $775,762 $1,517,572
Cost of sales . . . . . . . . . . . . . . . . . . . . . . 1,250,183 1,246,442 1,270,151 626,725 672,098 1,315,524
Gross profit . . . . . . . . . . . . . . . . . . . . . . 159,209 167,293 199,078 100,694 103,664 202,048
Operating expenses:
Selling . . . . . . . . . . . . . . . . . . . . . . . . 34,084 35,054 40,946 18,518 16,086 38,514
General and administrative . . . . . . . . 70,692 77,209 91,496 43,542 48,471 96,425
(Gain)/loss on disposal of property,
plant and equipment . . . . . . . . . . . (160) (1,294) (2,684) 12 (8) (2,704)
Total operating expenses . . . . . . . . . 104,616 110,969 129,758 62,072 64,549 132,235
Income from operations . . . . . . . . 54,593 56,324 69,320 38,622 39,115 69,813
Other income (expense):
Interest expense and finance
charges, net . . . . . . . . . . . . . . . . . . (39,070) (36,411) (36,411) (18,292) (18,296) (36,415)
Loss on early extinguishment of
debt . . . . . . . . . . . . . . . . . . . . . . . . (23,546) — — — — —
Other . . . . . . . . . . . . . . . . . . . . . . . . . 1,696 1,477 1,615 446 (122) 1,047
Total other expense . . . . . . . . . . . . . . (60,920) (34,934) (34,796) (17,846) (18,418) (35,368)
Net income (loss) . . . . . . . . . . . . . . $ (6,327) $ 21,390 $ 34,524 $ 20,776 $ 20,697 $ 34,445

Selected Balance Sheet Data

(at period end):
Cash and cash equivalents . . . . . . . . . . $ 4,809 $ 8, 694 $ 3,324 $ 9,592 $ 6,709
Working capital(1) . . . . . . . . . . . . . . . . 293,072 321,030 303,933 311,049 312,245
Total assets . . . . . . . . . . . . . . . . . . . . . . 798,649 833,505 856,385 837,653 891,267
Total debt(2) . . . . . . . . . . . . . . . . . . . . . 489,017 495,278 463,263 470,722 476,098
Total shareholders’ equity . . . . . . . . . . . 152,328 192,472 215,126 208,252 223,875
Other Selected Data:
EBITDA(3) . . . . . . . . . . . . . . . . . . . . . . . $ 70,181 $ 95,783 $ 115,105 $ 59,012 $ 62,222 $ 118,315
Adjusted EBITDA(3) . . . . . . . . . . . . . . . 96,238 96,028 117,805 59,762 62,972 121,015
Depreciation and amortization . . . . . . . 33,779 39,977 46,302 22,718 22,927 46,511
Capital expenditures . . . . . . . . . . . . . . . 55,936 61,350 60,118 21,374 31,997 70,741
Cash flow provided (used) by
operations . . . . . . . . . . . . . . . . . . . . . (8,691) 48,382 93,877 125,012 110,580 79,445

Twelve
months ended
July 1, 2017
As Adjusted Data:
Adjusted EBITDA(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 121,015
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 30,250
Net debt(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 509,651
Ratio of net debt to Adjusted EBITDA(2),(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2
Ratio of Adjusted EBITDA to interest expense(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.0

(1) Working capital is defined as total current assets, excluding cash and cash equivalents, less total current liabilities,
excluding the current portion of long-term debt and notes payable.

14
(2) Total debt includes the current and long-term portion of debt, less unamortized deferred financing costs.
(3) EBITDA represents net income (loss) plus net interest expense, accrued income taxes, depreciation and
amortization expenses and non-cash hedging losses, less non-cash hedging gains. EBITDA is not intended to
represent cash flows for the periods presented, nor has it been presented as an alternative to net income (loss) as an
indicator of operating performance. It should not be considered in isolation or as a substitute for measures of
performance prepared in accordance with U.S. GAAP. EBITDA is included in this offering memorandum because it
is one of the measures through which we assess our financial performance. We use EBITDA as part of our overall
assessment of financial performance by comparing EBITDA between accounting periods. We believe that EBITDA
is used by the financial community as a method of measuring our performance and of evaluating the market value
of companies considered to be in businesses similar to ours. However, EBITDA as presented may not be
comparable to other similarly titled measures used by other companies. A reconciliation of EBITDA to net income
(loss) determined in accordance with U.S. GAAP is provided in the table below.
Adjusted EBITDA is EBITDA further adjusted to exclude items that management does not consider to be
representative of our ongoing operations. These generally include costs or benefits that are unusual, non-cash or
one-time in nature. In addition, Adjusted EBITDA includes certain adjustments to EBITDA pursuant to the
provisions of our senior secured credit facility and indenture governing the notes. Adjusted EBITDA is presented
because such information is used by our management and lenders to assess the financial performance and
operating results of our business. Adjusted EBITDA is used by our management to assist in evaluating our
normalized operating results and to compare those results with our operating results from corresponding historical
periods and with the operational performance of other companies in our industry. Adjusted EBITDA is also used by
our management in assessing the performance of our separate operating businesses and evaluating targeted
businesses for acquisition. The EBITDA adjustments to determine Adjusted EBITDA are itemized in the below
table. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for
supplemental analysis. In evaluating Adjusted EBITDA, you should be aware that in the future we may incur losses
or charges that are the same as, or similar to, some of the adjustments in this presentation. Our presentation of
Adjusted EBITDA should not be construed to imply that our future results will be unaffected by unusual or
nonrecurring items. Adjusted EBITDA is not a financial measurement recognized under U.S. GAAP, and when
analyzing our operating performance, investors should use Adjusted EBITDA in addition to, and not as an
alternative for, net income, operating income, or any other performance measure derived in accordance with U.S.
GAAP, or as an alternative to cash flow from operating activities as a measure of our liquidity. Because all
companies do not use identical calculations, our presentation of Adjusted EBITDA may be different from similarly
titled measures of other companies.

Year ended Six months ended Twelve

December 27, January 2, December 31, July 2, July 1, months ended
2014 2016 2016 2016 2017 July 1, 2017
(in thousands)
Reconciliation of non-U.S. GAAP
financial measures:
Net income (loss) . . . . . . . . . . . . . . . . . . . . . $ (6,327) $21,390 $ 34,524 $20,776 $20,697 $ 34,445
Depreciation and amortization(a) . . . . . . . . 33,779 39,977 46,302 22,718 22,927 46,511
Interest expense and finance charges,
net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,070 36,411 36,411 18,292 18,296 36,415
Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101 — (160) — — (160)
Unrealized (gain)/loss on hedging . . . . . . . 3,558 (1,995) (1,972) (2,774) 302 1,104
EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,181 95,783 115,105 59,012 62,222 118,315
Adjustments:
Non-recurring expenses(b) . . . . . . . . . . . . . 1,010 — 1,200 — — 1,200
Discontinued operations(c) . . . . . . . . . . . . . — (1,255) — — — —
Management fees(d) . . . . . . . . . . . . . . . . . . 1,500 1,500 1,500 750 750 1,500
Loss on early extinguishment of debt(e) . . . 23,547 — — — — —
Adjusted EBITDA . . . . . . . . . . . . . . . . . . . . $96,238 $96,028 $117,805 $59,762 $62,972 $121,015

(a) Excludes amortization of finance charges included in interest expense and finance charges, net below.

15
(b) Represents retention bonuses associated with the announcement of the closing of our custom processing plant and
employee severance costs in fiscal 2014 and employee retirement/severance costs in fiscal 2016.
(c) Represents the gain on sale of our custom processing plant.
(d) Represents bonus payments made to certain of our management.
(e) Represents loss on early extinguishment of debt in connection with the refinancing of an aggregate principal
amount of $315.0 million of our 10.5% Second Lien Senior Secured Notes due 2017.
(4) Net debt represents total debt of $550.0 million less cash and cash equivalents after giving effect to the sale of the
notes offered hereby and the application of the net proceeds thereof as set forth under “Use of Proceeds” as if they
had occurred on July 1, 2017. See “Capitalization.”

16
 RISK FACTORS
An investment in the notes involves a high degree of risk. You should carefully consider the following
risks involved in investing in the notes, as well as the other information contained in this offering
memorandum, before deciding whether to purchase the notes. Any of the following risks could materially
and adversely affect our business, financial condition or results of operations. The risks described below
are not the only risks facing us. Additional risks and uncertainties not currently known to us or those we
currently view to be immaterial may also materially and adversely affect our business, financial condition
or results of operations. In such a case, you may lose all or part of your original investment.

Risks Related to Our Business

Industry cyclicality can affect our earnings, especially due to fluctuations in commodity prices of feed
ingredients and chicken and in the prevailing price of broiler products.
Profitability in the chicken industry is materially affected by the commodity prices of feed ingredients
and chicken, which are determined by supply and demand factors. As a result, the chicken industry is
subject to cyclical earnings fluctuations.
The production of feed ingredients is positively or negatively affected primarily by the global level of
supply inventories and demand for feed ingredients, the agricultural policies of the United States and
foreign governments and weather patterns throughout the world. In particular, weather patterns often
change agricultural conditions in an unpredictable manner. A significant change in weather patterns could
affect supplies of feed ingredients, as well as both the industry’s and our ability to obtain feed ingredients,
grow chickens or deliver products. Prices for feed ingredients have also been impacted by increased
demand both domestically for ethanol and globally for protein production.
We have recently benefited from low-to-moderate market prices for corn and soybean meal, our
primary poultry feed ingredients. However, the market prices for our feed ingredients are volatile.
Consequently, there can be no assurance that the price of corn or soybean meal will not significantly rise as
a result of, among other things, lower crop yields, increasing demand for these products around the world
and alternative uses of these products, such as ethanol and biodiesel production. In the past, high feed
ingredient prices have had, and may in the future have, a material adverse effect on our operating results.
We periodically seek, to the extent available, to enter into advance purchase commitments or financial
derivative contracts for the purchase of feed ingredients in an effort to manage our feed ingredient costs.
The use of such instruments may not be successful and could have an adverse effect on our financial
results.
Profitability in the broiler industry is materially affected by the prevailing price of broiler products,
which is primarily determined by supply and demand factors in the market. In recent years, the profitability
of companies in the broiler industry has been adversely affected from time to time by excess supplies of
broiler products in the market. As a result of the efficiencies in the U.S. broiler market, even modest
increases in the broiler supply in the United States can significantly decrease the market prices at which we
can sell our broiler products. Such increases in domestic supply can arise as a result of unanticipated
decreases in export demand, among other reasons. Given the perishable nature of broiler products, we may
be unable to manage inventories to address any short-term changes in market prices. As a result, from time
to time we are forced to sell our broiler products at a loss.

Changes in consumer preference could negatively impact our business.

The food industry in general is subject to changing consumer trends, demands and preferences.
Trends within the food industry change often, and failure to identify and react to changes in these trends
could lead to, among other things, reduced demand and price reductions for our products, and could have
an adverse effect on our financial results.

17
Outbreaks of livestock diseases in general and poultry diseases in particular, including avian
influenza, can significantly affect our ability to conduct our operations and demand for our products.
We take precautions designed to ensure that our flocks are healthy and that facilities owned by our
independent contract growers, our processing plants and our other facilities operate in a sanitary and
environmentally-sound manner. However, events beyond our control, such as the outbreaks of disease,
either in our own flocks or elsewhere, could significantly affect demand for our products or our ability to
conduct our operations. Furthermore, an outbreak of disease could result in governmental restrictions on
the import and export of our fresh chicken or other products to or from our suppliers, facilities or customers,
or require us to destroy one or more of our flocks. This could also result in the cancellation of orders by our
customers and create adverse publicity that may have a material adverse effect on our ability to market our
products successfully and on our business, financial condition and results of operation.
Highly pathogenic strains of avian influenza that have the potential to also threaten humans, including
the strain known as H5N1, have created substantial publicity and concern from time to time. H5N1 has
been affecting Asia since 2002 and has also been found in Europe and Africa. Human illness and deaths
have been reported in China and other parts of Asia among people having direct contact with poultry
infected with H5N1, as well as other strains; however, none of these viruses are known to have been spread
among humans. Highly pathogenic avian influenza H5 infections have been reported in the United States
and Canada beginning in December 2014 through mid-June 2015. These H5 infections were found in wild
birds, as well as in a few backyard and commercial poultry flocks. No human infections with the H5 viruses
have been detected. In Mexico, outbreaks of both high and low-pathogenic strains of avian influenza are a
fairly common occurrence. Also, there have been outbreaks of other low pathogenic strains of avian
influenza in the United States. Historically, the outbreaks of low pathogenic avian influenza have not
generated the same level of concern, or received the same level of publicity or been accompanied by the
same reduction in demand for poultry products in certain countries, as those associated with the highly
pathogenic strains such as H5N1. However, there can be no assurance that outbreaks of highly pathogenic
or highly contagious strains of avian influenza outside of the United States or Canada will not materially
adversely affect demand for domestically produced poultry internationally and/or domestically, and, if any
of these strains were to spread to the United States or Canada, there can be no assurance that it would not
significantly affect our ability to conduct our operations and/or demand for our products, in each case in a
manner having a material adverse effect on our business, reputation, prospects, financial condition and
results of operations.

If our products become contaminated, we may be subject to product liability claims and product
recalls.
Our products may be subject to contamination by disease-producing organisms, or pathogens, such as
Listeria monocytogenes, Salmonella and generic E.coli. These pathogens are generally found in the
environment, and, as a result, there is a risk that they, as a result of food processing, could be present in our
processed poultry products or in our pet food products. These pathogens can also be introduced to our
poultry products as a result of improper handling at the further processing, foodservice or consumer level.
These risks may be controlled, although not eliminated, by adherence to good manufacturing practices and
finished product testing. We have little, if any, control over proper handling once the product has been
shipped. Illness and death may result if the pathogens are not eliminated at the further processing,
foodservice or consumer level. Even an inadvertent shipment of contaminated products is a violation of law
and may lead to increased risk of exposure to product liability claims, product recalls and increased
scrutiny or investigations by federal and state regulatory agencies and may have a material adverse effect
on our business, reputation and prospects.

Product liability claims or product recalls can adversely affect our business reputation and expose us
to increased scrutiny by federal and state regulators.
The packaging, marketing and distribution of food products entail an inherent risk of product liability
and product recall and the resultant adverse publicity. We may be subject to significant liability if the

18
consumption of any of our products causes injury, illness or death. We could be required to recall certain of
our products in the event they are contaminated or damaged.

In addition to the risks of product liability or product recall due to deficiencies caused by our
production or processing operations, we may encounter the same risks if any third party tampers with our
products. We cannot assure you that we will not be required to perform product recalls, or that product
liability claims will not be asserted against us, in the future. Any claims that may be made may create
adverse publicity that would have a material adverse effect on our ability to market our products
successfully or on our business, reputation, prospects, financial condition and results of operations.

If our poultry or other products become contaminated, we may be subject to product liability claims
and product recalls. There can be no assurance that any litigation or reputational injury associated with
product recalls will not have a material adverse effect on our ability to market our products successfully or
on our business, reputation, prospects, financial condition and results of operations.

Any product recall instituted by a non-affiliated poultry producer or pet food manufacturer, or by a
non-affiliated company in similar industry, could result in adverse publicity for the poultry or pet food
industries as whole. Any such recall, and any negative public response thereto, could have the effect of
decreasing demand for poultry or pet food industry-wide, which could have a material adverse effect on our
ability to market our products successfully and on our business, reputation, prospects, financial condition
and results of operations.

We are exposed to risks relating to product liability, product recall, property damage and injuries to
persons for which insurance coverage is expensive, limited and potentially inadequate.

Our business operations entail a number of risks, including risks relating to product liability claims,
product recalls, property damage and injuries to persons. We currently maintain insurance with respect to
certain of these risks, including product liability insurance, property insurance, workers compensation
insurance, business interruption insurance and general liability insurance, but in many cases such
insurance is expensive and difficult to obtain. We believe that we currently maintain insurance with
coverage and amounts sufficient to repair or replace any assets physically damaged or destroyed, including
coverage for resultant business interruption losses, or extra expenses sustained, and to cover in respect of
claims for bodily injury or property damage arising out of our assets or operations. However, not all risk
factors are covered by insurance, and no assurance can be given that insurance will be consistently
available or will be consistently available on an economically feasible basis or that the amounts of
insurance will at all times be sufficient to cover each and every loss or claim that may occur involving our
assets or operations. Moreover, even though our insurance coverage may be designed to protect us from
losses attributable to certain events, it may not adequately protect us from liability and expenses we incur
in connection with such events.

Deterioration of economic conditions could negatively impact our business.

Our business may be adversely affected by changes in national or global economic conditions,
including inflation, interest rates, availability of capital markets, consumer spending rates, energy
availability and costs (including fuel surcharges) and the effects of governmental initiatives to manage
economic conditions. Any such changes could adversely affect the demand for our products or the cost and
availability of necessary raw materials, cooking ingredients and packaging materials, thereby negatively
affecting our financial results.

Downturns in the U.S. economy may result in reduced demand for certain of our products, downward
pressure on prices and a shift in our product mix toward less profitable products. Moreover, any material
reduction in demand for our products in our key export markets (Africa, Mexico and Iraq, among others)
could have an adverse effect on our results of operations.

19
 Disruptions and instability in credit and other financial markets and deterioration of national and
global economic conditions, could, among other things:
• make it more difficult or costly for us to obtain financing for our operations or investments or to
refinance our debt in the future;
• cause our lenders to depart from prior credit industry practice and make the granting of any
technical or other waivers under our credit agreements more difficult or expensive to the extent we
may seek them in the future;
• impair the financial condition of some of our customers, suppliers or counterparties to our derivative
instruments, thereby increasing customer bad debts, non-performance by suppliers or counterparty
failures negatively impacting our treasury operations;
• negatively impact global demand for poultry and pet food products, which could result in a
reduction of sales, operating income and cash flows; and
• impair the financial viability of our insurers.

Our operations are subject to general risks of litigation.

We are involved on an ongoing basis in litigation arising in the ordinary course of business or
otherwise. During September 2016 and October 2016, a number of purported antitrust class action lawsuits
were brought against 14 vertically-integrated broiler chicken producers, including Simmons Foods, Inc., by
and on behalf of direct and indirect purchasers of broiler chickens. The actions, which were filed and have
been consolidated in the U.S. District Court for the Northern District of Illinois, allege that (i) all of the
defendants conspired to reduce the supply of broilers in order to fix artificially high prices in violation of the
Sherman Antitrust Act from the period of January 2008 to the present and (ii) that certain of the defendants
(excluding Simmons Foods, Inc. and others) conspired to inflate poultry pricing that was reported to the
Georgia Department of Agriculture for its Georgia Dock price index. Trends in litigation may include class
actions involving consumers, shareholders, employees or injured persons, and claims relating to
commercial, labor, employment, antitrust, securities or environmental matters. Litigation trends and the
outcome of litigation cannot be predicted with certainty and adverse litigation trends and outcomes could
adversely affect our financial results. See “Business – Legal Proceedings.”

The poultry and pet food industries are highly competitive, and we may be unable to compete
successfully in these industries, which could adversely affect our business.
The poultry and pet food industries in North America are highly competitive. Some of our competitors
have economic resources greater than ours and are well established as suppliers to the markets that we
serve. Accordingly, such competitors may be better able to withstand volatility within the poultry and pet
food industries and throughout the economy as a whole while retaining significantly greater operating and
financial flexibility than us. Demand for our products may be adversely affected by our competitors’ pricing
actions and, with respect to our poultry products, the availability or price of competing protein products.
There can be no assurance that we will be able to compete successfully against our current or future
competitors or that such competition will not have a material adverse effect on our financial condition and
results of operations.

Cost increases for the raw materials we use, or increases in the overhead costs associated with the
manufacture of our products, could reduce our operating margins from the sale of our products and
any associated price increases by us could reduce the demand for our products, each of which could
have a material adverse effect on our financial condition, operating results and cash flows.
We attempt to obtain prices for our products that reflect, in part, the price we must pay for the raw
materials that go into our products. In addition, the price of our products also reflects overhead costs
associated with the manufacture of our products, such as utilities, fuel and labor costs. While it is often the

20
case that we are able to increase prices for our products at the same time our competitors are raising their
prices, at times we must increase our prices independent of general industry trends or the prices our
competitors are charging for their products which could cause a reduction in the demand for our products.
If we are not able to obtain higher prices for our products when the price we pay for raw materials or
associated overhead increases, we may be unable to maintain positive operating margins, which could have
a material adverse effect on our financial condition, operating results and cash flows.

We depend primarily on independent contract growers to raise our livestock.

We contract primarily with independent contract growers to raise the live chickens processed in our
poultry operations. We compete with other vertically integrated poultry producers for the services of quality
contract growers. If we do not attract and maintain contracts with our growers, our production and results of
operations could be negatively affected.

Commodity market fluctuations could negatively impact our operating results as we hedge certain
transactions.
Our business is exposed to fluctuating market conditions. We periodically enter into advance purchase
commitments or derivative financial instruments to reduce our exposure to changes in commodity prices,
primarily corn and soybean meal. Thus, we may hedge our usage of feed grains through a combination of
cash, futures and option purchases based upon our expected utilization over the next year. These hedging
activities, undertaken in an effort to minimize the risks associated with severe price fluctuations that
periodically occur for these commodities, are considered to be a hedge against changes in the amount of
future cash flows related commodity procurement. All material unrealized gains and losses are marked to
market and are reported in our combined statements of operations. While these contracts reduce our
exposure to changes in prices for commodity products, the use of such instruments may ultimately limit our
ability to benefit from favorable commodity prices or be ineffective to protect us against adverse
commodity prices.

The loss of one or more of our largest customers could adversely affect our business.
Our business could suffer significant setbacks in revenues and operating income if our customers’
plans and/or markets should change significantly or if we lost one or more of our largest end-user
customers. Our largest end-user customer, Wal-Mart Stores, Inc., accounted for approximately 10% of our
net sales in fiscal 2016 and 10% of our net sales for the six months ended July 1, 2017. Many of our
agreements with our customers are short-term, primarily due to the nature of our products, industry
practice and the fluctuation in demand and price for our products.

The consolidation of our customers could negatively impact our business.

Our customers, such as mass merchandisers, wholesale clubs, grocery chains and food distributors,
have consolidated in recent years, and consolidation is expected to continue throughout the United States
and in other major markets. These consolidations have produced large, sophisticated customers with
increased buying power who are more capable of operating with reduced inventories, opposing price
increases and demanding lower pricing and specifically tailored private label products. Because of these
trends, our volume growth could slow and/or we may need to lower prices for our products, either or both of
which would adversely affect our results of operations.

Our exposure to the credit risk of our customers may adversely affect our financial results.
If our customers experience financial difficulties, we could have difficulty recovering amounts owed to
us from these customers. Although we have a process to administer credit and believe our reserve for bad
debts is adequate, in the future we may experience losses as a result of our inability to collect our accounts
receivable. If our customers fail to meet their payment obligations to us, we could experience reduced cash
flows and losses in excess of amounts reserved. Actual bad debt write-offs may differ from our estimates,
which may have a material adverse effect on our financial condition, operating results and cash flows.

21
Disruptions in international markets and distribution channels could adversely affect our business.
We have established international distribution networks into markets in Africa, Mexico and Asia
(including China), often in association with international sales to our retail customers. However, our
international sales may be, and have been from time to time, adversely affected by disruptions in poultry
export markets. For example, after an outbreak of the highly pathogenic avian influenza H5 infections in
the United States in 2015, a significant number of countries, including Canada, China and Mexico,
imposed either partial or full bans on the importation of poultry produced in the United States.
Additionally, China imposed anti-dumping duties and countervailing duties on chicken imports from
United States chicken producers in 2010 that have adversely affected exports to that country over the last
seven years and Russia has from time to time restricted the importation of U.S. poultry products to protect
Russian poultry producers, typically based on allegations of consumer health issues. This happened most
recently in August 2014, in response to U.S. and European trade sanctions related to the conflict in
Ukraine. Even though we may not have any direct exposure to an affected international market, such as
Russia’s most recent ban on the importation of U.S. poultry products, such disruptions may result in
increased competitive pressures and other adverse consequences in those international markets in which
engage in sales.
Disruptions in international sales may be due to import restrictions and tariffs, other trade protection
measures and import or export licensing requirements. In addition, disruptions may be caused by
outbreaks of disease such as avian influenza, either in our flocks or elsewhere in the world, and resulting
changes in consumer preferences. One or more of these or other disruptions in the international markets
and distribution channels could adversely affect our business and results of operations.

We are subject to extensive regulation, and our compliance with existing or future laws and
regulations could cause us to incur substantial expenditures and adversely affect our business.
Our operations are subject to a broad range of federal, state, local and foreign laws and regulations
intended to protect the public health and environment, including those governing discharges of materials
to the air and water, the storage and transportation of propane and chemicals and the handling and disposal
of solid or hazardous waste. Our domestic operations are also subject to regulation by the Occupational
Safety and Health Administration (“OSHA”), the FDA, the USDA and by various state and local authorities
regarding the processing, packaging, storing, distributing and labeling of our products, including food
safety concerns. The U.S. Food Safety Modernization Act, which was enacted in 2011, granted to the FDA
enhanced powers and authority intended to ensure the safety of foods intended for human and animal
consumption, including with respect to its authority to access records, detain products, suspend
registrations of plant facilities and mandate product recalls. Our operations in Canada are subject to similar
safety laws and regulations that are enforced by Canadian governmental and provincial agencies. Our
Canadian operations may increase our exposure to regulatory matters specific to border crossing, which
include export licenses, tariffs, customs and tax issues and the North American Free Trade Agreement.
Loss of or failure to obtain necessary permits and registrations could delay or prevent us from meeting
current product demand, introducing new products, building new facilities or acquiring new businesses and
could adversely affect operating results. We are also subject to country of origin labeling requirements. In
addition, we are routinely subject to new or modified laws and regulations. If we are found to be out of
compliance with applicable laws and regulations in these or other areas, we could be subject to civil
remedies, including fines, injunctions, recalls or asset seizures, as well as potential criminal sanctions, any
of which could have an adverse effect on our financial results.
Our operations are also subject to the risk of changes in laws and regulations which may impose
restrictions on our business or cause us to incur material costs in order to comply. Our future operations
and earnings may be adversely affected by new legislation, new regulations or changes in, or new
interpretations of, existing regulations, and the impact of these changes could be material.

22
A material acquisition, joint venture or other significant initiative could affect our financial condition
and results of operations.
We periodically evaluate potential acquisitions, joint ventures and other initiatives (collectively,
“transactions”). While we have not currently entered into any agreement to make a specific acquisition, we
do continue to evaluate potential transactions. Certain of the proceeds of this offering may be used as
financing for such a transaction to the extent we deem appropriate. We may seek to expand our business
through the acquisition of companies, processing plants, technologies, products and services, which could
include material transactions. A material transaction may involve a number of risks, including:
• failure to realize the anticipated benefits of the transaction;
• difficulty integrating acquired businesses, technologies, operations and personnel with our existing
business;
• diversion of management attention in connection with negotiating transactions and integrating the
businesses acquired;
• exposure to unforeseen or undisclosed liabilities of acquired companies; and
• the need to obtain additional debt or equity financing for any transaction.
We may not be able to address these risks and successfully develop these acquired companies or
businesses into profitable units. If we are unable to do this, such expansion could adversely affect our
financial condition and results of operations.

New immigration legislation or increased enforcement efforts in connection with existing immigration
legislation could cause the costs of doing business to increase, cause us to change the way we conduct
our business or otherwise disrupt our operations.
Immigration reform continues to attract significant attention in the public arena and the United States
Congress. If new federal immigration legislation is enacted or if states in which we do business enact
immigration laws, such laws may contain provisions that could make it more difficult or costly for us to hire
U.S. citizens and/or legal immigrant workers and could potentially reduce the availability of prospective
employees. Following the 2016 United States presidential election, immigration laws have been a topic of
considerable political focus as the Trump administration has indicated that it intends to re-examine
immigration laws and regulations. In the event there are further changes in immigration or work
authorization laws, we may incur additional costs to run our business or may have to change the way we
conduct our operations, either of which could have a material adverse effect on our business, operating
results and financial condition. Also, despite our past and continuing efforts to hire only U.S. citizens and/
or persons legally authorized to work in the United States, we may be unable to ensure that all of our
employees are U.S. citizens and/or persons legally authorized to work in the United States.

Loss of our senior management or other essential employees could have a significant negative impact
on our business.
Our success is largely dependent on the skills, experience and efforts of our senior management and
other essential employees, including without limitation, Mark Simmons, Chairman of the Board of
Directors of each of the Issuers, M. Todd Simmons, Vice Chairman and Chief Executive Officer of each of
the Issuers, Mark A. Wiens, Executive Vice President, Chief Financial Officer and Corporate Secretary of
each of the Issuers, David G. Jackson, President and Chief Operating Officer of Simmons Foods and
Simmons Prepared Foods, Jason A. Godsey, President and Chief Operating Officer of Simmons Pet Food,
and Jeffrey D. Webster, President and Chief Operating Officer of Simmons Feed Ingredients. The loss of
the services of one or more of these individuals, or one or more of the other members of our senior
management or of employees with essential skills, could have a negative effect on our business, financial
condition and results of operations. Except for a key man insurance policy of $50.0 million on M. Todd
Simmons, we do not maintain key man insurance on our management.

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Our performance depends on favorable labor relations with our employees.
As of July 1, 2017, we had approximately 5,658 employees in the United States and approximately 216
employees in Canada. Approximately 161 of our employees located in Pennsauken, New Jersey, are
covered by a collective bargaining agreement. The collective bargaining agreement covering our unionized
employees in Pennsauken, New Jersey expires on March 31, 2018. Upon the expiration of that agreement,
other existing collective bargaining agreements or other collective labor agreements, we may not reach new
agreements without union action, or any such new agreements may not be on terms satisfactory to us,
which could result in higher wages or benefits paid to union workers. In addition, any new agreements may
be for shorter durations than those expiring agreements. Moreover, additional groups of currently
non-unionized employees may seek union representation in the future. If we are unable to negotiate
acceptable collective bargaining agreements, we may become subject to union-initiated work stoppages,
including strikes.

Extreme factors or forces beyond our control could negatively impact our business.
Natural disasters, fire, bioterrorism, pandemic or extreme weather, including droughts, floods,
excessive cold or heat, hurricanes or other storms, could impair the health or growth of livestock or interfere
with our operations due to power outages, fuel shortages, damage to our production and processing
facilities or disruption of transportation channels, among other things. Any of these factors, as well as
disruptions in our information systems, could have an adverse effect on our financial condition or results of
operations.

Media campaigns related to food production present risks to our operations.

Media outlets, including social media platforms, provide the opportunity for organizations or
individuals to publicize inappropriate or inaccurate stories or perceptions about the food industry, poultry
processing operation, pet food manufacturing or us. Such practices have the ability to cause damage to our
brands, the industries in which we operate generally, or consumers’ perceptions of us or the industries in
which we operate and may result in negative publicity and adversely affect our financial results.

Our goodwill and other intangible assets may become impaired.

We have a substantial amount of goodwill. At least annually, or more frequently if impairment
indicators arise, we evaluate our goodwill and intangible assets for impairment based on the fair value of
each reporting unit. The specific guidance for testing goodwill and other intangible assets for impairment
requires us to make estimates and assumptions when determining the fair value of a reporting unit,
including, among other things, anticipated cash flows, market conditions and growth rates. There are
inherent uncertainties related to these factors and management’s judgment in applying these factors.
Estimated fair value could change if there were future changes in our capital structure, cost of debt, interest
rates, capital expenditure levels or ability to perform at levels that were forecasted. These changes could
result in an impairment that would require a material non-cash charge to our results of operations. A
significant decrease in expected cash flows or changes in market conditions may indicate potential
impairment of recorded goodwill or other intangible assets. For further discussion, see “Management’s
Discussion and Analysis of Financial Condition and Results of Operations of Simmons — Critical
Accounting Policies and Estimates — Goodwill and Other Intangible Assets.”

The failure of any of the institutions that provide credit to us could limit our ability to operate our
business.
If any of the banks in our lending group were to fail, it is possible that the capacity under the revolving
portion of our senior secured credit facility would be reduced. In the event that the availability under the
revolving portion of the senior secured credit facility was reduced significantly, we could be required to
obtain capital from alternate sources in order to continue to operate our business. Our options for

24
addressing such capital constraints would include, but not be limited to, (i) obtaining commitments from
the remaining banks in the lending group or from new banks to fund increased amounts under the terms of
our senior secured credit facility, or (ii) scaling back our business operations or delaying certain of our
internal initiatives. Alternative financing could possibly be on terms less favorable than under existing
terms, or may not be available at all, which could have a material adverse effect on our financial condition,
results of operations, or cash flows.

Our dependence on third-party manufacturers and distributors for raw materials for our pet food
products may expose our business to harm from the adulteration of such raw materials.
In late 2006 and early 2007, a number of pet food manufacturers were affected by an industry-wide
incident of adulteration of two pet food ingredients, wheat gluten and rice protein, with melamine and
related compounds. The adulteration led to the recall of certain products and subjected the manufacturers
to civil claims, investigations, and the possibility of fines and penalties. This type of adulteration takes
advantage of existing rapid technology used to characterize food ingredient quality and the increasing need
to minimize supply chain costs by reducing lead times relative to product deliveries. The expansion to
sourcing on a global basis and transfer of raw material production to overseas markets with more difficult
oversight has also contributed to this risk. A widespread product recall resulting from adulteration could
result in significant losses due to its costs, the destruction of product inventory and lost sales due to the
unavailability of product for a period of time. We could also suffer losses from a significant product liability
judgment against us. A significant product recall or product liability case could also result in adverse
publicity, damage to our reputation and a loss of consumer confidence in our pet food products, which
could have a material adverse effect on our results of operations.

Restrictions on the free movement of finished goods across the U.S. — Canadian border may have an
adverse effect on our pet food operations and results of operations.
During 2003, following the discovery of a single case of Bovine Spongiform Encephalopathy (“BSE”),
commonly referred to as “mad cow disease,” in each of Alberta, Canada and Washington, USA, Canada and
the United States each closed its borders to pet food manufactured in the other country. Similarly Mexico
and certain other countries followed suit in respect of such closures. While certain restrictions on the
importation of pet food have been lifted by some of those countries, such as the restrictions on the import
and export of pet food between the United States and Canada, unrestricted movement between some
countries has not returned and in certain cases the restrictions remain unchanged. While we have pet food
manufacturing facilities in each of Canada and the United States, those manufacturing capabilities do not
address the issue of shipments to customers in countries other than Canada or the United States where
border closures for BSE or for any other reason could adversely impact sales to that country. Also, future
border closures may adversely affect the cost of our raw materials or other import costs.

If future cases of BSE are found in North America, regulation may be enacted to limit the use of BSE
related material in our pet food products or to limit the shipment of our pet food products from an
affected country, which could have a material adverse effect on our financial condition and results of
operations.
The BSE agent remains an area of international concern as it is not destroyed by conventional
processing techniques. We source our raw materials from various animal groups, including those from
ruminant animal groups. Such ruminant animals are susceptible to contracting BSE which can potentially
be transmitted to humans and/or other animals. Should additional cases of BSE be found in Canada or the
United States, the food regulators in these countries would be expected to take steps to limit the use of BSE
related material in the manufacture of pet food and to take steps to limit the shipment of products from a
BSE affected country. Furthermore, the emergence of new diseases which are resistant to conventional
processing could have a similar adverse impact on trade. Such actions may have a material adverse effect
on our financial condition and results of operations.

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Potential risks of the use of Bisphenol A (“BPA”) and other compounds in epoxy compounds utilized in
lining cans for our wet pet food products could result in future regulations requiring alternative lining
methods which could increase our costs or result in can shortages.
There are various compounds used in can coatings utilized in food contact surfaces which are under
investigation globally by food safety agencies. These include BPA, BADGE, Bisphenol F, BFDGE and
Novolac glycidyl ethers (“NOGE”), which are primarily used to make polycarbonate plastic food and
beverage containers, plastic food wrap and epoxy resin compounds that are used to line metal cans for food,
including cans for pet food. The European Union has disallowed the use of NOGE in food cans but not pet
food cans at this time. BPA has received recent scientific interest because of findings within human foods
where this compound has been found to leach from containers in polycarbonate plastic bottles and certain
cans. It is of special concern in infant containers. With respect to pets, there has been a population analysis
study which alluded to a possible relationship of BPA presence in cans to hyperthyroidism in cats. There
has been much recent public pressure in North America and globally to re-evaluate the safety of BPA which
is having an impact on regulatory bodies. The canning industry has had an active research program to
identify BPA alternatives but has yet to identify a suitable replacement. If either the use of NOGE is
disallowed in pet food packaging by the European Union or the use of BPA in pet food packaging in North
America is prohibited before the industry has an alternative identified, there could be an industry-wide
supply shortage in cans and ends. Even if an alternative sealant lining for the epoxy of pet food cans is
discovered, the alternative may result in increased costs related to our wet pet food business and adversely
affect our business and results of operations. An additional impact may be to drive consumers toward dry
pet food or to wet pet food in semi-rigid packaging. In the case of the latter, there are competitors in the
United States and Asia who would benefit from a migration to this packaging format. Since the sterilization
process differs for cans and cups, a shift in consumer demand could also result in the idling of some
equipment and strain capacity on other equipment.

The possible existence of processing-labile epizootic diseases in pet food may cause other countries to
refuse importation of our pet food products.
Epizootic diseases present in North America continue to provide opportunities for other countries to
refuse import of raw materials and finished goods originating from either localized or broad geographical
regions. Often times these represent trade barriers rather than true risks to the native pet population. An
example occurred during 2006 with avian influenza with regard to a specific strain (H5N1) which has been
found in Asia and has spread to Eastern Europe. The standard cooking process associated with wet pet food
production would destroy the virus, but trade was temporarily disrupted. Any future outbreak of an
epizootic disease could result in the ban by certain countries of the importation of our pet food products,
which would adversely affect our business and results of operations.

Future regulation of allergens in pet foods could negatively affect our business and results of
operations and the detection of certain allergens or mold toxins in our products could result in product
recalls.
Allergens are one of the most often cited causes of Class I recalls in human food. Production has
become quite complex to eliminate the potential for cross-contamination, resulting in dedicated lines or
plants. Currently there are no regulations associated with allergen control in pet foods. Enactment of
similar regulations for pet foods or extension of human food allergen risk to pet foods because of food
handling would result in the need for a massive overhaul of existing pet food manufacturing techniques,
which could adversely affect our business and results of operations.
Molds have the opportunity to grow during dry or wet extremes in growing or harvesting season. The
mold toxins which are formed are stable to heat. Although detoxifying agents may be commercially
available, most pet food manufacturers, including us, have adopted the position of not-accepting grains
with mold toxins at levels which represent a food safety risk. There have been several recalls relating to
mold toxin presence in pet foods. Any product recall due to the detection of allergens or molds in our
products may have a material adverse effect on our business, reputation and prospects.

26
Our operations in Canada may subject us to foreign currency risks, which could negatively impact our
results of operations.
We have significant operations and assets located in Canada. Changes in the value of the U.S. dollar
against the Canadian dollar could have a negative impact on our results of operations.

Pet food sales in the supermarket channel have been losing market share to other channels. Any
continued reduction in the pet food supermarket market share could adversely affect our results of
operations.
We have significant private label sales in the supermarket channel. Industry sources show that
supermarkets have been losing market share in the wet pet food market segment to mass merchandisers,
pet specialty retailers and, more recently, to the growing number of dollar and discount retailers. Our
customer base may be eroded and our private label sales may decline if the decline in supermarket market
share continues and we are unable to develop customer relationships in other segments of the market,
including mass merchandisers, dollar and discount retailers and pet specialty retailers.

Our tax returns and positions are subject to review and audit by the Internal Revenue Service and
other tax authorities, and any adverse outcomes resulting from any examination of our tax returns
could adversely affect our liquidity and financial condition.
We have elected S corporation status for federal and state income tax purposes and, as a result, we do
not pay taxes on our results of operations because our results of operations are included in our
shareholders’ individual tax returns. However, we are allowed to make tax distributions to our shareholders
to fund their income tax liabilities on any additional taxable income of ours resulting from any tax audit
adjustments. While our federal and state tax returns are not currently under examination, such returns may
be subject to examination in the future. An unfavorable outcome of any future tax audit could result in our
need to utilize available cash for tax distributions to shareholders rather than for our business operations.
As a result, the occurrence of an unfavorable outcome with respect to any future tax audit could have a
material adverse effect on our liquidity and financial condition.

Changes in tax laws and regulations could adversely affect our liquidity and financial condition.
The tax laws and regulation to which we are subject may change over time. We have elected
S corporation status for federal and applicable state income tax purposes and, as a result, we do not pay
federal or applicable state income taxes on our income from operations because such income is included in
our shareholders’ individual tax returns. There exists uncertainty as to whether any tax reform proposals
under consideration by Congress will likely be adopted and the specific tax laws and regulations that would
be affected. However, if changes in federal and applicable state income tax law increase the federal and
state income tax liability of our shareholders, we will be obligated to distribute greater amounts to such
shareholders on account of such increased federal and state income tax liability which would reduce our
cash available for business operations. Changes to or the imposition of new federal, state, or local taxes
could have a material adverse effect on our liquidity and financial condition. Simmons Pet Food ON, Inc., a
Canadian subsidiary of Simmons Pet Food, is subject to Canadian income taxes. Any applicable foreign tax
expense has not been significant during any reporting periods presented in our accompanying combined
financial statements. Accordingly, no provision for income taxes related to our results of operations has
been made in our accompanying combined financial statements.

A cybersecurity incident or other technology disruptions could negatively impact our business and our
relationships with customers.
We use computers in substantially all aspects of our business operations. We also use mobile devices
and the internet to connect with our employees, suppliers and customers. Such uses give rise to
cybersecurity risks, including security breach, espionage, system disruption, theft and inadvertent release

27
of information. Our business involves the storage and transmission of numerous classes of sensitive and/or
confidential information and intellectual property, including customers’ and suppliers’ information, private
information about employees, and financial and strategic information about the Company and its business
partners. As we may pursue initiatives to improve our operations and cost structure from time to time, we
will also be expanding and improving our information technologies, resulting in a larger technological
presence and corresponding exposure to cybersecurity risk. If we fail to assess and identify cybersecurity
risks associated with our business or new initiatives, we may become increasingly vulnerable to such risks.
Additionally, while we have implemented measures to prevent security breaches and cyber incidents, our
preventative measures and incident response efforts may not be entirely effective. We also do not currently
maintain cyber incident insurance. The theft, destruction, loss, misappropriation, or release of sensitive
and/or confidential information or intellectual property, or interference with our information technology
systems or the technology systems of third parties on which we rely, could result in business disruption,
negative publicity, brand damage, violation of privacy laws, loss of customers, potential liability and
competitive disadvantage, all of which could have a material adverse effect on our financial condition,
operating results and cash flows.

If we fail to maintain an effective system of internal controls, we might not be able to report our
financial results accurately or prevent fraud.

Effective internal controls are necessary for us to provide reliable financial reports and prevent fraud.
We are not subject to the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”), which requires public companies
to have and maintain effective disclosure controls and procedures to ensure timely disclosure of material
information and have management review the effectiveness of those controls on a quarterly basis.
Sarbanes-Oxley also requires public companies to have and maintain effective internal controls over
financial reporting to provide reasonable assurance regarding the reliability of financial reporting and
preparation of financial statements and have management review the effectiveness of those controls on an
annual basis (and, if required, have the independent auditor attest to the effectiveness of such internal
controls). We are not required to comply with these requirements and therefore we may not have
comparable internal control procedures in place as compared to public companies. We have established
and do maintain a system of internal controls that is designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements in accordance with
generally accepted accounting principles. However, even if our internal controls provide reasonable
assurance regarding the reliability of our preparation of financial statements for internal or external
purposes in accordance with generally accepted accounting principles, our system of internal controls may
not prevent or detect fraud or misstatements because of inherent limitations in any such system. In the
event we were to have any material weaknesses in our internal controls over financial reporting, we may not
detect errors on a timely basis and our financial statements may be materially misstated. Failure to
maintain effective controls, or difficulties encountered in their implementation, could harm our operating
results.

Risks Related to the Notes

Our substantial indebtedness could adversely affect our financial condition.

As a result of our substantial indebtedness, a significant portion of our cash flow will be required to pay
interest and principal on our outstanding indebtedness, and we may not generate sufficient cash flow from
operations, or have future borrowings available under our senior secured credit facility, to enable us to
repay our indebtedness, including the notes, or to fund other liquidity needs. As of July 1, 2017, after
giving effect to the sale of the notes offered hereby and the application of the net proceeds therefrom as set
forth under “Use of Proceeds,” we would have no indebtedness outstanding under our senior secured credit
facility. We would have had, however, approximately $247.2 million of unused availability after taking into
account our borrowing base and outstanding letters of credit under our senior secured credit facility as of

28
August 31, 2017, all of which would effectively rank senior to the notes to the extent of the value of the
assets securing such indebtedness.

Our substantial indebtedness could have important consequences to you. For example, it could:

• make it more difficult for us to satisfy our obligations with respect to the notes and our other debt;

• increase our vulnerability to general adverse economic and industry conditions;

• require us to dedicate a substantial portion of our cash flow from operations to payments on our
indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital
expenditures and other general corporate purposes;

• limit our flexibility in planning for, or reacting to, changes in our business and the industry in which
we operate;

• increase our cost of borrowing;

• place us at a competitive disadvantage compared to our competitors that may have less debt;

• limit our ability to obtain additional financing for working capital, capital expenditures, acquisitions
or general corporate purposes; and

• inhibit our ability to refinance our indebtedness on terms acceptable to us or at all.

We expect to use cash flow from operations to meet our current and future financial obligations,
including funding our operations, debt service and capital expenditures. Our ability to make these
payments depends on our future performance, which will be affected by financial, business, economic and
other factors, many of which we cannot control. Our business may not generate sufficient cash flow from
operations in the future, which could result in our being unable to repay indebtedness, or to fund other
liquidity needs. If we do not have enough money, we may be forced to reduce or delay our business
activities and capital expenditures, sell assets, obtain additional debt or equity capital or restructure or
refinance all or a portion of our debt, including our senior secured credit facility and the notes offered
hereby, on or before maturity. We cannot make any assurances that we will be able to accomplish any of
these alternatives on terms acceptable to us, or at all. In addition, the terms of existing or future
indebtedness, including the agreements for our senior secured credit facility, may limit our ability to pursue
any of these alternatives.

Despite current indebtedness levels and restrictive covenants, we may still be able to incur more debt
or make certain restricted payments, which could further exacerbate the risks described above.

We and our subsidiaries may be able to incur additional debt in the future. Although our senior
secured credit facility and the indenture governing the notes contain restrictions on our ability to incur
indebtedness, those restrictions are subject to a number of exceptions. The incurrence of additional
indebtedness would further increase our leverage and may inhibit our ability to pay the principal, premium,
if any, and interest on the notes. In addition, if we are able to designate some of our restricted subsidiaries
under the indenture governing the notes as unrestricted subsidiaries, those unrestricted subsidiaries would
be permitted to borrow beyond the limitations specified in the indenture and engage in other activities in
which restricted subsidiaries may not engage. We may also consider investments in joint ventures or
acquisitions, which may increase our indebtedness. Moreover, although our senior secured credit facility
and the indenture governing the notes contain restrictions on our ability to make restricted payments,
including the declaration and payment of dividends, we are able to make such restricted payments under
certain circumstances. Adding new debt to current debt levels or making restricted payments could
intensify the related risks that we and our subsidiaries now face. See “Capitalization,” “Description of Other
Indebtedness” and “Description of Notes.”

29
Our debt agreements restrict our ability to engage in some business and financial transactions.
Our debt agreements, such as the indenture governing the notes and the agreement governing our
senior secured credit facility, restrict our ability in certain circumstances to, among other things:
• incur additional debt;
• pay dividends and make other distributions on, redeem or repurchase, capital stock;
• make investments or other restricted payments;
• enter into transactions with affiliates;
• sell all, or substantially all, of our assets;
• create liens on assets to secure debt; or
• effect a consolidation or merger.
These covenants limit our operational flexibility and could prevent us from taking advantage of
business opportunities as they arise, growing our business or competing effectively. In addition, if excess
availability as defined in our senior secured credit facility falls below a specified amount, we will be
required to maintain a specified minimum fixed charge coverage ratio. In such event, our ability to meet
this financial ratio can be affected by events beyond our control, and we cannot assure you that we will meet
the requirement.
A breach of any of these covenants or other provisions in our debt agreements could result in an event
of default, which if not cured or waived, could result in such debt becoming immediately due and payable.
This, in turn, could cause our other debt to become due and payable as a result of cross-acceleration
provisions contained in the agreements governing such other debt. In the event that some or all of our debt
is accelerated and becomes immediately due and payable, we may not have the funds to repay, or the ability
to refinance, such debt. Under the intercreditor agreement, in the event that the notes become immediately
due and payable and our other debt senior to the notes has also (by cross-acceleration or otherwise) become
due and payable, the holders of the notes would not be entitled to receive any payment from the proceeds of
the collateral in respect of the notes until all of our senior debt has been paid in full.

Other secured indebtedness, including indebtedness under our senior secured credit facility, which is
secured by a first priority lien on certain of our and the guarantors’ assets, will be senior to the notes to
the extent of the value of the collateral securing such indebtedness on a first priority basis.
Obligations under our senior secured credit facility are secured by a first priority lien on substantially
all of our and each guarantor’s tangible and intangible assets. See “Description of Other Indebtedness.” The
notes and the related guarantees will be secured by a second priority lien on such collateral securing our
senior secured credit facility, subject to certain exceptions and permitted liens. Any rights to payment and
claims by the holders of the notes will be, therefore, fully subordinated to any rights to payment and claims
by our creditors under our senior secured credit facility with respect to distributions of such collateral. Only
when our obligations under the senior secured credit facility are satisfied in full will any proceeds of the
collateral be available, subject to certain exceptions and permitted liens, to satisfy obligations under the
notes and guarantees. In addition, the indenture permits us to incur additional indebtedness secured by a
lien that ranks pari passu with the notes. Any such indebtedness may further limit the recovery from the
realization of the value of such collateral available to satisfy holders of the notes. See “Description of
Notes — Certain Covenants — Limitations on Liens” and “— Limitations on Additional Indebtedness.”

The lien ranking provisions of the indenture and the intercreditor agreement relating to the collateral
securing the notes limit the rights of holders of the notes with respect to certain collateral, even during
an event of default.
The rights of the holders of the notes with respect to the collateral are substantially limited by the
terms of the lien ranking agreements set forth in the indenture and the intercreditor agreement, even

30
during an event of default. Under the indenture and the intercreditor agreement, subject to the standstill
provisions of the intercreditor agreement and certain other exceptions, at any time that obligations that
have the benefit of the higher-priority liens are outstanding, any actions that may be taken with respect to
(or in respect of) such collateral, including the ability to cause the commencement of enforcement
proceedings against such collateral and to control the conduct of such proceedings relating to such
collateral, will be at the direction of the holders of the obligations secured by the first priority liens, and the
holders of the notes secured by second priority liens may be adversely affected. See “Description of Notes —
Security” and “— Amendment, Supplement and Waiver.” Under the terms of the intercreditor agreement, at
any time that obligations that have the benefit of the first priority liens on the collateral are outstanding, if
the holders of such indebtedness release their liens on any of the collateral in connection with (i) the
exercise by such holders of remedies in respect of any of the collateral, including any sale, lease, exchange,
transfer, or other disposition of such and, as of the date thereof, an event of default under the first priority
debt of such holders’ exists and is continuing or (ii) any sale, lease, exchange, transfer, or other disposition
of the collateral permitted under the terms of such first priority debt and the indenture, the second priority
security interest in such collateral securing the notes will be automatically and simultaneously released
without any consent or action by the holders of the notes, subject to certain exceptions. The collateral so
released will no longer secure our and the guarantors’ obligations under the notes and the guarantees.
In addition, because the holders of indebtedness secured by first priority liens in the collateral control
the exercise of remedies with respect to the collateral, subject to the standstill provisions of the intercreditor
agreement and certain other exceptions, such holders could decide not to proceed against the collateral,
regardless of whether there is a default under the documents governing such indebtedness or under the
indenture governing the notes. The intercreditor agreement contains certain provisions benefiting holders
of indebtedness under our senior secured credit facility, including provisions prohibiting the trustee and
the collateral agent under the indenture from objecting to or taking certain other actions following the filing
of a bankruptcy petition with respect to a number of important matters regarding the collateral and the
financing to be provided to us, subject to certain exceptions. After such filing, the value of this collateral
could materially deteriorate and holders of the notes would be unable to raise an objection. In addition, the
right of holders of obligations secured by first priority liens to foreclose upon and sell such collateral upon
the occurrence of an event of default also would be subject to limitations under applicable bankruptcy laws
if we or any of our subsidiaries become subject to a bankruptcy proceeding. The intercreditor agreement
also gives the holders of first priority liens on the collateral the right to access and use the collateral that
secures the notes to allow those holders to protect the collateral and to process, store and dispose of the
collateral.
The collateral is also subject to any and all exceptions, defects, encumbrances, liens and other
imperfections as may be accepted by the lenders under our senior secured credit facility and other creditors
that have the benefit of first priority liens on such collateral from time to time, whether on or after the date
the notes and guarantees are issued. The existence of any such exceptions, defects, encumbrances, liens
and other imperfections could adversely affect the value of the collateral securing the notes as well as the
ability of the collateral agent to realize or foreclose on such collateral. The issuers have not analyzed the
effect of such exceptions, defects, encumbrances, liens and imperfections, and the existence thereof could
adversely affect the value of the collateral securing the notes as well as the ability of the collateral agent to
realize or foreclose on such collateral.

There may not be sufficient collateral to pay all or any of the notes, especially if we incur additional
secured indebtedness ranking prior to or pari passu with the notes, which will dilute the value of the
collateral securing the notes and guarantees.
No appraisals of any collateral have been prepared in connection with the issuance of the notes offered
hereby. The fair market value of the collateral is subject to fluctuations based on factors that include, among
others, the condition of the markets and sectors in which we operate, the ability to sell the collateral in an
orderly sale, the condition of the national and local economies, the availability of buyers and similar factors.

31
The value of the assets pledged as collateral for the notes could also be impaired in the future as a result of
our failure to implement our business strategy, competition or other future trends. In the event of
foreclosure on the collateral, the proceeds from the sale of the collateral may not be sufficient to satisfy in
full our obligations under the notes and any additional indebtedness secured equally and ratably with the
notes after satisfying obligations that have a first priority lien on the collateral. The amount to be received
upon such a sale would be dependent on numerous factors, including, but not limited to, the timing and the
manner of the sale. In addition, the book value of the collateral should not be relied on as a measure of
realizable value for such assets. By its nature, portions of the collateral may be illiquid and may have no
readily ascertainable market value. Accordingly, there can be no assurance that the collateral can be sold in
a short period of time in an orderly manner. A significant portion of the collateral includes assets that may
only be usable, and thus retain value, as part of our existing operating business. Accordingly, any such sale
of the collateral separate from the sale of certain of our operating businesses may not be feasible or of
significant value.
To the extent that pre-existing liens, liens permitted under the indenture and other rights, including
liens on excluded assets (such as those securing purchase money obligations and capital lease obligations
granted to other parties in addition to the holders of obligations secured by liens ranking prior to the notes,
including liens under our senior secured credit facility) encumber any of the collateral securing the notes
and the guarantees, those parties have or may exercise rights and remedies with respect to the collateral
that could adversely affect the value of the collateral and the ability of the trustee and the collateral agent
under the indenture or the holders of the notes to realize or foreclose on the collateral. We or any guarantor
may incur additional secured indebtedness under the indenture, including the issuance of additional notes
or the incurrence of other forms of indebtedness secured equally and ratably with the notes and borrowings
under our senior secured credit facility or other senior lien obligations, subject to certain specified
conditions. See “Description of Notes — Certain Covenants — Limitations on Additional Indebtedness”
and “— Limitations on Liens.” Any such incurrence could dilute the value of the collateral securing the notes
and guarantees. Consequently, liquidating the collateral securing the notes may not result in proceeds in an
amount sufficient to pay any amounts due under the notes after also satisfying the obligations to pay any
creditors with prior liens. If the proceeds of any sale of collateral are not sufficient to repay all amounts due
on the notes, the holders of the notes (to the extent not repaid from the proceeds of the sale of the collateral)
would have only an unsecured, unsubordinated claim against our and the guarantors’ remaining assets.
The consequences of a finding of under-collateralization would include, among other things, a lack of
entitlement on the part of the notes to receive post-petition interest and collect fees, expenses, and costs in
any bankruptcy proceeding. In addition, under these circumstances, the unsecured portion of the notes
would not be entitled to receive “adequate protection” under federal bankruptcy laws. Furthermore, if any
payments of post-petition interest had been made at any time prior to such a finding of under-
collateralization, those payments would be recharacterized by the bankruptcy court as a reduction of the
principal amount of the secured claim with respect to the notes.
In addition, the collateral agent for the notes may need to evaluate the impact of potential liabilities
before determining to foreclose on the collateral, because entities that hold a security interest in real
property may be held liable under environmental laws for the costs of remediating or preventing release or
threatened releases of hazardous substances at the secured property. In this regard, the collateral agent
may decline to foreclose on the collateral or exercise remedies available if it does not receive
indemnification to its satisfaction from the holders.

Rights of holders of the notes in the collateral may be adversely affected by the failure to perfect liens
on certain collateral acquired in the future.
Applicable law requires that a security interest in certain tangible and intangible assets can only be
properly perfected and its priority retained through certain actions undertaken by the secured party. The
liens in the collateral securing the notes may not be perfected with respect to the claims of the notes if the
collateral agent is not able to take the actions necessary to perfect any of these liens on or prior to the date

32
of the issuance of the notes or thereafter. We will have limited obligations to perfect the security interest of
the holders of the notes in specified collateral. Applicable law requires that certain property and rights
acquired after the grant of a general security interest or other lien, such as real property, equipment subject
to a certificate and certain proceeds, can only be perfected at the time such property and rights are acquired
and identified. The trustee and the collateral agent are not required to monitor, and we may not inform the
trustee or the collateral agent of, the future acquisition of property and rights that constitute collateral, and
necessary action may not be taken to properly perfect the security interest in such after-acquired collateral.
The collateral agent for the notes has no obligation to monitor the acquisition of additional property or
rights that constitute collateral or the perfection of any security interest in favor of the notes against third-
parties. Such failure may result in the loss of the security interest therein or the priority of the security
interest in favor of the notes against third-parties. In addition, as described further herein, even if the
trustee or the collateral agent does properly perfect liens on collateral acquired in the future, such liens may
potentially be avoidable as a preference in any bankruptcy proceeding under certain circumstances.
See “— Certain pledges of collateral and payments on the notes might be avoidable by a trustee in
bankruptcy.”

Certain of our real property will not be mortgaged as security for the notes. Accordingly, the value of
such real property will not be included in the collateral securing the notes and guarantees.
We will grant mortgages as security for the notes only on our real properties that have been mortgaged
to secure our obligations under our senior secured credit facility. Mortgages on a number of our properties,
primarily consisting of those in certain flood zones and those related to our propane distribution, have not
been mortgaged to secure our obligations under the senior secured credit facility and will not be mortgaged
to secure the notes and guarantees. Consequently, the value of these real properties will not constitute
collateral securing the notes. No appraisals of any collateral have been prepared in connection with the
notes offered hereby, however the value of the unencumbered real property may be significant.

Security interests over certain collateral may not be in place by closing or may not be perfected by
closing. Any issues that we are not able to resolve in connection with the issuance of such security
interests may impact the value of the collateral. Delivery of such security interest after the issue date
of the notes increases the risk that the liens granted by those security interests could be avoided.
Certain security interests, including mortgages on certain of our real properties, may not be in place by
the closing date of this offering or may not be perfected on the closing date of this offering. One or more of
these mortgages may constitute a significant portion of the value of the collateral securing the notes and
the guarantees. To the extent any security interest in the collateral securing the notes is not perfected on or
prior to the closing date, we will use our commercially reasonable efforts to have all such security interests
perfected, to the extent required by the indenture governing the notes and the security documents, within
120 days following the closing date. If we are unable to do so after 120 days following the closing of the
offering, we will use commercially reasonable efforts to do so as soon as practicable thereafter. In addition,
to the extent a security interest in certain collateral is perfected following the closing date, that security
interest would remain at risk of being avoided to the extent it were granted within 90 days of a bankruptcy
filing (in which case it might be voided as a preferential transfer by a trustee in bankruptcy) even after the
security interests perfected on the closing date were no longer subject to such risk. See “— Certain pledges
of collateral and payments on the notes may be avoidable by a trustee in bankruptcy.”

With respect to our real property to be mortgaged as security for the notes, we do not expect all title
insurance policies or surveys will be in place at the time of the issuance of the notes. Any issues that we
are not able to resolve in connection with the issuance of such title policies or surveys may impact the
value of the collateral.
We do not expect that we will have title insurance policies on the properties to be mortgaged as
security for the notes in place at the time of the issuance of the notes to insure, among other things, (i) loss

33
resulting from the entity represented by us to be the owner thereof not holding fee title or a valid leasehold
interest in the properties and such interest being encumbered by unpermitted liens and (ii) the validity and
second lien priority of the mortgage granted to the collateral agent for its benefit and for the benefit of the
trustee and the holders of the notes. We have agreed to obtain title insurance and surveys on the properties
within 120 days following the issue date of the notes or as soon as practical thereafter using commercially
reasonable efforts. In addition, if a title defect results in a loss, we cannot assure you that any insurance
proceeds received by us will be sufficient to satisfy all the secured obligations, including the notes.
The mortgages and title insurance policies will be issued based upon, among other things, land
surveys. The surveys could reflect certain issues that we will not be able to resolve. If we are unable to
resolve any issues raised by the surveys or that are otherwise raised in connection with obtaining the
mortgages or title policies, the mortgages and title policies will be issued subject to those issues, which
could have a significant impact on the value of the collateral or any recovery under the title insurance
policies.

Certain of the real property constituting collateral for the notes is leased. There is a risk that such
leases may terminate and no longer constitute collateral for the notes.
Debt secured by a lien on a leasehold interest in real estate is subject to risks not associated with debt
secured by a mortgage lien on a fee interest in real estate. The most significant of these risks is that a
leasehold interest could be terminated before the debt secured by the mortgage is paid in full. The forms of
these leases vary in scope and extent with respect to provisions designed to protect the interests of a
leasehold mortgagee. However, most of our real property interests subject to leases require that the lessor
provide the leasehold mortgagee with notice of the occurrence of a default under the lease and the
opportunity to cure the applicable borrower’s default.
In addition, if a mortgage on our landlord’s fee interest in the property is recorded prior to the
recordation of a memorandum of our interest, as tenant, in the lease or if the lease, by its terms, is
subordinate to our landlord’s fee mortgage, the holder of such fee mortgage could, in the event of the
foreclosure of such fee mortgage, elect to terminate the applicable lease, and, thereby, your mortgage lien
on such leasehold interest would terminate.
In general, the leases do not prohibit the lessee from encumbering its interest in the property, though
in some cases, consent of the lessor is required. If we are unable to obtain the consent of the applicable
landlord to pledge any of our leasehold interests in real property, such interests shall not constitute
collateral for the notes.

Rights of holders of the notes in their collateral may be adversely affected by bankruptcy proceedings.
The right of the collateral agent for the notes to repossess and dispose of the collateral securing the
notes upon acceleration is likely to be significantly impaired by (or at a minimum delayed by) U.S. federal
bankruptcy law if bankruptcy proceedings are commenced by or against us. This could be true even if
bankruptcy proceedings are commenced after the collateral agent has repossessed and disposed of the
collateral. Under U.S. federal bankruptcy law, a secured creditor such as a collateral agent for the notes is
stayed or prohibited from repossessing its security from a debtor in a bankruptcy case, or from disposing of
security repossessed from a debtor, without prior bankruptcy court approval (which may or may not be
given under the circumstances of any particular case). Moreover, U.S. federal bankruptcy law permits the
debtor to continue to retain and to use collateral, and the proceeds, products, rents or profits of the
collateral, even though the debtor is in default under the applicable debt instruments, provided that the
secured creditor is given “adequate protection.”
The meaning of the term “adequate protection” varies according to circumstance, but in general the
doctrine of “adequate protection” requires a debtor to provide protection for the value of a secured creditor’s
interest in the collateral, through cash payments, the granting of an additional or replacement security
interest or otherwise, if and at such time as the court in its discretion may determine during the pendency of

34
the bankruptcy case, to the extent that the collateral decreases in value during the pendency of the
bankruptcy case as a result of, among other things, the use, sale or lease of such collateral or the imposition
of the automatic stay. In view of the broad discretionary powers of a bankruptcy court and the lack of a
precise definition of the term “adequate protection”, it is impossible to predict whether or when payments
under the notes could be made following the commencement of a bankruptcy case (or the length of the
delay in making any such payments), whether or when the collateral agent could or would repossess or
dispose of the collateral, the value of the collateral at or subsequent to the date of the commencement of
such bankruptcy case, or whether or to what extent holders of the notes would be compensated for any
delay in payment or loss of value of the collateral through the requirements of “adequate protection.”
Furthermore, in the event the bankruptcy court determines that the value of the collateral is not sufficient to
repay all amounts due on the notes and all claims with a first priority lien on the collateral, the holders of
the notes would have unsecured “deficiency claims” for the balance of the principal on the notes (excluding
“unmatured interest,” as described above). U.S. federal bankruptcy laws do not generally permit the
payment or accrual of interest, costs, expenses or attorneys’ fees for unsecured or undersecured claims
during the debtor’s bankruptcy case. Nor would the holders of the notes be entitled to any adequate
protection with respect to the unsecured, deficiency portion of their claims.
In addition, as noted above, the intercreditor agreement contains certain provisions benefiting holders
of indebtedness under our senior secured credit facility, including provisions prohibiting the trustee and
the collateral agent under the indenture from objecting to certain actions following the filing of a
bankruptcy petition with respect to a number of important matters regarding the collateral and the
financing to be provided to us, subject to certain exceptions. After such filing, the value of this collateral
could materially deteriorate and holders of the notes would be unable to raise an objection. See “— The lien
ranking provisions of the indenture and the intercreditor agreement relating to the collateral securing the
notes limit the rights of holders of the notes with respect to certain collateral, even during an event of
default.”

State law may limit the ability of the collateral agent, trustee and the holders of the notes to foreclose
on real property and improvements included in the collateral.
The notes are expected to be, secured by, among other things, liens on certain real property and
improvements which we and/or the guarantors own. State laws may limit the ability of the collateral agent,
trustee and the holders of the notes to foreclose on improved real property collateral. State laws govern the
perfection, enforceability and foreclosure of mortgage liens against real property which secure debt
obligations such as the notes. These laws may impose procedural requirements for foreclosure different
from and necessitating a longer time period for completion than the requirements for foreclosure of security
interests in personal property. Debtors may have the right to reinstate defaulted debt (even if it has been
accelerated) before the foreclosure date by paying the past due amounts and a right of redemption after
foreclosure. Governing law may also impose security first and one form of action rules, which rules can
affect the ability to foreclose or the timing of foreclosure on real and personal property collateral regardless
of the location of the collateral and may limit the right to recover a deficiency following a foreclosure.
The holders of the notes and the trustee also may be limited in their ability to enforce a breach of the
“no liens” covenant. Some decisions of certain state courts have placed limits on a lender’s ability to
accelerate debt as a result of a breach of this type of a covenant. Under these decisions, a lender seeking to
accelerate debt secured by real property upon breach of covenants prohibiting the creation of certain junior
liens or leasehold estates may need to demonstrate that enforcement is reasonably necessary to protect
against impairment of the lender’s security or to protect against an increased risk of default. Although the
foregoing court decisions may have been preempted, at least in part, by certain federal laws, the scope of
such preemption, if any, is uncertain. Accordingly, a court could prevent the trustee and the holders of the
notes from declaring a default and accelerating the notes by reason of a breach of this covenant, which
could have a material adverse effect on the ability of holders to enforce the covenant.

35
Certain pledges of collateral and payments on the notes might be avoidable by a trustee in bankruptcy.
Any future pledge of collateral, or any future perfection of any other pledge, to secure the notes or
guarantees, or any guarantees issued in the future might be avoidable under the U.S. bankruptcy
preference laws by the pledgor or such guarantor (as debtor in possession), by its trustee in bankruptcy or
by someone else acting on behalf of the bankruptcy estate (including potentially certain of our other
creditors), if certain events or circumstances exist or occur, including, among others, if the pledgor or
guarantor is insolvent at the time of the pledge or issuance of the guaranty, the pledge or issuance of the
guarantee permits the holders of the notes to receive a greater recovery in a hypothetical liquidation case
under Chapter 7 of the U.S. bankruptcy code than if the pledge or guarantee had not been given, and a
bankruptcy proceeding in respect of the pledgor is commenced within 90 days following the pledge or
issuance of the guarantee, or, in certain circumstances, a longer period. If any pledges of collateral or
guarantee are avoided, the collateral or guarantee will not be available to the holders of the notes or the
other guarantees to satisfy the obligations under the notes.
Certain payments on the notes or guarantees might also be avoidable under the U.S. bankruptcy
preference laws by the issuers (as debtors in possession), by its trustee in bankruptcy or by someone else
acting on behalf of the bankruptcy estate (including potentially certain of our other creditors) if certain
events or circumstances exist or occur, including, among others, if the issuers are insolvent at the time of
the payment, the payment permits the holders of the notes to receive a greater recovery in a hypothetical
liquidation case under Chapter 7 of the U.S. bankruptcy code than if the payment had not been made, and a
bankruptcy proceeding in respect of the issuers or guarantors is commenced within 90 days following the
payment, or, in certain circumstances, a longer period.

The collateral is subject to casualty risks.

We intend to maintain insurance or otherwise insure against hazards in a manner appropriate and
customary for our business. There are, however, certain losses that may be either uninsurable or not
economically insurable, in whole or in part. Insurance proceeds may not compensate us fully for our losses.
If there is a complete or partial loss of any of the collateral, the insurance proceeds may not be sufficient to
satisfy all of the secured obligations, including the notes and the guarantees.
In the event of a total or partial loss to any of the mortgaged facilities, certain items of equipment,
fixtures and other improvements may not be easily replaced. Accordingly, even though there may be
insurance coverage, the extended period needed to manufacture or construct replacement of such items
could cause significant delays.

We will in most cases have control over the collateral, and the sale of particular assets by us could
reduce the pool of assets securing the notes and related guarantees.
The collateral documents allow us, subject to certain exceptions, to remain in possession of, retain
exclusive control over, freely operate and collect, invest and dispose of any income from, the collateral
securing the notes and the guarantees.
In addition, the indenture governing the notes will not be qualified under, and we will not be required
to comply with, all or any portion of the Trust Indenture Act of 1939 (“Trust Indenture Act”). With respect
to any release of collateral, we must deliver to the collateral agent, from time to time, an officer’s certificate
to the effect that all releases and withdrawals during the preceding twelve-month period in which no release
or consent of the collateral agent was obtained in the ordinary course of business were not prohibited by the
indenture. See “Description of Notes.”

The imposition of certain permitted liens will cause the asset on which such liens are imposed to be
excluded from the collateral securing the notes and related guarantees. There are also certain other
categories of property that are also excluded from the collateral.
The indenture permits liens in favor of third-parties to secure purchase money indebtedness and
capital lease obligations, and any assets subject to such liens will be automatically excluded from the

36
collateral securing the notes and the guarantees to the extent that the terms of such debt do not permit
additional liens on such assets and to the extent such assets do not secure any credit facility obligations.
Our ability to incur purchase money indebtedness and capital lease obligations is subject to the limitations,
as described in “Description of Notes — Certain Covenants — Limitations on Additional Indebtedness”
and “— Limitations on Liens.” In addition, certain categories of assets are excluded from the collateral
securing the notes and related guarantees, and the liens on certain categories of assets are not required to
be perfected. Excluded assets will not be available as collateral to secure the issuers’ and the guarantors’
obligations under the notes. See “Description of Notes — Security.” As a result, with respect to the excluded
assets, the notes and the guarantees will effectively rank equally with any other unsubordinated
indebtedness of the issuers and the guarantors that is not itself secured by the excluded assets.

It may be difficult to realize the value of the collateral pledged to secure the notes and the guarantees.
The security interest of the collateral agent may be subject to practical problems generally associated
with the realization of security interests in the collateral to the extent that the terms of such indebtedness
and obligations do not permit additional liens on such assets. For example, the collateral agent may need to
obtain the consent of a third-party or governmental agency to obtain or enforce a security interest in a
license or contract or to otherwise operate our business. We cannot assure you that the collateral agent will
be able to obtain any such consent. If the trustee exercises its rights to foreclose on certain assets,
transferring required government approvals to, or obtaining new approvals by, a purchaser of assets may
require governmental proceedings with consequent delays. In addition, any foreclosure on the assets of a
subsidiary, rather than upon its capital stock as a result of the stock of such subsidiary being an “excluded
asset,” may result in delays and additional expense, as well as less proceeds than would otherwise have
been the case.

The notes will be effectively structurally subordinated to all liabilities of our subsidiaries that are not
guarantors of the notes.
The notes will not be guaranteed by any of our non-U.S. subsidiaries. The notes will be effectively
structurally subordinated to the indebtedness and other liabilities of our subsidiaries that do not guarantee
the notes. These non-guarantor subsidiaries are separate and distinct legal entities and have no obligation,
contingent or otherwise, to pay any amounts due pursuant to the notes, or to make any funds available
therefor, whether by dividends, loans, distributions or other payments. Any right that we or the subsidiary
guarantors have to receive any assets of any of the non-guarantor subsidiaries upon the liquidation or
reorganization of those subsidiaries, and the consequent rights of holders of the notes to realize proceeds
from the sale of any of those subsidiaries’ assets, will be effectively subordinated to the claims of those
subsidiaries’ creditors, including trade creditors and holders of preferred equity interests of those
subsidiaries. Accordingly, in the event of a bankruptcy, liquidation or reorganization of any of our non-
guarantor subsidiaries, absent a decision of the court, such as in the case of substantive consolidation,
these non-guarantor subsidiaries will pay the holders of their debts, holders of preferred equity interests
and their trade creditors before they will be able to distribute any of their assets to us.
Our non-U.S. subsidiaries represented approximately $36.4 million, or 2.5% of our net sales for the
fiscal year ended December 31, 2016 and approximately $18.9 million, or 2.4% of our net sales for the
six months ended July 1, 2017. In addition, as of July 1, 2017, these subsidiaries would have held assets of
approximately $128.3 million, or 14.4% of our combined assets, and would have had no outstanding
indebtedness.

The amount that can be collected under the guarantees will be limited.
Each of the guarantees will be limited to the maximum amount that can be guaranteed by a particular
guarantor without rendering the guarantee, as it relates to that guarantor, avoidable. See “— A court could
deem the issuance of the notes or the guarantees or the related security interests to be a fraudulent
conveyance and avoid all or a portion of the obligations represented by the notes or the guarantees” below.

37
In general, the maximum amount that can be guaranteed by a particular guarantor may be significantly less
than the principal amount of the notes. This provision may not be effective to protect the guarantees from
being voided under fraudulent transfer law, or may eliminate the guarantor’s obligations or reduce the
guarantor’s obligations to an amount that effectively makes the guarantee worthless.

A court could deem the issuance of the notes or the guarantees or the related security interests to be a
fraudulent conveyance and avoid all or a portion of the obligations represented by the notes or the
guarantees.
In a bankruptcy proceeding, a trustee, debtor in possession, or someone else acting on behalf of the
bankruptcy estate (including, potentially, our other creditors) may seek to recover transfers made or avoid
obligations incurred prior to the bankruptcy proceeding on the basis that such transfers and obligations
constituted fraudulent conveyances. or fraudulent transfers. Fraudulent conveyances or fraudulent transfers
are generally defined to include transfers made or obligations incurred for inadequate consideration or
value when the debtor was insolvent (or was rendered insolvent as a result of such transfer), inadequately
capitalized, unable to pay its debts as they became due, or in similar financial distress, or transfers made or
obligations incurred with the intent of hindering, delaying or defrauding current or future creditors. Under
U.S. bankruptcy law, a debtor, trustee or such other parties may recover such transfers and avoid such
obligations made within two years prior to the commencement of a bankruptcy proceeding. Furthermore,
under certain circumstances, creditors may recover transfers or avoid obligations under state fraudulent
conveyance laws, within the applicable limitation period, which may be longer than two years, even if the
debtor is not in bankruptcy. In bankruptcy, a representative of the estate may potentially also assert such
state law claims. If a court were to find that either an issuer issued the notes or a guarantor issued its
guarantee (and the related security interests) under circumstances constituting a fraudulent conveyance or
fraudulent transfer, the court could avoid all or a portion of the obligations under the notes or the
guarantees, or the pledge of collateral granted in connection therewith. In addition, under such
circumstances, the value of any consideration holders received with respect to the notes, including upon
foreclosure of the collateral, could also be subject to recovery from such holders and possibly from
subsequent transferees. If the pledge of collateral to secure the notes or guarantees were avoided and the
issuance of the notes and/or guarantees were not avoided, holders of the notes would be unsecured
creditors with claims that ranked pari passu with all other unsubordinated creditors of the applicable
obligor, including trade creditors.
A note could be avoided, claims in respect of a note could be subordinated to all other debts of an
issuer or the pledge of collateral securing the notes could be avoided, if such issuer at the time the
indebtedness evidenced by the notes was incurred:
• intended to hinder, delay, or defraud any existing or future creditor or contemplated insolvency with
a design to prefer one or more creditors to the exclusion in whole or in part of others;
• received less than reasonably equivalent value or fair consideration for the issuance of the notes and
was insolvent or rendered insolvent by reason of such issuance or incurrence;
• was engaged in a business or transaction for which such issuer’s remaining assets constituted
unreasonably small capital; or
• intended to incur, or believed that it would incur, debts beyond the ability to pay those debts as they
mature.
Similar risks apply to the incurrence by each guarantor of its guarantee of the notes and its pledge of
collateral to secure its guarantee of the notes.
As a general matter, value is given for a transfer or conveyance or an obligation if, in exchange for the
transfer or conveyance or obligation, property is transferred or a valid antecedent debt is satisfied. A court
would likely find that a guarantor did not receive reasonably equivalent value or fair consideration for its
guarantee and/or lien to the extent such guarantor did not obtain a reasonably equivalent benefit from the

38
issuance of the notes and/or such guarantee and/or lien. Thus, if the guarantees or liens were legally
challenged, any guarantee or lien could be subject to the claim that, since the guarantee or lien was
incurred for an issuer’s benefit, and only indirectly for the benefit of the guarantor, the obligations of the
applicable guarantor were incurred for less than reasonably equivalent value or fair consideration.
The measures of insolvency for purposes of these fraudulent transfer or fraudulent conveyance laws
vary depending upon the law applied in any proceeding to determine whether a fraudulent transfer has
occurred. Generally, however, a debtor would be considered insolvent if:
• the sum of its debts, including contingent liabilities, was greater than the fair value of all of 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, including contingent liabilities, as they become absolute and
mature; or
• it could not pay its debts as they become due.
We cannot assure you as to what standard a court would apply in determining whether an issuer or a
guarantor would be considered to be insolvent. at the relevant time or, regardless of the standard that a
court uses, whether the notes or the guarantees would be subordinated to our or any of our guarantors’ other
debt or whether the notes, the guarantees or the granting of liens to secure the notes or the guarantees
would be avoided as a preference, fraudulent transfer, fraudulent conveyance, or otherwise. If a court
determined that an issuer or a guarantor was insolvent prior to or after giving effect to the issuance of the
notes or the applicable guarantee, it could avoid the notes or the applicable guarantees of the notes (or the
pledge of collateral) and require you to return any payments received in respect of the notes or guarantees
(or upon the foreclosure on collateral). If a guarantee is voided or held unenforceable for any other reason,
holders of the notes would cease to have a claim against the guarantor based on the guarantee and would be
creditors only of the issuers and any guarantor whose guarantee was not similarly voided or otherwise held
unenforceable. If a lien is voided or held unenforceable for any other reason, you would lose the benefit of
that lien. As a result, in the event of a finding that a fraudulent transfer or fraudulent conveyance occurred,
you may not receive any repayment on the notes.
The indenture governing the notes will contain a “savings” provision intended to limit each guarantor’s
liability under its guarantee to the maximum amount that it could incur without causing the guarantee to be
a fraudulent transfer or fraudulent conveyance. This provision may not be effective as a legal matter to
protect the guarantees from being voided under fraudulent transfer law. There can be no assurance that this
provision will be upheld as intended.
In addition, any payment by us pursuant to the notes or by a guarantor made at a time when we or such
guarantor is subsequently found to be insolvent could be avoided and required to be returned to us or such
guarantor or to a fund for the benefit of our or the guarantors’ creditors if such payment is made to an
insider within a one-year period prior to a bankruptcy filing or within 90 days to any non-insider party and
such payment would give the holders of the notes more than such holders of the notes would have received
in a hypothetical liquidation under Chapter 7 of the U.S. bankruptcy code.

We may not have the funds necessary to satisfy all of our obligations under our senior secured credit
facility, the notes or other indebtedness in connection with certain change of control events.
Upon the occurrence of specific kinds of change of control events, the indenture governing the notes
requires us to make an offer to repurchase all outstanding notes at 101% of the principal amount thereof,
plus accrued and unpaid interest (and additional interest, if any) to the date of repurchase. However, it is
possible that we will not have sufficient funds, or the ability to raise sufficient funds, at the time of the
change of control to make the required repurchase of the notes. In addition, restrictions under our senior
secured credit facility may not allow us to repurchase the notes upon a change of control. If we could not
refinance such debt or otherwise obtain a waiver from the holders of such debt, we would be prohibited from

39
repurchasing the notes, which would constitute an event of default under the indenture. Certain important
corporate events, such as leveraged recapitalizations that would increase the level of our indebtedness,
would not constitute a “Change of Control” under the indenture. See “Description of Notes — Change of
Control.”
In addition, our senior secured credit facility provides that certain change of control events constitute
an event of default under such senior secured credit facility. Such an event of default entitles the lenders
thereunder to, among other things, cause all outstanding debt obligations under our senior secured credit
facility to become due and payable and to proceed against the collateral. Any event of default or
acceleration of our senior secured credit facility will likely also cause a default under the terms of our other
indebtedness.

We may enter into transactions that would not constitute a change of control that could affect our
ability to satisfy our obligations under the notes.
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 our assets and 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 the issuers to repurchase
notes as a result of a transfer of less than all of our assets to another person may be uncertain.

The failure of an active trading market to develop for the notes could harm the liquidity and price of
your notes.
The notes are a new issue of securities with no established trading market. We do not intend to list the
notes on any national securities exchange or to seek admission thereof to trading on any other market. We
cannot assure you that an active trading market for the notes will develop or be sustained. We have been
informed by the Initial Purchaser that it presently intends to make a market in the notes after this offering is
completed. The Initial Purchaser is not obligated, however, to make a market in the notes, and the Initial
Purchaser may discontinue such market making at any time. If an active trading market for the notes fails
to develop or be sustained, the trading price of the notes could be adversely affected.
Even if an active trading market for the notes develops, the notes could trade at prices that may be
lower than the initial offering price. Whether or not the notes trade at lower prices depends on many
factors, some of which are beyond our control, including:
• prevailing interest rates;
• demand for high yield debt securities generally;
• general economic conditions;
• our financial condition, performance and future prospects; and
• prospects for companies in our industry generally.

The notes are subject to transfer restrictions. We will not offer to register the resale of the notes or to
exchange the notes in a registered exchange offer, and, therefore, you may find it difficult to sell them.
We have not registered the notes offered hereby under the Securities Act or the securities laws of any
other jurisdiction, and we have no intention to do so. The notes are being offered and sold pursuant to
exemptions from the registration requirements under the Securities Act and applicable state securities laws.
The notes may be transferred or resold only in a transaction registered under or exempt from the
registration requirements of the Securities Act and applicable state securities laws. As a result, the notes are

40
subject to restrictions on transfer that may make them more difficult to sell. See “Notice to Investors” for a
description of restrictions on transfer of the notes.

If the notes are rated investment grade by both Standard & Poor’s and Moody’s, most of the restrictive
covenants and corresponding events of default contained in the indenture that will govern the notes
will be suspended, and you will lose the protection of these covenants.
If the notes are rated investment grade by both Standard & Poor’s and Moody’s and no default has
occurred and is continuing, we will no longer be subject to most of the restrictive covenants and
corresponding events of default contained in the indenture that will govern the notes. Any restrictive
covenants or corresponding events of default that cease to apply to us as a result of achieving these ratings
will be restored if one or both of the credit ratings on the notes later fall below the investment grade
threshold or in certain other circumstances. However, during any period in which these restrictive
covenants are suspended, we may incur other indebtedness, make restricted payments and take other
actions that would have been prohibited if these covenants had been in effect. If the restrictive covenants
are later restored, the actions taken while the covenants were suspended will not result in an event of
default under the indenture that will govern the notes even if they would have constituted an event of
default at the time the covenants were restored. Accordingly, if these covenants and the corresponding
events of default are suspended, holders of the notes will have less credit protection than at the time the
notes are issued. See “Description of Notes—Certain Covenants.”

Mark C. Simmons and members of the Simmons family exercise control of our management and affairs.
Mark C. Simmons is the beneficial owner of 100% of the outstanding shares of voting common stock of
each of the Issuers. In addition, Mr. Simmons and members of the Simmons family serve on the Board of
Directors of each of the Issuers. As a result, Mr. Simmons and members of the Simmons family have control
over our management and affairs. Mr. Simmons has sole control of the election of our boards of directors
and sole control of any vote coming before our shareholders, including any significant corporate
transactions, such as a merger or other sale of Simmons or its assets. The interests of Mr. Simmons and
members of the Simmons family as equity holders may conflict with your interests as a noteholder.
Mr. Simmons and members of the Simmons family may have an incentive to increase the value of their
investment or cause us to distribute funds at the expense of our financial condition and affect our ability to
make payments on the notes. In addition, Mr. Simmons and members of the Simmons family may have an
interest in pursuing acquisitions, divestitures, financings or other transactions that they believe could
enhance their equity investments even though such transactions might involve risks to you as a noteholder.

41
 USE OF PROCEEDS

We plan to use the net proceeds of this offering of notes to pay the purchase price for the 2021 Notes
that are validly tendered by holders and accepted by us pursuant to the Tender Offer, to redeem or retire
any 2021 Notes not purchased in the Tender Offer, to pay accrued and unpaid interest on all 2021 Notes
purchased pursuant to the Tender Offer or otherwise redeemed or retired, to pay down our borrowings
under our secured senior credit facility, for general corporate purposes, including future capital
expenditures and/or acquisitions, and to pay fees and expenses incurred in connection with this offering
and the Tender Offer.

The following table sets forth the estimated sources and uses of funds in connection with the above-
described transactions.

Sources of Funds Amount Uses of Funds Amount

(in millions)
Notes offered hereby . . . . . . . . . . . . . . . . . . $550.0 Repayment of the 2021 Notes(1) . . . . . . $415.0
Estimated premium and accrued interest
on repayment of the 2021 Notes(2) . . 28.6
Pay down borrowings under senior
secured credit facility(3) . . . . . . . . . . . 65.5
General corporate purposes, including
future capital expenditures and/or
acquisitions(4) . . . . . . . . . . . . . . . . . . . 33.7
Estimated transaction fees and
expenses(5) . . . . . . . . . . . . . . . . . . . . . 7.2
Total sources . . . . . . . . . . . . . . . . . . . . . . . . . $550.0 Total uses . . . . . . . . . . . . . . . . . . . . . . . . . $550.0

(1) The 2021 Notes bear interest at 7.875% per annum and mature on October 1, 2021.

(2) Represents estimated aggregate tender and consent consideration of $26.4 million and accrued
interest of approximately $2.2 million to be paid in connection with the Tender Offer of the 2021 Notes
assuming a 100% tender of the 2021 Notes.

(3) At July 1, 2017, we had outstanding borrowings of $65.5 million under our senior secured credit
facility and a weighted average interest rate of 3.44% per annum. Our senior secured credit facility
matures (subject to the refinancing of the 2021 Notes pursuant to this offering) on August 11, 2022.
Outstanding borrowings under our senior secured credit facility were incurred to refinance our prior
credit facility and to fund working capital and capital expenditures. Actual amounts repaid will vary
based on the amount of borrowings outstanding on the date of repayment.

(4) We anticipate such funds will be used to fund future anticipated capital expenditures relating to a new
poultry processing plant and/or to pursue acquisitions. See “Risk Factors — A material acquisition,
joint venture or other significant initiative could affect our financial condition and result of
operations.”

(5) Includes estimated transaction fees, including the Initial Purchaser’s discount, and expenses related to
the offer and sale of the notes hereby and the Tender Offer.

An affiliate of Wells Fargo Securities, LLC, the Initial Purchaser, is a lender under our senior secured
credit facility and, as a result, this affiliate will receive a portion of the proceeds from this offering. The
Initial Purchaser or its affiliates may hold some of our outstanding 2021 Notes, and if any such notes are
purchased by us in the Tender Offer or redeemed, the Initial Purchaser or such affiliates will receive a
portion of the proceeds of this offering. See “Plan of Distribution.”

42
 CAPITALIZATION
The following table sets forth as of July 1, 2017, our cash and cash equivalents and capitalization on an
actual basis and on an as adjusted basis to give effect to this offering and the application of the net proceeds
as described in “Use of Proceeds” as though such transactions had occurred on such date. This table should
be read together with “Use of Proceeds,” “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” and our combined financial statements and the related notes thereto included
elsewhere in this offering memorandum.

As of July 1, 2017
Actual As Adjusted
(unaudited)
(in millions)
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6.7 $ 40.4
Debt:
Senior secured credit facility(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65.5 —
7.875% Second Lien Senior Secured Notes due 2021(2) . . . . . . . . . . . . . . . . . . . . . 415.0 —
Notes offered hereby(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 550.0
Total debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 480.5 550.0
Shareholder’ equity(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223.9 193.1
Total capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $704.4 $743.1

(1) The senior secured credit facility, as amended on August 11, 2017, provides a revolving facility of up
to $275.0 million of borrowings, subject to availability and our borrowing base. As of August 31, 2017,
we had approximately $55.4 million of indebtedness outstanding under our senior secured credit
facility and approximately $191.8 million available under our senior secured credit facility after taking
into account our borrowing base and outstanding letters of credit. See “Description of Other
Indebtedness.”
(2) As adjusted assumes 100% tender of the 2021 Notes. We expect to redeem any 2021 Notes not
tendered to us. See “Offering Memorandum Summary — Recent Developments — Tender Offer for the
2021 Notes.”
(3) Assumes the notes offered hereby are sold at par.
(4) The as adjusted amount reflects the payment of estimated aggregate tender and consent consideration
of $26.4 million and the write-off of deferred financing costs of approximately $4.4 million in
connection with the settlement of the 2021 Notes.

43
 SELECTED HISTORICAL COMBINED FINANCIAL DATA
The following table shows selected historical combined financial data for the periods indicated. The
balance sheet data as of December 29, 2012, December 28, 2013, December 27, 2014, January 2, 2016, and
December 31, 2016 and the statement of operations data for each of the five years in the period ended
December 31, 2016 are derived from our audited combined financial statements. The balance sheet data as
of July 2, 2016 and July 1, 2017 and statement of operations data for the six-month periods ended July 2,
2016 and July 1, 2017 have been derived from our unaudited combined financial statements and include all
adjustments, consisting only of normal recurring accruals, that management considers necessary for the
fair presentation of the combined financial position and results of operations for these periods.
The following information should be read together with “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” and the combined financial statements and the notes
related to those statements included elsewhere in this offering memorandum. The financial information
included in this offering memorandum may not be indicative of our future results of operations.

Fiscal year ended Six months ended

July 2, July 1,
December 29, December 28, December 27, January 2, December 31, 2016 2017
2012 2013 2014 2016 2016 (Unaudited) (Unaudited)
(in thousands)
Combined Statements of
Operations Data:
Net sales . . . . . . . . . . . . . . . . $1,290,899 $1,345,312 $1,409,392 $1,413,735 $1,469,229 $727,419 $775,762
Cost of sales . . . . . . . . . . . . . 1,164,494 1,202,977 1,250,183 1,246,442 1,270,151 626,725 672,098
Gross profit . . . . . . . . . . . . . . 126,405 142,335 159,209 167,293 199,078 100,694 103,664
Operating expenses:
Selling . . . . . . . . . . . . . . . . 30,160 33,423 34,084 35,054 40,946 18,518 16,086
General and
administrative . . . . . . . . 50,739 53,219 70,692 77,209 91,496 43,542 48,471
Gain on disposal of
property, plant and
equipment . . . . . . . . . . . (35) (231) (160) (1,294) (2,684) 12 (8)
Restructuring, exit and
disposal costs . . . . . . . . 19,269 — — — — — —
Total operating
expenses . . . . . . . . . . 100,133 86,411 104,616 110,969 129,758 62,072 64,549
Income from operations . . . . 26,272 55,924 54,593 56,324 69,320 38,622 39,115
Other income (expense):
Interest expense and
finance charges, net . . . (44,453) (39,400) (39,070) (36,411) (36,411) (18,292) (18,296)
Loss on early
extinguishment of
debt . . . . . . . . . . . . . . . . — (1,164) (23,546) — — — —
Other . . . . . . . . . . . . . . . . . 1,136 1,555 1,696 1,477 1,615 446 (122)
Total other expense . . . . (43,317) (39,009) (60,920) (34,934) (34,796) (17,846) (18,418)
Net income (loss) . . . . . . . . . $ (17,045) $ 16,915 $ (6,327) $ 21,390 $ 34,524 $ 20,776 $ 20,697

Selected Balance Sheet Data

(at period end):
Cash and cash
equivalents . . . . . . . . . . . . $ 4,775 $ 5,894 $ 4,809 $ 8, 694 $ 3,324 $ 9,592 $ 6,709
Working capital(1) . . . . . . . . 217,284 240,291 293,072 321,030 303,933 311,049 312,245
Total assets . . . . . . . . . . . . . . 673,837 709,074 798,649 833,505 856,385 837,653 891,267
Total debt(2) . . . . . . . . . . . . . 397,565 399,194 489,017 495,278 463,263 470,722 476,098
Total shareholders’ equity . . 132,925 166,242 152,328 192,472 215,126 208,252 223,875

44
 Fiscal year ended Six months ended
July 2, July 1,
December 29, December 28, December 27, January 2, December 31, 2016 2017
2012 2013 2014 2016 2016 (Unaudited) (Unaudited)
(in thousands)
Selected Statements of Cash
Flow Data:
Depreciation and
amortization . . . . . . . . . . . . $ 37,190 $ 33,989 $ 37,173 $ 41,634 $ 47,996 $ 23,524 $ 23,753
Capital expenditures . . . . . . . 21,707 41,987 55,936 61,350 60,118 21,374 31,997
Cash provided by (used in):
Operating activities . . . . . . . . 37,484 27,345 (8,691) 48,382 93,877 125,012 110,580
Investing activities . . . . . . . . (17,756) (41,027) (55,775) (58,293) (57,216) (94,770) (103,130)
Financing activities . . . . . . . . (21,341) 14,801 63,381 13,796 (42,031) (29,344) (4,065)

(1) We define working capital as total current assets, excluding cash and cash equivalents, less total current liabilities, excluding the
current portion of long-term debt and notes payable.

(2) Total debt includes the current and long-term portion of total debt, less unamortized deferred financing costs.

45
 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
You should read the following discussion in conjunction with our combined financial statements,
including the related notes, and other financial information included in this offering memorandum and the
risks involved in investing in the notes as described in “Risk Factors.”

Overview
We are one of the leading vertically integrated poultry processors and the largest private label wet pet
food producer in the United States and Canada. Founded in 1949 with headquarters in Siloam Springs,
Arkansas, we have operations in Arkansas, Oklahoma, Missouri, Kansas, New Jersey, and Ontario,
Canada. We operate in three primary business segments: (i) Poultry; (ii) Pet Food; and (iii) Protein.
Poultry: Poultry operations include breeding and raising chickens, processing, marketing, and
distribution of value-added, fully cooked, ready-to-cook, breaded, frozen, and fresh chicken products.
These products are targeted primarily to foodservice and retail customers, where the vast majority of our
products are sold under private label. We sell our poultry products to the foodservice industry for end use
primarily by national and regional quick service and casual dining chain restaurants and to the retail
industry, primarily the mass merchandiser and warehouse club store channels. Through our energy
company, we distribute propane gas to residential and commercial customers in Oklahoma, Arkansas, and
Missouri, with a vast majority of sales being to poultry farm operators. Our Poultry segment includes the
businesses of Simmons Foods, Inc., Simmons Prepared Foods, Inc., and Simmons Energy Solutions, Inc.
Pet Food: Pet Food operations include the manufacture of wet and dry pet food for dogs and cats, as
well as pet treats for dogs. We sell our pet food products to grocery store chains, dollar and discount stores,
farm and feed stores, mass merchandisers, club store retailers and pet specialty stores for their private label
products and to a limited number of pet food brand owners on a contract manufacturing basis. Our Pet
Food segment includes the businesses of Simmons Pet Food, Inc. and its subsidiaries Simmons Pet Food
Holdings, Inc. and Simmons Pet Food ON, Inc.
Protein: Protein operations include the manufacture of wet and dry feed ingredients and protein
supplements for the pet food, aquaculture, and livestock markets. Our wet protein operations provide
tailored wet feed ingredients (multi-species, multi-bone, and multi-temperature) for the pet food industry,
while delivering unparalleled blending, food safety, and raw material traceability. Our dry protein operation
renders chicken and turkey by-products into finished poultry meal, feather meal, and poultry fat.
Shared Services: Shared services include corporate overhead expenses that are incurred to operate
each business segment. This includes accounting, finance, information technology, management, human
resources, hedging activities, and other administrative functions. These costs are primarily included in
general and administrative expenses in the combined statements of income.

Basis of Presentation
We operate on a 52/53-week fiscal year ending on the Saturday nearest to December 31. Fiscal years
ending on December 29, 2012, December 28, 2013, December 27, 2014, and December 31, 2016 consisted
of 52 weeks each. Each quarter ends on the Saturday nearest to the end of the applicable calendar month,
with the first six months of fiscal 2016 and 2017 ending on July 2, 2016 and July 1, 2017, respectively.
We are privately owned Arkansas corporations and have elected S corporation status for federal and
state income tax purposes. Therefore, we are not subject to U.S. federal and state income taxes as our
results of operations are included in our stockholders’ individual tax returns. Simmons Pet Food ON, Inc., a
Canadian subsidiary of Simmons Pet Food, is subject to Canadian income taxes. Any applicable foreign tax
expense has not been significant during any reporting periods presented in our accompanying combined
financial statements. Accordingly, no provision for income taxes related to our results of operations has
been made in our accompanying combined financial statements.

46
 The following discussion and analysis is intended to provide a summary of significant factors relevant
to our financial performance and condition. The discussion should be read together with our combined
financial statements and related notes included in this offering memorandum. Results for the fiscal year
ended December 31, 2016 and the six months ended July 1, 2017 are not necessarily indicative of results
that may be attained in the future.

Results of Operations
The following table below provides certain statement of operation data in thousands of dollars and
related percentage information for our business segments and for the combined Simmons companies for
the periods set forth below ($ and pounds in thousands except price per pound). Some of the key factors
influencing our business include, without limitation: (i) customer demand for our products; (ii) the ability to
maintain and grow relationships with customers; (iii) the ability to introduce new and innovative products
to the marketplace; (iv) accessibility of international markets; (v) market prices for our products; (vi) the
cost of raw materials and grain; and (vii) the operating efficiencies of our facilities.

Fiscal year ended Six months ended

December 27, January 2, December 31, July 2, July 1,
2014 2016 % Change 2016 % Change 2016 2017 % Change
(in thousands, except price per pound)
Poultry Segment
Net sales . . . . . . . . . $ 825,996 $ 839,872 1.7% $ 871,450 3.8% $435,541 $441,958 1.5%
Cost of sales . . . . . . . 720,070 735,538 2.1% 756,281 2.8% 378,873 381,037 0.6%
Gross profit . . . . . . . $ 105,926 $ 104,334 $ 115,169 $ 56,668 $ 60,921
Gross margin . . . . . . 12.8% 12.4% 13.2% 13.0% 13.8%
Pounds sold . . . . . . . 741,634 735,354 (0.8)% 792,024 7.7% 402,767 402,265 (0.1)%
Price per pound . . . . $ 1.1138 $ 1.1420 2.5% $ 1.1003 (3.7)% $ 1.0814 $ 1.0987 1.6%
Pet Food Segment
Net sales . . . . . . . . . $ 479,103 $ 484,495 1.1% $ 522,084 7.8% $256,127 $287,266 12.2%
Cost of sales . . . . . . . 440,672 437,327 (0.8)% 461,945 5.6% 224,585 253,424 12.8%
Gross profit . . . . . . . $ 38,431 $ 47,168 $ 60,139 $ 31,542 $ 33,842
Gross margin . . . . . . 8.0% 9.7% 11.5% 12.3% 11.8%
Protein Segment
Net sales . . . . . . . . . $ 104,293 $ 87,675 (15.9)% $ 75,695 (13.7)% $ 35,751 $ 46,538 30.2%
Cost of sales . . . . . . . 85,281 72,496 (15.0)% 55,474 (23.5)% 26,467 37,058 40.0%
Gross profit . . . . . . . $ 19,012 $ 15,179 $ 20,221 $ 9,284 $ 9,480
Gross margin . . . . . . 18.2% 17.3% 26.7% 26.0% 20.4%
Shared Services
Net sales . . . . . . . . . $ 1 $ 1,693 $ — $ — $ —
Cost of sales . . . . . . . $ 4,159 1,081 (3,549) (3,200) 579
Gross
profit/(loss) . . . . . $ (4,158) $ 612 $ 3,549 $ 3,200 $ (579)

Total Combined
Net sales . . . . . . . . . $1,409,392 $1,413,735 0.3% $1,469,229 3.9% $727,419 $775,762 6.6%
Cost of sales . . . . . . . 1,250,183 1,246,442 (0.3)% 1,270,151 1.9% 626,725 672,098 7.2%
Gross profit . . . . . . . $ 159,209 $ 167,293 $ 199,078 $100,694 $103,664
Gross margin . . . . . . 11.3% 11.8% 13.5% 13.8% 13.4%

47
Six Months Ended July 1, 2017 versus Six Months Ended July 2, 2016
Total Company: Net sales were $775.8 million for the first six months of fiscal 2017 compared to
$727.4 million for the same period in 2016, an increase of $48.3 million or 6.6%. Sales were up in our
Poultry and Pet Food segments, partially offset by lower sales in our Protein segment.
Cost of sales for the first six months of fiscal 2017 was $672.1 million, an increase of $45.4 million or
7.2% from the same period in 2016. Cost of sales was up in our Poultry and Pet Food segments, partially
offset by lower costs in our Protein segment.
Gross profit for the first six months of fiscal 2017 was $103.7 million compared to $100.7 million for
the same period in 2016, an increase of $3.0 million or 2.9%. Gross margin was 13.4% for the first six months
of 2017 compared to 13.8% for the same period in 2016.
Combined selling, general and administrative expenses were $64.6 million for the first six months of
fiscal 2017, an increase of $2.5 million or 4.0% from $62.1 million for the same period in 2016. This increase
is primarily due to higher accruals associated with our company growth.
Interest expense was $18.3 million for the first six months of each of fiscal 2017 and fiscal 2016.
As a result of the items discussed above, net income was $20.7 million for the first six months of fiscal
2017 compared to $20.8 million for the same period in 2016.
Poultry Segment: Net sales for the first six months of fiscal 2017 were $442.0 million compared to
$435.5 million for the same period in 2016, an increase of $6.4 million or 1.5%. Net sales were favorably
impacted by higher average sales price (“ASP”), resulting in price-related sales increases of $7.0 million,
partially offset by volume-related sales decreases of $0.5 million. Higher ASP is primarily due to favorable
sales mix changes, coupled with overall higher market prices for our leg quarters. Leg quarter prices were
up $0.0930 per pound or 45.6% versus the same period in 2016. Lower volume is mostly related to
decreased leg quarter sales in 2017 versus the first half of 2016, when we significantly reduced our leg
quarter inventory.
Cost of sales was $381.0 million for the first six months of fiscal 2017, an increase of $2.2 million or
0.6%, from $378.9 million for the same period in 2016. Higher cost per pound increased cost of sales by
$2.6 million, partially offset by volume-related cost decreases of $0.5 million. Feed ingredient cost per ton
increased by $4.50 or 1.8%, resulting in price-related feed cost increases of $2.2 million, coupled with
volume-related feed cost increases of $0.1 million.
Pet Food Segment: Net sales were $287.3 million for the first six months of fiscal 2017 compared to
$256.1 million for the same period in 2016, an increase of $31.1 million or 12.2%. Net sales were favorably
impacted by higher Wet Pet sales of $23.4 million or 12.2%, coupled with higher Dry Pet sales of
$8.8 million or 15.6%. Wet Pet sales were favorably impacted by higher volumes, resulting in volume-
related sales increases of $21.9 million, coupled with price-related sales increases of $1.5 million. Dry Pet
sales were favorably impacted by higher volumes, resulting in volume-related sales increases of
$6.2 million, coupled with price-related sales increases of $2.6 million.
Cost of sales was $253.4 million for the first six months of fiscal 2017, an increase of $28.8 million or
12.8% from $224.6 million for the same period in 2016. Cost of sales was unfavorably impacted by higher
Wet Pet costs of $20.4 million or 12.5%, coupled with higher Dry Pet costs of $9.3 million or 17.2%. Wet Pet
costs were unfavorably impacted by higher volumes, resulting in volume-related cost increases of
$18.7 million, coupled with price-related cost increases of $1.7 million. Dry Pet costs were unfavorably
impacted by higher volumes, resulting in volume-related cost increases of $6.0 million, coupled with price-
related cost increases of $3.3 million.
Protein Segment: Net sales were $46.5 million for the first six months of fiscal 2017 compared to
$35.8 million for the same period in 2016, an increase of $10.8 million or 30.2%. Net sales were favorably
impacted by higher ASP, resulting in price-related sales increases of $10.7 million, coupled with

48
volume-related sales increases of $0.1 million. Cost of sales was $37.1 million for the first six months of
fiscal 2017 compared to $26.5 million for the same period in 2016, an increase of $10.6 million or
40.0%. Higher cost per ton increased cost of sales by $10.6 million.

Fiscal Year 2016 versus Fiscal Year 2015

Total Company: Net sales were $1,469.2 million for fiscal 2016 compared to $1,413.7 million for the
same period in 2015, an increase of $55.5 million or 3.9%. Incremental sales were primarily due to higher
volume in our Poultry and Pet Food segments, partially offset by lower Protein sales.
Cost of sales for fiscal 2016 was $1,270.2 million, an increase of $23.8 million or 1.9% from
$1,246.4 million for the same period in 2015. Higher cost of sales was mostly related to incremental volume
in our Poultry and Pet Food segments, partially offset by lower Protein costs.
Combined selling, general and administrative expenses were $132.4 million for fiscal 2016 compared
to $112.3 million for the same period in 2015, an increase of $20.1 million or 17.9%. This increase is
primarily due to accruals associated with our incentive plan and cost of living increases.
Interest expense was $36.4 million for each of fiscal 2016 and fiscal 2015.
As a result of the items discussed above, net income was $34.5 million for fiscal 2016 versus
$21.4 million for 2015.
Poultry Segment: Net sales were $ 871.5 million for fiscal 2016 compared to $839.9 million in 2015,
an increase of $31.6 million or 3.8%. Net sales were positively impacted by higher volume, resulting in
volume-related sales increases of $64.7 million, partially offset by price-related sales decreases of
$33.1 million. Higher volume is primarily due to increased demand in our international and retail channels.
Lower ASP is the result of unfavorable rate and sales mix changes. Leg quarter sales for fiscal 2016 were
$58.1 million, up $14.3 million or 32.7%. Combined leg quarter volume was 246.8 million pounds, up
22.8 million pounds or 10.2%.
Cost of sales was $756.3 million for fiscal 2016, an increase of $20.8 million or 2.8%, from
$735.5 million for the same period in 2015. Higher volume increased cost of sales $56.7 million, partially
offset by price-related cost decreases of $35.9 million. Feed ingredient cost per ton decreased $7.68 or
2.9%, resulting in price-related feed cost decreases of $7.3 million, coupled with volume-related feed cost
decreases of $0.4 million.
Pet Food Segment: Net sales were $522.1 million for fiscal 2016 compared to $484.5 million for the
same period in 2015, an increase of $37.6 million or 7.8%. Net sales were favorably impacted by higher Wet
Pet sales of $13.5 million or 3.6%, coupled with higher Dry Pet sales of $24.2 million or 25.2%. Wet Pet sales
were positively impacted by higher volume, resulting in volume-related sales increases of $12.5 million,
coupled with price-related sales increases of $1.0 million. Dry Pet sales were favorably impacted by higher
volume, resulting in volume-related sales increases of $18.8 million, coupled with price-related sales
increases of $5.4 million.
Cost of sales was $461.9 million for fiscal 2016, an increase of $24.6 million or 5.6% from $437.3
million for the same period in 2015. Cost of sales was unfavorably impacted by higher Wet Pet costs of
$2.0 million, coupled with higher Dry Pet costs of $22.1 million. Wet Pet costs were negatively impacted by
higher volume, resulting in volume-related cost increases of $11.0 million, partially offset by price-related
cost decreases of $9.0 million. Dry Pet costs were unfavorably impacted by higher volume, resulting in
volume-related cost increases of $18.4 million, coupled with price-related cost increases of $3.7 million.
Protein Segment: Net sales were $75.7 million for fiscal 2016 compared to $87.7 million for fiscal
2015, a decrease of $12.0 million or 13.7%. Net sales were negatively impacted by lower volume, resulting
in volume-related sales decreases of $8.8 million, coupled with price-related sales decreases of
$3.2 million. Cost of sales was $55.5 million for 2016 compared to $72.5 million for the same period in
2015, a decrease of $17.0 million or 23.5%.

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Fiscal Year 2015 versus Fiscal Year 2014
Total Company: Net sales were $1,413.7 million for fiscal 2015 compared to $1,409.4 million for the
same period in 2014, an increase of $4.3 million or 0.3%. Incremental sales were primarily due to our
Poultry and Pet Food segments, partially offset by lower Protein sales.
Cost of sales for fiscal 2015 was $1,246.4 million, a decrease of $3.8 million or 0.3% from
$1,250.2 million for the same period in 2014. Lower cost of sales was mostly related to our Protein and Pet
segments, partially offset by higher Poultry costs.
Combined selling, general and administrative expenses were $112.3 million for fiscal 2015 compared
to $104.8 million for the same period in 2014, an increase of $7.5 million or 7.2%. This increase is primarily
due to accruals associated with our incentive plan and cost of living increases.
Interest expense was $36.4 million for fiscal 2015 compared to $39.1 million for fiscal 2014, a decrease
of $2.7 million, or 6.9%. This decrease was primarily due to lower rates on borrowed funds.
As a result of the items discussed above, net income was $21.4 million for fiscal 2015 versus a net loss
of $6.3 million for 2014.
Poultry Segment: Net sales were $839.9 million for fiscal 2015 compared to $826.0 million in 2014,
an increase of $13.9 million or 1.7%. Net sales were positively impacted by higher ASP, resulting in
price-related sales increases of $20.8 million, partially offset by volume-related sales decreases of
$7.0 million. Higher ASP is primarily due to favorable sales mix changes, coupled with overall higher
market prices for our poultry products during the first half of 2015. Lower volume is the result of our
decision to exit our custom processing business in the second quarter of 2015. Leg quarter sales for fiscal
2015 were $43.8 million, down $46.9 million or 51.7%. Combined leg quarter volume was 224.0 million
pounds, up 10.4 million pounds or 4.8%.
Cost of sales was $735.5 million for fiscal 2015, an increase of $15.4 million or 2.1%, from
$720.1 million for the same period in 2014. Higher cost per pound increased cost of sales $21.5 million,
partially offset by volume-related cost decreases of $6.0 million. Incremental costs are the result of
unfavorable mix changes. Feed ingredient cost per ton decreased $27.90 or 9.3%, resulting in price-related
feed cost decreases of $26.2 million, offset by volume-related feed cost increases of $33.8 million.
Incremental feed cost is the result of our decision to increase internal bird production and reduce the
amount of parts we purchase on the market.
Pet Food Segment: Net sales were $484.5 million for fiscal 2015 compared to $479.1 million for the
same period in 2014, an increase of $5.4 million or 1.1%. Net sales were positively impacted by higher Dry
Pet sales of $10.9 million or 12.6%, partially offset by lower Wet Pet sales of $3.8 million or 1.0%. Wet Pet
sales were negatively impacted by lower volume, resulting in volume-related sales decreases of
$3.8 million. Dry Pet sales were favorably impacted by higher volume, resulting in volume-related sales
increases of $16.0 million, partially offset by price-related sales decreases of $5.1 million.
Cost of sales was $437.3 million for fiscal 2015, an increase of $3.4 million or 0.8% from $440.7 million
for the same period in 2014. Cost of sales was favorably impacted by lower Wet Pet and Treats costs of
$14.2 million, partially offset by higher Dry Pet costs of $12.0 million. Wet Pet costs were favorably
impacted by lower input costs, resulting in price-related cost decreases of $6.7 million, coupled with
volume-related cost decreases of $3.5 million. Dry Pet costs were negatively impacted by higher volume,
resulting in volume-related cost increases of $15.4 million, partially offset by price-related cost decreases
of $3.4 million.
Protein Segment: Net sales were $87.7 million for fiscal 2015 compared to $104.3 million for fiscal
2014, a decrease of $16.6 million or 15.9%. Net sales were negatively impacted by lower ASP, resulting in
price-related sales decreases of $16.4 million, coupled with volume-related sales decreases of $0.2 million.
Lower sales price is primarily due to softer commodity markets. As a toll operator, we strive to pass-through
our variable commodity costs. Accordingly, our sales will increase or decrease as the underlying
commodity markets rise and fall.

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 Cost of sales was $72.5 million for fiscal 2015 compared to $85.3 million for 2014, a decrease of
$12.8 million or 15.0%. Lower cost per ton decreased cost of sales by $12.6 million, coupled with
volume-related cost decreases of $0.2 million.

Fiscal Year 2014 versus Fiscal Year 2013

Total Company: Net sales were $1,409.4 million for fiscal 2014 compared to $1,345.3 million for the
same period in 2013, an increase of $64.1 million or 4.8%. Sales were up in our Poultry and Pet segments,
partially offset by lower sales in our Protein segment.
Cost of sales for fiscal 2014 was $1,250.2 million, an increase of $47.2 million or 3.9% from
$1,203.0 million for the same period in 2013. Poultry and Pet Food costs increased $25.8 million and
$20.3 million or 3.7% and 4.8%, respectively.
Combined selling, general and administrative expenses were $104.8 million for fiscal 2014 compared
to $86.6 million for the same period in 2013, an increase of $18.2 million or 21.0%. Incremental general and
administrative expenses of $17.5 million or 32.8% is primarily due to increased accruals associated with our
incentive plan.
Interest expense was $39.1 million for fiscal 2014 compared to $39.4 million for the same period in
2013, a decrease of $0.3 million or 0.8%. The decrease in interest expense primarily represents a reduction
of borrowings on our revolving credit facility, coupled with lower average rates on those funds.
As a result of the items discussed above, net loss was $6.3 million for fiscal 2014 compared to net
income of $16.9 million for fiscal 2013.
Poultry Segment: Net sales were $826.0 million for fiscal 2014 compared to $776.7 million in 2013,
an increase of $49.3 million or 6.4%. Net sales were positively impacted by increased sales volume, partially
offset by a lower average sales price. Average sales price per poultry pound for fiscal 2014 was $1.1138, a
decrease of 2.1%, versus $1.1379 for the same period in 2013. This price decrease is primarily due to
unfavorable mix changes, coupled with overall lower market prices for our poultry products. Poultry volume
for 2014 was 741.6 million pounds, up 59.1 million pounds or 8.7% from 682.5 million pounds for the same
period in 2013. Combined leg quarter volume for fiscal 2014 was 213.7 million pounds, up 5.9 million
pounds or 2.8% from 207.8 million pounds for the same period in 2013.
Cost of sales was $720.1 million for fiscal 2014, an increase of $25.8 million or 3.7%, from
$694.3 million for the same period in 2013. Higher sales volume increased cost of sales by $60.1 million,
partially offset by price-related cost decreases of $34.3 million. Feed ingredient cost per ton for 2014
decreased $63.6 or 17.8% compared to fiscal 2013, resulting in price-related feed cost decreases of
$53.3 million, partially offset by volume-related feed cost increases of $20.0 million.
Pet Food Segment: Net sales were $479.1 million for fiscal 2014 compared to $460.9 million in fiscal
2013, an increase of $18.2 million or 3.9%. Wet pet sales increased $11.4 million or 3.1%, primarily as a
result of favorable volume, rate, and mix changes. Dry pet sales decreased $9.1 million or 9.6%, mostly
related to decreased volume, coupled with lower price. Pet treats sales increased $17.1 million mostly
related to higher volumes.
Cost of sales was $440.7 million in fiscal 2014 compared to $420.3 million in fiscal 2013, an increase
of $20.3 million, or 4.8%. Approximately $60.1 million of the increase was a result of higher volumes,
partially offset by price-related cost decreases of $34.6 million.
Protein Segment: Net sales were $104.3 million for fiscal 2014 compared to $107.7 million for the
same period in 2013, a decrease of $3.4 million or 3.2%. Cost of sales for fiscal 2014 decreased by
$2.8 million or 3.2% compared to fiscal 2013 due to a decrease in sale volume, offset by higher conversion
and raw material costs.

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Liquidity and Capital Resources
Our cash needs for working capital, capital expenditures, and growth opportunities are expected to be
met with current cash on hand, cash flows provided by operating activities, leases, or available borrowings.
Based on our current expectations, we believe our liquidity and capital resources will be sufficient to
operate our business. However, we may take advantage of opportunities to generate additional liquidity or
refinance existing debt through capital market transactions. The amount, nature, and timing of any capital
market transactions will depend on: (i) our operating performance and other circumstances; (ii) our then-
current commitments and obligations; (iii) the amount, nature, and timing of our capital requirements;
(iv) any limitations imposed by our current credit arrangements; and (v) overall market conditions.
As of July 1, 2017, we had $6.7 million in cash and cash equivalents. Our working capital, defined as
total current assets, excluding cash and cash equivalents, less total current liabilities, excluding the current
portion of long-term debt and notes payable, on July 1, 2017 was $312.2 million compared to
$303.9 million on December 31, 2016. Working capital increased primarily due to an increase in finished
good inventory versus the comparative period.
Our principal sources of liquidity include cash from operations and borrowings under our revolving
credit facility. On August 11, 2017, we entered into our Fifth Amended and Restated Credit Agreement,
which extends our senior secured credit facilities until August 11, 2022 (subject to the refinancing of our
outstanding 2021 Notes upon consummation of the sale of the notes offered hereby). This facility consists
of a $275 million asset-based revolving credit facility. Availability under the senior secured revolving credit
facility is subject to a borrowing base calculation, generally based upon a percentage of eligible accounts
receivable, inventories, and fixed assets. As of August 31, 2017, we had $191.8 million available under our
senior secured revolving credit facility. Obligations under the credit facility are secured by a first priority
lien on substantially all of our and our domestic subsidiaries’ assets, subject to certain exceptions and
permitted liens. Obligations under the Canadian subfacility are guaranteed by our Canadian subsidiaries
but the Canadian subsidiaries are not guarantors of any U.S. obligations under the facility. See “Description
of Other Indebtedness.”
We have elected S Corporation status for federal and state income tax purposes. Accordingly, our
income, deductions and credits flow through to our shareholders annually and income is taxed at the
shareholder level. Cash flows provided by (used in) financing activities may include certain contributions
from and distributions to shareholders related to the tax planning and income tax liabilities of our
shareholders.

Six Months Ended July 1, 2017 versus Six Months Ended July 2, 2016
Cash flow provided (used) by operations for the first six months of fiscal 2017 was $110.6 million
compared to $125.0 million for the same period in 2016. This increase is primarily due to elevated levels of
our finished goods inventory.
Cash flow provided (used) by investing activities for the first six months of fiscal 2017 was
($103.1) million compared to ($94.8) million for the same period in 2016. Incremental spending is
consistent with capital requirements associated with our growth initiatives.
Cash flow provided (used) by financing activities for the first six months of fiscal 2017 was
($4.1) million compared to ($29.3) million for the same period in 2016. This decrease is due to less
borrowing to fund capital expenditures.

Fiscal Year 2016 versus Fiscal Year 2015

Cash flow provided (used) by operations for fiscal 2016 was $93.9 million compared to $48.4 million
for the same period in 2015. Higher cash flow from operations was primarily due to increased profits,
coupled with growth in accrued expenses.

52
 Cash flow provided (used) by investing activities for fiscal 2016 was ($57.2) million compared to
($58.3) million for the same period in 2015. Our capital expenditures during these two periods were
$60.1 million and $61.4 million, respectively.
Cash flow provided (used) by financing activities during fiscal 2016 was ($42.0) million compared to
$13.8 million for the same period in 2015.

Fiscal Year 2015 versus Fiscal Year 2014

Cash flow provided (used) by operations for fiscal 2015 was $48.4 million compared to ($8.7) million
for the same period in 2014. Higher cash flow from operations was primarily due to improved results in our
pet food segment and better inventory management in our poultry and pet food segments.
Cash flow provided (used) by investing activities for fiscal 2015 was ($58.3) million compared to
($55.8) million for the same period in 2014. Our capital expenditures during these two periods were
$61.4 million and $55.9 million, respectively.
Cash flow provided (used) by financing activities during fiscal 2015 was $13.8 million compared to
$63.4 million for the same period in 2014. Lower cash flow from financing activities is primarily due to the
fact that we didn’t finance any shareholder distributions in 2015, whereas, in 2014 a portion of our bond
issuance proceeds was used to finance a distribution to our shareholders.

Contractual Obligations
We enter into various contractual obligations for varying terms and amounts in the ordinary course of
business. The table below summarizes our non-cancelable contractual obligations as of July 1, 2017, and
our best estimate of the fiscal period in which such obligations will be settled:

Payments due by Fiscal Period

Total 2017 2018 2019 2020 2021 Thereafter
($ in thousands)
Long-Term Debt(1) . . . . . . . . . . . . . . 480,539 — 65,539 — — 415,000 —
Interest on Long-Term Debt(2) . . . . 150,011 17,321 34,647 32,681 32,681 32,681 —
Operating Leases(3) . . . . . . . . . . . . . 38,451 6,955 10,442 8,865 6,550 3,216 2,423
Purchase Obligations(4) . . . . . . . . . . 135,984 124,481 11,137 366 — — —
Total . . . . . . . . . . . . . . . . . . . . . . . . . . 804,985 148,757 121,765 41,912 39,231 450,897 2,423

(1) Long-term debt payments are based on our long-term debt obligations when they are contractually
due.
(2) Interest payments on our long-term debt are based upon our interest rates in effect on such debt as of
July 1, 2017.
(3) We lease processing and other manufacturing equipment, warehouse space, trucks and trailers under
non-cancelable operating leases with varying maturities.
(4) Purchase obligations consist of feed grain, feed ingredients, packaging supplies, and aluminum. These
commitments are designed to assure sources of supply for our normal requirements.

Quantitative and Qualitative Disclosures about Market Risk

Market risk relating to our operations results primarily from changes in commodity prices and interest
rates. To address certain of these risks, we may engage in hedging activities with respect to our purchases
of feed grain products through the advance purchase of corn and soybean meal based upon our expected
utilization over the next year. These hedging activities, undertaken in an effort to minimize the risks
associated with severe price fluctuations that periodically occur for these commodities, are considered to be
a hedge against changes in the amount of future cash flows related to commodity procurement.

53
Commodity Price Risks
We are a purchaser of certain commodities, primarily corn and soybean meal, for use in manufacturing
feed for chickens. As a result, our earnings are affected by changes in the price and availability of such feed
ingredients. Feed grains are subject to volatile price changes caused by factors described below that include
weather, size of harvest, transportation and storage costs, and the agricultural policies of the United States
and foreign governments. The price fluctuations of feed grains have a direct and material effect on our
profitability. We estimate that every $0.10 change per bushel in corn prices impacts our profitability by
$2.4 million and every $10.00 change per ton in soybean meal impacts our profitability by $2.5 million on
an annual basis.
Generally, we purchase feed ingredients for deferred delivery from one month to six months after the
time of purchase. We sometimes purchase our feed ingredients for prompt delivery to our feed mills at
market prices at the time of such purchases. The grain purchases are made directly with our usual grain
suppliers, which are companies in the regular business of supplying grain to end users, and do not involve
options to purchase. Such purchases occur when senior management concludes that market factors indicate
that prices at the time the grain is needed are likely to be higher than current prices, or where, based on
current and expected market prices for our poultry products, management believes we can purchase feed
ingredients at prices that will allow us to earn a reasonable return for our shareholders. Market factors
considered by management in determining whether or not, and to what extent, to buy grain for deferred
delivery include:
• current market prices;
• current and predicted weather patterns in the United States and other feed grain producing
countries, as such weather patterns might affect the planting, growing, harvesting, and yield of feed
grains;
• the expected size of the harvest of feed grains in the United States and grain producing areas around
the world as reported by governmental and private sources;
• current and expected changes to the agricultural policies of the United States and foreign
governments;
• the relative strength of U.S. currency and expected changes therein as it might impact the ability of
foreign countries to buy U.S. feed grain commodities;
• the current and expected volumes of export of feed grain commodities as reported by governmental
and private sources;
• the current and expected use of available feed grains for uses other than as livestock feed grains
(such as the use of corn for production of ethanol, which use is impacted by the price of crude oil);
and
• current and projected market prices for our poultry and pet food products.
We may engage in hedging activities with respect to our purchases of feed grain products through the
advance purchase of corn and soybean meal based upon the expected utilization over the next year. These
hedging activities, undertaken in an effort to minimize the risks associated with severe price fluctuations
that periodically occur for these commodities, are considered to be a hedge against changes in the amount
of future cash flows related to commodity procurement.
The cost of feed grains is recognized in cost of sales, on a first-in, first-out basis, at the same time that
the sales of the chickens that consume the feed grains are recognized.

Interest Rate Risks

Our policy is to manage interest rate risk through use of a combination of variable and fixed rate debt
instruments. We do not utilize interest rate swap agreements or any other derivatives for trading purposes.

54
Our variable rate debt bears interest at LIBOR or the bank’s index rate, plus the applicable margin. As of
July 1, 2017, we estimate that a 1% change in the prevailing variable interest rate would impact our related
annualized earnings by approximately $0.7 million.

Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with U.S. GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of revenue and expenses during the reporting period, as well
as related disclosures of contingent assets and liabilities. Actual results could differ from these estimates
and assumptions, which differences could be material. Our significant accounting policies are summarized
in Note 1 to our consolidated financial statements included in this offering memorandum. Our critical
accounting policies noted below are those accounting policies that are important to the portrayal of our
financial position and results of operation and that require the more difficult, subjective and/or complex
judgments by management regarding estimates about inherently uncertain matters.
Accounts Receivable: We record accounts receivable at net realizable value. This value includes an
appropriate allowance for estimated amounts that we believe may not be collected. In addition, we have
established a general reserve for potential uncollectible accounts based on historical bad debts. Past due
status is determined based upon contractual terms. Amounts are written off when collection attempts on the
accounts have been exhausted. We use significant judgment in estimating uncollectible amounts. In
estimating uncollectible amounts, we consider factors such as current overall economic conditions,
industry-specific economic conditions, historical customer performance and anticipated customer
performance. While we believe our processes effectively address our exposure to doubtful accounts,
changes in economic, industry, or specific customer conditions may require adjustment to the allowance
recorded by us.
Inventories: Processed poultry inventories (finished products) are stated at the lower of cost (first-in,
first-out method) or market. Live poultry for processing is valued at the total cost accumulated on the flock
as of the end of the fiscal year. Accumulated costs include chick cost, feed, supplies, and other costs related
to individual flocks. Inventories of breeder and laying flocks are valued at the accumulated cost when the
flock entered production less accumulated amortization. Grain inventories, supplies, and other materials
are stated at lower of cost (first-in, first-out method) or market.
Pet food inventories are stated at the lower of cost (first-in, first-out method) or market. Pet food
inventories include the costs directly attributable to the acquisition of raw materials, direct labor, variable
production costs, and systematic allocation of fixed production overhead incurred, based on normal
production capacities.
Property, Plant, and Equipment: Property, plant, and equipment are stated at cost less accumulated
depreciation. Depreciation is primarily calculated by the straight-line method, using estimated useful lives
for Land Improvements of 15 to 20 years; Buildings of 15 to 30 years; Machinery and Equipment of 3 to
10 years; and Other Equipment and Improvements of 3 to 10 years. Major repairs and maintenance costs
that significantly extend the useful life of the related assets are capitalized. Normal repairs and
maintenance costs are expensed as incurred.
Goodwill and other Intangible Assets: Goodwill is reviewed at least annually for impairment by
assessing qualitative factors to determine whether the existence of events or circumstances leads to a
determination that it is more likely than not that the fair value of a reporting unit is less than its carrying
amount. After assessing the totality of events or circumstances, if we determine it is more likely than not
that the fair value of a reporting unit is less than its carrying amount, then we perform additional
quantitative tests to determine the magnitude of any impairment. Our management’s analysis indicated no
impairment of goodwill existed at December 31, 2016 or January 2, 2016.

55
 Long-Lived Assets: Long-lived assets are evaluated for impairment whenever events or changes in
circumstances indicate the carrying value may not be recoverable. When evaluating long-lived assets for
impairment, we compare the carrying value of the asset to the asset’s estimated undiscounted future cash
flows. If the estimated future cash flows are less than the carrying value of the asset, then impairment is
recorded for the difference between the estimated future cash flows and the carrying value of the asset. For
long-lived assets held for sale, we compare the carrying value of the disposal group to fair value. The
impairment is the excess of the carrying value over the fair value of the long-lived asset. Based on
management’s assessments, no significant impairment was recognized during the fiscal years ended
December 31, 2016, January 2, 2016, or December 27, 2014.
Revenue Recognition: We recognize revenue when the risk of loss is transferred to customers, which
is generally upon delivery based upon terms of sale. Revenue is recognized as the net amount estimated to
be received after deducting estimated amounts for discounts, trade allowances and product terms.
Accrued Self Insurance: Insurance expense for workers’ compensation benefits and employee-
related health care benefits are estimated using historical experience and actuarial estimates. Stop-loss
coverage is maintained with third party insurers to limit our total exposure. We regularly review the
assumptions used to recognize periodic expenses. If historical experience proves not to be a good indicator
of future history, there could be a significant increase (or decrease) in the cost of sales depending on
whether these expenses increased or decreased, respectively.
Contingencies: We are involved in various claims and litigation incidental to our business. Although
the outcomes of these matters cannot be determined with certainty, management is of the opinion that the
final outcomes should not have a material effect on our combined results of operation or financial position.

Recent Accounting Pronouncements

See Note 1 to our combined financial statements included in this offering memorandum for a
discussion of recent accounting pronouncements.

56
 BUSINESS

General
We are one of the leading vertically integrated poultry processors and the largest private label wet pet
food producer in the United States and Canada. Our company was founded in 1949 and is privately held,
with headquarters in Siloam Springs, Arkansas and operations in Arkansas, Oklahoma, Missouri, Kansas,
New Jersey and Ontario, Canada. We operate in three primary business segments: (i) Poultry, (ii) Pet Food
and (iii) Protein.
Our integrated Poultry segment consists of hatching egg production, hatching, feed production,
raising chicks to marketable age (“grow-out”) primarily via contract growers, processing, further
processing, marketing and transportation of chicken. We produce a wide range of value-added, frozen,
refrigerated and fresh chicken products targeted primarily to foodservice and retail customers, where the
vast majority of our products are sold under private label. We sell our poultry products to the foodservice
industry for end use primarily by national and regional chain restaurants and to the retail industry,
primarily the mass merchandiser and warehouse club store channels. Within our Pet Food segment, we
produce wet and dry pet food for dogs and cats and pet treats for dogs. We sell our pet food products to
grocery store chains, dollar and discount stores, farm and feed stores, mass merchandisers, club store
retailers, e-commerce retailers, and pet specialty stores for their private label products and to a limited
number of pet food brand owners on a contract manufacturing basis. We believe that we are a top three
supplier of private label wet pet food to Wal-Mart for its Ol’ Roy brand pet food, a leading pet food brand in
the United States. We have supplied wet pet food to Wal-Mart for over 30 years, and in early 2010 we
began producing private label dry pet food for Wal-Mart. We have now expanded that customer base to
multiple customers. We intend to continue to expand our pet food product portfolio to sell more products to
our existing customers and to help us attract new customers. Our Protein segment is in the business of
converting, or rendering, raw material by-products of protein processing operations into prime feed
ingredient products for the pet food, aquaculture, and livestock markets. Our feed ingredient products
include poultry meal, feather meal, poultry fat and wet pet food ingredients.

Our Poultry Segment

Our poultry operations constitute our largest business segment. We are a vertically integrated poultry
processing company engaged in the production, marketing and distribution of fully cooked, ready to cook
breaded, frozen and fresh chicken products. We supply primarily private label and proprietary products to
our customers, with the exception of limited direct retail items sold under the Simmons® brand. We sell our
products to the foodservice industry for end use by restaurants, including quick service restaurants and
casual dining restaurants, such as Chick-fil-A, KFC and Taco Bell, and to the retail industry, primarily the
mass merchandiser and warehouse club stores, such as Wal-Mart and Sam’s Club. A small portion of our
revenue each year (generally less than 10%) is derived from exports of commodity chicken products to
international markets, including Africa, Mexico, Iraq and 51 other countries. Over the years, we have grown
as the result of expanding markets, increased market penetration and various acquisitions of farming
operations and poultry processors. As a vertically integrated company, we control all phases of the
production of our products. We believe this vertical integration has allowed us to be one of the leading
producers of chicken products in North America. During 2016, we processed approximately 203.8 million
chickens, or approximately 3.9 million chickens per week. Through Simmons Energy, we distribute
approximately 4.7 million gallons of propane gas per year to commercial and residential customers in
Oklahoma, Arkansas and Missouri, with approximately 90% of our sales being to poultry farm operators.
Over the past decade, we have focused our growth efforts on increasing our sales of historically higher-
value prepared chicken products. Our sales efforts of these products have primarily been focused on chain
restaurants, retail mass merchandisers and warehouse club stores, where we supply these customers with
their private label and proprietary chicken products.

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 We are committed to customer relationships and to supplying our customers with the highest quality
private label products. We utilize specific sales teams established for our specific customers. Each customer
sales team is composed of sales, marketing and research and development professionals and is designed to
focus on the specific needs of each of our customer partners. Because we concentrate our efforts on specific
customer markets, we believe we can more effectively deploy all of our resources around the specific needs
of our customers and become the premier provider for their chicken products and related services. Our
service goal is to deliver innovative business solutions that are superior to competitive offerings with a
quicker turnaround for the customer. Our services include product development (driven by our consumer-
insights research), menu strategy and concept development, cost improvement strategies, category
management, supply chain solutions and market, product and industry research.
Our customer service has resulted in our receipt of recognition and awards from our customers,
including, among others, 2016 Chick-fil-A Supplier of the Year, 2016 Cheddar’s Supplier of the Year, 2016
BJs Brewery Supplier of the Year, 2015 Raising Cane’s Supplier of the Year, 2015 Red Robin Supplier of the
Year, 2015 Taco Bell Star Award for Innovation, and 2015 KFC Star Award for Quality.

Chicken Industry Overview

The U.S. chicken industry is the world’s largest producer and second largest exporter of chicken. The
U.S. chicken industry has grown for the last ten years at a compounded annual growth rate of 1.4%, from
35.5 billion pounds of chicken produced in 2006 to 40.7 billion pounds produced in 2016. This growth
resulted from increasing domestic and international per capita consumption of chicken and population
growth. The USDA states that per capita consumption of chicken in the United States grew from 80 pounds
in 2009 to 91 pounds in 2016. From 2006 to 2016, annual per capita consumption of chicken in the
United States grew at a compounded annual growth rate of 0.5%, while annual per capita consumption of
beef declined at a compound rate of 1.5% and annual per capita consumption of pork increased 0.2%. Per
capita consumption of chicken in the United States surpassed that of pork in 1986 and that of beef in 1994.
We believe these favorable trends will continue over the long-term due to consumers’ continued awareness
of the health benefits, convenience, cost advantages and versatility of chicken.
We expect several favorable trends that the chicken industry has experienced over the last several
years to continue. These include increasing consumer demand for high-quality chicken products in the
United States and globally, as well as consolidation within the U.S. chicken industry. Since 2008, head
count for small and medium size birds has declined, and increasing average bird weights has led to
production growth. Higher bird weights and consolidation within the industry have both been driven by a
desire for enhanced cost efficiencies. In lieu of capacity increases, many integrated processors responded to
growth expectations by increasing bird weight and subsequently pound throughput; thereby gaining
advantages through better overhead absorption and reduced labor cost per processed pound. This has
come during a time of intense customer food cost pressure and resistance to higher shelf and menu pricing
in the current economy. Pressure has also come from intensifying environmental, food safety, labor and
other regulations governing the chicken industry. However, given the reality of tight family food budgets,
we believe demand will remain robust for our products vis-à-vis competing proteins.
The chicken industry has two major customer categories or markets: foodservice and retail. The
majority of our U.S. chicken sales are derived from products sold to the foodservice market. Foodservice
customers principally include chain and independent restaurants, the emerging food preparation
operations of retailers (e.g., service deli, ‘grocerants’, c-stores), distributors and certain other institutions
located throughout the continental United States. The retail market consists primarily of grocery store
chains, wholesale clubs and other retail distributors. According to the USDA, between 1980 to 2014,
consumer spending through food away from home channels (i.e., foodservice) grew from 39% to 50% of total
food spending. Foodservice sales, defined as consumer food-away-from-home expenditures, continue to
demonstrate growth, increasing approximately 4.9% and 5.0% in 2015 and 2016, respectively, according to
the National Restaurant Association. Furthermore, this growth trend is estimated to continue with
forecasted growth of 4.3% in 2017.

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Chicken Products
Because of the U.S. market preference for white chicken meat, our primary product focus in domestic
markets is prepared chicken parts that come from the front half of the chicken, such as boneless skinless
chicken breast, chicken tenders and wings. The majority of our wings are sold disjointed as party wings. We
also market products from the back half of the chicken such as portioned and/or marinated legs, drums and
thighs for the domestic markets and leg quarters for the export markets.

Prepared Chicken
Our chicken parts are processed into a wide selection of value-added prepared chicken products such
as portion controlled boneless skinless fillets, tenderloins and breast strips, chicken wings, chicken
nuggets, chicken patties, boneless wings and bone-in chicken parts. These products are sold either
refrigerated or frozen and may be fully cooked, partially cooked or raw. In addition, these products are
breaded or non-breaded and either pre-marinated or non-marinated.
Boneless skinless chicken breast and tenders can be portioned to tight customer specifications through
a variety of cutting, slicing, dicing and scaling options. All parts can be value-added by adding marinade,
sauces, glazes and/or breading. We have grill-marking and other specialty equipment to add to the visual
appeal and taste of products. All of our chicken products can be partially fried, commonly referred to as “par
fried,” or fully cooked in fryers, steamers or specialty ovens before being individually frozen. Packaging
options include bulk packs, bags or cartons. Our in-house graphics design, pre-press, and vendor sourcing
capabilities allow us to provide turnkey retail and foodservice packaging solutions.
We establish prices for our prepared chicken products based primarily upon perceived value to the
customer, production costs and prices of competing products. The majority of these products are sold
pursuant to agreements with varying terms that either set a fixed price for the products or set a price
according to formulas based on an underlying commodity market, subject in many cases to minimum and
maximum prices. Many times, these prices are dependent upon the customer’s location, volume, product
specifications and other factors.

Export
Our export products consist of chicken parts, primarily sold in leg quarter form for distribution to
export markets. These exports have historically been characterized by lower prices and greater price
volatility than our more value-added product lines. However, with increasing access to international
markets and a weakening U.S. dollar, leg quarter price levels have strengthened over the last 12 months
while keeping U.S. processors competitive on world markets.

Poultry Production and Processing

We are a vertically integrated producer of fresh and frozen chicken products, controlling the
production of hatching eggs, hatching, feed manufacturing, grow-out, processing and packaging of our
product lines.

Breeding and Hatching

We maintain our own breeder flocks for the production of hatching eggs. Our breeder flocks are
acquired as one-day old chicks (known as pullets) from primary breeding companies that specialize in the
production of genetically designed breeder stock. As of July 1, 2017, we maintained contracts with
25 pullet farm operators for the grow-out of pullets (growing the pullet to the point at which it is capable of
egg production, which takes approximately six months). Thereafter, the mature breeder flocks are
transported by us to independent breeder farms. As of July 1, 2017, we maintained contracts with
approximately 80 breeder farm operators. Eggs produced at these breeder farms are transported by us to
one of our company-owned hatcheries.

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 We own four hatcheries (three of which are currently being operated) located in Arkansas and Missouri
where eggs are incubated, vaccinated and hatched in a process generally requiring 21 days. The chicks are
vaccinated against common poultry diseases and are transported by us to independent contract grow-out
farms. As of July 1, 2017, our hatcheries were capable of producing an aggregate of approximately
4.4 million broiler chicks per week.

Grow-out
We placed our broiler chicks on approximately 224 grow-out farms as of July 1, 2017, located in
Arkansas, Missouri and Oklahoma, where broilers are grown to an age of approximately six to eight weeks.
These farms provide us with sufficient housing capacity for our operations and are typically family-owned
farms operated under contract with us. While a majority of the grow-out farms are independently owned,
approximately 12% of our aggregate grow-out inventory of broiler chicks is maintained on farms owned by
parties related to us and that we manage. The independent farm owners provide facilities, utilities and
labor, and we supply the day-old chicks, feed and veterinary and technical services. We own the chicks and
the feed at all times. The farms are closely monitored by our staff of service technicians who provide regular
routine and as needed visits to monitor flock health and growth and ensure compliance with our best
practices. Our independent farm owners are compensated pursuant to an incentive formula designed to
promote production cost efficiency.
In response to changing market demand and evolving key customer supplier partner expectations
(triggered by aggressive animal activist pressure), we are ramping up and will begin offering two programs
of antimicrobial/antibiotic usage: (i) No Antibiotics Ever (NAE); and (ii) No Antibiotics Important to
Human Medicine (NHA) during 2018.
Animal Welfare has become a global area of concern for the food industry. We have long made our
responsibility for stewardship of the animals in our care a key guiding principle for the people at every level
of our company and our grower partners. We continue to monitor evolving animal welfare guidelines and to
work to optimize bird health, maintaining a standard for quality of care, nutrition, and housing for our
flocks that is best in class because it is the right thing to do.

Feed Mills
An important factor in the grow-out of chickens is the rate at which chickens convert feed into body
weight, commonly known as the conversion rate. We purchase on the open market the primary feed
ingredients, including corn and soybean meal, which have historically been the largest cost components of
our total feed costs. The quality and composition of the feed are critical to the conversion rate, and,
accordingly, we formulate and produce our own feed. We have the capacity to produce approximately
1.4 million tons of finished feed annually from our feed mill facilities, which satisfies our current
requirements.
Feed grains, including corn and soybean meal, are commodities which can be subject to volatile price
changes caused by weather, size of harvest, transportation and storage costs, demand and the agricultural
and energy policies of the United States and foreign governments. Generally, we purchase our corn and
other feed supplies at current prices from suppliers. Feed grains are available from an adequate number of
sources. Although we have not experienced, and do not anticipate problems in securing adequate supplies
of feed grains, price fluctuations of feed grains can have a direct and material effect upon our profitability.
To address these risks, we engage in certain commodity risk management activities in which we use
derivative financial instruments, primarily futures and options, to reduce the effect of changing commodity
input prices and as a mechanism to procure the underlying commodity. However, we cannot eliminate the
potentially adverse effect of grain price increases.

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 Processing
Once the broilers reach processing weight, they are transported to one of our processing plants. These
plants generally use modern, highly automated equipment to process and package the chickens.

First Processing
We have two first processing plants, or slaughter facilities, both of which run two shifts, five days per
week. Our flagship plant in Southwest City, Missouri, currently processes approximately 2.2 million
chickens per week, representing approximately 57% of the total chickens we process.
Most of the chickens will be split into front and back halves in the first processing plants, while a small
percentage of chickens processed in our Decatur, Arkansas facility will be processed and sold as rotisserie
chickens to retail and foodservice customers. The majority of the back half of the chicken is prepared for
international sales, usually in the form of leg quarters. The front half is deboned and used as raw material
by the further processing plants. Breast frames are used in the production of mechanically separated
chicken (a primary raw material for hot dog and bologna manufacturers) and wet pet food for use by our Pet
Food segment. Other by-products from our first processing operations are sold to our Pet Food and Protein
segments.
On September 27, 2017, we announced our plans to build a new poultry processing plant in Benton
County, Arkansas, which plant would replace our existing processing plant in Decatur, Arkansas, which is
nearing the end of its economic life. See “Offering Memorandum Summary — Recent Developments —
Announcement of New Poultry Processing Plant.”

Further Processing
The majority of our further processing operations are performed at our main further processing plant
in Van Buren, Arkansas and at our further processing plant in Siloam Springs, Arkansas. These plants are
capable of producing a wide variety of prepared chicken products such as portion-controlled boneless
skinless filets, tenderloins and breast strips, chicken wings, chicken nuggets, chicken patties, boneless
wings and bone-in chicken parts. The Van Buren cook plant operates various production lines preparing
items such as grilled filets (whole muscle or shaped and formed), sauced wings, breaded and formed items
and fajita strip type products. All production lines have marinating and glazing options, and two production
lines have saucing and breading capabilities. Finished products are packaged in bags or cartons. In 2016,
we opened a further processing operation in Fort Smith, Arkansas, which is capable of producing portion-
controlled boneless skinless fillets and chicken nuggets. Finished products are packaged in bags.

Research and Development

We conduct research and development activities to develop new chicken products and to improve
existing chicken products and production processes. Our in-house research and product development
group includes a full-time staff of eight senior level food scientists, three regulatory compliance specialists,
two innovation chefs and six additional food scientists. Our research and development personnel, together
with members of the customer sales and marketing teams, work directly with our customers in developing
their products, which we believe helps promote long-term customer relationships. Our research and
development activities are an integral component of our customer service focused strategy to expand our
private label business and sales to the prepared foods market, as customers continue to place greater
importance on value-added services which we provide.
Working in conjunction with the resources of our Marketing and Consumer Insights teams, on-going
menu/product innovation and tailored development work is guided by market trends assessment, menu
gap analysis, and understanding of emerging consumer and operational needs.
Our research and development department also assists us in achieving operational efficiencies in our
processing activities. Our research and development department ensures that we utilize leading advanced

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processing technologies, which enables us to better meet our customers’ needs for product innovation and
development, consistent quality and cost efficiency. We believe our product innovation and development
experience and capabilities are competitive strengths that distinguish us in the private label and custom
development markets.

Logistics and Distribution

We utilize a third party logistics company to operate a finished goods distribution center, which is
owned by Snowwis Cold Storage, LLC and is connected to our cook plant in Van Buren, Arkansas. We also
utilize public warehousing as needed for overflow inventory and shipping needs. We operate an in-house
truck fleet primarily for internal transfer of work in process. Contract carriers deliver the majority of our
internal transfer of feed and chicks and our finished product volume to external customers.

Markets for Our Chicken Products

Foodservice
The foodservice market principally consists of chain restaurants, food processors, broad-line
distributors and certain other institutions located throughout the United States. Our foodservice team
markets custom formulated chicken items directly to many of the largest restaurant chains in the United
States. Our primary customer targets are quick service and casual dining restaurant customers. We
generally rely on our restaurant customers to “pull” their products through foodservice distributors. Two
notable exceptions to that approach are Sysco and Gordon Foodservice, where we also provide products for
the private label programs of each of these distributors, in addition to providing support to their
distribution of our custom formulated products sold to our restaurant end-user customers.
We believe we are positioned to be the primary or secondary supplier partner to national and select
international chain restaurants that require multiple suppliers of chicken products. Additionally, we believe
we are well positioned to be the sole supplier for many regional chain restaurants. Regional chain
restaurants can often offer better margin opportunities for producers like us and a more diverse base of
business than most national chain restaurants.
We believe we have operational strengths in terms of full-line product capabilities, high-volume
production capacities, research and development expertise and extensive distribution and marketing
experience relative to smaller and non-vertically integrated producers.
Over the last five years, our sales to the foodservice market have grown at an average annual rate of
approximately 9.4%. We attribute this growth in sales of prepared chicken to the foodservice market to a
number of factors:
• sales team aggressive new business development activity, new products, and organic growth with
existing customer partners;
• there has been continued growth in the number of foodservice operators offering chicken on their
menus and in the number of chicken items offered; and
• foodservice operators are increasingly purchasing prepared chicken products, which allow them to
reduce labor costs while providing greater product consistency, quality and variety across all
restaurant locations.
There is a strong need among larger foodservice companies for a limited-source supplier base in the
prepared chicken market. A viable supplier must be able to ensure supply, demonstrate innovation and new
product development and provide competitive pricing. We have been successful in our objective of
becoming a supplier of choice by being the primary or secondary prepared chicken supplier to many large
foodservice companies due to the following key factors:
• we are vertically integrated, giving us control over our supply of chicken and chicken parts;

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 • our further processing facilities, with a wide range of capabilities, are particularly well-suited to the
high-volume production, as well as low-volume custom production runs, necessary to meet both the
capacity and quality requirements of the foodservice market;
• we have established a reputation for dependable quality, highly responsive service and excellent
technical support; and
• we are a leader in utilizing advanced processing technology, which enables us to better meet our
customers’ needs for product innovation, consistent quality and cost efficiency.
As a result of the experience and reputation we have developed with our larger customers, we have
increasingly become the principal supplier to mid-sized foodservice organizations. Our in-house product
development group follows a customer-driven research and development focus designed to develop new
products to meet customers’ changing needs. Our research and development personnel often work directly
with these customers developing products for their specific needs.

Retail
The retail market consists primarily of warehouse club stores, mass merchandisers, traditional grocery
store chains, limited assortment grocery, and other retail distributors. Our retail team markets custom
formulated products or private label items directly to warehouse club stores, mass merchandisers, larger
grocery chains and contract manufacture customers. Over the last five years, our sales to the retail market
have grown at an average annual rate of approximately 6.7%.

International
Historically, we have targeted international markets to generate additional demand for our dark
chicken meat, which is a natural by-product of our U.S. operations given our concentration on prepared
chicken products and the U.S. customers’ general preference for white chicken meat. Chicken leg quarters
represent our largest volume item sold in the international market. We export our products to major
markets around the globe including Africa, Mexico and Iraq. We have also begun selling further processed
chicken products for export to the international divisions of our U.S. chain restaurant customers. Although
our volume in pounds is high, international sales usually comprise less than 17% of our total poultry sales.
We believe that U.S. chicken exports will continue to grow as worldwide demand increases for high-grade,
low-cost meat protein sources.

Commodity
Our excess processed chicken parts generated in the production of products for our foodservice and
retail customers are sold fresh through the commodity sales channel by supply chain management and
commodity brokers. Most of these commodity sales are based upon certain weekly or monthly market
prices reported by the USDA and other public price reporting services, plus a markup, which is dependent
upon the customer’s location, volume, product specifications and other factors. We believe our practices
with respect to sales of fresh chicken are generally consistent with those of our competitors. The majority of
these products are sold pursuant to agreements with varying terms that either set a fixed price for the
products or set a price according to formulas based on an underlying commodity market, subject in many
cases to minimum and maximum prices.

Customers
We have a diversified customer base, with our chicken products being sold to numerous end users in
the foodservice and retail markets. In the foodservice market, our major customer end users are primarily
comprised of quick service and casual dining restaurants, such as Chick-fil-A, KFC, Taco Bell and Pizza
Hut (which are owned by Yum! Brands, Inc.), Chili’s (which is owned by Brinker International, Inc.), and
Applebee’s (owned by DineEquity, Inc.), among others. The majority of our sales to foodservice end-user

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customers are through foodservice distributors as specified in our contracts with such end users. In the
retail market, our private label customers include: (i) mass merchandisers, such as Wal-Mart;
(ii) warehouse club stores, such as Sam’s Club; and (iii) grocery chains, such as Kroger and Aldi. We also
provide contract manufactured products for national brand food companies, such as H.J. Heinz and
Schwan’s.

Competition
We are subject to significant competition in all of the markets in which our Poultry segment competes.
We compete principally with other national and regional vertically integrated chicken processors. Some of
our competitors in the poultry industry possess significantly greater financial and marketing resources than
we do. In general, the competitive factors in the U.S. chicken industry vary across the major markets. In the
foodservice market, we believe competition is based on consistent quality, product development, customer
service and price. In the retail market, we believe competition is based on product quality, customer
support services and price. Our Poultry segment also competes indirectly with other protein producers,
including producers of beef, pork and fish. Any changes in the relative prices of, and perceived value in,
these foods and/or in consumer preference may alter consumer buying patterns and the requirements of
our chicken customers.

Seasonality
The demand for our chicken products generally is greatest during the consumer grilling season in the
spring and summer months and lowest during the fourth quarter when retail customers allocate additional
freezer case space to turkeys in connection with the holiday seasons.

Our Pet Food Segment

We believe we are one of the five largest pet food producers in the United States and Canada and the
largest private label wet pet food producer in the United States and Canada. We began producing wet pet
food in 1964, dry pet food in 2010 and pet treats in 2013.
Our pet food sales are categorized into two product market areas: (i) private label and (ii) contract
manufacturing. Private label customers primarily include mass merchandisers, grocery chains, e-commerce
retailers, farm and feed companies and pet specialty stores. Private label accounts include customers such
as Wal-Mart, Dollar General, Tractor Supply, Kroger, Publix and numerous others. We also maintain
certain proprietary brands, such as Twin Pet®, Strongheart®, Bolo™ and Healthy By Design®, which we sell to
retailers that are either too small or do not wish to maintain their own private label programs. Select
contract manufacturing customers include Blue Buffalo and Wellpet for whom we believe we produce and
package either all or a significant portion of their wet pet food products.
Our wet pet food product segment serves the value, national brand equivalent and premium/super
premium markets. We manufacture wet pet food products for both the cat and dog food markets, with a
greater portion of volume derived from dog food. These products are available in the form of cuts in gravy,
slices in gravy, ground, pâté or loaf depending on our customer’s preference.
In early 2010, we began producing dry pet food for Wal-Mart, an existing wet pet food customer. Since
that time, we have secured additional private label and select contract manufacturing customers as part of
our targeted business model for this segment. As a result of this growth, current customer demand is
nearing our manufacturing capacity, causing us to consider installing an additional line.
In November 2012, we sold our can manufacturing machinery and equipment assets to Crown Cork &
Seal USA, Inc. (“Crown”). In connection with our sale of the can manufacturing assets to Crown, Simmons
Pet Food and its subsidiaries Simmons Pet Food ON, Inc., Simmons Pet Food NJ, Inc. and Simmons Pet
Food KS, Inc. entered into a supply agreement with Crown for cans and ends (the “Supply Agreement”).

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Concurrently with the execution of the Supply Agreement, Crown paid us a signing fee of $25.0 million,
which amount is “at risk” to repayment to Crown. In the event we fail to issue orders for the delivery of the
minimum threshold of container sets specified in the Supply Agreement during any calendar year,
beginning with 2014 through and including 2023, we are obligated to pay Crown ten percent of the signing
fee, or $2.5 million. We will recognize income related to the signing fee ratably ($2.5 million per year) over
the life of the Supply Agreement when it is earned and no longer at risk for repayment. In 2014, 2015 and
2016 we purchased more than the minimum thresholds of container sets and recognized $2.5 million in
each year.
In December 2012, we announced the restructuring of our wet pet food production facility in Siloam
Springs, Arkansas, to manufacture pet treats. We completed the conversion of the facility to a pet treats
production facility and began production at the end of 2013. We entered into a multi-year contract with an
anchor customer who committed to the majority of our pet treat plant capacity.

Pet Food Industry Overview

Pet food (in this industry overview, pet food means dog food and cat food) is sold through various
distribution channels, including supermarkets, mass merchandisers, pet specialty retailers, online e-
commerce retailers, dollar and discount stores, farm and feed stores, veterinarians and kennels. We
currently participate in the U.S. and Canadian dry and wet pet food markets. According to Euromonitor, in
2016, retail sales of pet food in the United States were approximately $28.6 billion, an increase of 3.6%
compared to 2015 sales of $27.6 billion. From 2012 to 2016, U.S. pet food industry sales increased at a
compounded annual growth rate of 3.8%.

U.S. Pet Food Market

The wet pet food market in the United States was approximately $6.6 billion and $6.9 billion in sales in
2015 and 2016, respectively; and the dry pet food market in the United States was approximately $16.5
billion and $16.9 billion in 2015 and 2016, respectively, according to Euromonitor. Of the total U.S. retail
sales in 2016, private label dog and cat food comprised approximately 11.0% and 6.0%, respectively.
We expect that continued growth in pet food sales in our markets will be primarily driven by (i) an
increasing pet population, (ii) a continuing customer shift toward premium products and (iii) higher prices
due to rising costs for raw and packaging materials and increasing costs of production. According to
Euromonitor, there were 69.2 million dogs and 74.7 million cats in the United States in 2016. This
represented a decrease of 1.0% in the dog population and a 0.7% increase in the cat population from 2015.
Furthermore, the pet population is expected to grow at an average annual rate of 3.9% from 2017 to 2022
according to IBIS World.
Over the last ten years, the pet food market has seen the introduction of an increasing number of
products that represent premium product alternatives to traditional pet food choices, including food keyed
to the age-stages of pets, low-calorie foods, organic foods, foods that discourage certain ailments and
nutraceutical products (foods or naturally occurring food supplements believed to have beneficial health
effects for animals). We believe we have benefited from this trend through the introduction of premium
products by our respective private label and contract manufacturing customers seeking to capitalize on
these trends in the pet food market.

U.S. Pet Food Market Segments

The pet food market is generally broken down into three product segments: wet, dry and treats &
mixers. Each of these segments has a great diversity of offerings with respect to product and packaging
formats. Dry pet food is the largest segment of the U.S. market, accounting for approximately 59% of sales
in 2016, according to Euromonitor. Wet pet food is the second largest segment of the U.S. market,
accounting for approximately 24% of sales, and treats & mixers is the smallest segment with 17% of sales.

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 Dry Products Segment — Dry pet food was estimated to account for approximately $16.9 billion of total
pet food sales in the United States in 2016, an increase of 2.3% over 2015 sales of $16.5 billion. Dry pet food
is generally available in a number of formats, including kibbles, meal and expanded particles. We began
producing dry pet food in early 2010.
Wet Products Segment — Wet pet food was estimated to account for approximately $6.9 billion of total
pet food sales in the United States in 2016, an increase of 4.2% over 2015 sales of approximately $6.6
billion. Wet pet food is sold in cans (aluminum and steel), pouches, trays and cups. We have participated in
this segment for over 50 years.
Treats & Mixers Segment — The treats & mixers segment of pet food was estimated to account for
approximately $4.9 billion of total pet food sales in the United States in 2016, an increase of 7.7% over 2015
sales of $4.5 billion. Treats include meat, biscuit, cereal, fish or yeast-based products. Treats are those
products marketed and fed not as a pet’s primary meal but as a reward or indulgence. We began
manufacturing pet treats for dogs (primarily the chicken jerky style products) in late 2013.
Market data for the United States, as reported by Euromonitor for 2016, also segments the specific
retail distribution channels for the sale of pet food products into the following three segments:
Pet Specialty Store Channel. The Pet specialty/superstores remained the single largest distribution
channel for dog food, accounting for a value share of 27% in 2016 – up from only 19% in 2003. There is
strong specialty brand presence in these stores, and they offer premium pet food products generally not
available in other channels.
E-Commerce. Despite this strong track record of growth, the shift to e-commerce caused pet
superstores to lose share in 2016 and 2017 (projected). Internet retailing’s value share of dog food is
expected to be 5% in 2017 – up from only 2% in 2014 – leaving bricks and mortar pet stores to seriously
examine how to combat the growing threat of online sales. Some independent pet stores, for instance, work
with dog food manufacturers like Champion Petfoods and WellPet LLC to institute Minimum Resale Price
(MRP) policies that prevent online retailers from undercutting stores on price. Even so, online retailers offer
most of the same specialty brands as pet shops or superstores with the added convenience of home delivery
and recurring order programs. By 2016, what was once a small nuisance for pet specialists had become a
significant threat, evidenced by PetSmart’s acquisition of online Chewy.com for USD3.35 billion in April
2017.
All Other Channels. The non-grocery retailers (such as farm and feed stores) and veterinary/kennel
channels comprise the majority of the all other segment of the distribution channels of pet food products.

Products and Services

Our current wet pet food products consist of cat and dog food, with the greater portion of our volume
coming from dog food. These products are available in the form of cuts in gravy, slices in gravy, ground,
pâté, or loaf depending on each customer’s preference. Our dry pet food products are also primarily geared
towards dog food because the dog food market is significantly larger than the market for cat food.
Currently, all of our pet treat products are made for the dog food market.
We also provide our customers with comprehensive pet food category management services designed
to expand each customer’s pet food product lines and improve the category’s profitability. Category
management services include: (i) product development and testing; (ii) packaging design services; and
(iii) pricing, formulation and marketing strategy in connection with its customers’ store brand programs.
Our store brand program involves the formulation and supply of a wide variety of high quality pet food
products, including wet and dry food. We believe that these products are comparable in quality to
competing branded pet food products, except they may be sold by our customers at a lower price and result
in a higher margin for our customers. For our national branded customers, we manufacture wet and dry pet
food to meet those customers’ specifications and quality standards. We own the formula for our private
label products and for most of our contract manufactured products.

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 We produce approximately 3,156 stock keeping units, or SKUs, made up of over 1,825 formulas. Our
wet pet food is sold in aluminum and steel cans (with sizes ranging from three to 22 ounces), pouches, tubs
and cups.

Research and Development

We continuously strive to develop new pet food products and manufacturing techniques, while
improving existing methods, materials and processes. Our research and development department for the
Pet Food segment includes a full-time staff of 16 food technologists involved in product development,
seven engineers or equipment experts assigned to develop new processes and/or plant process
improvement and two in general management and project coordination for research and development. Our
research and development team, which is housed in multiple locations favorable to primary product or
plant assignment, formulates new recipes (comprised of raw materials, vitamins and minerals) and tests the
nutritional content of new products based on requirements of both the customer as well as certain
regulatory bodies such as the Association of American Feed Control Officials to whom the FDA has
delegated certain powers to govern the nutritional and labeling requirements for pet foods. We also use
independent, USDA licensed and inspected commercial kennels and catteries for comparison taste tests
with national branded products in order to achieve comparable digestibility and palatability and to
substantiate the nutritional claims of new products.

Quality Assurance, Government Affairs & Nutrition

We maintain a comprehensive program for qualifying new suppliers, testing raw materials for
nutritional adequacy and screening to detect the presence of bacteria and other harmful substances. With
respect to raw materials, those which are deemed to represent a potential food safety threat are subject to
positive release where analyses are conducted and reviewed by internal experts prior to entering inventory
available for production. We also have a cross-functional Raw Material and Supplier Steering Committee
staffed with technical experts to manage the qualification of new raw materials and suppliers. This includes
nutritionists, microbiologists and regulatory experts, as well as representatives of purchasing, operations
and research and development. The wet pet food industry has had a strong history utilizing Hazard
Analysis and Critical Control Points (HACCP) principles in the production process and the heat
sterilization processes have been subject to such control from a regulatory standpoint. The enactment of the
Food Safety and Modernization Act regulations will extend use of these principles to all pet food segments
and additionally add radiological hazards to the list of hazards to consider. We also continuously verify the
effectiveness of raw material and process monitoring through extensive finished product testing against
specifications, formula and regulatory requirements. Packaging is inspected for print quality, proper
dimensions, construction and compliance with labeling regulations. Our formulation, Enterprise Resource
Planning and quality programs are all integrated with each other to minimize the opportunity for errors in
transition. Additionally, to improve accuracy we have initiated a program with several of our external
analytical laboratories to transfer information directly to our quality system with no human intervention.
We use bar coding and scanning on finished goods and are in the process of implementing a similar
program with respect to raw materials to enhance traceability speed and accuracy where raw materials are
in question. Wherever possible we substitute document manuals with actual information on our computer
systems used for raw material receiving, production or quality information input. This includes approved
suppliers, process control points and finished product specifications. Our finished product release
documents are self-generated from our Quality Statistical Process Control System. Our diverse set of
customers has also challenged us to adopt flexible quality programs to allow for product export, organic
production and GM-free production as well as Marine Stewardship Council certification. This involves
combinations of raw material handling, sanitation and process adjustments. Our technical resources
involve a full complement of skills including food science, engineering, regulatory affairs, nutrition,
microbiology and thermal process authorities in house to ensure the development of products that are safe
and effective (quality by design). We believe our affiliation with and in-depth understanding of the food
production chain provides us with certain perspectives that have historically enabled us to better

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respond to an increasingly scrutinized pet food manufacturing industry. In addition, we believe our systems
and affiliations place us in a leadership position in the industry and make us an attractive manufacturing
partner. In addition to a member on the senior leadership team, total staffing includes nine (9) in
Government Affairs, three (3) in Nutrition and seventy-five (75) in Quality Assurance including ten (10) in
the corporate quality assurance group and the balance in plant quality assurance group which reports in to
corporate quality.

Sales and Distribution

Our direct sales force works with existing and prospective mass merchandiser, warehouse club store,
farm and feed store, pet specialty store and grocery chain customers as well as e-commerce companies and
brand owners. This team also uses independent food brokers, though generally only at the request of
certain retailers with whom there is an existing in-house brokerage team. Our goal is to generate new
business, in part, through the expansion of our product lines and the development of new marketing
programs to existing customers. Additional business expansion may come through the form of
participation in periodic competitive bidding situations and/or unsolicited activity either on our part or the
part of a potential customer. As our capabilities and our reputation for innovation and quality have grown,
so have the number of unsolicited inquiries we have received from potential customers who have expressed
an interest in having us either develop their products or begin the production of existing product lines.
The majority of our products are distributed utilizing our customers’ transportation networks. Several
of our largest customers utilize us as a just-in-time supplier and maintain trailers at our distribution facility,
which allows these customers to have a product order filled and placed on their trailers for transportation to
their target destination immediately following placing a product order with us. For customers that do not
utilize their own transportation fleet or arrange third-party carriers, we provide transportation on a contract
basis through common carriers. The only transportation equipment we own and operate is used solely to
shuttle product between our manufacturing facilities and our primary distribution centers.

Raw Materials and Packaging

Raw materials and packaging requirements vary between our wet pet food, dry pet food and treats
products. Our primary production ingredients for wet pet food are meat, chicken, fish and associated by-
products, cereals, nutrients, steel and aluminum cans and other packaging materials. We have developed
long-term relationships with our major suppliers to achieve optimum quality and cost. As a result of our
being a vertically integrated poultry producer, we are able to procure chicken and chicken by-product
ingredients from our Poultry segment operations.
The principal raw materials required for our dry manufacturing operations, which we purchase from
large national commodity companies and local grain cooperatives, are bulk commodity grains, including
corn, soybean meal, wheat middlings, poultry by-product meal, meat and bone meal, and corn gluten meal.
Certain of our raw material inputs are occasionally purchased from internal supply. We generally purchase
raw materials from one to 12 months in advance. While we do not maintain long-term contracts with any of
our ingredient suppliers, we believe alternative suppliers are readily available. Prices for these commodities
are generally tied to national commodities markets or are indirectly priced on the basis of their nutritional
components versus their commercially traded alternatives such as soybean meal.
Our major dry pet food customers and a significant number of wet pet food customers have agreed to
accept ingredients and packaging on a cost pass-through basis, which further insulates us from commodity
price risk. Our geographic location, along with our co-location with other Poultry facilities, offers
significant and sustainable advantages in the delivery of inbound materials. Whereas many other dry pet
food facilities are only able to receive ingredients in truckloads, our corn and soybean meal are generally
delivered by rail car, which typically offers significantly lower costs per ton.

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Customers
We manufactured pet food products for over 131 customers in fiscal 2016. Private label customers in
the United States include: (i) mass merchandisers, such as Wal-Mart and Dollar General; (ii) grocery
chains, such as Kroger and Aldi; (iii) farm and feed stores, such as Tractor Supply Company; (iv) targeted
pet specialty stores, such as PetSmart; and (v) e-commerce retails, such as Chewy.com. In addition, we
manufacture products for many of the largest national branded pet food companies in the United States.
Our contract manufacturing customers include some of the top branded pet food companies in the world,
for whom we produce and package either all or a major portion of their products. Contract manufactured
customers include Blue Buffalo and Wellpet.
Our wet pet food sales are distributed between contract manufactured and private label. For the six
months ended July 1, 2017, our wet pet food sales mix was approximately 54% contract manufactured and
46% private label.
We began making dry pet food in early 2010 for Wal-Mart. Since our commencement of dry pet food
operations, we have secured additional customers. Our customer demand is nearing our current dry pet
food manufacturing capacity. As a result, we are considering installing an additional line in our second dry
pet food plant in Decatur, Arkansas.
We have entered into a multi-year contract with a national branded pet food producer for pet treats
which accounts for a majority of our pet treat plant capacity. Additionally, we have secured new customers
for our treats business, causing us to add additional shifts to this operation.

Competition
The pet food industry is highly competitive. Our store brand pet food products compete for shelf space
with national branded pet food products on the basis of quality, product safety, flexible service and price.
We believe we generally compare favorably with our competitors with respect to each of these factors.
Certain national branded companies also manufacture store brands. National branded products
compete principally through advertising to create brand awareness and loyalty. We experience some price
competition from national branded products. Significant price competition from national branded products
or considerably increased store brand presence by the national branded manufacturers could adversely
affect our operating results and cash flows. We also compete with regional branded manufacturers and
other regional store brand manufacturers. The companies that produce and market the major national
branded pet foods are national or international consumer packaged goods companies that are substantially
larger than we are and possess significantly greater financial and marketing resources than we have.
We differentiate our company from the national branded pet food manufacturers by offering
comparable, lower-priced products tailored to our retail customers’ needs. This provides our retail
customers with the opportunity to increase their pet food category profitability and provides a destination
purchase item in this important consumer category. In addition, we believe we differentiate our company
from other store brand pet food manufacturers by offering higher quality products with national production
and distribution capabilities.

Seasonality
Sales of our pet food products experience modest seasonality. We typically experience an increase in sales
volume during the first and fourth quarters of each year, as dogs increase consumption in cooler weather.

Our Protein Segment

Through Simmons Feed Ingredients, we are in the business of converting, or rendering, raw material
by-products into prime feed ingredient products for the pet food, aquaculture, and livestock markets. Our
feed ingredient products include poultry meal products, feather meal, poultry fat and wet pet food

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ingredients. Applications for our feed ingredients include, among others, enhancing animal and poultry
diets, providing a source of high energy and improved palatability in large and small animal feed
formulations and providing a raw material input for pet food and treats. Our customers in the animal feed
industry include pet food manufacturers and suppliers who aggregate feed ingredients to produce animal
feed products for the sale or use in other animal feed markets, such as the dairy, beef, pork, poultry and
aquaculture markets. As a result of the growth in population increasing the demand for animal products
(such as meat, milk and eggs) and the growth in the pet population, there has been a significant increase in
the demand for feed ingredient sources that can be used in animal feed.
Over the past decade the animal feed industry has experienced increasing constraints with respect to
the supply of raw material. Currently, we collect and process all of the raw material generated from our
Poultry segment and collect and process substantially all of the poultry raw material available from other
poultry processors within a 250 mile radius of our Southwest City, Missouri feed ingredients facility. Our
feed ingredients plant operations provide a valuable service to our poultry processing suppliers by
providing a lower cost outlet for their raw material by-products. Our use of such raw material by-products
removes the need and cost to dispose of such by-products in landfills or by other methods that may create a
strain on existing space or facilities or pose potential environmental risks.

Industry Overview
The USDA Livestock Slaughter estimates that approximately 9 billion chickens, 232 million turkeys,
116 million hogs, 29 million cattle, 28 million ducks, and 2 million sheep and lambs are slaughtered and
processed in the United States annually. According to the National Chicken Council and National Turkey
Federation the United States is the largest producer of poultry products in the world. Poultry, when
processed into edible meat, results in the generation of raw material by-products that include offal, fat,
skin, bones, feathers, blood and other miscellaneous parts. These raw material by-products comprise
approximately 37% of live chicken weight and approximately 36% of live turkey weight. Rendering is a
heating process that extracts usable ingredients from the poultry raw material by-products, such as poultry
meals and fats that are valuable ingredients in the pet food and animal feed industries. The pet food and
other animal feed industries are highly dependent upon the rendering industry for the supply of animal-
based protein and fat ingredients in order to meet the demand for pet food and other animal feed products.

Products
Our finished products include: (i) poultry meals; (ii) feather meal; (iii) poultry fat; (iv) wet pet food
ingredients; and (v) pet food palatability products.
• Poultry Meals. Our poultry meals are a high quality protein source for supplying needed amino
acids and energy used in animal feeds. Poultry meals contain approximately 60% to 65% protein and
12% to 15% fat. We produce several poultry meals, including poultry by-product meal, chicken by-
product meal, turkey by-product meal and turkey meal. We produce both feed grade and pet grade
products, with our pet grade products being classified by the ash content of such products.
Generally, low ash product is considered pet grade and is sold in the pet food markets and higher
ash product is considered feed grade and is sold in the cattle and pork markets. Our poultry meal
products are sold to pet food manufacturers and to customers in the dairy, beef, pork, poultry and
aquaculture feed markets.
• Feather Meal. Our hydrolyzed feather meal is a highly digestible natural protein source for most
animal diets. It can be used to replace a significant portion of other animal and plant protein sources
for the animal feed industry. Our feather meal is sold to customers in the dairy, beef and pork feed
markets.
• Poultry Fat. Our poultry fat is produced under stringent guidelines developed by us to ensure it
meets the exacting standards of the animal feed industry. Chicken fat is a desirable ingredient and
has a flavor that is preferred over most other dietetic energy sources. Rendered poultry fat competes

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 with other fat sources (including beef tallow, choice white pork fat and vegetable oils) in digestibility
and overall contribution of metabolizable energy to the diet. Our poultry fat is sold to pet food
manufacturers and to customers in the dairy, beef, pork and poultry feed markets.
• Wet Pet Food Ingredients. We produce proprietary and tailored meat ingredients for pet food
manufacturers. Through our industry leading blending capabilities, we can manufacture products
that contain any combination of the following: (i) multi-species (including chicken, beef, lamb, pork,
duck, salmon, white fish, rabbit as well as other exotic species); (ii) multi-temperature (frozen at
32°F, fresh/refrigerated at 42°F, and shelf-stable meat at 72°F); (iii) multi-bone (including bone
out, emulsification, and course grind); and (iv) shelf stable product manufacturing.
• Pet Food Palatability Products. We also manufacture a line of pet food palatability products to
enhance the initial attraction to, and the consumption of, dry pet foods.
We also produce Pro*Cal, a proprietary product manufactured from multiple by-product streams at our
Southwest City, Missouri facility. Pro*Cal is a unique high protein, high fat, powdered feed supplement
used as a supplemental additive in animal feed to meet dietary protein and energy requirements. The
product is supplement for a variety of animals. Pro*Cal is currently sold primarily to the dairy feed market,
and customers include Land O’Lakes Purina Feed and other suppliers of dairy feed products.

Processing Operations
Our Southwest City, Missouri feed ingredients facility is one of the largest rendering facilities in the
United States. Our feed ingredients plant manufactures high-quality ingredients for livestock and poultry
feeds as well as for premium pet foods. In 2016, our plant processed over 1 billion pounds of raw material.
We create finished poultry meals and fat products primarily through the separating, cooking, drying
and further processing of our various raw materials. We utilize a continuous batch cooking process that
cooks the poultry meat by-products to extract water. These by-products are then processed by expeller
presses to separate animal tissue (meat/protein) and oils (fat). Finally, shaker screens remove any excess
foreign materials, such as bone chips, and the separated fat is centrifuged and refined.
Feather meal is also manufactured at our plant. Feathers are pressed to extract the excess moisture,
then processed through continuous hydrolyzers under pressure and heat, and finally dried, ground and
screened to produce the high protein feather meal.
In 2017, we commissioned a new wet protein manufacturing facility in Siloam Springs, Arkansas. The
72,000-square-foot ingredient facility produces fresh, frozen and shelf stable meat ingredients for pet food
manufacturers. The facility features unprecedented sourcing traceability, proprietary processes and
innovative food safety systems, and industry leading blending capability to produce the highest quality,
customizable ingredients for our customers’ products.

Quality Control
Quality control at our protein facility consists of testing, processing and formulations. Ongoing staff
training, strict traffic control, biosecurity and rigid quality assurance programs are designed to allow us to
provide customers with consistent high-quality products that are safe and free of contaminants. Our animal
feed ingredients are subject to FDA and state agency oversight with respect to labeling accuracy, and our
feed ingredients plant is subject to inspection by federal and state regulatory agencies.

Raw Materials
We collect and process all of the raw material by-products generated by our Poultry segment and all
available poultry raw material from approximately ten other processing locations within a 250 mile radius
of our feed ingredients facility. Our Poultry segment supplies approximately 33% of the raw material
processed by us, with the remaining 67% supplied from other processing companies.

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 We collect raw materials from our suppliers in open top dump trailers and closed tankers and transport
them to our plant. The type and frequency of service is determined by specific supplier requirements, the
volume of raw material generated, supplier location and weather, among other factors. Raw material is
delivered to our plant for processing within two to four hours of collection to deter spoilage.

Sales and Distribution

We sell our finished product nationally. Feed ingredient sales are primarily managed through our sales
organization in Southwest City, Missouri. Our sales force is in contact with customers daily and coordinates
the sale and assists in the distribution of all finished products produced at our plants.
We monitor market conditions and prices for our finished products. When market conditions or prices
significantly change, we evaluate and respond accordingly to such change. A number of our customers
purchase our products under formula-based pricing, whereby the indexing of the finished product price to
raw material cost effectively fixes the gross margin on finished product sales and provides protection from
price fluctuations.
Our finished products are shipped from our plant primarily by contract carriers and our internal fleet.
We maintain adequate inventory levels to meet the demand and satisfy the requirements of our customers.

Customers
We sell our feed ingredient products on a nationwide basis to numerous customers in the pet food
manufacturing industry and in other animal feed industries, including livestock and poultry feed. Our
major pet food manufacturing customers include national brand manufacturers such as Blue Buffalo, Mars
Pet Care and Nestle Purina.

Competition
The feed ingredient business is highly competitive, and we face competition from national, regional
and local suppliers of rendered feed ingredients. Many of our competitors are larger than we are and
possess significantly greater financial and marketing resources than we have. Factors that influence
competition, markets and the prices that we receive for our finished products include the following:
(i) product quality; (ii) demand for feed ingredient products; (iii) rate of animal feed consumption; and
(iv) export conditions.

Significant Customers
Sales representing approximately 10%, 10% and 10% of our company-wide total net sales for fiscal 2015
and 2016 and the six months ended July 1, 2017, respectively, were to one customer, Wal-Mart Stores, Inc.,
a distributor whose purchases were made on behalf of a number of our customer end users primarily in the
foodservice market.

Trademarks
Certain of our brands are protected by trademark registrations in the United States. We believe our
registered trademarks are adequate to protect such brand names.

Regulation and Environmental Matters

Our poultry and pet food operations are subject to government regulation, particularly in the health
and environmental areas. The manufacturing and marketing of our products are subject to health regulation
by federal regulatory agencies, including OSHA, the FDA and the USDA, and by various state and local
authorities. The FDA inspects our feed mills and regulates the labeling of our products. Our chicken
processing plants are subject to continuous on-site inspection by the USDA. Substantial administrative,
civil and criminal penalties may be imposed for violations of OSHA, FDA and USDA regulations, and

72
violations may be restrained through injunction proceedings. We procure and maintain the necessary
permits and licenses to operate our facilities and consider our company to be in material compliance with
applicable OSHA, FDA and USDA requirements.
We are also subject to a broad range of federal, state and local environmental laws and regulations,
including those governing discharges into the air, soil and water, the storage of petroleum substances and
chemicals, the handling and disposal of solid or hazardous wastes and other regulated materials, and the
investigation or remediation of contamination associated with releases of wastes or hazardous substances
either on or emanating from our facilities or at third-party locations where we have sent waste for disposal.
Violations of or liability under these laws and regulations may result in significant administrative, civil or
criminal penalties being levied against us, private lawsuits by affected parties, permit revocation or
modification, performance of environmental investigatory or remedial activities, as well as, in certain
instances, the issuance of injunctions or orders that may limit or prohibit our operations or that may require
us to spend money on additional pollution control equipment. Environmental laws and regulations have
changed substantially over the years, and we believe the trend of more strict and expansive environmental
laws and regulations will continue. We believe we are in material compliance with all applicable
environmental laws and regulations.
Our operations are also subject to the federal Clean Water Act, as amended, and analogous state laws
relating to the discharge of pollutants into state and federal waters. These laws also regulate the discharge
of stormwater in process areas. Local sewerage authorities have established regulations governing
connections to and discharges into their sewer systems and treatment plants. Pursuant to these laws and
regulations, we are required to obtain and maintain approvals or permits at a number of our facilities for the
discharge of our wastewater and stormwater. We operate full and pre-treatment wastewater treatment
facilities at certain of our processing plants. We are required, from time to time, to make capital
improvements or make operational upgrades at certain of our facilities to assure compliance with regulatory
and permit conditions, including requirements to meet more stringent discharge standards, relating to our
wastewaters discharged offsite as well as our other operating activities. Failure to comply with these laws,
regulations and permit conditions may result in the imposition of significant administrative, civil and
criminal penalties. We believe that our operations are in substantial compliance with the Clean Water Act
and analogous state and local requirements.
Our operations are also subject to federal, state and local requirements pertaining to air emissions. We
have been required from time to time to install air emission control or odor control devices to satisfy
applicable air requirements. It is possible that in the future, additional air emission or odor control devices
may be required to be installed at facilities of ours as deemed necessary to satisfy existing or future
requirements.
We believe our operations are in compliance in all material respects with applicable current
environmental, safety and public health laws and regulations; however, those laws and regulations are
subject to significant change in the future and we may incur significant costs in the future to comply with
those laws and regulations or in connection with the effect of these matters on our business.

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Properties
Our principal operating facilities are as follows:

No. of
Operating Facility Facilities Location (City, State) Total Square Feet
Corporate Headquarters: . . . . . . . . . . . . . . 1 Siloam Springs, AR 44,072
Poultry Business:
Processing plants(1) . . . . . . . . . . . . . . . . . 3 Siloam Springs, AR 55,313
Decatur, AR 128,510
Southwest City, MO 139,650
Further processing plants . . . . . . . . . . . . . 3 Siloam Springs, AR 73,324
Van Buren, AR 112,871
Ft. Smith, AR 20,571
Cook plant . . . . . . . . . . . . . . . . . . . . . . . . . 1 Van Buren, AR 107,111
Hatcheries . . . . . . . . . . . . . . . . . . . . . . . . . 4 Siloam Springs, AR 58,298
Decatur, AR (2 hatcheries) 61,393
Jane, MO 95,822
Live production offices . . . . . . . . . . . . . . . 1 Decatur, AR 9,240
Feed Mills . . . . . . . . . . . . . . . . . . . . . . . . . 2 Decatur, AR 36,811
Fairland, OK 37,637
Propane distribution facilities . . . . . . . . . 4 Decatur, AR n/a
Jay, OK n/a
Fairland, OK n/a
Southwest City, MO n/a
Truck shop . . . . . . . . . . . . . . . . . . . . . . . . . 1 Decatur, AR n/a
Pet Food Business:
Wet Pet Food Manufacturing Plant . . . . . . . 3 Emporia, KS 480,266
Pennsauken, NJ 199,985
Mississauga, Ontario 131,976
Dry Pet Food Manufacturing Plant . . . . . . . 2 Decatur, AR 89,265
Pet Treats Manufacturing Plant . . . . . . . . . . 1 Siloam Springs, AR 168,984
Warehouses . . . . . . . . . . . . . . . . . . . . . . . . . 6 Siloam Springs, AR(2) 237,940
Siloam Springs, AR 26,569
Fort Gibson, OK 126,740
Mississauga, Ontario(2) 72,000
Emporia, KS 155,046
Pennsauken, NJ 185,881
Protein Business:
Feed ingredients plants . . . . . . . . . . . . . . . . 2 Southwest City, MO 74,034
Wet protein manufacturing plant . . . . . . . . 1 Siloam Springs, AR 72,000

(1) These plants also have the ability to conduct some further processing including debone, portion,
marinate, glaze, and individually freeze deboned or boned-in chicken into finished products.
(2) These facilities are leased.
All of our owned properties, other than those located in flood zones and propane distribution facilities,
are or will be encumbered by mortgages to collateralize our senior secured credit facility and the notes.

Employees
As of July 1, 2017, we had approximately 5,658 employees in the United States and approximately 216
employees in Canada. Approximately 161 of our employees located in Pennsauken, New Jersey, are

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covered by a collective bargaining agreement. The collective bargaining agreement covering our unionized
employees in Pennsauken, New Jersey expires on March 31, 2018. We expect to commence negotiations
on a new collective bargaining agreement following our 2017 fiscal year end. We consider relations with
our employees to be satisfactory.

Legal Proceedings
On September 2, 2016, Maplevale Farms, Inc. filed a putative antitrust class action lawsuit against 14
vertically-integrated broiler chicken producers, including Simmons Foods, Inc. Collectively, the defendants
are alleged to control 90% of the wholesale broiler market. In its complaint, Maplevale Farms alleges that
(1) all of the defendants conspired to reduce the supply of broilers in order to fix artificially high prices in
violation of the Sherman Antitrust Act, and (2) that certain of the defendants conspired to inflate broiler
pricing that was reported to the Georgia Department of Agriculture for its Georgia Dock price index.
Simmons Foods, Inc. is not alleged to have participated in the Georgia Dock price index matter. The
lawsuit was filed in the United States District Court for the Northern District of Illinois. In the days and
weeks that followed, a number of similar complaints were filed in the same jurisdiction alleging similar
antitrust violations (both state and federal claims). For pre-trial purposes, the court has consolidated the
complaints into actions on behalf of three different putative classes (such classes have not yet been certified
by the court and motions and rulings regarding class certification will not take place until after the court has
made a ruling on the defendants’ motions to dismiss described below) consisting of (1) direct purchaser
plaintiffs, (2) commercial and institutional indirect purchaser plaintiffs, and (3) consumer and end-user
indirect purchaser plaintiffs. These actions have been consolidated as In Re: Broiler Chicken Antitrust
Litigation, Case No. 1:16-cv-08637, in the United States District Court for the Northern District of Illinois.
Only limited discovery has been conducted to date. The defendants filed motions to dismiss in January
2017 and are awaiting a ruling on such motions.
On June 19, 2005, the Attorney General and the Secretary of the Environment of the State of
Oklahoma filed a complaint in the U.S. District Court for the Northern District of Oklahoma against
Simmons Foods and six other poultry integrators. This complaint was subsequently amended. As amended,
the complaint asserts a number of state and federal causes of action including, but not limited to, counts
under the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), the
Resource Conservation and Recovery Act (“RCRA”), and state-law public nuisance theories. The amended
complaint asserts that the defendants and certain contract growers who are not named in the amended
complaint polluted the surface waters, groundwater and associated drinking water supplies of the Illinois
River Watershed (“IRW”) through the land application of poultry litter. Oklahoma asserts that this alleged
pollution has also caused extensive injury to the environment (including soils and sediments) of the IRW
and that the defendants have been unjustly enriched. Oklahoma’s claims cover the entire IRW, which
encompasses more than one million acres of land and the natural resources (including lakes and waterways)
contained therein. Oklahoma seeks wide-ranging relief, including injunctive relief, compensatory damages
in excess of $800 million and unspecified punitive damages and attorneys’ fees. We and the other
defendants have denied liability, asserted various defenses and filed a third-party complaint that asserts
claims against other persons and entities whose activities may have contributed to the pollution alleged in
the amended complaint. The district court has stayed proceedings on the third party complaint pending
resolution of Oklahoma’s claims against the defendants. On October 31, 2008, the defendants filed a
motion to dismiss for failure to join the Cherokee Nation as a required party or, in the alternative, for
judgment as a matter of law based on the plaintiffs’ lack of standing. This motion was granted in part and
denied in part on July 22, 2009. In its ruling, the district court granted several defense motions, including
summary judgment with respect to the CERCLA claim and claim for monetary damages, but denied the
motion with respect to the claims for injunctive relief. On September 2, 2009, the Cherokee Nation filed a
motion to intervene in the lawsuit. The Cherokee Nation’s motion to intervene was denied by the district
court on September 15, 2009, and the district court’s decision was affirmed on appeal by the U.S. Court of
Appeals for the Tenth Circuit on September 21, 2010. The trial began in September 2009 and continued
through January 2010. The district court granted defense mid-trial motions on the RCRA and nuisance per

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se claims. The district court held closing arguments on February 18, 2010, and has not rendered a decision
as of the date of this offering memorandum.
We are also a party to a number of other legal proceedings in the ordinary course of business. Some of
these proceedings are covered in whole or in part by insurance. Although the outcome of such proceedings
cannot be determined with certainty, we believe that none of these proceedings will result in a material
adverse effect on our business, financial condition or results of operations.

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 MANAGEMENT
Set forth below is information concerning our directors and executive officers:
Name Age Position
Mark C. Simmons . . . . 70 Director, Chairman — Simmons Foods, Simmons Prepared Foods,
Simmons Pet Food, Simmons Feed Ingredients, and Simmons Energy
M. Todd Simmons . . . . 44 Director, Co-Vice Chairman and Chief Executive Officer, — Simmons
Foods, Simmons Prepared Foods, Simmons Pet Food, Simmons Feed
Ingredients, and Simmons Energy
Sarah L. Simmons . . . . 41 Director and Co-Vice Chairman — Simmons Foods, Simmons Prepared
Foods, Simmons Pet Food, Simmons Feed Ingredients, and Simmons
Energy
David G. Jackson . . . . 48 President and Chief Operating Officer — Simmons Foods and Simmons
Prepared Foods
Jason A. Godsey . . . . . 43 President and Chief Operating Officer — Simmons Pet Food
Jeffrey D. Webster . . . 55 President and Chief Operating Officer — Simmons Feed Ingredients
Mark A. Wiens . . . . . . 53 Executive Vice President, Chief Financial Officer and Corporate
Secretary — Simmons Foods, Simmons Prepared Foods, Simmons Pet
Food, Simmons Feed Ingredients, and Simmons Energy
Jerry D. Laster . . . . . . . 60 Executive Vice President and Chief Strategy Officer — Simmons Foods,
Simmons Prepared Foods, Simmons Pet Food, Simmons Feed
Ingredients, and Simmons Energy
Daniel T. Houston . . . . 53 Executive Vice President and Chief Human Resource Officer — Simmons
Foods, Simmons Prepared Foods, Simmons Pet Food, Simmons Feed
Ingredients, and Simmons Energy
Kerry L. Hairston, I . . . 49 Vice President of Finance and Treasurer — Simmons Foods, Simmons
Prepared Foods, Simmons Pet Food, Simmons Feed Ingredients, and
Simmons Energy
Brian T. Dietrich . . . . . 42 Vice President of Finance & Accounting — Simmons Foods, Simmons
Prepared Foods, Simmons Pet Food, Simmons Feed Ingredients, and
Simmons Energy
Mark C. Simmons has served as Chairman of the Board of Directors of Simmons Foods since 1987. He
is the son of M.H. “Bill” Simmons, the founder of Simmons Foods, and the father of M. Todd Simmons and
Sarah L. Simmons. Mr. Simmons has been with Simmons Foods since 1968, having served in various
capacities, including President from 1974 to 2002. Mr. Simmons also has served as a director of Simmons
Prepared Foods, Simmons Pet Food, Simmons Feed Ingredients, and Simmons Energy since each entity’s
organization. He served as the chairman of the National Broiler Council (now National Chicken Council) in
1997 and has also served as the president of the Arkansas Poultry Federation earning the organization’s
“Man of the Year” in 1990. Mr. Simmons received a bachelor of business administration degree from the
University of Arkansas.
M. Todd Simmons serves as a director and Chief Executive Officer of Simmons Foods, Simmons
Prepared Foods, Simmons Pet Food, Simmons Feed Ingredients, and Simmons Energy. Mr. Simmons
joined Simmons Foods in 1990 and has worked in various capacities of increasing responsibility. He has

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served as a director of Simmons Prepared Foods, Simmons Pet Food, Simmons Feed Ingredients, and
Simmons Energy since each entity’s organization. Mr. Simmons serves on the board of directors for
Signature Bank of Arkansas and is a past board member of the National Chicken Council, the U.S.
Poultry & Egg Association, The Poultry Federation (which represents Arkansas, Oklahoma and Missouri)
and the Pet Food Institute. He attended Georgetown University where he earned a bachelor of science
degree in business management. He is the son of Mark C. Simmons and brother of Sarah L. Simmons.
Sarah L. Simmons serves as a director of Simmons Foods, Simmons Prepared Foods, Simmons Pet
Food, Simmons Feed Ingredients and Simmons Energy. Ms. Simmons joined Simmons Foods in 1993 and
currently manages various investments associated with Simmons Foods. She has served in various
capacities, including a number of sales, marketing and management positions within the company.
Ms. Simmons is the daughter of Mark C. Simmons and is the sister of M. Todd Simmons. She earned a
bachelor of science degree in international studies from Southern Methodist University.
David G. Jackson has served as President and Chief Operation Officer of Simmons Foods and
Simmons Prepared Foods since October 2016. Mr. Jackson joined Simmons in 1991 and has over 25 years
of poultry and pet food experience. From March 2014 through October 2016, Mr. Jackson served as
President and Chief Operating Officer of Simmons Pet Food. From 2012 through March 2014, Mr. Jackson
served as President of Simmons Wet Pet Food division. From 2007 through 2011, Mr. Jackson served as
President of Simmons Prepared Foods. Mr. Jackson served nine years as a director of Siloam Springs
Memorial Hospital until its sale in 2009. Mr. Jackson received a bachelor of science degree in
administrative management from the University of Arkansas and a master of business administration
degree from the University of Texas at Austin.
Jason A. Godsey serves as President and Chief Operating Officer of Simmons Pet Food. Mr. Godsey
joined Simmons in 1998 and has over 18 years of poultry and pet food experience. From 2015 until his
appointment as President of Simmons Pet Food in October 2016, he served as Senior Vice President of
Simmons Pet Food. From 2007 through 2011, Mr. Godsey served as Vice President of Simmons Prepared
Foods. Mr. Godsey received a bachelor of science degree in agriculture and a master of science degree in
agricultural economics from the University of Arkansas.
Jeffrey D. Webster serves as President and Chief Operating Officer of Simmons Feed Ingredients. He
joined Simmons in June 2014. Prior to joining Simmons, Mr. Webster had served since September 2012 as
Chief Operating Officer of Sapphire Energy, Inc., a privately-held biotech company focused on creating
crude oil and animal feed products from algae. From 2004 to 2011, Mr. Webster was employed by Tyson
Foods, Inc., last serving as Group Vice President of Renewable Products for Tyson Foods, where he led the
food ingredient, pet food ingredient, and animal feed businesses. Earlier at Tyson, Mr. Webster served as
SVP of Strategy & Development. Prior to joining Tyson Foods, he served as CEO of Carmichael Training
Systems, a consumer marketer of nutritional products and fitness services in the health and nutrition
industry. Earlier in his career, Mr. Webster held various management positions within engineering, market
research, finance, and ultimately as VP — Global Strategy & Development at Kellogg Co. He began his
career as a geophysicist with ARCO. Mr. Webster received a bachelor of science degree in geophysics from
Michigan State University and is a graduate of Northwestern University’s Executive Development Program.
Mark A. Wiens serves as Executive Vice President, Chief Financial Officer and Corporate Secretary of
Simmons. Mr. Wiens joined Simmons in 2012 and has 25 years of experience in private label
manufacturing of pet food, premium meats and soft drinks. Prior to joining Simmons, Mr. Wiens was CFO
for Menu Foods Ltd., a position he held since 2001 and was part of the team to take Menu public in 2002.
Prior to his employment with Menu Foods, Mr. Wiens served as Vice President and CFO of Centennial
Foods, a manufacturer and distributor of premium private-label meat products and a food service
distributor. Prior to his employment with Centennial, he served as the Vice President and General Manager
of Cott Beverages West Corporation (a subsidiary of Cott Corporation), a manufacturer and distributor of
premium private-label soft drinks. Mr. Wiens is a Chartered Professional Accountant and member of the
Canadian, Ontario and Alberta Institutes of Chartered Professional Accountancy and graduated from
Wilfrid Laurier University with an honours degree in business administration.

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 Jerry D. Laster serves as Executive Vice President and Chief Strategy Officer of Simmons. He joined
Simmons Food in 2000 as our Vice President of Marketing. Prior to joining Simmons Foods, he served
three years in various capacities at Hudson Foods Inc. and five years in various capacities at Foster Farms.
His retail experience includes the development and or management of multiple product lines for the frozen,
deli, fresh and service deli departments in both grocery and mass merchandiser channels. During his
career, Mr. Laster has managed or directed the following functional areas: sales, marketing, research and
development, supply chain management and strategic planning. Mr. Laster received a bachelor of arts
degree in sociology from Ball State University and a master of business administration degree from Loyola
University.
Daniel T. Houston serves as Executive Vice President and Chief Human Resource Officer of Simmons.
Mr. Houston joined Simmons in March of 2013 and has over 25 years of combined human resources,
organizational development and learning and development experience. Prior to joining Simmons, he was
Senior Vice President and Chief People Officer for Wilbur Smith Associates, a global civil engineering
consulting firm. During his career, Mr. Houston has held human resources leadership roles in the
aerospace, banking, contract office manufacturing and commodity chemical manufacturing industries.
Mr. Houston received a bachelor of science in business administration degree with a minor in psychology
from Aquinas College, a master of science in organizational behavior degree from the University of
Hartford, and a certificate in executive education from the University of Notre Dame.
Kerry L. Hairston, I serves as Vice President of Finance and Treasurer of Simmons. Mr. Hairston
joined Simmons in 2011 and has over 20 years experience in investment banking, private equity, corporate
finance, M&A, and business development. Prior to joining Simmons, Mr. Hairston was Vice President of
Business Development for PRWT Services, a manufacturer and distributor of pharmaceutical products and
provider of business process outsourcing services. Prior to PRWT Services, Mr. Hairston served as
Managing Director with both EGL Ventures and InvestLinc Private Equity. Prior to serving InvestLinc
Private Equity, Mr. Hairston was Senior Vice President and Head of Corporate Finance at Jackson
Securities, a regional investment banking firm. Mr. Hairston graduated from the University of Louisville
with a bachelor of science in business administration degree, majoring in accounting.
Brian T. Dietrich serves as Vice President of Financing & Accounting of Simmons. Mr. Dietrich joined
Simmons in November of 2013 and has over 15 years of corporate accounting and finance experience. Prior
to joining Simmons, he served as International Controller for CDM Smith, Inc, a global engineering and
consulting firm, with responsibility for the IFRS and U.S. GAAP reporting for over 25 global entities.
During his career, Mr. Dietrich has also served as Director of FP&A, Corporate Controller, Corporate
Treasurer, and Project Accounting/Revenue Recognition Manager. Mr. Dietrich graduated from the
University of South Carolina with a bachelor of science in business administration degree, majoring in
accounting.

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 CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
We lease certain poultry farms and related equipment utilized in our Poultry segment and a warehouse
utilized in our Pet Food segment from Millcreek Properties, LLC (“Millcreek Properties”), an entity in which
Mark C. Simmons, a director of Simmons, M. Todd Simmons, a director and executive officer of Simmons,
Sarah L. Simmons, a director of Simmons, and certain other Simmons family members are owners. In
addition, we lease two airplanes from a wholly-owned subsidiary of Millcreek Properties for our business
usage. During fiscal 2015, fiscal 2016 and the six-month period ended July 1, 2017, we incurred charges of
$6.3 million, $3.4 million and $1.7 million, respectively, with respect to such leases.
We lease a cold storage warehouse and distribution facility in Van Buren, Arkansas, pursuant to a lease
agreement entered into with Snowwis Cold Storage, LLC, an entity owned by M. Todd Simmons and Sarah
L. Simmons until December 31, 2016, and now owned by Millcreek Properties. The lease agreement
between us and Snowwis Cold Storage provides for payment of $100,000 per month in base rent. We are
also obligated under the lease agreement to pay the annual real estate taxes as additional rent. During each
of fiscal 2015 and fiscal 2016, we incurred charges of $1.2 million on such lease. During the six-month
period ended July 1, 2017, we incurred charges of $0.6 million on such lease.
We purchase feed ingredients each year (i) for use in the grow-out of our chicken inventory, through
contract growers, over the following fiscal year and (ii) for planning purposes. These purchases are made
pursuant to one or more feed purchase agreements between us and nationally recognized grain suppliers.
In this process we obtain short term financing (non-revolving lines of credit with maturities of less than one
year, which are usually entered into in December of each year), which we refer to as prepaid grain loans, to
fund a portion of these advance purchases. During the subsequent year, as we receive periodic deliveries of
physical feed ingredients from the grain suppliers, we repay the prepaid grain loans in monthly
installments (in lieu of what would otherwise be direct payments to the grain suppliers, absent the prepaid
grain loan arrangement). As an element of our shareholders’ overall planning strategy, our shareholders
may occasionally obtain such financing directly, whereby the shareholders are borrowers under the prepaid
grain loans, and we are not contractually obligated as borrowers or guarantors under such loans. In the
instances where the shareholders are borrowers under the prepaid grain loans, the shareholders contribute
funds from the prepaid grain loans to us for our use to fund a portion of our feed ingredient purchases for
the subsequent year. In these instances, we make monthly installment payments to the lender on the
shareholders’ prepaid grain loans on behalf of the shareholders, which payments generate an account
receivable due to us from the shareholders. Such accounts receivable are repaid at the end of each year by a
repeat of the cycle to purchase prepaid grain for the next year. The short-term financings described above
are entered into on comparable market terms regardless of whether the financings are obtained by us or by
the shareholders. As of fiscal year end 2015 and 2016, the outstanding principal amounts of the prepaid
grain loans obtained by the shareholders was $128.0 million and $132.5 million, respectively. At
December 31, 2016, we made tax advances to the shareholders totaling $0.9 million. These tax advances
were repaid during fiscal 2017. We anticipate that these transactions will continue in the future.

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 DESCRIPTION OF OTHER INDEBTEDNESS
Senior Secured Credit Facility
We, as U.S. borrowers, and Simmons Pet Food ON, Inc., as Canadian borrower, have entered into a
fifth amended and restated credit agreement with Wells Fargo Bank, National Association, as
administrative agent, the lenders party thereto, and other titled agents party thereto that governs our senior
secured credit facility. Following the consummation of the sale of the notes offered hereby and the
application of the proceeds thereof, the senior secured credit facility will have a maturity date of August 11,
2022.
The senior secured credit facility provides for a revolving credit facility up to $275.0 million.
Availability under the credit facility is subject to a borrowing base calculation, generally based upon a
percentage of eligible accounts receivable, inventories, and fixed assets, less, in each case, customary
reserves. Generally, the fixed asset availability amount is to be based on the lower of (i) a specified
percentage of the valuations of eligible real property and fixed assets located thereon and (ii) a fixed asset
sub-line amount, which is reduced by required permanent amortization of the real estate component;
provided that such amount does not exceed a specified percentage of the maximum amount of the credit
facility. The credit facility provides a Canadian subfacility on behalf of Simmons Pet Food ON, Inc. of up to
$25.0 million, subject to a borrowing base determined with respect to its Canadian assets. The facility also
includes a $28.0 million swing-line commitment ($25.0 million to the U.S. borrowers and $3.0 million to
the Canadian borrower), a $40.0 million sublimit for U.S. letters of credit, a $3.0 million sublimit for
Canadian letters of credit, and an accordion feature allowing us to request additional commitments for the
increase of up to $100.0 million to the revolving credit facility.
Borrowings under the senior secured credit facility bear interest at a rate per annum equal to, at our
option, either (a) a base rate determined by reference to the highest of (1) the prime rate of Wells Fargo
Bank, (2) the federal funds effective rate plus 0.50% and (3) a LIBOR rate plus 1.00% or (b) a LIBOR rate, in
each case plus an applicable margin. The applicable margin through December 31, 2017 is (a) 0.50% for
base rate borrowings and (b) 1.50% for LIBOR rate borrowings. Thereafter, the applicable margin is subject
to adjustment each calendar month based on the average daily excess availability (as defined under the
credit facility).
The obligations under the senior secured credit facility are guaranteed by all of our existing and
subsequently acquired or organized domestic subsidiaries and secured by a pledge of 100% of the capital
stock of all of our domestic subsidiaries and up to 65% of the capital stock of Simmons Pet Food ON, Inc.
with respect to U.S. obligations and 100% of the capital stock of Simmons Pet Food ON, Inc. with respect to
the Canadian subfacility. Obligations under the credit facility are secured by first priority security interests
on substantially all of our assets and the assets of each subsidiary guarantor, subject to certain exceptions
and permitted liens. Obligations under the Canadian subfacility are secured by a first priority lien on
substantially all assets of ours, our domestic subsidiaries and our direct and indirect wholly owned
Canadian subsidiaries and a pledge of 100% of the stock of such Canadian subsidiaries. The obligations
under the Canadian subfacility are guaranteed by our Canadian subsidiaries but the Canadian subsidiaries
are not guarantors of any U.S. obligations under the facility. The intercreditor agreement will provide that
the senior secured credit facility and certain associated obligations will be paid in full prior to the payment
of obligations with respect to the notes out of the proceeds of any collateral or in connection with any
distribution of collateral in a liquidation or insolvency proceeding. See “Description of Notes — Security —
Intercreditor Agreement.”
The credit facility contains a fixed charge coverage ratio covenant which becomes applicable when
excess availability (as defined under such facility) is less than the greater of (i) 12.5% of the lesser of the
borrowing base or the maximum revolving facility amount or (ii) $31.25 million. Until the time excess
availability exceeds the greater of (i) 12.5% of the lesser of the borrowing base or the maximum revolving
facility amount or (ii) $31.25 million for 60 consecutive days, such facility will require us to maintain a
consolidated fixed charge coverage ratio of at least 1.0 to 1.0. The senior secured credit facility also requires

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us and our subsidiaries to maintain substantially all of our cash in accounts that are subject to the control of
the agent, which control becomes applicable when (a) an event of default under the facility occurs and is
continuing or (b) excess availability is less than the greater of (i) 12.5% of the lesser of the borrowing base or
the maximum revolving facility amount or (ii) $31.25 million.
The senior secured credit facility contains a number of covenants that, among other things and subject
to certain exceptions, restrict our ability and that of any of our subsidiaries to incur indebtedness, create
liens, make loans, advances, acquisitions or other investments, engage in mergers, consolidations or other
fundamental changes, make changes in the nature of our business, dispose of assets, make certain
payments of dividends or distributions and redeem or repurchase equity interests, and engage in
transactions with affiliates.
The amended and restated credit facility contains certain customary affirmative covenants and events
of default, including events of default upon a default of other material indebtedness and upon a change of
control.

7.875% Second Lien Senior Secured Notes due 2021

In October 2014, we completed an offering of $415.0 million aggregate principal amount of 7.875%
Second Lien Senior Secured Notes due 2021 under Rule 144A of the Securities Act. The net proceeds of the
offering were used to repay $315.0 million aggregate principal amount of 10.5% Second Lien Senior
Secured Notes due 2017 (the “2017 Notes”), to pay a premium and accrued and unpaid interest on the 2017
Notes, repay a portion of the outstanding indebtedness under our first lien senior secured credit facility,
pay a dividend to our shareholders and pay related fees and expenses. The 2021 Notes are guaranteed,
jointly and severally, on a second lien senior secured basis by each of our direct and indirect domestic
subsidiaries. The 2021 Notes and guaranties are secured by a second priority lien on our and the
guarantors’ property and assets that secure our senior secured credit facility, subject to certain exceptions
and permitted liens. Concurrently with this offering, we commenced the Tender Offer to purchase for cash
any and all of our outstanding 2021 Notes. We expect to redeem any 2021 Notes not tendered to us and
simultaneously discharge the indenture governing the 2021 Notes with a portion of the proceeds we receive
from this offering. See “Use of Proceeds” and “Offering Memorandum Summary — Recent Developments —
Tender Offer for the 2021 Notes.”

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 DESCRIPTION OF NOTES
As used below in this “Description of Notes,” the “Issuers” means, jointly, severally and collectively,
Simmons Foods, Inc., an Arkansas corporation, Simmons Prepared Foods, Inc., an Arkansas corporation,
Simmons Pet Food, Inc., an Arkansas corporation, Simmons Feed Ingredients, Inc., an Arkansas
corporation, and Simmons Energy Solutions, Inc., an Arkansas corporation, and each of their respective
successors, but not any of their respective subsidiaries or affiliates. The Notes will be the joint and several
obligations of the Issuers. The Issuers will issue the notes described in this offering memorandum (the
“Notes”) under an Indenture, to be dated as of the Issue Date (the “Indenture”), among the Issuers, the
Guarantors and Wells Fargo Bank, National Association, as trustee (in such capacity, the “Trustee”) and as
collateral agent (in such capacity, the “Second Lien Collateral Agent”). You may obtain a copy of the
Indenture from the Issuers at their address set forth elsewhere in this offering memorandum.
The Issuers intend to use the proceeds from the offering of the Notes to (i) purchase any and all of our
outstanding 2021 Notes that are validly tendered by holders and accepted by us pursuant to a cash tender
offer, or the Tender Offer, that we are currently conducting and to redeem or retire any 2021 Notes not
purchased in the Tender Offer, (ii) pay accrued and unpaid interest on the 2021 Notes, (iii) pay down
indebtedness under our first lien senior secured credit facility and (iv) pay the fees and expenses associated
with this offering and the Tender Offer as described under “Use of Proceeds.”
The following summary of the material terms and provisions of the Notes, the Indenture, the Security
Documents and the Intercreditor Agreement does not purport to be complete and is subject to the detailed
provisions of, and qualified in its entirety by reference to, provisions of the Notes, the Indenture, the
Security Documents and the Intercreditor Agreement. You can find definitions of certain terms used in this
description under the heading “— Certain Definitions.”

Principal, Maturity and Interest

The Notes will mature on , 2024. The Notes will bear interest at the rate shown on the cover
page of this offering memorandum, payable on and of each year, commencing on ,
2018, to Holders of record at the close of business on or , as the case may be, immediately
preceding the relevant interest payment date. Interest on the Notes will be computed on the basis of a
360-day year of twelve 30-day months.
The Notes will be issued in registered form, without coupons, and in minimum denominations of
$2,000 and integral multiples of $1,000 in excess thereof.
An aggregate principal amount of Notes equal to $550.0 million is being issued in this offering. The
Issuers may issue additional Notes having identical terms and conditions to the Notes being issued in this
offering, except for issue date, issue price and first interest payment date in an unlimited aggregate
principal amount (the “Additional Notes”), subject to compliance with the covenants described under
“— Certain Covenants — Limitations on Additional Indebtedness” and “— Limitations on Liens.” Any
Additional Notes will be part of the same issue as the Notes being issued in this offering and will be treated
as one class with the Notes being issued in this offering, including for purposes of voting, redemptions and
offers to purchase. For purposes of this “Description of Notes,” except for the covenants described under
“— Certain Covenants — Limitations on Additional Indebtedness” and “— Limitations on Liens,” references
to the Notes include Additional Notes, if any.

Methods of Receiving Payments on the Notes

If a Holder of at least $100,000 principal amount of certificated Notes has given wire transfer
instructions to the Issuers at least ten Business Days prior to the applicable payment date, the Issuers will
make all payments on such Holder’s Notes by wire transfer of immediately available funds to the account
specified in those instructions to an account in the United States of America. Otherwise, payments on the
Notes will be made at the office or agency of the paying agent (the “Paying Agent”) and registrar (the

83
“Registrar”) for the Notes unless the Issuers elect to make interest payments by check mailed to the Holders
at their addresses set forth in the register of Holders.

Note Guarantees
The joint and several obligations of the Issuers under the Notes, the Indenture and the Security
Documents will be jointly and severally guaranteed (the “Note Guarantees”), on a senior secured basis, by
each domestic Restricted Subsidiary of the Issuers that guarantees any Credit Facilities. The Note
Guarantees will be secured by Second Priority Liens on the portion (if any) of the Collateral owned by such
Guarantor, subject to Permitted Liens and Liens on the Collateral securing the Credit Facility Obligations
on a first priority basis. The Second Priority Liens securing the Notes will be subject to the provisions of the
Intercreditor Agreement.
As of the date of the Indenture, all of the Issuers’ Subsidiaries will be “Restricted Subsidiaries.”
However, under the circumstances described below under “— Certain Covenants — Limitations on
Designation of Unrestricted Subsidiaries,” the Issuers will be permitted to designate some of their
respective Subsidiaries as “Unrestricted Subsidiaries.” The effects of designating a Subsidiary as an
“Unrestricted Subsidiary” will be:
• an Unrestricted Subsidiary will not be subject to many of the restrictive covenants in the Indenture;
• a Subsidiary that has previously been a Guarantor and that is designated an Unrestricted Subsidiary
will be released from its Note Guarantee, the Security Documents and the Intercreditor Agreement,
and any of its assets that constitute Collateral will be released from the Liens of the Security
Documents; and
• the assets, income, cash flow and other financial results of an Unrestricted Subsidiary will not be
consolidated with those of the Issuers for purposes of calculating compliance with the restrictive
covenants contained in the Indenture.
The obligations of each Guarantor under its Note Guarantee will be limited to the maximum amount as
will, after giving effect to all other contingent and fixed liabilities of such Guarantor (including, without
limitation, any guarantees under any Credit Facility permitted under clause (1) of “— Certain Covenants —
Limitations on Additional Indebtedness”) and after giving effect to any collections from or payments made
by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its Note
Guarantee or pursuant to its contribution obligations under the Indenture, result in the obligations of such
Guarantor under its Note Guarantee not constituting a fraudulent conveyance or fraudulent transfer under
federal or state law. This provision may not be effective to protect the Note Guarantees from being voided
under fraudulent transfer law, or may eliminate the Guarantor’s obligations or reduce such obligations to an
amount that effectively makes the Guarantee worthless. See “Risk Factors — Risks Related to the Notes —
The amount that can be collected under the guarantees will be limited.” Each Guarantor that makes a
payment for distribution under its Note Guarantee will be entitled to contribution from each other
Guarantor in a pro rata amount based on the adjusted net assets of each Guarantor.
A Guarantor will be released from its obligations under its Note Guarantee:
(1) in the event of a sale or other disposition of all or substantially all of the assets of such
Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the
Equity Interests of such Guarantor then held by an Issuer and the Restricted Subsidiaries;
(2) if such Guarantor is designated as an Unrestricted Subsidiary or otherwise ceases to be a
Guarantor, in each case in accordance with the provisions of the Indenture, upon effectiveness of such
designation or when it first ceases to be a Restricted Subsidiary, respectively;
(3) if we exercise our legal defeasance option or our covenant defeasance option as described
under “— Legal Defeasance and Covenant Defeasance” or if our obligations under the Indenture are
discharged in accordance with the terms of the Indenture as described under “— Satisfaction and
Discharge”; or

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 (4) if such Guarantor no longer guarantees or is otherwise obligated under the Issuers’ Credit
Facilities.

Ranking
Senior Notes
The Notes will be senior secured obligations of each Issuer that rank senior in right of payment to all of
such Issuer’s Indebtedness that is expressly subordinated in right of payment to the Notes. The Notes will
rank equally in right of payment with all Indebtedness of each Issuer that is not so subordinated, including
the Credit Facility Obligations. The Notes will effectively rank senior to all unsecured Indebtedness of each
Issuer to the extent of the value of the Collateral, after giving effect to any first priority Lien on the
Collateral, and effectively subordinated to any obligations of each Issuer that are either (i) secured by a Lien
on the Collateral that is senior or prior to the Second Priority Liens securing the Notes, including the first
priority Liens securing the Credit Facility Obligations and any other first priority Permitted Liens, or
(ii) secured by assets that are not part of the Collateral securing the Notes, in each case, to the extent of the
value of the assets securing such obligations. In the event of bankruptcy, liquidation, reorganization or
other winding up of the Issuers or the Guarantors or upon a default in payment with respect to, or the
acceleration of any Indebtedness under, the Credit Facilities or other Indebtedness secured by a first
priority Lien on the Collateral, the assets of each Issuer and the Guarantors that secure such Indebtedness
and other Indebtedness secured by a first priority Lien on the Collateral will be available to pay obligations
on the Notes and the Note Guarantees only after all such Indebtedness has been repaid in full from such
assets, and there may not be sufficient assets remaining to pay amounts due on any or all of the Notes and
the Note Guarantees then outstanding. See “Risk Factors — Risks Related to the Notes — Other secured
indebtedness, including indebtedness under our senior secured credit facility, which is secured by a first
priority Lien on certain of our and the Guarantors’ assets, will be senior to the Notes to the extent of the
value of the collateral securing such indebtedness on a first priority basis.” In addition, the Notes will be
structurally subordinated to all of the indebtedness and other liabilities of our Subsidiaries that do not
guarantee the Notes, to the extent of the assets of those Subsidiaries, including, without limitation, our
Canadian Subsidiaries, which are borrowers or guarantors under our Credit Facilities, but will not
guarantee the Notes or pledge assets as collateral for the Notes.
As of July 1, 2017, on a pro forma basis after giving effect to the Transactions, the Issuers and their
respective Subsidiaries would not have had any first priority secured Indebtedness outstanding (excluding
unused commitments). We would have had, however, approximately $247.2 million of unused availability
after taking into account our borrowing base and outstanding letters of credit under our senior secured
credit facility as of August 31, 2017, all of which would effectively rank senior to the notes to the extent of
the value of the assets securing such indebtedness. After giving pro forma effect to the Transactions, the
non-Guarantor Subsidiaries would have represented approximately $36.4 million, or 2.5% of our net sales
for the fiscal year ended December 30, 2016, and approximately $18.9 million, or 2.4% of our net sales for
the for the six months ended July 1, 2017. In addition, as of July 1, 2017, on a pro forma basis, the non-
Guarantor Subsidiaries would have held approximately $128.3 million, or 13.9% of our combined assets and
would have had no outstanding indebtedness. See “Risk Factors — Risks Related to the Notes — The notes
will be effectively structurally subordinated to all liabilities of our subsidiaries that are not guarantors of the
notes.”

Note Guarantees
The Guarantors will, jointly and severally, unconditionally guarantee on a senior secured basis the due
and punctual payment of principal of, premium, if any, and interest on, the Notes. Each Note Guarantee
will be secured by a Second Priority Lien on the portion (if any) of the Collateral owned by such Guarantor,
subject to Permitted Lien and Liens on the Collateral securing the Credit Facility Obligations on a first
priority basis. The Second Priority Liens will be subject to the provisions of the Intercreditor Agreement.
Each Note Guarantee of a Guarantor will be effectively senior to all of such Guarantor’s senior unsecured

85
Indebtedness, to the extent of the value of the Collateral, after giving effect to any first priority Lien on the
Collateral. The obligations of each Guarantor under its Note Guarantee will rank equally in right of
payment to all Indebtedness of such Guarantor, except to the extent such Indebtedness is subordinated to
the obligations arising under the Note Guarantee, in which case the obligations of the Guarantor under the
Note Guarantee will rank senior in right of payment to such Indebtedness. The Note Guarantee of a
Guarantor will be effectively subordinated to any obligations of such Guarantor that are either (i) secured
by a Lien on the Collateral that is senior or prior to the Second Priority Liens securing the Note Guarantee,
including first priority Liens securing the Credit Facility Obligations, and any other first priority Permitted
Liens, or (ii) secured by assets that are not part of the Collateral securing the Note Guarantee, in each case,
to the extent of the value of the assets securing such obligations.
Under certain circumstances described under “— Certain Covenants — Additional Note Guarantees,”
we will be required to cause the execution and delivery of additional Note Guarantees by Restricted
Subsidiaries.

Optional Redemption
Except as set forth below, the Notes may not be redeemed prior to , 2020. At any time or from
time to time on or after , 2020, the Issuers, at their option, may redeem the Notes, in whole or in
part, at the redemption prices (expressed as percentages of principal amount) set forth below, together with
accrued and unpaid interest thereon, if any, to the redemption date, if redeemed during the 12-month
period beginning of the years indicated:
Optional
Year Redemption Price
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . %
2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . %
2022 and thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.000%
Prior to , 2020 the Issuers may redeem the Notes, in whole or in part, at a redemption price
equal to 100% of the principal amount thereof, plus the Applicable Premium, plus accrued and unpaid
interest thereon, if any, to the date of redemption.
“Applicable Premium” means, with respect to any Note on any redemption date, the greater of (i) 1.00%
of the principal amount of such Note and (ii) the excess of (A) the present value at such redemption date of
(1) the redemption price of such Note at , 2020, plus (2) all scheduled interest payments due on such
Note from the redemption date through , 2020, computed using a discount rate equal to the Treasury
Rate at such redemption date, plus 50 basis points over (B) the principal amount of such Note.
“Treasury Rate” means the weekly average rounded to the nearest 1/100th of a percentage point (for
the most recently completed week for which such information is available as of the date that is two business
days prior to the redemption date) of the yield to maturity at the time of computation of United States
Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve
Statistical Release H.15 with respect to each applicable day during such week (or, if such Statistical Release
is no longer published, any publicly available source for similar market data)) most nearly equal to the then
remaining term of the Notes to , 2020; provided, however, that if the remaining term of the Notes to
, 2020 is not equal to the constant maturity of a United States Treasury security for which a weekly
average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest
one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such
yields are given, except that if the then remaining term of the Notes to , 2020 is less than one year,
the weekly average yield on actually traded United States Treasury securities adjusted to a constant
maturity of one year shall be used. In each case, the Issuers or their agent shall obtain the Treasury Rate.
The Issuers will calculate the Treasury Rate prior to such redemption date and file with the Trustee an
Officers’ Certificate setting forth the Applicable Premium and Treasury Rate prior to such redemption date,
showing the calculation of each in reasonable detail.

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Redemption with Proceeds from Equity Offerings
At any time prior to , 2020, the Issuers may redeem up to 35% of the aggregate principal amount
of the Notes with the net cash proceeds of one or more Qualified Equity Offerings at a redemption price
equal to % of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest thereon,
if any, to the date of redemption; provided that (1) at least 65% of the aggregate principal amount of Notes
issued under the Indenture remains outstanding immediately after the occurrence of such redemption and
(2) the redemption occurs within 90 days of the date of the closing of any such Qualified Equity Offering.
The Issuers may acquire Notes by means other than a redemption, whether pursuant to an issuer
tender offer, open market purchase or otherwise, so long as the acquisition does not otherwise violate the
terms of the Indenture.

Selection and Notice of Redemption

In the event that less than all of the Notes are to be redeemed at any time pursuant to an optional
redemption, selection of the Notes for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the
Notes are not listed on a national securities exchange, on a pro rata basis(or for Notes held in book-entry
form, by such method as The Depository Trust Company may require).
Notice of redemption will be sent by electronic transmission (for Notes held in book-entry form) or
mailed by first-class mail at least 30 but not more than 60 days before the date of redemption to each
Holder of Notes to be redeemed at its registered address, except that redemption notices may be sent by
electronic transmission or mailed by first-class mail, as applicable, 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 the Note to be redeemed. A new Note in a principal amount
equal to the unredeemed portion of the Note will be issued in the name of the Holder of the Note upon
cancellation of the original Note. On and after the date of redemption, interest will cease to accrue on Notes
or portions thereof called for redemption so long as the Issuers have deposited with the paying agent for the
Notes funds in satisfaction of the redemption price (including accrued and unpaid interest and Applicable
Premium, if any, on the Notes to be redeemed) pursuant to the Indenture.
Any redemption and notice may, in the Issuers’ discretion, be subject to the satisfaction of one or more
conditions precedent, including, but not limited to, completion of the related transaction. If such
redemption or purchase is subject to satisfaction of one or more conditions precedent, the notice of
redemption shall describe each such condition, and if applicable, shall state that, the redemption date may
be delayed until such time as any or all such conditions shall have been satisfied to the Issuers’ satisfaction.
Such notice may also state that such redemption or purchase may not occur and such notice of redemption
may be rescinded if any or all such conditions shall not have been satisfied by the original redemption date,
or by the redemption date as so delayed. In addition, the Issuers may state in such notice that payment of
the redemption price and performance of the Issuers’ obligations with respect to such redemption may be
performed by another Person to whom the Issuers have delegated such obligation.

Security
General
The Notes, the Note Guarantees and any Other Pari Passu Secured Indebtedness will be secured by the
Second Priority Liens granted by the Issuers and the Guarantors on substantially all of the tangible and
intangible assets of the Issuers and the Guarantors (whether now owned or hereinafter arising or acquired)
pursuant to the Collateral Agreement and other Security Documents and, with respect to Collateral
consisting of Real Property and fixtures (whether now owned or hereinafter arising or acquired), pursuant to
Mortgages, in each case to the extent such assets secure obligations of the Issuers and the Guarantors

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under the Credit Facilities (collectively, the “Collateral”); provided that the Collateral will not include any
Excluded Property (as defined below) and such Liens will be subject to Permitted Liens.
The Collateral will exclude:
(1) Voting Stock of any CFC, solely to the extent that (A) such Voting Stock represents more than
65% of the outstanding Voting Stock of such CFC, and (B) pledging or hypothecating more than 65% of
the total outstanding Voting Stock of such CFC would result in adverse tax consequences as
reasonably determined by the Issuer and communicated in writing to the Trustee and the Second Lien
Collateral Agent or the First Lien Agent or other agent appointed as representative for any Credit
Facility in consultation with the Issuer determined that the cost of providing such pledge are
unreasonably excessive in relation to the benefits to the secured parties under the Credit Agreement or
other Credit Facility, as applicable, which determination shall be promptly communicated in writing to
the Trustee and the Second Lien Collateral Agent (which pledge, if requested by First Lien Agent
pursuant to the Credit Agreement or the Second Lien Collateral Agent, shall be governed by the laws
of the jurisdictions of such Subsidiary);
(2) any rights or interest in any contract, lease, permit, license, or license agreement governing
real or personal property of the Issuer or any Guarantor if under the terms of such contract, lease,
permit, license or license agreement, or applicable law with respect thereto, the grant of a security
interest or lien therein is prohibited as a matter of law or under the terms of such contract, lease,
permit, license, or license agreement and such prohibition or restriction has not been waived or the
consent of the other party to such contract, lease, permit, license, or license agreement has not been
obtained (provided, that, (A) the foregoing exclusions of this clause (2) shall in no way be construed
(i) to apply to the extent that any described prohibition or restrictions is ineffective under Section 9-
406, 9-407, 9-408, or 9-409 of the UCC or other applicable law, or (ii) to apply to the extent that any
consent or waiver has been obtained that would permit the Second Lien Collateral Agent’s security
interest or lien to attach notwithstanding the prohibition or restriction on the pledge of such contract,
lease, permit, license or license agreement and (B) the foregoing exclusion of clauses (1) and (2) shall
in no way be construed to limit, impair, or otherwise affect any of the Trustee’s, Second Lien Collateral
Agent’s, the Holders’ and the holders’ of Other Pari Passu Secured Indebtedness, continuing security
interest in and liens upon any rights or interest of the Issuer or any Guarantor in or to (1) monies due
or to become due under or in connection with any described contract, lease, permit, license, license
agreement, or Equity Interests (including any accounts receivable or Equity Interests), or (2) any
proceeds from the sale, license, lease or other dispositions of any such contract, lease, permit, license,
license agreement or Equity Interests);
(3) any United States intent-to-use trademark applications to the extent that, and solely during the
period in which, the grant of a security interest therein would impair the validity or enforceability of
such intent-to-use trademark applications under applicable federal law; provided that upon
submission and acceptance by the PTO of an amendment to allege use or a verified statement of use,
such intent-to-use trademark applicable shall be considered Collateral;
(4) Real Property that is not subject to a Lien securing the Credit Facility Obligations or, if the
Credit Facility Obligations have been discharged, any Real Property (to the extent not already subject
to a Mortgage) acquired after the Issue Date having a fair market value of less than $5,000,000;
(5) to the extent not constituting collateral securing any Credit Facility Obligations, assets that
are subject to a Lien securing a Purchase Money Indebtedness or Capitalized Lease Obligation
permitted to be incurred pursuant to clause (16) of the definition of Permitted Liens in the Indenture
(and Liens to secure Obligations in respect of Refinancing Indebtedness in respect thereof permitted
by clause (18) of the same definition) to the extent and for so long as the contract or other agreement in
which such Lien is granted (or the documentation providing for such Purchase Money Indebtedness or

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 Capitalized Lease Obligation) validly prohibits the creation of any other Lien on such assets and
proceeds; and
(6) to the extent not constituting collateral securing any Credit Facility Obligations, (a) any
property secured by liens permitted under clause (29) of the definition of Permitted Liens and (b) any
property of a person existing at the time such person is acquired or merged with or into or consolidated
with the Issuer or any Guarantor that is subject to a Lien permitted by clause (17), (19) or (29) of the
definition of Permitted Liens (and Liens to secure Obligations in respect of Refinancing Indebtedness
in respect thereof permitted by clause (18) of the same definition) to the extent and for so long as the
contract or other agreement in which such Lien is granted validly prohibits the creation of any other
Lien on such property.
Any property described in this paragraph is referred to collectively or individually as “Excluded Property.”
The Issuers and the Guarantors will be required to perfect on the Issue Date the security interests in
the Collateral to the extent they can be perfected by the filing of UCC-1 financing statements, financing
statements under personal property security legislation applicable to the personal property collateral or,
subject to the Intercreditor Agreement, the delivery of capital stock or instruments. To the extent any such
security interest cannot be perfected by such a filing or the delivery of capital stock or instruments, such as
perfection of security interests on real property, the Issuers and the Guarantors will be required to use
commercially reasonable efforts to have all security interests and Liens that are contemplated by the
Indenture and the Security Documents to be in place and perfected within 120 days after the Issue Date, or
as soon as practicable thereafter using commercially reasonable efforts. If any Issuer or any Guarantor were
to become subject to a bankruptcy proceeding, any Liens recorded or perfected after the Issue Date would
face a greater risk of being avoided and invalidated (as a preferential transfer, fraudulent transfer, or
otherwise) than if they had been recorded or perfected on the Issue Date. See “Risk Factors — Risks Related
to the Notes — Certain pledges of collateral and payments on the notes might be avoidable by a trustee in
bankruptcy.”
To the extent that Liens, rights or easements granted to third parties encumber any real property
intended to constitute Collateral, such third parties have or may exercise rights and remedies with respect
to the property subject to such Liens that could adversely affect the value of the Collateral and the ability of
the Second Lien Collateral Agent to realize or foreclose on the Collateral. See “Risk Factors — Risks Related
to the Notes — Security interests over certain collateral may not be in place by closing or may not be
perfected by closing. Any issues that we are not able to resolve in connection with the issuance of such
security interests may impact the value of the Collateral. Delivery of such security interest after the issue
date of the notes increases the risk that the liens granted by those security interests could be avoided” and
“— With respect to our real property to be mortgaged as security for the notes, we do not expect all title
insurance policies or surveys will be in place at the time of the issuance of the notes. Any issues that we are
not able to resolve in connection with the issuance of such title policies or surveys may impact the value of
the collateral.”
From and after the Issue Date, if any Issuer or any Guarantor creates any additional Lien upon any
property to secure Credit Facility Obligations, it must concurrently grant at least a Second Priority Lien
upon such property (subject to Permitted Liens) as security for the Notes substantially concurrently with
granting any such additional Lien.
The Liens on the Collateral securing the Notes and the Note Guarantees under the Security
Documents will rank junior in priority to any and all security interests in and Liens on the Collateral at any
time granted to secure the Credit Facility Obligations and certain Permitted Liens and will rank equally in
priority with the security interest and Liens in and on the Collateral securing any Other Pari Passu Secured
Indebtedness. In addition, the Notes will not be secured by the Equity Interests in the Issuers or by any of
the assets of any Subsidiary that is not a Guarantor. After giving pro forma effect to the Transactions, the
non-Guarantor Subsidiaries would have represented approximately $36.4 million, or 2.5% of our net sales
for the fiscal year ended December 30, 2016, and approximately $18.9 million, or 2.4% of our net sales for
the for the six months ended July 1, 2017. In addition, as of July 1, 2017, on a pro forma basis, the non-

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Guarantor Subsidiaries would have held approximately $128.3 million, or 13.9% of our combined assets and
would have had no outstanding indebtedness. See “Risk Factors — Risks Related to the Notes — The notes
will be effectively structurally subordinated to all liabilities of our subsidiaries that are not guarantors of the
notes.”

Intercreditor Agreement
On the Issue Date, the Second Lien Collateral Agent and the representative of the holders of the Credit
Facility Obligations will enter into the Intercreditor Agreement. The Intercreditor Agreement will govern
the priorities of the security interests in and Liens on the Collateral and certain related creditor rights
among the holders of the Credit Facility Obligations and the Trustee, Second Lien Collateral Agent, the
Holders and the holders of Other Pari Passu Secured Indebtedness. By acceptance of the Notes, the Holders
will have deemed to have authorized the Second Lien Collateral Agent to enter into the Intercreditor
Agreement. If any other Indebtedness is designated as Other Pari Passu Secured Indebtedness by the
Issuers and the holders thereof, the holders or representatives of the holders of such Other Pari Passu
Secured Indebtedness will agree that such holders are bound by the provisions of the Intercreditor
Agreement. The Second Lien Collateral Agent will act as collateral agent on behalf of the holders of the
Notes and such Other Pari Passu Secured Indebtedness under the Intercreditor Agreement.
The rights of the Holders of the Notes with respect to the Collateral securing the Notes and the Note
Guarantees will be materially limited pursuant to the terms of the Intercreditor Agreement. Under the terms
of the Intercreditor Agreement, the Second Priority Liens securing the Notes and the Other Pari Passu
Secured Indebtedness will rank junior to the Liens securing the Credit Facility Obligations. Pursuant to the
terms of the Intercreditor Agreement, prior to the discharge of the first priority Liens securing the Credit
Facility Obligations, the First Lien Agent, as representative for the holders of the Credit Facility
Obligations will determine the time and method by which its security interest in and Lien on the Collateral
will be enforced (and, in the case of the Second Lien Collateral Agent, subject to the 180-day “standstill”
period described below). The collateral agent under the Credit Agreement will act as representative of the
holders of the Credit Facility Obligations until the Credit Agreement is repaid, cash collateral or a letter of
credit is posted with respect to contingent obligations under the Credit Agreement and all commitments to
lend under the Credit Agreement have been terminated. Until the discharge of the Credit Facility
Obligations and subject to the standstill provisions of the Intercreditor Agreement, the Second Lien
Collateral Agent will not be permitted to enforce the security interests and other rights related to the
Collateral even if an Event of Default has occurred and the Notes have been accelerated, except (i) in any
bankruptcy proceeding, the Second Lien Collateral Agent may file a proof of claim with respect to the Notes
or any Note Guarantee and shall be entitled to vote on any Plan of Reorganization (as defined below) or
similar dispositive plan to the extent consistent with the provisions of the Intercreditor Agreement and
(ii) exercise such rights as described in the following paragraphs and certain other limited rights. Following
the discharge of the first priority Liens securing the Credit Facility Obligations, the Second Lien Collateral
Agent, acting at the written instruction of the holders of a majority in principal amount of the Notes and any
Other Pari Passu Secured Indebtedness, voting as one class, in accordance with the provisions of the
Indenture and the Security Documents, will determine the time and method by which its security interest in
and Lien on the Collateral will be enforced and, if applicable, will distribute proceeds (after payment of the
costs of enforcement and Collateral administration) of the Collateral received by it under the Security
Documents for the ratable benefit of the Holders of the Notes and any holders of Other Pari Passu Secured
Indebtedness.
Before the discharge of the Credit Facility Obligations, the Second Lien Collateral Agent may exercise
rights and remedies with respect to the security interests and Liens after the passage of a period of 180 days
from the first date the representative of the holders of the Credit Facility Obligations receives written notice
from the Second Lien Collateral Agent that an Event of Default (or a similar event of default with respect to
Other Pari Passu Secured Indebtedness, if any such Indebtedness is outstanding) has been declared and, in
either case, the repayment of all the principal amount under the Notes (and Other Pari Passu Secured

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Indebtedness, if any such Indebtedness is outstanding) has been accelerated and demanded in writing.
However, the Second Lien Collateral Agent is only permitted to exercise rights and remedies at the
expiration of such 180-day period to the extent that (A) such Event of Default (or a similar event of default
with respect to Other Pari Passu Secured Indebtedness) has occurred and is continuing and has not been
cured and (B) the representative of the holders of, or any other secured party under, the Credit Facility
Obligations is not diligently pursuing in good faith the exercise of its rights and remedies with respect to a
material portion of the Collateral.
Any proceeds received upon a realization of the Collateral securing the Notes, any Other Pari Passu
Secured Indebtedness and the Credit Facility Obligations will be applied as follows:
(1) first, to the representative for the Credit Facility Obligations and for cash collateral as required
under the Credit Facilities, and in such order as specified in the Credit Facilities until the discharge of
the Credit Facility Obligations has occurred except for any payments in respect of the Notes and Other
Pari Passu Secured Indebtedness made in accordance with the provisions of the Credit Facilities
expressly permitting such payments; and
(2) second, ratably to the Notes and Other Pari Passu Secured Indebtedness, and in such order as
specified in the Indenture and the Security Documents (with the Trustee and Second Lien Collateral
Agent entitled to apply any proceeds in respect of the Notes to their costs and expenses prior to
principal and interest being paid to the holders of Notes) and the corresponding documents under
such Other Pari Passu Secured Indebtedness, as applicable.
In the event of a release of the Collateral under the Credit Facilities (i) in connection with the exercise
by the representative of the holders of the Credit Facility Obligations of its rights and remedies in respect of
any of the Collateral, including any sale, lease, exchange, transfer, or other disposition of such Collateral,
and as of the date thereof, an event of default under the Credit Facility Obligations exists and is continuing,
(ii) in connection with any disposition of all or any material portion of the Collateral by one or more Issuers
or Guarantors approved by representative of the holders of the Credit Facility Obligations while an event of
default under the Credit Facility is continuing which disposition is conducted by such Issuers or Guarantors
with the consent of such representative in connection with good faith efforts to collect the Credit Facility
Obligations through the disposition of Collateral, or (iii) any sale, lease, exchange, transfer, or other
disposition of the Collateral permitted under the terms of the Credit Agreement and the Indenture (as in
effect on the Issue Date), the Second Priority Liens on the Collateral will be automatically and
unconditionally released and the Second Lien Collateral Agent will be required to take any action (and be
deemed to have authorized such action) as the First Lien Agent or the Issuers may reasonably request to
effect such release. Pursuant to the Intercreditor Agreement, prior to the discharge of the Credit Facility
Obligations, the Second Lien Collateral Agent, for and on behalf of the Holders and the holders of Other
Pari Passu Secured Indebtedness will irrevocably constitute and appoint the administrative agent and
collateral agent under the Credit Agreement (the “First Lien Agent”) and any officer or agent thereof, with
full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in
the place and stead of the Second Lien Collateral Agent or such Holder or holder of Other Pari Passu
Secured Indebtedness or in the First Lien Agent’s name, from time to time in the First Lien Agent’s
discretion, for the purpose of carrying out the terms of the release provisions of the Intercreditor
Agreement, to take any and all appropriate action and to execute any and all documents and instruments
which may be necessary or desirable to accomplish the purposes of such provisions, including, without
limitation, any financing statement amendments, endorsements or other instruments of transfer or release.
Upon the acceleration of the Credit Facility Obligations or the commencement of an insolvency
proceeding, the Holders of the Notes and holders of Other Pari Passu Secured Indebtedness will have the
option, by irrevocable written notice to the representative under the Credit Facility Obligations, to be given
within 30 calendar days after receipt of notice of acceleration or commencement of the insolvency
proceeding (such notice, in the case of acceleration, to be provided, in the absence of exigent
circumstances, at least five (5) Business Days before any such action is taken), to purchase all (but not less

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than all) of the Credit Facility Obligations in full in cash at a price equal to 100% of the Credit Facility
Obligations (including principal, interest, fees and expenses, including reasonable attorneys’ fees and legal
expenses) plus cash collateral for asserted claims that are the subject of indemnification obligations and in
connection with any issued and outstanding letters of credit under the Credit Facilities in an amount up to
105% of the aggregate undrawn face amount of such letters of credit plus related fees and expenses. Such
purchase of the Credit Facility Obligations shall be consummated within five Business Days after receipt by
the representative under the Credit Facility Obligations of the notice of the election to exercise the
purchase option.
The Intercreditor Agreement will preclude the Holders of the Notes from initiating any bankruptcy
proceeding, including initiating an involuntary proceeding under the U.S. federal bankruptcy laws against
any Issuer or Guarantor prior to the earlier to occur of the expiration of the 180-day standstill period
described above or the discharge of the Credit Facility Obligations. In the event a bankruptcy proceeding
shall be commenced by or against any Issuer or any Guarantor and the representative of the Credit Facility
Obligations or any other holder of Credit Facility Obligations shall desire to permit any Issuer or any
Guarantor the use of cash collateral which constitutes Collateral or to enter into debtor-in-possession
financings with a holder of Credit Facility Obligations or any other person (a “DIP Financing”) in such
proceeding, and if (x) the DIP Financing is secured by Liens on the Collateral that are senior to or pari
passu with the Liens of the holders of Credit Facility Obligations on the Collateral and (y) to the extent the
holders of the Credit Facility Obligations receive replacement Liens on post-petition assets in connection
with such DIP Financing and the Second Lien Collateral Agent, for the benefit of the Holders and the
holders of Other Pari Passu Secured Indebtedness, receives replacement Liens on such post-petition assets
that are junior and subordinate to the replacement Liens securing the Credit Facility Obligations to the
same extent as the Second Lien Collateral Agent’s Liens on the Collateral are junior and subordinate to the
Liens on the Collateral securing the Credit Facility Obligations, then the Second Lien Collateral Agent, on
behalf of itself and the other Holders and the holders of Other Pari Passu Secured Indebtedness, agrees that
(a) it will not raise any objection to and will consent to such use of cash collateral or DIP Financing;
provided that the Second Lien Collateral Agent may object to such DIP Financing if (A) the sum of (i) the
maximum aggregate principal amount of indebtedness that may be outstanding from time to time under
such DIP Financing plus, without duplication, (ii) the aggregate principal amount of loans and the
aggregate face amount of letters of credit issued but not reimbursed under the Credit Facility (after giving
effect to any closing with respect to such DIP Financing following the final hearing in respect thereof)
exceeds the First Lien Debt Cap, and (B) any such cash collateral use or DIP Financing compels any Issuer
or any Guarantor to seek confirmation of a specific any plan or reorganization, plan of compromise, plan of
liquidation, agreement for composition, plan of arrangement or other type of plan of arrangement proposed
in or in connection with any bankruptcy proceeding (a “Plan of Reorganization”) for which all or
substantially all of the material terms are set forth in the cash collateral order or DIP Financing
documentation, (b) it will not request adequate protection or any other relief in connection therewith,
except as otherwise expressly permitted under the Intercreditor Agreement, and (c) it will subordinate its
Liens in the Collateral to the Liens securing such DIP Financing (and all obligations related thereto) on the
same basis as the Liens securing the obligations under the Indenture and the Notes are subordinated to the
Liens securing the Credit Facility Obligations under the Intercreditor Agreement. The use of cash collateral
or the provision of DIP Financing to the Issuers or any Guarantor will require the approval of the
governmental authority having jurisdiction over such bankruptcy proceeding, to the extent required by law.
The Second Lien Collateral Agent, on behalf of itself and the other Holders and the holders of Other
Pari Passu Secured Indebtedness, agrees that none of them shall contest (or support any other person in
contesting) (a) any request by the First Lien Agent or any of the other holders of Credit Facility Obligations
for adequate protection or (b) any objection by the First Lien Agent or any other holder of Credit Facility
Obligations to any motion, relief, action or proceeding based on the First Lien Agent or any other holder of
the Credit Facility Obligations claiming a lack of adequate protection. Notwithstanding the foregoing, in
any bankruptcy proceeding, (i) if the First Lien Agent or the holders of the Credit Facility Obligations (or
any subset thereof) are granted adequate protection in the form of additional collateral in connection with

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any DIP Financing or use of its cash collateral under Section 363 or Section 364 of the Bankruptcy Code,
then the Second Lien Collateral Agent, on behalf of itself or any other Holder or holder of Other Pari Passu
Secured Indebtedness, may seek or request adequate protection in the form of a replacement Lien on such
additional collateral, which Lien is subordinated to the Liens securing the Credit Facility Obligations and
such DIP Financing (and all obligations secured thereby) on the same basis as the other Liens securing the
obligations under the Indenture and the Notes and the Other Pari Passu Secured Indebtedness are so
subordinated to the Liens securing the Credit Facility Obligations under the Intercreditor Agreement,
(ii) the Second Lien Collateral Agent, on behalf of itself and the other Holders and the holders of Other Pari
Passu Secured Indebtedness, agrees that it will not otherwise seek or request adequate protection in respect
of its Liens on the Collateral, except as otherwise consented to by the First Lien Agent, and (iii) if,
notwithstanding the foregoing, the Second Lien Collateral Agent or any other Holder is granted a Lien on
additional Collateral as adequate protection for the obligations under the Indenture and the Notes, but the
First Lien Agent is not granted a senior and prior Lien on the same Collateral with respect to the Credit
Facility Obligations, then until the discharge of Credit Facility Obligations has occurred, such additional
Collateral shall be assigned to the First Lien Agent for application to the Credit Facility Obligations to the
same extent and on the same terms as proceeds of the Collateral. Notwithstanding the foregoing, if the First
Lien Agent or the other holders of Credit Facility Obligations (or any subset thereof) are granted adequate
protection in the form of payments in the amount of current post-petition incurred fees and expenses, the
Second Lien Collateral Agent, on behalf of itself or any Holder or holder of Other Pari Passu Secured
Indebtedness, may seek or request adequate protection in the form of payments in the amount of current
post-petition incurred fees and expenses, so long as (x) such fees and expenses are not incurred in
connection with any action by the Second Lien Collateral Agent or any other Holders or holders of Other
Pari Passu Secured Indebtedness that is inconsistent with the terms of the Intercreditor Agreement and
(y) such fees and expenses are set forth in a budget approved by First Lien Agent; provided that nothing
contained in the Intercreditor Agreement shall limit the right of First Lien Agent or other holders of Credit
Agreement Obligations to object to the amount of such fees and expenses so sought by the Second Lien
Collateral Agent on behalf of the Holders or holders of Other Pari Passu Secured Indebtedness.
The Intercreditor Agreement will limit the right of the Second Lien Collateral Agent and the Holders of
the Notes (and the holders of any Other Pari Passu Secured Indebtedness, if any) to seek relief from the
“automatic stay” without the prior written consent of the First Lien Agent and the required lenders under
the Credit Facilities. The Intercreditor Agreement will also provide that the Second Lien Collateral Agent,
for each of the Holders and the Holders of Other Pari Passu Secured Indebtedness, agrees that it will
consent to and not object to or oppose a sale or other disposition of any Collateral or other assets,
properties or capital stock securing the Credit Facility Obligations (or any portion thereof) free and clear of
security interests, liens or other claims if the First Lien Agent has consented to such sale or disposition;
provided that the Liens of the Second Lien Collateral Agent in such Collateral attach to the proceeds thereof
from such sale with the same priority relative to the Liens of the First Lien Lenders as its Liens in such
Collateral and provided, further, that the Second Lien Collateral Agent and the Holders of the Notes and
the holders of any Other Pari Passu Secured Indebtedness are not prohibited from asserting any objection
to the bidding and related procedures proposed to be utilized in connection with such sale or other
disposition that may be asserted by any unsecured creditor of an Issuer or a Guarantor.
The Intercreditor Agreement will provide that, until the discharge of the Credit Facility Obligations
and subject to the standstill provisions of the Intercreditor Agreement, the Second Lien Collateral Agent
may not assert any right of marshalling, appraisal, valuation or other similar right that may be available
under applicable law with respect to the Collateral or any other similar rights a junior secured creditor may
have under applicable law.
The obligations under the Credit Agreement and the obligations under the Indenture and the Notes
and any Other Pari Passu Secured Indebtedness may be refinanced or replaced, in whole or in part, in each
case, without notice to, or the consent (except to the extent a consent is otherwise required to permit the
refinancing transaction under the Credit Agreement or any collateral document related thereto or under the

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Indenture with respect to a redemption and under the Security Documents) of the First Lien Agent, the
Second Lien Collateral Agent or any holder of Notes, all without affecting the Lien priorities provided for in
the Intercreditor Agreement; provided, however, that the lenders or holders of any such refinancing or
replacement indebtedness (or an authorized agent or trustee on their behalf) bind themselves in writing to
the terms of the Intercreditor Agreement by executing a joinder to the Intercreditor Agreement or an
amendment or supplement to the Intercreditor Agreement agreeing to the terms of the Intercreditor
Agreement.
In addition, if at any time in connection with or after the discharge of Credit Facility Obligations, the
Issuers enter into any replacement or refinancing of the Credit Agreement, then such prior discharge of
Credit Facility Obligations shall automatically be deemed not to have occurred for all purposes of the
Intercreditor Agreement, and the Obligations under such replacement or refinancing shall automatically be
treated as Credit Facility Obligations for all purposes of the Intercreditor Agreement, including for
purposes of the Lien priorities and rights in respect of the Collateral set forth therein. During the period the
Credit Agreement is not in existence, the Notes and the Note Guarantees will be secured by a first priority
Lien on the Collateral.

Collateral
Sufficiency of Collateral
The Fair Market Value of the Collateral is subject to fluctuations based on factors that include, among
others, the ability to sell the Collateral in an orderly sale, general economic conditions, the availability of
buyers and similar factors. The amount to be received upon a sale of the Collateral would also be dependent
on numerous factors, including, but not limited to, the actual Fair Market Value of the Collateral at such
time and the timing and the manner of the sale. By its nature, portions of the Collateral may be illiquid and
may have no readily ascertainable market value. Accordingly, there can be no assurance that the Collateral
can be sold in a short period of time or in an orderly manner. In addition, in the event of a bankruptcy, the
ability of the holders to realize upon any of the Collateral may be subject to certain bankruptcy law
limitations as described below. See “Risk Factors — Risks Related to the Notes — There may not be
sufficient collateral to pay all or any of the notes, especially if we incur additional secured indebtedness
ranking prior to or pari passu with the notes, which will dilute the value of the collateral securing the notes
and guarantees.”
The Collateral will be pledged pursuant to the Security Documents, which will contain provisions
relating to the administration, preservation and disposition of the Collateral. The following is a summary of
some of the covenants and provisions set forth in the Security Documents and the Indenture as they relate
to the Collateral.

Maintenance of Collateral
The Indenture and the Security Documents will provide that each Issuer will, and will cause each of the
Restricted Subsidiaries to (i) at all times maintain, preserve and protect all property material to the conduct
of its business and keep such property in good repair, working order and condition (other than wear and
tear); (ii) from time to time make, or cause to be made, all required repairs, renewals, additions,
improvements and replacements thereto or that the Issuers deem necessary or appropriate in order that the
business carried on in connection therewith may be properly conducted at all times; (iii) keep its insurable
property adequately insured at all times by financially sound and reputable insurers; and (iv) maintain such
other insurance, to such extent and against such risks as is customary with companies in the same or
similar businesses operating in the same or similar locations.

After-acquired Property
If any Issuer or Guarantor acquires property that is not automatically subject to a perfected security
interest or Lien under the Security Documents and such property would be of the type that would constitute

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Collateral, or if a Restricted Subsidiary becomes a Guarantor, then such Issuer or such Guarantor will
provide security interests in and Liens on such property (or, in the case of a new Guarantor, all of its assets
constituting Collateral) in favor of the Second Lien Collateral Agent for its benefit and the benefit of the
Holders of the Notes and the holders of any Other Pari Passu Secured Indebtedness and deliver certain
joinder agreements and certificates in respect thereof as required by the Indenture and the Security
Documents.

Further Assurances
Subject to the limitations described above under “— General,” the Security Documents and the
Indenture will provide that the Issuers and the Guarantors shall, at their expense, duly execute and deliver,
or cause to be duly executed and delivered, such further agreements, documents, instruments, financing
and continuation statements and amendments thereto and do or cause to be done such further acts as may
be necessary or proper to evidence, perfect, maintain and enforce the security interests and the priority
thereof in the Collateral in favor of the Second Lien Collateral Agent for its benefit and for the benefit of the
Holders of the Notes and the Trustee and the holders of any Other Pari Passu Secured Indebtedness, and to
otherwise effectuate the provisions or purposes of the Indenture and the Security Documents.

Real Estate Mortgages and Filings

Subject to the limitations described above under “— General,” and provided that the following does not
grant any real estate security interests beyond those required pursuant to the Credit Agreement or the
collateral documents securing the Credit Facility Obligations, with respect to any fee interest in certain
Real Property identified in a schedule to the Indenture as owned by any Issuer or Guarantor on the Issue
Date or fee interest in Real Property acquired by any Issuer or Guarantor after the Issue Date or that
otherwise secures the Credit Facility Obligations, but exclusive of Excluded Property (individually and
collectively, the “Mortgaged Property”) in each instance:
(1) with respect to each Mortgaged Property, the Issuers and the Guarantors will cause to be
delivered to the Second Lien Collateral Agent, as mortgagee or beneficiary, as applicable, fully
executed counterparts of a Mortgage, in accordance with the requirements of the Indenture and/or the
Security Documents, duly executed by the applicable Issuer or the applicable Guarantor, as the case
may be, together with reasonably satisfactory evidence of the completion (or reasonably satisfactory
arrangements for the completion) of all recordings and filings of such Mortgage (and payment of any
taxes or fees in connection therewith) as may be necessary to create a valid, perfected at least Second
Priority Lien (subject to Permitted Liens) against the Mortgaged Property purported to be covered
thereby;
(2) for any Mortgaged Property, the Issuers and the Guarantors shall deliver to the Second Lien
Collateral Agent mortgagee’s title insurance policies in favor of the Second Lien Collateral Agent, as
mortgagee for the benefit of itself, the Holders of the Notes and holders of any Other Pari Passu
Secured Indebtedness, in the form and amount reasonably necessary, with respect to the property
purported to be covered by such Mortgage, to insure that the interests created by the Mortgage
constitute valid and at least Second Priority Liens on such Mortgaged Property free and clear of all
Liens, defects and encumbrances (other than Permitted Liens), each such title insurance policy to be in
an amount reasonably satisfactory to the Second Lien Collateral Agent (provided, however, that title
insurance policies (and the amount thereof) deemed satisfactory to the collateral agent under the
Credit Facilities and related collateral documents shall be deemed reasonably satisfactory to the
Second Lien Collateral Agent), and provided, further, that, after the discharge of the Credit Facility
Obligations, the Second Lien Collateral Agent shall be entitled to conclusively rely upon the
recommendations of an insurance consultant engaged by the Issuers with respect to title insurance
policies (and the amount thereof), and such policies shall also include, to the extent available at a
commercially reasonable premium, the endorsements, as applicable, equivalent to those delivered in
connection with the Credit Facilities and shall be accompanied by evidence of the payment in full of all
premiums thereon; and

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 (3) the Issuers and the Guarantors shall deliver to the Second Lien Collateral Agent, with respect
to each Mortgaged Property, such filings (or any updates or affidavits that the title company may
reasonably require as necessary to issue the title insurance policies), surveys and fixture filings, along
with such other documents, opinions, instruments, certificates, consents and agreements, as the
Second Lien Collateral Agent shall reasonably require to create, evidence or perfect a valid and at least
Second Priority Lien on the Mortgaged Property subject to each such Mortgage (subject to Permitted
Liens) (provided, however, that any such filings (including such updates and affidavits), documents,
opinions, instruments, certificates or agreements (including surveys) deemed reasonably satisfactory
to the collateral agent under the Credit Facilities and related collateral documents shall be deemed
reasonably acceptable to the Second Lien Collateral Agent).
The Issuers do not expect to have completed all the actions necessary to perfect certain of the
Mortgages by the completion of this offering. See “Risk Factors — Risks Related to the Notes — With respect
to our real property to be mortgaged as security for the notes, we do not expect all title insurance policies or
surveys will be in place at the time of the issuance of the notes. Any issues that we are not able to resolve in
connection with the issuance of such title policies or surveys may impact the value of the collateral.”

Foreclosure
In the event of foreclosure on the Collateral, the proceeds from the sale of the Collateral may not be
sufficient to satisfy the Issuers’ obligations under the Notes, either in whole or in part.

Other Pari Passu Secured Indebtedness

To the extent an Issuer and its Restricted Subsidiaries are permitted to incur Other Pari Passu Secured
Indebtedness under the covenants described below under “— Certain Covenants — Limitations on Liens”
and “— Limitations on Additional Indebtedness,” the holders of such Other Pari Passu Secured
Indebtedness will share the Second Priority Lien granted to the Second Lien Collateral Agent on an equal
and ratable basis with the Holders of the Notes. Subject to the provisions of the Intercreditor Agreement,
the proceeds of the Second Priority Lien in the Collateral will be distributed first, to the Trustee, the Second
Lien Collateral Agent and any representative for Other Pari Passu Secured Indebtedness for the payment of
all costs and expenses incurred in connection with the collection of proceeds from the sale of any Collateral
or otherwise in connection with the Indenture and any documents relating to the Other Pari Passu Secured
Indebtedness, the Security Documents and the Intercreditor Agreement (including all existing claims for
indemnification under the Indenture or any other document evidencing Other Pari Passu Secured
Indebtedness), including all court costs and the reasonable fees and expenses of their agents and legal
counsel, the repayment of all advances made by the Trustee or Second Lien Collateral Agent or
representative of any Other Pari Passu Secured Indebtedness on behalf of any Issuer or any Guarantor and
any other costs and expenses incurred in connection with the exercise of any right or remedy of the Holders
of the Notes or the holders of the Other Pari Passu Secured Indebtedness, and second, to the Trustee and
any representative of Other Pari Passu Secured Indebtedness to pay the principal and any accrued and
unpaid interest thereon on a pro rata basis on the respective amounts of the Notes and the Other Pari Passu
Secured Indebtedness then outstanding. The Second Lien Collateral Agent will only be permitted, subject
to applicable law, the Intercreditor Agreement, and the next sentence, to exercise remedies and sell the
Collateral at the direction of the holders of a majority in the aggregate principal amount of the Notes and
such Other Pari Passu Secured Indebtedness. Upon written instruction from the Holders or the holders of
Other Pari Passu Secured Indebtedness in accordance with the Indenture and the Security Documents, the
Second Lien Collateral Agent shall take, but shall in no event have any liability for the taking, any delay in
taking or the failure to take, such actions with regard to a default or an event of default which the Second
Lien Collateral Agent, in good faith, believes to be reasonably required to promote and protect the interests
of the Holders of the Notes and the holders of Other Pari Passu Secured Indebtedness and to preserve the
value of the Collateral. Any action taken or not taken without the vote of any Holder or holder of Other Pari
Passu Secured Indebtedness pursuant to the remedies section of the Security Documents shall nevertheless
be binding on such party.

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 In the event of any determination by a court of competent jurisdiction with respect to any series of
Other Pari Passu Secured Indebtedness (other than any Additional Notes) that (i) such series of Other Pari
Passu Secured Indebtedness is unenforceable under applicable law or are subordinated to any other
obligations (other than the Notes or another series of Other Pari Passu Secured Indebtedness), (ii) such
series of Other Pari Passu Secured Indebtedness does not have an enforceable security interest in any of the
Collateral and/or (iii) any intervening security interest exists securing any other obligations (other than the
Notes or other series of Other Pari Passu Secured Indebtedness) on a basis ranking prior to the security
interest of such series of Other Pari Passu Secured Indebtedness but junior to the security interest of the
Notes or other series of Other Pari Passu Secured Indebtedness (any such condition referred to in the
foregoing clauses (i), (ii) or (iii) with respect to any series of Other Pari Passu Secured Indebtedness, an
“Impairment” of such series of Other Pari Passu Secured Indebtedness), the results of such Impairment
shall be borne solely by the holders of such series of Other Pari Passu Secured Indebtedness, and the rights
of the holders of such series of Other Pari Passu Secured Indebtedness (including, without limitation, the
right to receive distributions in respect of such series of Other Pari Passu Secured Indebtedness) set forth
herein shall be modified to the extent necessary so that the effects of such Impairment are borne solely by
the holders of such series of Other Pari Passu Secured Indebtedness subject to such Impairment.
Notwithstanding the foregoing, with respect to any Collateral for which a third party (other than a holder of
the Notes or series of Other Pari Passu Secured Indebtedness) has a lien or security interest that is junior in
priority to the security interest of the Holders or any series of Other Pari Passu Secured Indebtedness but
senior (as determined by appropriate legal proceedings in the case of any dispute) to the security interest of
the holder of any other series of Other Pari Passu Secured Indebtedness (other than any Additional Notes)
(such third party, an “Intervening Creditor”), the value of any Collateral or proceeds which are allocated to
such Intervening Creditor shall be deducted on a ratable basis solely from the Collateral or proceeds to be
distributed in respect of the series of Other Pari Passu Secured Indebtedness with respect to which such
Impairment exists.

Certain Bankruptcy Limitations

The right of the Second Lien Collateral Agent to repossess and dispose of the Collateral upon the
occurrence of an Event of Default would be significantly impaired (or at a minimum delayed) by applicable
bankruptcy law in the event that a bankruptcy case were to be commenced by or against any Issuer or any
Guarantor prior to the Second Lien Collateral Agent having repossessed and disposed of the Collateral.
Upon the commencement of a case for relief under the Bankruptcy Code, a secured creditor such as the
Second Lien Collateral Agent is prohibited from repossessing its security from a debtor in a bankruptcy
case, or from disposing of security repossessed from the debtor or any other Collateral, without prior
bankruptcy court approval (which may not be given under the circumstances). Applicable legislation in
other jurisdictions may impose similar approval requirements in relation to debtors in foreign proceedings.
In view of the broad equitable powers of a U.S. bankruptcy court and the lack of a precise definition of
the term “adequate protection”, it is impossible to predict whether or when payments under the Notes or
any Guarantees could be made following the commencement of a bankruptcy case (or the length of any
delay in making such payments), whether or when the Second Lien Collateral Agent could repossess or
dispose of the Collateral, the value of the Collateral at the time of the bankruptcy petition or whether or to
what extent Holders of the Notes would be compensated for any delay in payment or loss of value of the
Collateral (through the provision of adequate protection or otherwise). The Bankruptcy Code only permits
the payment and/or accrual of post-petition interest, costs, expenses and fees to a secured creditor during a
debtor’s bankruptcy case to the extent the value of the Collateral is determined by the bankruptcy court to
exceed the aggregate outstanding principal amount of the obligations secured by the Collateral, including
any obligation secured on a priority basis.
Furthermore, in the event a bankruptcy court determines that the value of the Collateral is not
sufficient to repay all amounts due on the Notes after payment of any priority claims, the Holders of the
Notes would hold secured claims only to the extent of the value of the Collateral to which the Holders of the

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Notes are entitled (and subject to the rights in the Collateral of holders of the Credit Facility Obligations),
and unsecured claims with respect to such shortfall.

Release
The Liens on the Collateral will be released with respect to the Notes and the Note Guarantees, as
applicable:
(1) in whole, upon payment in full of the principal of, accrued and unpaid interest, and premium,
if any, on the Notes;
(2) in whole, upon satisfaction and discharge of the Indenture;
(3) in whole, upon a legal defeasance or a covenant defeasance as set forth under “— Legal
Defeasance and Covenant Defeasance”;
(4) as to any asset constituting Collateral (A) that is sold or otherwise disposed of by any Issuer or
any Guarantor in a transaction permitted by “— Certain Covenants — Limitations on Asset Sales” and
by the Security Documents (to the extent of the interest sold or disposed of and other than any sale or
disposition among the Issuers and the Guarantors) or otherwise permitted by the Indenture and the
Security Documents, if all other Liens on that asset securing the Credit Facility Obligations and any
Other Pari Passu Secured Indebtedness then secured by that asset (including all commitments
thereunder) are released other than any sale or disposition in connection with a Specified Sale and
Lease-Back Transaction; or (B) that is otherwise released in accordance with, and as expressly
provided for in accordance with, the Indenture, the Intercreditor Agreement, and the Security
Documents;
(5) as to any asset constituting Collateral when expressly required by the Intercreditor Agreement,
to the extent the corresponding first priority Liens securing Credit Facility Obligations are released,
unless such release occurs in connection with a repayment or termination of the Credit Agreement;
(6) as set forth under “— Amendment, Supplement and Waiver,” as to property that constitutes
less than all or substantially all of the Collateral, with the consent of holders of at least a majority in
aggregate principal amount of the Notes and Other Pari Passu Secured Indebtedness then
outstanding, voting as one class (or, in the case of a release of all or substantially all of the Collateral,
with the consent of the holders of at least sixty-six and two-thirds percent (66 2/3%) in aggregate
principal amount of the Notes and Other Pari Passu Secured Indebtedness then outstanding, voting as
one class), including consents obtained in connection with a tender offer or exchange offer for, or
purchase of, Notes; and
(7) with respect to assets of a Guarantor upon release of such Guarantor from its Note Guarantee
as set forth under “— Note Guarantees.”
Upon compliance by any Issuer or any Guarantor, as the case may be, with the conditions precedent
required by the Indenture, the Trustee or the Second Lien Collateral Agent shall promptly cause to be
released and reconveyed to such Issuer or such Guarantor, as the case may be, the released Collateral. Prior
to each proposed release, each Issuer and each Guarantor will furnish to the Trustee and the Second Lien
Collateral Agent all documents required by the Indenture and the Security Documents and an Officers’
Certificate and an opinion of counsel.

Change of Control
Upon the occurrence of any Change of Control, each Holder will have the right to require that the
Issuers purchase that Holder’s Notes for a cash price (the “Change of Control Purchase Price”) equal to
101% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any,
to the date of purchase.

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 Within 30 days following any Change of Control, the Issuers will send by electronic transmission or
mail, or cause to be sent by electronic transmission or mail, to the Holders a notice, with a copy to the
Trustee:
(1) describing the transaction or transactions that constitute the Change of Control;
(2) offering to purchase, pursuant to the procedures required by the Indenture and described in
the notice (a “Change of Control Offer”), on a date specified in the notice (which shall be a Business
Day not earlier than 30 days nor later than 60 days from the date the notice is sent or mailed) and for
the Change of Control Purchase Price, all Notes properly tendered by such Holder pursuant to such
Change of Control Offer; and
(3) describing the procedures that Holders must follow to accept the Change of Control Offer. The
Change of Control Offer is required to remain open for at least 20 Business Days or for such longer
period as is required by law.
The Issuers will publicly announce the results of the Change of Control Offer on or as soon as
practicable after the date of purchase.
The Credit Agreement will prohibit us from purchasing any Notes, subject to certain exceptions, and
will also provide that some change of control events with respect to us would constitute a default
thereunder. Any future credit agreements or other agreement to which the Issuers become a party may
contain similar restrictions. In the event a Change of Control occurs at a time when the Issuers are
prohibited from purchasing Notes, the Issuers could seek the consent from the lenders under the Credit
Agreement to the purchase of Notes or could attempt to refinance the borrowings that contain the
prohibition. If the Issuers do not obtain a consent or repay the borrowings, the Issuers will remain
prohibited from purchasing Notes. In that case, our failure to purchase tendered Notes would constitute an
Event of Default under the Indenture which would, in turn, constitute a default under the Credit Agreement.
In such circumstances, the provisions of the Intercreditor Agreement would restrict the ability of holders of
Notes and the Second Lien Collateral Agent to enforce their rights to the Collateral. See “— Security —
Intercreditor Agreement.”
The provisions described above that require us to make a Change of Control Offer following a Change
of Control will be applicable regardless of whether any other provisions of the Indenture are applicable to
the transaction giving rise to the Change of Control. 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 the
Issuers purchase or redeem the Notes in the event of a takeover, recapitalization or similar transaction.
The obligation of the Issuers to make a Change of Control Offer will be satisfied if a third party makes
the Change of Control Offer in the manner and at the times and otherwise in compliance with the
requirements applicable to a Change of Control Offer made by the Issuers and purchases all Notes properly
tendered and not withdrawn under the Change of Control Offer. In addition, the Issuers will not be required
to make a Change of Control Offer upon a Change of Control if the Notes have been or are called for
redemption by the Issuers prior to them being required to send or mail notice of the Change of Control
Offer, and thereafter redeem all notes called for redemption in accordance with the terms set forth in such
redemption notice. Notwithstanding anything to the contrary contained herein, a revocable 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.
With respect to any disposition of assets, the phrase “all or substantially all” as used in the Indenture
(including as set forth under the definition of “Change of Control” and under “— Certain Covenants —
Limitations on Mergers, Consolidations, Etc.”) varies according to the facts and circumstances of the
subject transaction, has no clearly established meaning under New York law (which governs the Indenture)
and is subject to judicial interpretation. Accordingly, in certain circumstances there may be a degree of
uncertainty in ascertaining whether a particular transaction would involve a disposition of “all or

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substantially all” of the assets of the Issuers, and therefore it may be unclear as to whether a Change of
Control has occurred and whether the Holders have the right to require the Issuers to purchase Notes.
The Issuers will comply with applicable tender offer rules, including the requirements of Rule 14e-1
under the Exchange Act and any other applicable laws and regulations in connection with the purchase of
Notes pursuant to a Change of Control Offer. To the extent that the provisions of any securities laws or
regulations conflict with the “Change of Control” provisions of the Indenture, the Issuers will be required to
comply with the applicable securities laws and regulations and will not be deemed to have breached its
obligations under the “Change of Control” provisions of the Indenture by virtue of this compliance.
If a Change of Control does occur, there can be no assurance that the Issuers will have the financial
resources at the time of the Change of Control to make any required repurchases of the Notes. In addition,
we cannot assure you that in the event of a Change of Control, the Issuers will be able to obtain the
consents necessary to consummate a Change of Control Offer from the lenders under agreements
governing outstanding Indebtedness which may prohibit the offer. See “Risk Factors — Risks Related to the
Notes — We may not have the funds necessary to satisfy all of our obligations under our senior secured
credit facility, the notes or other indebtedness in connection with certain change of control events.”
In the event that Holders of at least 90% of the aggregate principal amount of the Notes then
outstanding accept a Change of Control Offer and the Issuers purchase all of the Notes held by such
Holders, the Issuers will have the right, upon not less than 30 nor more than 60 days’ prior notice, given not
more than 30 days following the purchase pursuant to the Change of Control Offer described above, to
redeem all of the Notes that remain outstanding following such purchase at a redemption price equal to the
Change of Control Purchase Price plus, to the extent not included in the Change of Control Purchase Price,
accrued and unpaid interest, if any, on the Notes that remain outstanding, to the date of redemption
(subject to the right of holders of Notes on the relevant record date to receive interest due on the relevant
interest payment date).

Certain Covenants
Set forth below are summaries of certain covenants contained in the Indenture that will apply to the
Issuers and the Issuers’ Restricted Subsidiaries.
If on any date following the Issue Date (i) the Notes have an Investment Grade Rating from both
Rating Agencies and (ii) no Default has occurred and is continuing under the Indenture (the occurrence of
the events described in the foregoing clauses (i) and (ii) being collectively referred to as a “Covenant
Suspension Event” and the date thereof being referred to as the “Suspension Date”), then, the covenants
specifically listed under the following captions in this “Description of Notes” section of this offering
memorandum will no longer be applicable to the Notes (collectively, the “Suspended Covenants”) until the
occurrence of the Reversion Date (as defined below):
(1) “— Limitations on Additional Indebtedness”;
(2) “— Limitations on Restricted Payments”;
(3) “— Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries”;
(4) “— Limitations on Transactions with Affiliates”;
(5) “— Limitations on Asset Sales”;
(6) “— Limitations on Designation of Unrestricted Subsidiaries”; and
(7) clause (3) of the first paragraph of “— Limitations on Mergers, Consolidations, Etc.”
During any period that the foregoing covenants have been suspended, the Issuers may not designate
any of their Subsidiaries as Unrestricted Subsidiaries.
If and while the Issuers and their Restricted Subsidiaries are not subject to the Suspended Covenants,
the Notes will be entitled to substantially less covenant protection. In the event that the Issuers and their

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Restricted Subsidiaries are not subject to the Suspended Covenants under the Indenture for any period of
time as a result of the foregoing, and on any subsequent date (the “Reversion Date”) one or both of the
Rating Agencies withdraw their Investment Grade Rating or downgrade the rating assigned to the Notes
below an Investment Grade Rating, then the Issuers and their Restricted Subsidiaries will thereafter again
be subject to the Suspended Covenants under the Indenture with respect to future events. The period of
time between the Suspension Date and the Reversion Date is referred to in this description as the
“Suspension Period.” Additionally, upon the occurrence of a Covenant Suspension Event, the amount of
Excess Proceeds from any Asset Sales shall be reset to zero. During the Suspension Period, the Issuers and
their Restricted Subsidiaries will be entitled to incur Liens to the extent provided for under “— Limitations
on Liens” (including, without limitation, Permitted Liens) to the extent provided for in such covenant and
any Permitted Liens which may refer to one or more Suspended Covenants shall be interpreted as though
such applicable Suspended Covenant(s) continued to be applicable during the Suspension Period (but
solely for purposes of the “— Limitations on Liens” covenant and for no other covenant).
Notwithstanding the foregoing, in the event of any such reinstatement, no action taken or omitted to
be taken by the Issuers or any of their Restricted Subsidiaries prior to such reinstatement will give rise to a
Default or Event of Default under the Indenture with respect to the Notes; provided that (1) with respect to
Restricted Payments made after such reinstatement, the amount available to be made as Restricted
Payments will be calculated as though the covenant described above under the caption “— Limitations on
Restricted Payments” had been in effect prior to, but not during, the Suspension Period; and (2) all
Indebtedness incurred, or Disqualified Equity Interests issued, during the Suspension Period will be
classified to have been incurred or issued pursuant to clause (3) of the second paragraph of “— Limitations
on Additional Indebtedness”; (3) any Affiliate Transaction entered into after such reinstatement pursuant to
an agreement entered into during any Suspension Period shall be deemed to be permitted pursuant to
clause (7) of the second paragraph of the covenant described under “— Limitations on Transactions with
Affiliates”; (4) any encumbrance or restriction on the ability of any Restricted Subsidiary that is not a
Guarantor to take any action described in clauses (a) through (c) of the first paragraph of the covenant
described under “— Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries” that
becomes effective during any Suspension Period shall be deemed to be permitted pursuant to clause (4) of
the second paragraph of the covenant described under “— Limitations on Dividend and Other Restrictions
Affecting Restricted Subsidiaries”; and (5) no Subsidiary of the Issuers shall be required to comply with the
covenant described under “— Limitations on Designation of Unrestricted Subsidiaries” after such
reinstatement with respect to any guarantee entered into by such Subsidiary during any Suspension Period.
There can be no assurance that the Notes will ever achieve or maintain an Investment Grade Rating.
Promptly following the occurrence of any Covenant Suspension Event or Reversion Date, the Issuers
will provide an Officers’ Certificate to the Trustee regarding such occurrence. The Trustee shall not have
any obligation to monitor the ratings of the Notes, the occurrence or date of any Covenant Suspension
Event or Reversion Date and may rely conclusively on the Officers’ Certificate with respect to the same. The
Trustee shall not have any obligation to notify the Holders of the occurrence or date of any Covenant
Suspension Event or Reversion Date, but may provide a copy of such Officers’ Certificate to any Holder
upon request.

Limitations on Additional Indebtedness

The Issuers will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur any
Indebtedness; provided that any Issuer or any Guarantor may incur additional Indebtedness if, after giving
effect thereto, the Fixed Charge Coverage Ratio would be at least 2.00 to 1.00 (the “Coverage Ratio
Exception”).
Notwithstanding the above, each of the following shall be permitted (the “Permitted Indebtedness”):
(1) Indebtedness of the Issuers and any Guarantor under the Credit Facilities in an aggregate
amount at any time outstanding not to exceed the greater of (x) $375.0 million, less to the extent a

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permanent repayment and/or commitment reduction is required thereunder as a result of such
application, the aggregate amount of Net Available Proceeds applied to repayments under the Credit
Facilities in accordance with the covenant described under “— Limitations on Asset Sales,” and (y) the
sum of (i) 85% of the net book value of the accounts receivable of the Issuers and any Guarantors plus
(ii) 60% of the net book value of the inventory of the Issuers and any Guarantors plus (iii) 40% of the net
book value of property, plant and equipment of the Issuers and any Guarantors, in each case calculated
on a consolidated basis and in accordance with GAAP;
(2) the Notes issued on the Issue Date and the related Note Guarantees;
(3) Indebtedness of the Issuers and the Restricted Subsidiaries to the extent outstanding on the
Issue Date (other than Indebtedness referred to in clauses (1) and (2) above, and after giving effect to
the intended use of proceeds of the Notes);
(4) Indebtedness under Hedging Obligations that are designed to protect against fluctuations in
interest rates, foreign currency exchange rates and commodity prices; provided that if such Hedging
Obligations are of the type described in clause (1) of the definition thereof, (a) such Hedging
Obligations relate to payment obligations on Indebtedness otherwise permitted to be incurred by this
covenant, and (b) the notional principal amount of such Hedging Obligations at the time incurred does
not exceed the principal amount of the Indebtedness to which such Hedging Obligations relate;
(5) (x) Indebtedness of any Issuer owed to a Restricted Subsidiary or any other Issuer and
Indebtedness of any Restricted Subsidiary owed to any Issuer or any other Restricted Subsidiary and
(y) guarantees by any Issuer of any Indebtedness of a Restricted Subsidiary or any other Issuer and
guarantees by any Restricted Subsidiary that is a Guarantor of any Indebtedness of any Issuer or any
other Restricted Subsidiary that is a Guarantor; provided, however, that upon any such Restricted
Subsidiary ceasing to be a Restricted Subsidiary or such Indebtedness being owed to any Person other
than an Issuer or a Restricted Subsidiary, such Issuer or such Restricted Subsidiary, as applicable, shall
be deemed to have incurred Indebtedness not permitted by this clause (5);
(6) Indebtedness in respect of (A) bid, performance, indemnity or surety bonds provided by an
Issuer or any Restricted Subsidiary in the ordinary course of business, including guarantees or
obligations of an Issuer or any Restricted Subsidiary with respect to letters of credit supporting such
bid, performance or surety obligations and (B) in respect of performance bonds or similar obligations of
an Issuer or any of its Restricted Subsidiaries for or in connection with pledges, deposits or payments in
the ordinary course of business (in each case other than for an obligation for money borrowed);
(7) Purchase Money Indebtedness incurred by any Issuer or any Restricted Subsidiary, and
Refinancing Indebtedness thereof, in an aggregate amount not to exceed the greater of (x) $65.0
million and (y) 7.0% of Consolidated Total Assets at any one time outstanding;
(8) Indebtedness arising from the honoring by a bank or other financial institution of a check,
draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is
extinguished within five Business Days of incurrence;
(9) Indebtedness arising in connection with endorsement of instruments for deposit in the
ordinary course of business;
(10) Indebtedness of a Restricted Subsidiary Incurred and outstanding on or prior to the date on
which such Subsidiary was acquired by an Issuer (other than Indebtedness Incurred in connection
with, or for the purpose of providing all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant to which such Subsidiary
became a Subsidiary or was acquired by an Issuer); provided, however, that on the date of such
acquisition and after giving pro forma effect thereto, either:
(a) the Issuers would have been able to Incur at least $1.00 of additional Indebtedness
pursuant to the first paragraph of this covenant; or

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 (b) the Fixed Charge Coverage Ratio of the Issuers would not be less than the Fixed Charge
Coverage Ratio immediately prior to the consummation of such acquisition;
(11) Refinancing Indebtedness with respect to Indebtedness incurred pursuant to the Coverage
Ratio Exception or clause (2), (3) and (10) or this clause (11) of this covenant;
(12) Indebtedness of Subsidiaries that are not Guarantors or joint ventures in an aggregate
amount not to exceed the greater of (x) $25.0 million and (y) 3.0% of Consolidated Total Assets at any
one time outstanding;
(13) (a) Indebtedness relating to industrial revenue bonds (or similar conduit financings) issued
on behalf of the Issuers or any Restricted Subsidiary to finance the acquisition or construction of new
plants or facilities, or (b) other Indebtedness to finance the acquisition or construction of new plants or
facilities and secured only by such new plants or facilities, in each case, only to the extent that (i) the
aggregate amount of all such Indebtedness under this clause (13) at any time outstanding does not
exceed $30.0 million and (ii) no Default or Event of Default then exists or would result therefrom;
(14) Prepaid Grain Lines; and
(15) Indebtedness of the Issuers or any Restricted Subsidiary (other than Indebtedness
permitted by clauses (1) to (14) above) in an aggregate amount not to exceed the greater of (x) $55.0
million and (y) 6.0% of Consolidated Total Assets at any one time outstanding.
For purposes of determining compliance with this covenant, in the event that an item of Indebtedness
meets the criteria of more than one of the categories of Permitted Indebtedness described in clauses
(1) through (15) above or is entitled to be incurred pursuant to the Coverage Ratio Exception, the Issuers
shall classify and may reclassify, in each case in their sole discretion, such item of Indebtedness and may
divide, classify and reclassify such Indebtedness in more than one of the types of Indebtedness described,
except that Indebtedness incurred under the Credit Agreement on the Issue Date shall be deemed to have
been incurred under clause (1) above. In addition, for purposes of determining any particular amount of
Indebtedness under this covenant, guarantees, Liens or letter of credit obligations supporting Indebtedness
otherwise included in the determination of such particular amount shall not be included so long as incurred
by a Person that could have incurred such Indebtedness.
Any refinancing or replacement of any Indebtedness, Disqualified Equity Interests or Preferred Stock
incurred under clause (1), (12), (13) or (15) of this covenant or clause (22) of the definition of “Permitted
Liens” shall be permitted under such clause even if the maximum principal amount permitted to be
outstanding under such clause is exceeded in connection with such refinancing or replacement by an
amount equal to the aggregate amount of accrued interest, fees and expenses, including premiums, related
thereto funded with the proceeds of such refinancing or replacement. Any refinancing or replacement of
any Indebtedness, Disqualified Equity Interests or Preferred Stock incurred pursuant to clause (1), (12),
(13) or (15) of this covenant or clause (22) of the definition of “Permitted Liens” in reliance on a percentage
of Consolidated Total Assets shall be permitted under such clause in reliance on an exception based on a
percentage of Consolidated Total Assets so long as the principal amount of such new Indebtedness,
Disqualified Equity Interests or Preferred Stock does not exceed the principal amount of the Indebtedness,
Disqualified Equity Interests or Preferred Stock plus the aggregate amount of accrued interest, fees and
expenses, including premiums, related thereto funded with the proceeds of such refinancing or
replacement.
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

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 (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;
provided that the amount of any Indebtedness that is included in a Hedging Obligation permitted
under clause (b)(4) of this covenant shall be calculated after giving effect to such Hedging Obligation.

Limitations on Layering Indebtedness

The Issuers will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur any
Indebtedness that is or purports to be by its terms (or by the terms of any agreement governing such
Indebtedness) subordinated in right of payment to any other Indebtedness of the Issuers or of such
Restricted Subsidiary, as the case may be, unless such Indebtedness is also by its terms (or by the terms of
any agreement governing such Indebtedness) made expressly subordinate in right of payment to the Notes
or the Note Guarantee of such Restricted Subsidiary, to the same extent and in the same manner as such
Indebtedness is subordinated in right of payment to such other Indebtedness of the Issuers or such
Restricted Subsidiary, as the case may be.
For purposes of the foregoing, no Indebtedness will be deemed to be subordinated in right of payment
to any other Indebtedness of the Issuers or any Restricted Subsidiary solely by virtue of being unsecured or
by virtue of the fact that the holders of such Indebtedness have entered into intercreditor agreements or
other arrangements giving one or more of such holders priority over the other holders in the collateral held
by them.

Limitations on Restricted Payments

The Issuers will not, and will not permit any Restricted Subsidiary to, directly or indirectly, make any
Restricted Payment if at the time of such Restricted Payment:
(1) a Default shall have occurred and be continuing or shall occur as a consequence thereof;
(2) the Issuers cannot incur $1.00 of additional Indebtedness pursuant to the Coverage Ratio
Exception; or
(3) the amount of such Restricted Payment, when added to the aggregate amount of all other
Restricted Payments made after the Issue Date (other than Restricted Payments made pursuant to
clause (2), (3) or (4) of the next paragraph), exceeds the sum (the “Restricted Payments Basket”) of
(without duplication):
(a) 50% of Consolidated Net Income for the period (taken as one accounting period)
commencing on September 28, 2014, and ending on the last day of the fiscal quarter ended
immediately prior to the date of such calculation for which internal financial statements are
available (or, if such Consolidated Net Income shall be a deficit, minus 100% of such aggregate
deficit), plus
(b) 100% of the aggregate net cash proceeds, including the Fair Market Value of property
other than cash, received by an Issuer either (x) as contributions to the common equity of such
Issuer after the Issue Date or (y) from the issuance and sale of Qualified Equity Interests after the
Issue Date, in each case, other than any such proceeds which are used (x) to redeem Notes in
accordance with “— Optional Redemption — Redemption with Proceeds from Equity Offerings,”
(y) to make Restricted Payments in reliance on clause (3) of the next succeeding paragraph or
(z) any such proceeds or assets received from a Subsidiary of an Issuer, plus
(c) the aggregate amount by which Indebtedness incurred by an Issuer or any Restricted
Subsidiary subsequent to the Issue Date is reduced on such Issuer’s balance sheet upon the
conversion or exchange (other than by a Subsidiary of such Issuer) into Qualified Equity Interests

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 (less the amount of any cash, or the fair value of assets, distributed by such Issuer or any
Restricted Subsidiary upon such conversion or exchange), plus
(d) in the case of the disposition or repayment of or return on any Investment that was
treated as a Restricted Payment made after the Issue Date, an amount (to the extent not included
in the computation of Consolidated Net Income) equal to the lesser of (i) 100% of the aggregate
amount received by an Issuer or any Restricted Subsidiary in cash or other property (valued at the
Fair Market Value thereof) as the return of capital with respect to such Investment and (ii) the
amount of such Investment that was treated as a Restricted Payment, in either case, less the cost
of the disposition of such Investment and net of taxes, plus
(e) upon a Redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, the
lesser of (i) the Fair Market Value of an Issuer’s proportionate interest in such Subsidiary
immediately following such Redesignation, and (ii) the aggregate amount of such Issuer’s
Investments in such Subsidiary to the extent such Investments reduced the Restricted Payments
Basket and were not previously repaid or otherwise reduced, plus
(f) $25.0 million.
As of July 1, 2017, the Issuers would have had approximately $40.1 million of capacity to make Restricted
Payments pursuant to this clause (3).
The foregoing provisions will not prohibit:
(1) the payment by an Issuer or any Restricted Subsidiary of any dividend or other distribution
within 60 days after the date of declaration thereof, if on the date of declaration the payment would
have complied with the provisions of the Indenture;
(2) the redemption of any Equity Interests or the redemption, repurchase, defeasance or other
acquisition or retirement for value of Subordinated Indebtedness of an Issuer or any Restricted
Subsidiary in exchange for, or out of the proceeds of the substantially concurrent issuance and sale of,
Qualified Equity Interests; provided that the value of any such Qualified Equity Interests issued in
exchange for such acquired Equity Interests shall be excluded from clause (3)(b) of the first paragraph
of this covenant (and were not included therein at any time);
(3) the redemption, repurchase, defeasance or other acquisition or retirement for value of
Subordinated Indebtedness of an Issuer or any Restricted Subsidiary (a) in exchange for, or out of the
proceeds of the substantially concurrent issuance and sale of, Qualified Equity Interests; provided that
the value of any such Qualified Equity Interests issued in exchange for Subordinated Indebtedness
shall be excluded from clause (3)(b) of the first paragraph of this covenant (and were not included
therein at any time) or (b) in exchange for, or out of the proceeds of the substantially concurrent
incurrence of, Refinancing Indebtedness permitted to be incurred under “— Limitations on Additional
Indebtedness” and the other terms of the Indenture;
(4) repurchases of Equity Interests deemed to occur upon the exercise of stock options or other
Equity Interests, if such repurchased Equity Interests represent a portion of the exercise price thereof,
in an amount not to exceed $2.5 million in any calendar year and $6.0 million in the aggregate;
(5) Permitted Tax Distributions;
(6) Permitted Issuer Distributions;
(7) the payment by an Issuer or any Restricted Subsidiary of “key man” insurance premiums
associated with estate planning in an amount not to exceed $2.5 million in any calendar year;
(8) additional Restricted Payments not to exceed the greater of (x) $25.0 million and (y) 3.0% of
Consolidated Total Assets at any one time outstanding;
(9) the payment by an Issuer or any Restricted Subsidiary of a dividend or other distribution in
the amount of payments due by holders of the Equity Interests of such Issuer or Restricted Subsidiary

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 under Prepaid Grain Lines; provided that such dividend or distribution does not exceed the amount
actually contributed to such Issuer or Restricted Subsidiary by holders of its Equity Interests in cash in
respect of principal and interest relating to such Prepaid Grain Lines; and
(10) additional Restricted Payments, if, at the time of the making of such payment and after
giving effect thereto, the Consolidated Total Leverage Ratio of the Issuers would not exceed 3.0 to 1.0;
provided that (a) in the case of any Restricted Payment pursuant to clause (3), (4), (6), (7), (8), (9) or
(10) above, no Default shall have occurred and be continuing or occur as a consequence thereof and (b) no
issuance and sale of Qualified Equity Interests described in clause (2), (3) or (4) above shall increase the
Restricted Payments Basket.
For purposes of determining compliance with this covenant, in the event that a Restricted Payment or
Investment (or a portion thereof) meets the criteria of more than one of the categories of Restricted
Payments as described in clauses (1) through (10) above or of the definition of “Permitted Investments”, the
Issuers shall classify and may reclassify, in each case in their sole discretion, such Restricted Payment or
Investment (or a portion thereof) and may divide, classify and reclassify such Restricted Payment or
Investment (or a portion thereof) in more than one of the types of Restricted Payments described above or
such clauses of the definition of “Permitted Investments.”

Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries

The Issuers will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create or
otherwise cause or permit to exist or become effective any consensual encumbrance or consensual
restriction on the ability of any Restricted Subsidiary to:
(a) pay dividends or make any other distributions on or in respect of its Equity Interests;
(b) make loans or advances or pay any Indebtedness or other obligation owed to an Issuer or any
other Restricted Subsidiary; or
(c) transfer any of its assets to an Issuer or any other Restricted Subsidiary; except for:
(1) encumbrances or restrictions existing under or by reason of applicable law, rule,
regulation or order;
(2) encumbrances or restrictions existing under the Indenture, the Notes and the Note
Guarantees;
(3) non-assignment provisions or other provisions restricting transfers of any contractor
any lease or license entered into in the ordinary course of business;
(4) encumbrances or restrictions existing under agreements existing on the Issue Date
(including, without limitation, the Credit Agreement) as in effect on that date;
(5) restrictions on the transfer of assets subject to any Lien permitted under the Indenture
imposed by the holder of such Lien;
(6) restrictions on the transfer of assets imposed under any agreement to sell such assets
permitted under the Indenture to any Person pending the closing of such sale;
(7) any instrument governing Acquired Indebtedness, which encumbrance or restriction is
not applicable to any Person, or the properties or assets of any Person, other than the Person or
the properties or assets of the Person so acquired, so long as such Acquired Indebtedness was not
incurred in connection with, or in contemplation of, such acquisition;
(8) any other agreement governing Indebtedness entered into after the Issue Date that
contains encumbrances and restrictions that are not materially more restrictive with respect to any
Restricted Subsidiary than those in effect on the Issue Date with respect to that Restricted
Subsidiary pursuant to agreements in effect on the Issue Date;

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 (9) customary provisions in partnership agreements, limited liability company
organizational governance documents, joint venture agreements and other similar agreements
entered into in the ordinary course of business that restrict the transfer of ownership interests in
such partnership, limited liability company, joint venture or similar Person;
(10) Purchase Money Indebtedness incurred in compliance with the covenant described
under “— Limitations on Additional Indebtedness” that impose restrictions of the nature described
in clause (c) above on the assets acquired;
(11) restrictions on cash or other deposits or net worth imposed by suppliers or landlords
under contracts entered into in the ordinary course of business;
(12) agreements entered into in connection with a Sale and Lease-Back Transaction entered
into in the ordinary course of business or consistent with industry practice or a Specified Sale and
Lease-Back Transaction; and
(13) any encumbrances or restrictions imposed by any amendments or refinancings of the
contracts, instruments or obligations referred to in clauses (1) through (12) above; provided that
such amendments or refinancings are, in the good faith judgment of the relevant Issuer’s Board of
Directors, no more materially restrictive with respect to such encumbrances and restrictions than
those prior to such amendment or refinancing.

Limitations on Holders of Act 9 Bonds

Neither the Issuers nor any Guarantors which are holders of Act 9 Bond (“Act 9 Bond Holders”), as
owner of the Act 9 Bonds nor any agent or designee of the Act 9 Bond Holders (including the trustee under
the Act 9 Trust Indenture), shall, without the prior written consent of the Collateral Agent:
(1) dispose of any Act 9 Bonds or its economic interests therein (except to an Issuer or
Guarantor);
(2) enforce or exercise, or seek to enforce or exercise, any rights or remedies (including any right
of setoff) under the Act 9 Bond Documents (including the enforcement of any right under any other
agreement or arrangement to which the Act 9 Bond Holders or their agent or designee and either
Benton County or such governmental entity that has issued such Act 9 Bonds or an Issuer is a party
but excluding exercise of any purchase option or similar right); or
(3) commence or join with any Person (other than the Secured Parties and/or the First Lien
Agent) in commencing, or petition for or vote in favor of, any action or proceeding with respect to such
rights or remedies (including in any foreclosure action or any proceeding under any Debtor Relief
Laws); provided that such limitation shall not restrict such party from making an appearance in any
such proceeding for purposes of filing a proof of claim or interest.

Limitations on Transactions with Affiliates

The Issuers will not, and will not permit any Restricted Subsidiary to, directly or indirectly, in one
transaction or a series of related transactions involving aggregate consideration in excess of $5.0 million,
sell, lease, transfer or otherwise dispose of any of its assets to, or purchase any assets from, or enter into any
contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (an
“Affiliate Transaction”), unless:
(1) such Affiliate Transaction is on terms that are no less favorable to the relevant Issuer or the
relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction
at such time on an arm’s-length basis by such Issuer or such Restricted Subsidiary from a Person that
is not an Affiliate of such Issuer or such Restricted Subsidiary; and

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 (2) the relevant Issuer delivers to the Trustee, with respect to any Affiliate Transaction involving
aggregate value in excess of $25.0 million, an Officers’ Certificate certifying that such Affiliate
Transaction complies with clause (1) above and a Secretary’s Certificate which sets forth and
authenticates a resolution that has been adopted by the Independent Directors approving such
Affiliate Transaction.
The foregoing restrictions shall not apply to:
(1) any Restricted Payment permitted by the covenant described under “— Limitations on
Restricted Payments”;
(2) transactions exclusively between or among (a) an Issuer and one or more other Issuers,
(b) an Issuer and one or more Restricted Subsidiaries or (c) Restricted Subsidiaries; provided that, in
the case of (b) and (c), no Affiliate of an Issuer (other than another Issuer or Restricted Subsidiary)
owns Equity Interests of any such Restricted Subsidiary;
(3) reasonable and customary director, officer and employee compensation (including bonuses)
and other benefits (including retirement, health, stock option, deferred compensation and other benefit
plans) and indemnification arrangements, in each case approved by the Board of Directors of the
relevant Issuer;
(4) the entering into of a tax sharing agreement, or payments pursuant thereto, between an
Issuer and/or one or more Restricted Subsidiaries, on the one hand, and any other Person with which
such Issuer or such Restricted Subsidiaries are required or permitted to file a consolidated tax return or
with which such Issuer or such Restricted Subsidiaries are part of a consolidated group for tax
purposes, on the other hand, which payments by such Issuer and the Restricted Subsidiaries are not in
excess of the tax liabilities that would have been payable by them on a stand-alone basis;
(5) loans and advances permitted by clause (3) of the definition of “Permitted Investment”;
(6) transactions with customers, clients, suppliers, joint venture partners or purchasers or
sellers of goods and services, in each case in the ordinary course of business and otherwise not
prohibited by the Indenture;
(7) (x) any agreement in effect on the Issue Date or as thereafter amended or replaced in any
manner, that, taken as a whole, is not more disadvantageous to the Holders or the Issuers in any
material respect than such agreement as it was in effect on the Issue Date or (y) any transaction
pursuant to any agreement referred to in the immediately preceding clause (x); or
(8) any transaction with an Affiliate where the only consideration paid by an Issuer or any
Restricted Subsidiary is Qualified Equity Interests.

Limitations on Liens
The Issuers shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create,
incur, assume or permit or suffer to exist any Lien (other than Permitted Liens) of any nature whatsoever
against any assets of an Issuer or any Restricted Subsidiary (including Equity Interests of a Restricted
Subsidiary), whether owned at the Issue Date or thereafter acquired, or any proceeds therefrom, or assign or
otherwise convey any right to receive income or profits therefrom.

Limitations on Asset Sales

The Issuers will not, and will not permit any Restricted Subsidiary to, directly or indirectly,
consummate any Asset Sale unless:
(1) such Issuer or such Restricted Subsidiary receives consideration at the time of such Asset
Sale at least equal to the Fair Market Value of the assets included in such Asset Sale; and

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 (2) at least 75% of the total consideration received in such Asset Sale consists of cash or Cash
Equivalents.
For purposes of clause (2), the following shall be deemed to be cash:
(a) the amount (without duplication) of any Indebtedness of such Issuer or such Restricted
Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the
Notes or any Note Guarantee) that is expressly assumed by the transferee in such Asset Sale and with
respect to which such Issuer or such Restricted Subsidiary, as the case may be, is unconditionally
released by the holder of such Indebtedness;
(b) the amount of any securities, notes or other obligations received from such transferee that
are within 180 days converted by such Issuer or such Restricted Subsidiary to cash (to the extent of the
cash actually so received);
(c) the Fair Market Value of (i) any assets that are not classified as current assets under GAAP
(other than securities) received by an Issuer or any Restricted Subsidiary to be used by it in the
Permitted Business, (ii) Qualified Equity Interests in a Person that is a Restricted Subsidiary or in a
Person engaged in a Permitted Business that shall become a Restricted Subsidiary immediately upon
the acquisition of such Person by an Issuer or (iii) a combination of (i) and (ii); and
(d) the Fair Market Value at the time of the relevant Asset Sale of any Designated Non-Cash
Consideration received by the Issuers 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 (d) that is at that time outstanding, not to exceed the greater of
(x) $25.0 million and (y) 3.0% of Consolidated Total Assets at the time of the receipt of such
Designated Non-Cash Consideration, with the Fair Market Value of each item of Designated Non-
Cash Consideration being measured at the time received and without giving effect to subsequent
changes in value.
If at any time any non-cash consideration received by an Issuer or any Restricted Subsidiary, as the
case may be, in connection with any Asset Sale is repaid or converted into or sold or otherwise disposed of
for cash (other than interest received with respect to any such non-cash consideration), then the date of
such repayment, conversion or disposition shall be deemed to constitute the date of an Asset Sale
hereunder and the Net Available Proceeds thereof shall be applied in accordance with this covenant.
If an Issuer or any Restricted Subsidiary engages in an Asset Sale, such Issuer or such Restricted
Subsidiary shall, no later than 365 days following the consummation thereof, apply amount(s) equal to all
or any of the Net Available Proceeds therefrom to:
(1) repay obligations under the Credit Facilities, and in the case of any such repayment under
any revolving credit facility (other than with the Net Available Proceeds of borrowing base assets),
effect a permanent reduction in the availability under such revolving credit facility; provided that such
Indebtedness is secured on a priority basis with respect to the Notes;
(2) repay any Indebtedness which was secured by the assets sold in such Asset Sale; provided
that such Indebtedness is secured on a priority basis with respect to the Notes; and/or
(3) (A) invest, or enter into a binding commitment to invest within 180 days thereafter, all or any
part of the Net Available Proceeds thereof in the purchase of assets (other than securities) to be used
by an Issuer or any Restricted Subsidiary in a Permitted Business, (B) make, or enter into a binding
commitment to make within 180 days thereafter, capital expenditures in a Permitted Business,
(C) acquire, or enter into a binding agreement committing to so acquire within 180 days after the date
of such agreement, Qualified Equity Interests in a Person that is a Restricted Subsidiary or in a Person
engaged in a Permitted Business that shall become a Restricted Subsidiary immediately upon the
consummation of such acquisition or (D) a combination of (A), (B) and (C); provided that in the case of

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 clauses (B) and (C) above, a binding commitment shall be treated as a permitted application of the Net
Proceeds from the date of such commitment so long as the Company or a Restricted Subsidiary enters
into such commitment with the good faith expectation that such Net Proceeds will be applied to satisfy
such commitment within 180 days of such commitment; provided, further, that if such commitment is
later terminated or cancelled prior to the application of such Net Proceeds or such Net Proceeds are not
so applied within such 180-day period, then such Net Proceeds shall constitute Excess Proceeds.
Notwithstanding the foregoing, to the extent that the assets that were subject of such Asset Sale
constituted Collateral, such replacement assets acquired pursuant to clause (3) above shall also be required
to constitute Collateral.
The amount of Net Available Proceeds not applied or invested as provided in this paragraph will
constitute “Excess Proceeds.”
When the aggregate amount of Excess Proceeds equals or exceeds $25.0 million, the Issuers will be
required to make an offer to purchase from all Holders and, if applicable, redeem (or make an offer to do so)
any Pari Passu Indebtedness of the Issuers the provisions of which require the Issuers to redeem such
Indebtedness with the proceeds from any Asset Sales (or offer to do so), in an aggregate principal amount
of Notes and such Pari Passu Indebtedness equal to the amount of such Excess Proceeds as follows:
(1) the Issuers will (a) make an offer to purchase (a “Net Proceeds Offer”) to all Holders, with a
copy to the Trustee, in accordance with the procedures set forth in the Indenture, and (b) redeem (or
make an offer to do so) any such other Pari Passu Indebtedness, pro rata in proportion to the respective
principal amounts of the Notes and such other Indebtedness required to be redeemed, the maximum
principal amount of Notes and Pari Passu Indebtedness that may be redeemed out of the amount (the
“Payment Amount”) of such Excess Proceeds;
(2) the offer price for the Notes will be payable in cash in an amount equal to 100% of the
principal amount of the Notes tendered pursuant to a Net Proceeds Offer, plus accrued and unpaid
interest thereon, if any, to the date such Net Proceeds Offer is consummated (the “Offered Price”), in
accordance with the procedures set forth in the Indenture and the redemption price for such Pari Passu
Indebtedness (the “Pari Passu Indebtedness Price”) shall be as set forth in the related documentation
governing such Indebtedness;
(3) if the aggregate Offered Price of Notes validly tendered and not withdrawn by Holders
thereof exceeds the pro rata portion of the Payment Amount allocable to the Notes, Notes to be
purchased will be selected on a pro rata basis; and
(4) upon completion of such Net Proceeds Offer in accordance with the foregoing provisions,
the amount of Excess Proceeds with respect to which such Net Proceeds Offer was made shall be
deemed to be zero.
To the extent that the sum of the aggregate Offered Price of Notes tendered pursuant to a Net Proceeds
Offer and the aggregate Pari Passu Indebtedness Price paid to the holders of such Pari Passu Indebtedness
is less than the Payment Amount relating thereto (such shortfall constituting a “Net Proceeds Deficiency’),
the Issuers may use the Net Proceeds Deficiency, or a portion thereof, for general corporate purposes,
subject to the provisions of the Indenture.
In the event of the transfer of substantially all (but not all) of the assets of the Issuers and the Restricted
Subsidiaries as an entirety to a Person in a transaction covered by and effected in accordance with the
covenant described under “— Limitations on Mergers, Consolidations, Etc.,” the successor corporation shall
be deemed to have sold for cash at Fair Market Value the assets of the Issuers and the Restricted
Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this
covenant with respect to such deemed sale as if it were an Asset Sale (with such Fair Market Value being
deemed to be Net Available Proceeds for such purpose).
The Issuers will comply with applicable tender offer rules, including the requirements of Rule 14e-1
under the Exchange Act and any other applicable laws and regulations in connection with the purchase of

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Notes pursuant to a Net Proceeds Offer. To the extent that the provisions of any securities laws or
regulations conflict with the “Limitations on Asset Sales” provisions of the Indenture, the Issuers will
comply with the applicable securities laws and regulations and will not be deemed to have breached their
obligations under the “Limitations on Asset Sales” provisions of the Indenture by virtue of this compliance.
The agreements governing the Issuers’ other Indebtedness contain, and future agreements may
contain, prohibitions of certain events, including events that would constitute a Change of Control or an
Asset Sale and including repurchases of or other prepayments in respect of the Notes. The exercise by the
Holders of the Notes of their right to require the Issuers to repurchase the Notes upon a Change of Control
or an Asset Sale could cause a default under these other agreements, even if the Change of Control or Asset
Sale itself does not, due to the financial effect of such repurchases on the Issuers. In the event a Change of
Control or Asset Sale occurs at a time when the Issuers are prohibited from purchasing the Notes, the
Issuers could seek the consent of their senior lenders to the purchase of the Notes or could attempt to
refinance the borrowings that contain such prohibition. If the Issuers do not obtain a consent or repay those
borrowings, the Issuers will remain prohibited from purchasing the Notes. In that case, the Issuers’ 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, the Issuers’ ability to pay cash to the Holders of
the Notes upon a repurchase may be limited by the Issuers’ then existing financial resources. See “Risk
Factors — We may not have the funds necessary to satisfy all of our obligations under our senior secured
credit facility, the notes or other indebtedness in connection with certain change of control events.”

Limitations on Designation of Unrestricted Subsidiaries

The Issuers may designate any Subsidiary (including any newly formed or newly acquired Subsidiary)
of an Issuer as an “Unrestricted Subsidiary” under the Indenture (a “Designation”) only if:
(1) no Default shall have occurred and be continuing at the time of or after giving effect to such
Designation; and
(2) the Issuers would be permitted to make, at the time of such Designation, (a) a Permitted
Investment or (b) an Investment pursuant to “— Limitations on Restricted Payments” above, in either
case, in an amount (the “Designation Amount”) equal to the Fair Market Value of each Issuer’s
proportionate interest in such Subsidiary on such date.
No Subsidiary shall be Designated as an “Unrestricted Subsidiary” unless such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or understanding with an Issuer or any
Restricted Subsidiary unless the terms of the agreement, contract, arrangement or understanding are
no less favorable to such Issuer or such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates;
(3) is a Person with respect to which neither an Issuer nor any Restricted Subsidiary has any
direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or
preserve the Person’s financial condition or to cause the 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 an Issuer or any Restricted Subsidiary, except for any guarantee given solely to
support the pledge by an Issuer or any Restricted Subsidiary of the Equity Interests of such
Unrestricted Subsidiary, which guarantee is not recourse to an Issuer or any Restricted Subsidiary, and
except to the extent the amount thereof constitutes a Restricted Payment permitted pursuant to the
covenant described under “— Limitations on Restricted Payments.”
If, at any time, any Unrestricted Subsidiary fails to meet the preceding requirements as an Unrestricted
Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of the Indenture and any

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Indebtedness of the Subsidiary and any Liens on assets of such Subsidiary shall be deemed to be incurred
by a Restricted Subsidiary as of the date and, if the Indebtedness is not permitted to be incurred under the
covenant described under “— Limitations on Additional Indebtedness” or the Lien is not permitted under
the covenant described under “— Limitations on Liens,” the Issuers shall be in default of the applicable
covenant.
The Issuers may redesignate an Unrestricted Subsidiary as a Restricted Subsidiary (a “Redesignation”)
only if:
(1) no Default shall have occurred and be continuing at the time of and after giving effect to
such Redesignation; and
(2) all Liens, Indebtedness and Investments of such Unrestricted Subsidiary outstanding
immediately following such Redesignation would, if incurred or made at such time, have been
permitted to be incurred or made for all purposes of the Indenture.
All Designations and Redesignations must be evidenced by resolutions of the Board of Directors of the
relevant Issuer, delivered to the Trustee certifying compliance with the foregoing provisions.

Limitations on the Issuance or Sale of Equity Interests of Restricted Subsidiaries

The Issuers will not, and will not permit any Restricted Subsidiary to, directly or indirectly, sell or issue
any shares of Equity Interests of any Restricted Subsidiary except (1) to an Issuer, a Restricted Subsidiary or
the minority stockholders of any Restricted Subsidiary, on a pro rata basis, (2) to the extent such shares
represent directors’ qualifying shares or shares required by applicable law to be held by a Person other than
an Issuer or a Wholly Owned Restricted Subsidiary or (3) if immediately after giving effect to such sale or
issuance, such Restricted Subsidiary would no longer constitute a Restricted Subsidiary.

Limitations on Mergers, Consolidations, Etc.

None of Issuers will, directly or indirectly, in a single transaction or a series of related transactions,
consolidate or merge with or into (other than (i) a merger with another Issuer or (ii) a merger with a Wholly
Owned Restricted Subsidiary solely for the purpose of changing an Issuer’s jurisdiction of incorporation to
another State of the United States), or sell, lease, transfer, convey or otherwise dispose of or assign all or
substantially all of the assets of the Issuers and the Restricted Subsidiaries (taken as a whole) unless:
(1) either:
(a) such Issuer will be the surviving or continuing Person; or
(b) the Person formed by or surviving such consolidation or merger or to which such sale,
lease, conveyance or other disposition shall be made (or, in the case of a plan of liquidation, any
Person to which assets are transferred) (collectively, the “Successor”) is a corporation, limited
liability company or limited partnership organized and existing under the laws of any State of the
United States of America or the District of Columbia, and the Successor expressly assumes, by
supplemental indenture in form and substance satisfactory to the Trustee, all of the obligations of
such Issuer under the Notes, the Indenture, the Security Documents and the Intercreditor
Agreement, and shall cause (i) such amendments, supplements or other instruments to be
executed, filed and recorded in such jurisdiction as may be required by applicable law to preserve
and protect the lien on the Collateral pledged by such Issuer, together with such financing
statements or comparable documents as may be required to perfect any security interest in such
Collateral which may be perfected by the filing of a financing statement or a similar document
under the UCC or other similar statute or regulation of the relevant states or jurisdictions and
(ii) the property and assets of the Person which is merged or consolidated with or into the
Successor, to the extent that they are property or assets of the types which would constitute
Collateral under the Security Documents, to be treated as after-acquired property and the
Successor shall take such actions as may be reasonably necessary to cause such property and

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 assets to be made subject to the Lien of the Security Documents in the manner and to the extent
provided in the Indenture, in each case in a form reasonably satisfactory to the Trustee,
(2) immediately prior to and immediately after giving effect to such transaction and the
assumption of the obligations as set forth in clause (1)(b) above and the incurrence of any
Indebtedness to be incurred in connection therewith, and the use of any net proceeds therefrom on a
pro forma basis, no Default shall have occurred and be continuing;
(3) immediately after and giving effect to such transaction and the assumption of the obligations
set forth in clause (1)(b) above and the incurrence of any Indebtedness to be incurred in connection
therewith, and the use of any net proceeds therefrom on a pro forma basis, the Issuers or the Successor,
as the case may be, (a) could incur $1.00 of additional Indebtedness pursuant to the Coverage Ratio
Exception or (b) shall have a Fixed Charge Coverage Ratio not less than the Fixed Charge Coverage
Ratio of the Issuers immediately prior to such transaction and assumption; and
(4) the Issuer shall have delivered to the Trustee (a) an Officers’ Certificate and an opinion of
counsel to the effect that such transaction and such agreement and/or supplemental indenture (if any)
comply with the Notes, the Indenture, the Security Agreements and the Intercreditor Agreement and
(b) an opinion of counsel stating that the Notes, the Indenture, the Security Agreements and the
Intercreditor Agreement constitute the valid and binding obligations of the Issuer (or, if applicable, the
Successor).
For purposes of this covenant, any Indebtedness of the Successor which was not Indebtedness of the
Issuers immediately prior to the transaction shall be deemed to have been incurred in connection with such
transaction.
Except as provided in the fourth paragraph under “— Note Guarantees,” no Guarantor may consolidate
with or merge with or into (whether or not such Guarantor is the surviving Person) another Person, other
than an Issuer or another Guarantor, unless:
(1) either:
(a) such Guarantor will be the surviving or continuing Person; or
(b) the Person formed by or surviving any such consolidation or merger assumes, by
supplemental indenture in form and substance satisfactory to the Trustee, all of the obligations of
such Guarantor under the Note Guarantee of such Guarantor, the Indenture, the Security
Documents and the Intercreditor Agreement and shall (i) cause such amendments, supplements
or other instruments to be executed, filed and recorded in such jurisdiction as may be required by
applicable law to preserve and protect the lien on the Collateral pledged by such Guarantor,
together with such financing statements or comparable documents as may be required to perfect
any security interest in such Collateral which may be perfected by the filing of a financing
statement or a similar document under the UCC or other similar statute or regulation of the
relevant states or jurisdictions and (ii) the property and assets of the Person which is merged or
consolidated with or into the Successor, to the extent that they are property or assets of the types
which would constitute Collateral under the Security Documents, to be treated as after-acquired
property and the Successor shall take such actions as may be reasonably necessary to cause such
property and assets to be made subject to the Lien of the Security Documents in the manner and
to the extent provided in the Indenture, in each case in a form reasonably satisfactory to the
Trustee;
(2) immediately after giving effect to such transaction, no Default shall have occurred and be
continuing; and
(3) the Guarantor shall have delivered to the Trustee (a) an Officers’ Certificate and an opinion
of counsel to the effect that such transaction and such agreement and/or supplemental indenture (if
any) comply with the Notes, the Indenture, the Note Guarantee, the Security Agreements and the

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 Intercreditor Agreement and (b) an opinion of counsel stating that the Notes, the Note Guarantee, the
Security Agreements and the Intercreditor Agreement constitute the valid and binding obligations of
the Guarantor (or, if applicable, the successor company).
For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single
transaction or series of transactions) of all or substantially all of the properties or assets of one or more
Restricted Subsidiaries, the Equity Interests of which constitute all or substantially all of the properties and
assets of the Issuers, will be deemed to be the transfer of all or substantially all of the properties and assets
of the Issuers.
Upon any consolidation, combination or merger of an Issuer or a Guarantor, or any transfer of all or
substantially all of the assets of an Issuer in accordance with the foregoing, in which such Issuer or such
Guarantor is not the continuing obligor under the Notes or its Note Guarantee, the surviving entity formed
by such consolidation or into which such Issuer or such Guarantor is merged or to which the conveyance,
lease or transfer is made will succeed to, and be substituted for, and may exercise every right and power of,
such Issuer or such Guarantor under the Notes, the Note Guarantees, the Indenture, the Security
Documents and the Intercreditor Agreement, with the same effect as if such surviving entity had been
named therein as such Issuer or such Guarantor and, except in the case of a lease, such Issuer or such
Guarantor, as the case may be, will be released from the obligation to pay the principal of and interest on
the Notes or in respect of its Note Guarantee, as the case may be, and all of such Issuer’s or such
Guarantor’s other obligations and covenants under the Notes, the Indenture, the Security Documents, the
Intercreditor Agreement and its Note Guarantee, if applicable.
Notwithstanding the foregoing, any Restricted Subsidiary may merge into an Issuer or another
Restricted Subsidiary; provided that such Issuer or such Restricted Subsidiary shall cause such
amendments, supplements or other instruments to be executed, filed and recorded in such jurisdiction as
may be required by applicable law to preserve and protect the lien on the Collateral pledged by such entity,
together with such financing statements or comparable documents as may be required to perfect any
security interest in such Collateral which may be perfected by the filing of a financing statement or a similar
document under the UCC or other similar statute or regulation of the relevant states or jurisdictions.

Additional Note Guarantees

If, after the Issue Date, (a) an Issuer or any Restricted Subsidiary shall acquire or create another
domestic Subsidiary (other than in any case a Subsidiary that has been designated an Unrestricted
Subsidiary) that guarantees any Indebtedness under any Credit Facility or (b) any Unrestricted Subsidiary
is redesignated a Restricted Subsidiary and such Restricted Subsidiary guarantees any Indebtedness under
any Credit Facility or (c) an Issuer otherwise elects to have any Restricted Subsidiary become a Guarantor,
then, in each such case, such Issuer shall cause such Restricted Subsidiary to:
(1) execute and deliver to the Trustee (a) a supplemental indenture in form and substance
satisfactory to the Trustee pursuant to which such Restricted Subsidiary shall unconditionally
guarantee all of the Issuers’ obligations under the Notes, the Indenture, the Security Documents and
the Intercreditor Agreement, (b) a notation of guarantee in respect of its Note Guarantee and (c) a
joinder to the Security Documents or new Security Documents;
(2) deliver to the Trustee (a) one or more opinions of counsel that such supplemental indenture
(i) has been duly authorized, executed and delivered by such Restricted Subsidiary and (ii) constitutes
a valid and legally binding obligation of such Restricted Subsidiary in accordance with its terms, and
(b) an Officers’ Certificate and an opinion of counsel stating that the execution of the supplemental
indenture is authorized by the Indenture, the Notes, the Security Documents and the Intercreditor
Agreement; and
(3) shall take such actions as may be reasonably necessary to cause the property and assets of
such Restricted Subsidiary, to the extent that they are property or assets of the types which would
constitute Collateral under the Security Documents, to be treated as after-acquired property and to be

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 made subject to the perfected Lien of the Security Documents in the manner and to the extent provided
in the Indenture and Security Documents, in a manner reasonably satisfactory to the Trustee and the
Second Lien Collateral Agent.

Reports
The Indenture will provide that for so long as any Notes are outstanding, unless the Issuers are subject
to the reporting requirements of Section 13 or 15(d) of the Exchange Act or otherwise complies with such
reporting requirements, the Issuers will furnish without cost to each Holder and file with the Trustee:
(1) within 95 days after the end of each fiscal year of the Issuers, annual audited financial
statements of the Issuers for such fiscal year, including a “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” (including a discussion of risk management and the
presentation of Consolidated EBITDA), a discussion of internal control over financial reporting
(including disclosure of any material weakness or significant deficiency, if any, identified by
management or the Issuers’ certified independent accountants), information on directors, executive
officers and control persons, a report on the annual financial statements by the Issuers’ certified
independent accountants and information that would be required to be filed with the SEC on Form 10-
K if the Issuers were required to file such reports with respect to description of property, legal
proceedings, changes in and disagreements with accountants on accounting and financial disclosure
and security ownership of certain beneficial owners and management; provided that no such financial
statements shall be required to provide consolidating footnote disclosure regarding Guarantors and
non-Guarantors;
(2) within 50 days after the end of each of the first three fiscal quarters of each fiscal year of the
Issuers, quarterly unaudited financial statements for the interim period as of, and for the period ending
on, the end of such fiscal quarter, including a “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” (including a discussion of risk management and the presentation
of Consolidated EBITDA) but without the preparation of footnotes thereto; and
(3) promptly, and in any event within five (5) Business Days, all current reports that would be
required to be filed with the SEC on Form 8-K if the Issuers were required to file such reports with
respect to entry into a material definitive agreement, termination of a material definitive agreement,
bankruptcy or receivership, acquiring or disposing of certain assets, creating direct financial
obligations and certain obligations in off-balance sheet arrangements or triggering accelerations
thereof, costs associated with exit or disposal activities, unregistered sales of equity securities, material
modification to rights of security holders, material impairment of assets, changes in accountants, non-
reliance on previously issued financial statements, changes of control, changes in management,
amendments to governing documents and change in fiscal year.
In addition, the Issuers have agreed that, for so long as any Notes remain outstanding, they will
furnish to the Holders and the initial purchaser and to securities analysts, market makers and prospective
investors that certify that they are qualified institutional buyers, upon their request, the information
described above as well as all information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.
If the Issuers have designated any of their respective Subsidiaries as Unrestricted Subsidiaries, then
the annual and quarterly financial information required by the preceding paragraph shall 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 the Issuers and their respective Restricted Subsidiaries
separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the
Issuers.
The Issuers shall either (1) maintain a website (which may be non-public) to which Holders,
prospective investors that certify that they are qualified institutional buyers, securities analysts and market

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makers (collectively, “Permitted Parties”) are given access and to which such information is posted;
(2) distribute via electronic mail such information to beneficial owners of the Notes, securities analysts and
market makers who request to receive such distributions; or (3) file such information with the SEC.
So long as any Notes are outstanding, the Issuers will also:
(1) within 5 Business Days after filing with the Trustee the annual and quarterly information
required pursuant to clauses (1) and (2) of the first paragraph of this section, hold a conference call for
Permitted Parties to discuss such reports and the results of operations for the relevant reporting period;
and
(2) notify the Permitted Parties (including, without limitation, by posting an announcement on
the website) no fewer than three Business Days prior to the date of the conference call required to be
held in accordance with clause (1) above, announcing the time and date of such conference call and
either including all information necessary to access the call or directing Permitted Parties to contact
the appropriate person at the Issuers to obtain such information.
In addition, if at any time any direct or indirect parent becomes a Guarantor (there being no obligation
of any such parent to do so), such entity holds no material assets other than cash, Cash Equivalents and the
Equity Interests of the Issuers or any other direct or indirect parent of the Issuers (and performs the related
incidental activities associated with such ownership) and would comply with the requirements of Rule 3-10
of Regulation S-X promulgated by the SEC (or any successor provision), the reports, information and other
documents required to be furnished to Holders pursuant to this covenant may, at the option of the Issuers,
be furnished by and be those of such parent rather than the Issuers.
Delivery of such reports, information and documents to the Trustee is for informational purposes only,
and the Trustee’s receipt of such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the Issuers’ compliance with any of
their covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).
The Trustee shall not be obligated to monitor or confirm, on a continuing basis or otherwise, the Issuers’
compliance with the covenants described herein or with respect to any reports, information and documents
filed with the SEC or EDGAR or posted on any website under this Indenture, or participate in any
conference calls.
It is not expected that the Notes will be exchanged for similar notes in a transaction registered under
the Securities Act, or that the resale of the Notes will be registered under the Securities Act. Additionally, it
is not anticipated that the indenture will be qualified under the Trust Indenture Act of 1939, as amended
(the “Trust Indenture Act”) and as a result the Holders will not receive the protections otherwise provided
thereby.

Payments for Consent

Neither the Issuers nor any of their Subsidiaries will, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder for or as an inducement to any
consent, waiver or amendment of any terms or provisions of the Notes, unless the consideration is offered
to be paid or agreed to be paid to all Holders which so consent, waive or agree to amend in the time frame
set forth in the solicitation documents relating to such consent, waiver or agreement.

Events of Default
Each of the following is an “Event of Default”:
(1) failure by the Issuers to pay interest on any of the Notes when it becomes due and payable
and the continuance of any such failure for 30 days;
(2) failure by the Issuers to pay the principal on any of the Notes when it becomes due and
payable, whether at stated maturity, upon redemption, upon purchase, upon acceleration or otherwise;

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 (3) failure by the Issuers to comply with any of their agreements or covenants described above
under “— Certain Covenants — Limitations on Mergers, Consolidations, Etc.,” or in respect of their
obligations to make a Change of Control Offer as described above under “— Change of Control”;
(4) failure by the Issuers to comply with any other agreement or covenant in the Indenture and
continuance of this failure for 30 days after notice of the failure has been given to the Issuers by the
Trustee or by the Holders of at least 25% of the aggregate principal amount of the Notes then
outstanding;
(5) default under any mortgage, indenture or other instrument or agreement under which there
may be issued or by which there may be secured or evidenced Indebtedness of an Issuer or any
Restricted Subsidiary, whether such Indebtedness now exists or is incurred after the Issue Date, which
default:
(a) is caused by a failure to pay at final maturity (giving effect to any applicable grace
periods and any extensions thereof) principal on such Indebtedness,
(b) results in the acceleration of such Indebtedness prior to its express final maturity or
(c) results in the commencement of judicial proceedings to foreclose upon, or to exercise
remedies under applicable law or applicable collateral documents to take ownership of, the assets
securing such Indebtedness, and
in each case, the principal amount of such Indebtedness, together with any other Indebtedness with respect
to which an event described in clause (a), (b) or (c) has occurred and is continuing, aggregates $20.0
million or more or such Indebtedness is a Credit Facility;
(6) one or more judgments or orders that exceed $20.0 million in the aggregate (net of amounts
covered by insurance or bonded) for the payment of money have been entered by a court or courts of
competent jurisdiction against an Issuer or any Restricted Subsidiary and such judgment or judgments
have not been satisfied, stayed, annulled or rescinded within 60 days of being entered;
(7) an Issuer or any Significant Subsidiary pursuant to or within the meaning of any applicable
bankruptcy law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief against it in an involuntary case,
(c) consents to the appointment of a Custodian of it or for all or substantially all of its
assets, or
(d) makes a general assignment for the benefit of its creditors;
(8) a court of competent jurisdiction enters an order or decree under any applicable bankruptcy
law that:
(a) is for relief against an Issuer or any Significant Subsidiary as debtor in an involuntary
case,

(b) appoints a Custodian of an Issuer or any Significant Subsidiary or a Custodian for all or
substantially all of the assets of an Issuer or any Significant Subsidiary, or

(c) orders the liquidation of an Issuer or any Significant Subsidiary, and the order or decree
remains unstayed and in effect for 60 days;
(9) any Note Guarantee of any Significant Subsidiary ceases to be in full force and effect (other
than in accordance with the terms of such Note Guarantee and the Indenture) or is declared in a
judicial proceeding null and void and unenforceable or found in a judicial proceeding to be invalid or

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 any Guarantor denies its liability under its Note Guarantee (other than by reason of release of a
Guarantor from its Note Guarantee in accordance with the terms of the Indenture and the Note
Guarantee); or
(10) so long as the Security Documents have not been otherwise terminated in accordance with
their terms and the Collateral as a whole has not been released from the Lien of the Security
Documents securing the Notes in accordance with the terms thereof, with respect to Collateral having
a Fair Market Value in excess of $10.0 million, (a) any default by an Issuer or any Guarantor in the
performance of its obligations under the Security Documents (after the lapse of any applicable grace
periods) or the Indenture which adversely affects the condition or value of such Collateral, in any
material respect, (b) repudiation or disaffirmation of an Issuer or any Guarantor of its respective
obligations under the Security Documents, (c) the determination in a judicial proceeding that the
Security Documents are unenforceable or invalid against an Issuer or any Guarantor for any reason or
(d) any lien or security interest on the Collateral ceases to be in full force and effect (except as
permitted by the terms of the Indenture or the Security Documents)
If an Event of Default (other than an Event of Default specified in clause (7) or (8) above with respect to
an Issuer) shall have occurred and be continuing under the Indenture, the Trustee, by written notice to the
Issuers, or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding, by
written notice to the Issuers and the Trustee, may declare (an “acceleration declaration”) all amounts
owing under the Notes to be due and payable immediately. If an Event of Default specified in clause (7) or
(8) with respect to an Issuer occurs, all outstanding Notes shall become due and payable without any
further action or notice.
The Trustee shall, within 30 days after the occurrence of any Default with respect to the Notes known
to it, give the Holders notice of all uncured Defaults thereunder known to it; provided, however, that, except
in the case of an Event of Default in payment with respect to the Notes or a Default in complying with “—
Certain Covenants — Limitations on Mergers, Consolidations, Etc.,” the Trustee shall be protected in
withholding such notice if and so long as a committee of its trust officers in good faith determines that the
withholding of such notice is in the interest of the Holders.
No Holder will have any right to institute any proceeding with respect to the Indenture, the Notes, the
Security Documents or the Intercreditor Agreement, or for any remedy thereunder, unless the Trustee or
Second Lien Collateral Agent, as the case may be:
(1) has failed to act for a period of 60 days after receiving written notice of a continuing Event of
Default by such Holder and the offer of indemnity, security or prefunding referred to below, and a
written request to act by Holders of at least 25% in aggregate principal amount of Notes outstanding;
(2) has been offered indemnity, security or prefunding satisfactory to it for any loss, liability or
expense; and
(3) has not received from the Holders of a majority in aggregate principal amount of the
outstanding Notes a direction inconsistent with such request.
However, such limitations do not apply to a suit instituted by a Holder of any Note for enforcement of
payment of the principal of or interest on such Note on or after the due date therefor (after giving effect to
the grace period specified in clause (1) of the first paragraph of this “— Events of Default” section).
The Issuers are required to deliver to the Trustee annually a statement regarding compliance with the
Indenture and, upon any Officer of an Issuer becoming aware of any Default, a statement specifying such
Default and what action the Issuers are taking or propose to take with respect thereto.

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Legal Defeasance and Covenant Defeasance
The Issuers may, at their option and at any time, elect to have their obligations and the obligations of
the Guarantors discharged with respect to the outstanding Notes (“Legal Defeasance”). Legal Defeasance
means that the Issuers and the Guarantors shall be deemed to have paid and discharged the entire
indebtedness represented by the Notes and the Note Guarantees, and the Indenture shall cease to be of
further effect as to all outstanding Notes and Note Guarantees, except as to:
(1) rights of Holders to receive payments in respect of the principal of and interest on the Notes
when such payments are due from the trust funds referred to below,
(2) the Notes when such payments are due from the trust funds referred to below,
(3) the obligations of the Issuers 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,
(4) the rights, powers, trust, duties, and immunities of the Trustee and Second Lien Collateral
Agent, and the Issuers’ obligation in connection therewith, and
(5) the Legal Defeasance provisions of the Indenture.
In addition, the Issuers may, at their option and at any time, elect to have their obligations and the
obligations of the Guarantors released with respect to most of the covenants under the Indenture and the
Security Documents, except as described otherwise in the Indenture (“Covenant Defeasance”), and
thereafter any omission to comply with such obligations shall not constitute a Default. In the event
Covenant Defeasance occurs, certain Events of Default (not including non-payment, bankruptcy,
receivership, rehabilitation and insolvency events) will no longer apply. The Issuers may exercise their
Legal Defeasance option regardless of whether they had previously exercised Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance:
(1) the Issuers must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders,
U.S. legal tender, U.S. Government Obligations or a combination thereof, in such amounts as will be
sufficient (without reinvestment) in the opinion of a nationally recognized firm of independent public
accountants selected by the Issuers, to pay the principal of and interest on the Notes on the stated date
for payment or on the redemption date of the principal or installment of principal of or interest on the
Notes, and the Holders must have a valid, perfected, exclusive security interest in such trust,
(2) in the case of Legal Defeasance, the Issuers shall have delivered to the Trustee an opinion of
counsel in the United States confirming that:
(a) the Issuers have 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 U.S. federal
income tax law, in either case to the effect that, and based thereon this opinion of counsel shall
confirm that, the Holders will not recognize income, gain or loss for U.S. federal income tax
purposes as a result of the Legal Defeasance and will be subject to U.S. 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, the Issuers shall have delivered to the Trustee an
opinion of counsel in the United States reasonably acceptable to the Trustee confirming that the
Holders will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such
Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if the Covenant Defeasance had not
occurred,

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 (4) no Default shall have occurred and be continuing on the date of such deposit (other than a
Default resulting from the borrowing of funds to be applied to such deposit and the grant of any Lien
securing such borrowing),
(5) the Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or
constitute a Default under (other than a Default resulting solely from the borrowing of funds to be
applied to such deposit and the grant of any Lien on such deposit in favor of the Trustee and/or the
Holders), the Credit Agreement or any other material agreement or instrument to which an Issuer or
any of its Subsidiaries is a party or by which an Issuer or any of its Subsidiaries is bound,
(6) the Issuers shall have delivered to the Trustee Officers’ Certificates stating that the deposit
was not made by it with the intent of defeating, hindering, delaying or defrauding any other of its
creditors or others, and
(7) the Issuers shall have delivered to the Trustee Officers’ Certificates and an opinion of
counsel, each stating that the conditions provided for in this paragraph have been complied with.
If the funds deposited with the Trustee to effect Covenant Defeasance are insufficient to pay the
principal of and interest on the Notes when due, then our obligations and the obligations of Guarantors
under the Indenture will be revived and no such defeasance will be deemed to have occurred.

Satisfaction and Discharge

The Indenture and the Security Documents will be discharged and will cease to be of further effect
(except as to rights of registration of transfer or exchange of Notes which shall survive until all Notes have
been canceled) as to all outstanding Notes when either:
(1) all the Notes that have been authenticated and delivered (except lost, stolen or destroyed
Notes which have been replaced or paid and Notes for whose payment money has been deposited in
trust or segregated and held in trust by the Issuers and thereafter repaid to the Issuers or discharged
from this trust) have been delivered to the Trustee for cancellation, or
(2) all Notes not delivered to the Trustee for cancellation have been called for redemption
pursuant to the provisions described under “— Optional Redemption,” or otherwise become due and
payable within one year, and the Issuers have irrevocably deposited or caused to be deposited with the
Trustee, as trust funds to be held by the Trustee in trust solely for the benefit of the Holders an amount
of money sufficient to pay and discharge the entire Indebtedness (including all principal and accrued
interest) on the Notes not theretofore delivered to the Trustee for cancellation,
(a) the Issuers have paid all sums payable by them under the Indenture, and
(b) the Issuers have delivered irrevocable instructions to the Trustee to apply the deposited
money toward the payment of the Notes at maturity or on the date of redemption, as the case may
be.
In addition, the Issuers must deliver Officers’ Certificates and an opinion of counsel stating that all
conditions precedent to satisfaction and discharge have been complied with.

Transfer and Exchange

A Holder will be able to register the transfer of or exchange Notes only in accordance with the
provisions of the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the
Indenture. Without the prior consent of the Issuer, the Registrar is not required (1) to register the transfer of
or exchange any Note selected for redemption, (2) to register the transfer of or exchange any Note for a
period of 15 days before a selection of Notes to be redeemed or (3) to register the transfer or exchange of a
Note between a record date and the next succeeding interest payment date.

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 The Notes will be issued in registered form and the registered Holder will be treated as the owner of
such Note for all purposes.

Amendment, Supplement and Waiver

Subject to certain exceptions, the Indenture or the Notes may be amended with the consent (which
may include consents obtained in connection with a tender offer or exchange offer for Notes) of the Holders
of at least a majority in principal amount of the Notes then outstanding, and any existing Default under, or
compliance with any provision of, the Indenture may be waived (other than any continuing Default in the
payment of the principal or interest on the Notes) with the consent (which may include consents obtained
in connection with a tender offer or exchange offer for Notes) of the Holders of a majority in principal
amount of the Notes then outstanding; and subject to certain exceptions, the Intercreditor Agreement and
the Security Documents may be amended with the consent of the holders of a majority in principal amount
of the Notes and Other Pari Passu Secured Indebtedness then outstanding (voting as a single class)
(including consents obtained in connection with a tender offer or exchange offer for Notes) and any past
default or compliance with any provisions in the Intercreditor Agreement and the Security Documents may
also be waived with the consent of the Holders of a majority in principal amount of the Notes and Other Pari
Passu Secured Indebtedness then outstanding (voting as a single class) (including consents obtained in
connection with a tender offer or exchange offer for Notes); and such amendments may not, without the
consent of the Holders of 662/3% in principal amount of the Notes and Other Pari Passu Secured
Indebtedness then outstanding (voting as a single class), release all or substantially all of the Collateral
other than in accordance with the Indenture, the Intercreditor Agreement and the Security Documents;
provided that, without the consent of each Holder affected, no amendment or waiver may:

(1) reduce, or change the maturity of, the principal of any Note;

(2) reduce the rate of or extend the time for payment of interest on any Note;

(3) reduce any premium payable upon redemption of the Notes or change the date on which any
Notes are subject to redemption (other than provisions relating to the purchase of Notes described
above under “— Change of Control” and “— Certain Covenants — Limitations on Asset Sales,” except
that if a Change of Control has occurred, no amendment or other modification of the obligation of an
Issuer to make a Change of Control Offer relating to such Change of Control shall be made without the
consent of each Holder of the Notes affected);

(4) make any Note payable in money or currency other than that stated in the Notes;

(5) modify or change any provision of the Indenture or the related definitions to affect the
ranking of the Notes or any Note Guarantee in a manner that adversely affects the Holders;

(6) reduce the percentage of Holders necessary to consent to an amendment or waiver to the
Indenture or the Notes;

(7) waive a default in the payment of principal of or premium or interest on any Notes (except a
rescission of acceleration of the Notes by the Holders thereof as provided in the Indenture and a waiver
of the payment default that resulted from such acceleration);

(8) impair the rights of Holders to receive payments of principal of or interest on the Notes on or
after the due date therefor or to institute suit for the enforcement of any payment on the Notes;

(9) release any Guarantor that is a Significant Subsidiary from any of its obligations under its
Note Guarantee or the Indenture, except as permitted by the Indenture or to release all or substantially
all of the Collateral; or

(10) make any change in these amendment and waiver provisions.

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 Notwithstanding the foregoing, the Issuer, the Trustee and the Second Lien Collateral Agent, as
applicable, may amend the Indenture, the Note Guarantees, the Notes, the Security Documents or the
Intercreditor Agreement without the consent of any Holder:
(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 an Issuer’s or a Guarantor’s obligations to the Holders in the
case of a merger, consolidation or sale of all or substantially all of the assets in accordance with
“— Certain Covenants — Limitations on Mergers, Consolidations, Etc.”;
(4) to release any Guarantor from any of its obligations under its Note Guarantee or the
Indenture (to the extent permitted by the Indenture);
(5) to provide for the accession or succession of any parties to the Intercreditor Agreement or
the Security Documents (and other amendments that are administrative or ministerial in nature) in
connection with an amendment, renewal, extension, substitution, refinancing, restructuring,
replacement, supplementing or other modification from time to time of the Credit Facilities, the Notes
or Other Pari Passu Secured Indebtedness or any other agreement or action that is not prohibited by
the Indenture;
(6) to provide for the release of Collateral or priority of Liens with respect to Collateral in
accordance with the terms of the Indenture, the Intercreditor Agreement and the Security Documents;
(7) to provide security for additional borrowings under the Credit Facilities or any additional
Indebtedness which Liens are permitted to be incurred in accordance with the Indenture;
(8) to expand the Collateral securing the Notes or the Note Guarantees or to add additional Note
Guarantees or Guarantors;
(9) to evidence and provide the acceptance of the appointment of a successor trustee under the
Indenture or successor Second Lien Collateral Agent;
(10) conform the text of the Indenture, the Notes, the Note Guarantees, the Intercreditor
Agreement or the Security Documents to any provision of this “Description of Notes” to the extent that
such text constitutes an unintended conflict with the description of the corresponding provision in this
“Description of Notes”, as described in an Officers’ Certificate to the Trustee; or
(11) to make any change that does not materially adversely affect the rights of any Holder or, in
the case of the Indenture, to maintain the qualification of the Indenture under the Trust Indenture Act.

No Personal Liability of Directors, Officers, Employees, Stockholders and Members

No director, officer, employee, incorporator, stockholder, partner, member or manager of an Issuer or
any Guarantor will have any liability for any obligations of the Issuers under the Notes or the Indenture, the
Security Documents, the Intercreditor Agreement or of any Guarantor under its Note Guarantee or for any
claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a
Note waives and releases all such liability. The waiver and release are part of the consideration for issuance
of the Notes and the Note Guarantees. The waiver may not be effective to waive liabilities under the federal
securities laws. It is the view of the SEC that this type of waiver is against public policy.

Concerning the Trustee and the Second Lien Collateral Agent

Wells Fargo Bank, National Association will be the Trustee and the Second Lien Collateral Agent under
the Indenture and has been appointed by the Issuers as Registrar and Paying Agent with regard to the Notes.
The Indenture contains certain limitations on the rights of the Trustee, should it become a creditor of an
Issuer, to obtain payment of claims in certain cases, or to realize on certain assets 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 (as defined in the Indenture), it must eliminate such conflict or resign.

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 The Holders of a majority in 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 and the Second Lien Collateral Agent, subject to certain exceptions. The Indenture provides that, in
case an Event of Default occurs and is not cured, the Trustee and the Second Lien Collateral Agent will be
required, in the exercise of its power, to use the degree of care of a prudent person in similar circumstances
in the conduct of his own affairs. Subject to such provisions, the Trustee and the Second Lien Collateral
Agent will be under no obligation to exercise any of its rights or powers under the Indenture at the request
of any Holder, unless such Holder shall have offered to the Trustee or the Second Lien Collateral Agent, as
applicable, indemnity, security or prefunding satisfactory to the Trustee or the Second Lien Collateral
Agent, as applicable.
References in this section to the “Trustee” include the Trustee in its capacity as Second Lien Collateral
Agent.

Governing Law
The Indenture, the Notes, the Note Guarantees, the Security Documents (except as to real estate and
certain other Security Documents required to be governed by local law) and the Intercreditor Agreement
will be governed by, and construed in accordance with, the laws of the State of New York.

Certain Definitions
Set forth below is a summary of certain of the defined terms used in the Indenture. Reference is made
to the Indenture for the full definition of all such terms.
“Acquired Indebtedness” means (1) with respect to any Person that becomes a Restricted Subsidiary
after the Issue Date, Indebtedness of such Person and its Subsidiaries existing at the time such Person
becomes a Restricted Subsidiary and (2) with respect to an Issuer or any Restricted Subsidiary, any
Indebtedness of a Person (other than an Issuer or a Restricted Subsidiary) existing at the time such Person
is merged with or into such Issuer or such Restricted Subsidiary, or Indebtedness expressly assumed by
such Issuer or such Restricted Subsidiary in connection with the acquisition of an asset or assets from
another Person.
“Act 9 Bond Documents” means (a) the Act 9 Trust Indentures, (b) the Act 9 Lease Agreements, and
(c) any payment in lieu of taxes agreement or similar arrangement between Benton County, Arkansas or
another governmental entity and one or more of the Issuers, and all other documents, option agreements
and other instruments executed in connection therewith, as the same may be amended, restated,
supplemented or otherwise modified from time to time.

“Act 9 Bonds” means the bonds issued to the Act 9 Bond Holders under an Act 9 Trust Indenture
pursuant to Amendment 65 to the Constitution of State of Arkansas and Act No. 9 of the First Extraordinary
Session of the Sixty-Second General Assembly of the State of Arkansas for the year 1960, codified as Ark.
Code Ann. Sections 14-164-201 et seq. as amended.
“Act 9 Lease Agreement” means one or more lease agreements to be entered into between Benton
County, Arkansas or another governmental entity and one or more of the Issuers, as the same may be
amended, restated, supplemented or otherwise modified from time to time.
“Act 9 Trust Indenture” means one or more trust indentures to be entered into, between Benton
County, Arkansas or another governmental entity, as issuer, and the trustee for the Act 9 Bond Holders
issued thereunder, as the same may be amended, restated, supplemented or otherwise modified from time
to time.
“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 the purposes of
this definition, “control” when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by

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contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the
foregoing.
“amend” means to amend, supplement, restate, amend and restate or otherwise modify; and
“amendment” shall have a correlative meaning.
“asset” means any asset or property.
“Asset Acquisition” means:
(1) an Investment by an Issuer or any Restricted Subsidiary of an Issuer in any other Person if,
as a result of such Investment, such Person shall become a Restricted Subsidiary of such Issuer, or
shall be merged with or into such Issuer or any Restricted Subsidiary of such Issuer, or
(2) the acquisition by an Issuer or any Restricted Subsidiary of an Issuer of all or substantially all
of the assets of any other Person or any division or line of business of any other Person.
“Asset Sale” means any sale, issuance, conveyance, transfer, lease, assignment, Event of Loss or other
disposition by an Issuer or any Restricted Subsidiary to any Person other than an Issuer or any Restricted
Subsidiary (including by means of a Sale and Leaseback Transaction, other than a Specified Sale and
Lease-Back Transaction, or a merger or consolidation) (collectively, for purposes of this definition, a
“transfer”), in one transaction or a series of related transactions, of any assets of an Issuer or any Restricted
Subsidiary of an Issuer other than in the ordinary course of business. For purposes of this definition, the
term “Asset Sale” shall not include:
(1) transfers of cash or Cash Equivalents;
(2) transfers of assets (including Equity Interests) that are governed by, and made in accordance
with, the covenant described under “— Certain Covenants — Limitations on Mergers, Consolidations,
Etc.” and under “— Change of Control”;
(3) Permitted Investments and Restricted Payments permitted under the covenant described
under “— Certain Covenants — Limitations on Restricted Payments”;
(4) the creation or realization of any Permitted Lien;
(5) transfers of damaged, worn-out or obsolete equipment or assets that, in the Issuers’
reasonable judgment, are no longer used or useful in the business of the Issuers or their Restricted
Subsidiaries;
(6) any transfer or series of related transfers that, but for this clause, would be Asset Sales, if
after giving effect to such transfers, the aggregate Fair Market Value of the assets transferred in such
transaction or any such series of related transactions does not exceed $7.5 million;
(7) dispositions of inventory in the ordinary course of business or transfers of inventory among
the Issuers, the Issuers and their Restricted Subsidiaries, and their Restricted Subsidiaries;
(8) any license, sublicense, lease or sublease of any property (including intellectual property) in
the ordinary course of business;
(9) leases or subleases or real property no longer used or useful in the Issuers’ or their Restricted
Subsidiaries’ business;
(10) consignment arrangements or similar arrangements for the sale of assets in the ordinary
course of business;
(11) sales or discounts of overdue accounts receivable arising in the ordinary course of business,
but only in connection with the compromise or collection thereof;
(12) a Sale and Leaseback Transaction with respect to property built or acquired by the Issuer or
its Restricted Subsidiaries after the Issue Date and otherwise permitted by the covenants described

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 under “— Certain Covenants — Limitations on Additional Indebtedness” and “— Limitations on Liens;”
provided that such Sale and Leaseback Transaction occurs within twelve months following the point in
time which the building or acquisition of such property or equipment is complete, installed and in use;
and
(13) dispositions of property in connection with any Specified Sale and Lease-Back Transaction.
“Bankruptcy Code” means Title 11 of the United States Code, as amended.
“bankruptcy law” means the Bankruptcy Code or any similar federal, foreign or state law for the relief
of debtors.
“Board of Directors” means, with respect to any Person, (i) in the case of any corporation, the board of
directors of such Person, (ii) in the case of any limited liability company, the board of managers of such
Person, (iii) in the case of any partnership, the Board of Directors of the general partner of such Person and
(iv) in any other case, the functional equivalent of the foregoing.
“Business Day” means a day other than a Saturday, Sunday or other day on which banking institutions
in New York are authorized or required by law to close.
“Capitalized Lease” means a lease required to be capitalized for financial reporting purposes in
accordance with GAAP.
“Capitalized Lease Obligations” of any Person means the obligations of such Person to pay rent or
other amounts under a Capitalized Lease, and the amount of such obligation shall be the capitalized
amount thereof determined in accordance with GAAP.
“Cash Equivalents” means:
(1) obligations with a maturity of 360 days or less issued or directly and fully guaranteed or
insured by the United States of America or any agency or instrumentality thereof (provided that the full
faith and credit of the United States of America is pledged in support thereof);
(2) time deposits and certificates of deposit or acceptances with a maturity of 360 days or less of
any financial institution having combined capital and surplus and undivided profits of not less than
$250.0 million and is assigned at least a rating of “A” (or such other similar equivalent rating) or higher
by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the
Securities Act);
(3) commercial paper maturing no more than 180 days from the date of creation thereof issued
by a corporation that is not an Issuer or an Affiliate of an Issuer, and is organized under the laws of any
State of the United States of America or the District of Columbia and rated at least A-1 by S&P or at
least P-1 by Moody’s;
(4) repurchase obligations with a term of not more than ten days for underlying securities of the
types described in clause (1) above entered into with any commercial bank meeting the specifications
of clause (2) above;
(5) securities issued by any state of the United States or any political subdivision of any such
state or any public instrumentality thereof having maturities of not more than ninety days from the
date of acquisition and having one of the two highest ratings from either S&P or Moody’s;
(6) demand deposit accounts maintained in the ordinary course of business; and
(7) investments in money market or other mutual funds substantially all of whose assets
comprise securities of the types described in clauses (1) through (6) above.

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 “Change of Control” means the occurrence of any of the following events after the Issue Date:
(1) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange
Act), other than one or more Permitted Holders, is or becomes the beneficial owner (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act, except that for purposes of this clause that person or
group shall be deemed to have “beneficial ownership” of all securities that any such person or group
has the right to acquire, whether such right is exercisable immediately or only after the passage of
time), directly or indirectly, of Voting Stock representing 35% or more of the voting power of the total
outstanding Voting Stock of any Issuer;
(2) (a) all or substantially all of the assets of an Issuer and its Restricted Subsidiaries are sold or
otherwise transferred to any Person other than a Wholly Owned Restricted Subsidiary of an Issuer or
one or more Permitted Holders or (b) an Issuer consolidates or merges with or into another Person or
any Person consolidates or merges with or into an Issuer, in either case under this clause (2), in one
transaction or a series of related transactions in which immediately after the consummation thereof
Persons beneficially owning (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, Voting Stock representing in the aggregate a majority of the total voting power of the
Voting Stock of such Issuer immediately prior to such consummation do not beneficially own (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, Voting Stock
representing a majority of the total voting power of the Voting Stock of such Issuer or the surviving or
transferee Person; or
(3) an Issuer shall adopt a plan of liquidation or dissolution or any such plan shall be approved
by the stockholders of such Issuer.
For purposes of this definition, a Person shall not be deemed to have beneficial ownership of securities
subject to a stock purchase agreement, merger agreement or similar agreement until the consummation of
the transactions contemplated by such agreement.
“Code” means the Internal Revenue Code of 1986, as amended from time to time.
“Collateral Agreement” means the Collateral Agreement to be dated as of the Issue Date, among the
Issuers, the subsidiaries identified therein and the Second Lien Collateral Agent.
“Consolidated Amortization Expense” for any period means the amortization expense of the Issuers
and the Restricted Subsidiaries on a consolidated and combined basis (determined in accordance with
GAAP) for such period.
“Consolidated Depreciation Expense” for any period means the depreciation expense of the Issuers
and the Restricted Subsidiaries on a consolidated and combined basis (determined in accordance with
GAAP) for such period.
“Consolidated EBITDA” for any period means, without duplication, the Consolidated Net Income of
the Issuers and the Restricted Subsidiaries on a consolidated and combined basis (determined in
accordance with GAAP) for such period:
(1) increased (without duplication) by:
(a) provision for taxes based on income or profits or capital, including, without limitation,
state, franchise, excise and similar taxes and foreign withholding taxes paid or accrued during
such period deducted, including any penalties and interest relating to any tax examinations (and
not added back) in computing Consolidated Net Income, plus
(b) Consolidated Interest Expense for such period (including (x) net losses from Hedging
Obligations or other derivative instruments entered into for the purpose of hedging interest rate
risk and (y) costs of surety bonds in connection with financing activities, in each case, to the
extent included in Consolidated Interest Expense), together with items excluded from the
definition of “Consolidated Interest Expense” pursuant to clause (4) thereof, to the extent the same
were deducted (and not added back) in calculating such Consolidated Net Income; plus

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 (c) Consolidated Depreciation Expense and Consolidated Amortization Expense for such
period to the extent the same were deducted in computing Consolidated Net Income, plus
(d) the amount of any restructuring charge or reserve or non-recurring integration costs
deducted (and not added back) in such period in computing Consolidated Net Income, including
any one-time costs incurred in connection with acquisitions after the Issue Date and costs related
to the closure and/or consolidation of facilities and any expenses, severance, relocation costs,
new product introductions and one-time compensation charges, plus
(e) any other non-cash charges, including any write-off or write-downs, reducing
Consolidated Net Income for such period, excluding any such charge that represents an accrual or
reserve for a cash expenditure for a future period, plus
(f) the (i) amount of net cost savings and synergies projected by the Issuers in good faith to
be realized as a result of Permitted Investments, acquisitions or specified actions taken or to be
taken prior to or during such period and expected to be realized within 18 months of the date
thereof (which cost savings or synergies shall be subject only to certification by management of
the Issuers and shall be calculated on a pro forma basis as though such cost savings or synergies
had been realized on the first day of such period); provided that such cost savings or synergies are
reasonably identifiable and factually supportable, net of the amount of actual benefits realized
during such period from such actions, (ii) business optimization expenses (including
consolidation initiatives, severance costs and other costs relating to initiatives aimed at
profitability improvement), and (iii) restructuring charges or reserves (including restructuring
costs related to acquisitions after the Issue Date and to closure and/or consolidation of facilities
and to exiting lines of business); plus
(g) any management and advisory fees and expenses paid by the Issuers or any of the
Restricted Subsidiaries to any direct or indirect parent company of the Issuers or any of their
Affiliates during such period, to the extent permitted by clause 3 of the second paragraph of the
covenant described above under the caption “— Limitations on Restricted Payments”;
notwithstanding that in any four fiscal quarter period the aggregate amount of addbacks made
pursuant to this clause shall not exceed $1.5 million, plus
(h) the amount of any loss attributable to a new plant or facility until the date that is
12 months after the date of commencement of construction or the date of acquisition thereof, as
the case may be; provided that (A) such losses are reasonably identifiable and factually
supportable and certified by a responsible officer of the Issuers, (B) losses attributable to such
plant or facility after 12 months from the date of commencement of construction or the date of
acquisition of such plant or facility, as the case may be, shall not be included in this clause (h) and
(C) no amounts shall be added pursuant to this clause (h) to the extent duplicative of any expenses
or charges relating to such cost savings or revenue enhancements that are included in clauses
(d) or (f) above with respect to such period, and
(2) decreased by (without duplication) non-cash gains increasing Consolidated Net Income for
such period, excluding any non-cash gains which represent the reversal of any accrual of, or cash
reserve for, anticipated cash charges that reduced Consolidated EBITDA in any prior period.
“Consolidated Fixed Charges” means, with respect to the Issuers and the Restricted Subsidiaries on a
consolidated and combined basis (determined in accordance with GAAP) for any period, the sum of,
without duplication, the amounts for such period of:
(1) Consolidated Interest Expense; and
(2) the product of (a) all dividends and other distributions paid or accrued (other than dividends
or other distributions paid or accruing in Qualified Equity Interests) during such period in respect of
Disqualified Equity Interests or Preferred Stock of such Person and its Restricted Subsidiaries, times

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 (b) a fraction, the numerator of which is one and the denominator of which is one minus the then
current combined federal, state, provincial and local statutory tax rate of such Person, expressed as a
decimal.
“Consolidated Interest Expense” for any period means the sum, without duplication, of the total
interest expense of the Issuers and the Restricted Subsidiaries for such period, determined on a
consolidated and combined basis in accordance with GAAP and including without duplication:
(1) imputed interest on Capitalized Lease Obligations,
(2) commissions, discounts and other fees and charges owed with respect to letters of credit
securing financial obligations, bankers’ acceptance financing and receivables financings,
(3) the interest portion of any deferred payment obligations,
(4) all other non-cash interest expense (excluding amortization of debt issuance costs, debt
discount or premium and other financing fees and expenses),
(5) capitalized interest,
(6) the product of (a) all dividend payments on any series of Disqualified Equity Interests of any
Issuer or any Preferred Stock of any Restricted Subsidiary (other than any such Disqualified Equity
Interests or any Preferred Stock held by an Issuer or a Wholly Owned Restricted Subsidiary or to the
extent paid in Qualified Equity Interests), multiplied by (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 the Issuers and the Restricted Subsidiaries, expressed as a decimal,
(7) all interest payable with respect to discontinued operations, and
(8) all interest on any Indebtedness of any other Person guaranteed by an Issuer or any
Restricted Subsidiary.
Consolidated Interest Expense shall be calculated after giving effect to Hedging Obligations
(including associated costs) described in clause (1) of the definition of “Hedging Obligations,” but
excluding unrealized gains and losses with respect to Hedging Obligations.
“Consolidated Net Income” means, with respect to the Issuers and the Restricted Subsidiaries on a
consolidated and combined basis (determined in accordance with GAAP) for any period, the aggregate of
the net income (or loss) for such period; provided that there shall be excluded from such net income (to the
extent otherwise included therein), without duplication,
(1) any after-tax effect of extraordinary, non-recurring or unusual gains or losses (less all fees
and expenses relating thereto) or expenses, severance, relocation costs, new product introductions and
one-time compensation charges shall be excluded,
(2) the net income (loss) for such period shall not include the cumulative effect of a change in
accounting principles during such period,
(3) any after-tax effect of income (loss) from disposed, or discontinued operations and any net
after-tax gains or losses on disposal of disposed, abandoned or discontinued operations shall be
excluded,
(4) any after-tax effect of gains or losses (less all fees and expenses relating thereto) attributable
to asset dispositions other than in the ordinary course of business, as determined in good faith by
senior management or the Board of Directors of the relevant Issuer, shall be excluded,
(5) the net income (loss) for such period of any Person that is not a Subsidiary, or is an
Unrestricted Subsidiary, or that is accounted for by the equity method of accounting, shall be excluded;
provided that Consolidated Net Income of the Issuers and Restricted Subsidiaries shall be increased by
the amount of dividends or distributions or other payments that are actually paid in cash (or to the

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 extent converted into cash or Cash Equivalents) to the referent Person or a Restricted Subsidiary
thereof in respect of such period,
(6) effects of adjustments (including the effects of such adjustments pushed down to such
Person and its Restricted Subsidiaries) in any line item in such Person’s consolidated financial
statements required or permitted by ASC 805 and ASC 350 (formerly Financial Accounting Standards
Board Statement Nos. 141 and 142, respectively) resulting from the application of purchase
accounting in relation to any acquisition that is consummated after the Issue Date or the amortization
or write-off of any amounts thereof, net of taxes, shall be excluded,
(7) any after-tax effect of income (loss) from the early extinguishment of Indebtedness or
unrealized gains for losses from Hedging Obligations or other derivative instruments (including
deferred financing costs written off and premiums paid) shall be excluded,
(8) any impairment charge, asset write-off or write-down pursuant to ASC 350 and ASC 360
(formerly Financial Accounting Standards Board Statement Nos. 142 and No. 144, respectively) and
the amortization of intangibles arising pursuant to ASC 805 (formerly Financial Accounting Standards
Board Statement No. 141) shall be excluded,
(9) any non-cash compensation expense recorded from grants of stock appreciation or similar
rights, phantom equity, stock options, restricted stock or other rights to officers, directors, consultants
or employees shall be excluded,
(10) any fees and expenses incurred during such period, or any amortization thereof for such
period, in connection with any acquisition, Investment, recapitalization, Asset Sale, issuance or
repayment of Indebtedness, issuance of Equity Interests, refinancing transaction or amendment or
modification of any debt instrument (in each case, including any such transaction consummated prior
to the Issue Date and any such transaction undertaken but not completed) and any charges or non-
recurring merger costs incurred during such period as a result of any such transaction shall be
excluded,
(11) to the extent covered by insurance and actually reimbursed, or, so long as the Issuers have
made a determination that there exists reasonable evidence that such amount will in fact be
reimbursed by the insurer and only to the extent that such amount is (a) not denied by the applicable
carrier in writing within 180 days and (b) in fact reimbursed within 365 days of the date of such
evidence (with a deduction for any amount so added back to the extent not so reimbursed within 365
days), losses and expenses with respect to liability or casualty events or business interruption shall be
excluded,
(12) any non-cash SFAS 133 (or such successor provision) income (or loss) related to Hedging
Obligations shall be excluded,
(13) changes in accruals or reserves as a result of adoption or modification of accounting
policies shall be excluded, and
(14) gains and losses due solely to fluctuations in currency values and the related tax effects
according to GAAP shall be excluded.
Notwithstanding the foregoing, for the purposes of the covenant described under “— Certain
Covenants — Limitations on Restricted Payments” only, there shall be excluded from Consolidated Net
Income any repurchases, repayments or redemptions of Investments, proceeds realized on the sale of
investments or return of capital to an Issuer or a Restricted Subsidiary to the extent such repurchases,
repayments, redemptions, proceeds or returns increase the amount of Restricted Payments permitted under
such covenant pursuant to clause (3)(d) of the first paragraph thereof.
“Consolidated Total Assets” means, as of any date, the total assets of the Issuers and the Restricted
Subsidiaries on a consolidated and combined basis (determined in accordance with GAAP) at the end of the
fiscal quarter immediately preceding such date.

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 “Consolidated Total Leverage Ratio” means the ratio of (1) the aggregate amount of all Indebtedness
of the Issuers and the Restricted Subsidiaries determined on a consolidated basis as of the Transaction Date
to (2) the Consolidated EBITDA for the Four Quarter Period. In addition to and without limitation of the
foregoing, for purposes of this definition, this ratio shall be calculated in a manner consistent with the
adjustments and assumptions set forth in the definition of “Fixed Charge Coverage Ratio” below.
“Coverage Ratio Exception” has the meaning set forth in the proviso in the first paragraph of the
covenant described under “— Certain Covenants — Limitations on Additional Indebtedness.”
“Credit Agreement” means that Fifth Amended and Restated Credit Agreement, dated August 11,
2017, by and among the Issuers, as U.S. borrowers thereunder, Simmons Pet Food ON, Inc., as Canadian
borrower thereunder, certain guarantors party thereto, Wells Fargo Bank, National Association and BMO
Capital Markets as Joint Lead Arrangers and Joint Book Runners, Bank of Montreal as Syndication Agent,
Wells Fargo Bank, National Association as Administrative Agent, and the lenders party thereto, including
any notes, guarantees, collateral and security documents, instruments and agreements executed in
connection therewith, and in each case as amended, amended and restated, supplemented, modified,
refinanced, replaced or otherwise restructured, in whole or in part, from time to time.
“Credit Facilities” means one or more debt facilities (which may be outstanding at the same time and
including, without limitation, the Credit Agreement), indentures or commercial paper facilities with banks
or other institutional lenders or investors or indentures or other agreements providing for revolving credit
loans, term loans or letters of credit or other long-term indebtedness and, in each case, as such agreements
may be amended, amended and restated, supplemented, modified, refinanced, replaced or otherwise
restructured, in whole or in part from time to time (including increasing the amount of available borrowings
thereunder or adding Restricted Subsidiaries as additional borrowers or guarantors thereunder) with respect
to all or any portion of the Indebtedness under such agreement or agreements or any successor or
replacement agreement or agreements and whether by the same or any other agent, lender or group of
lenders.
“Credit Facility Obligations” means the indebtedness outstanding under Credit Facilities that is
secured by a Permitted Lien described in clause (15) of the definition thereof, and all other obligations of
any Issuer or any Guarantor under such Credit Facilities and all Hedging Obligations permitted by the
Indenture and secured by the collateral securing any Obligations under any of the Credit Facilities.
“Custodian” means any receiver, trustee, assignee, liquidator or similar official under any applicable
bankruptcy law.
“Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation, conservatorship,
bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization or similar debtor relief laws of the United States or other applicable jurisdictions from time
to time in effect and affecting the rights of creditors generally.
“Default” means (1) any Event of Default or (2) any event, act or condition that, after notice or the
passage of time or both, would be an Event of Default.
“Designated Non-Cash Consideration” means the Fair Market Value of non-cash consideration
received by the Issuers or a Restricted Subsidiary in connection with an Asset Sale that is so designated as
Designated Non-Cash Consideration pursuant to an Officers’ Certificate, less the amount of Cash
Equivalents received in connection with a subsequent sale, redemption or repurchase of, or collection or
payment on, such Designated Non-Cash Consideration.
“Designation” has the meaning given to this term in the covenant described under “— Certain
Covenants — Limitations on Designation of Unrestricted Subsidiaries.”
“Designation Amount” has the meaning given to this term in the covenant described under “— Certain
Covenants — Limitations on Designation of Unrestricted Subsidiaries.”

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 “Disqualified Equity Interests” of any Person means any class of Equity Interests of such Person that,
by its terms, or by the terms of any related agreement or of any security into which it is convertible, puttable
or exchangeable, is, or upon the happening of any event or the passage of time would be, required to be
redeemed by such Person, whether or not at the option of the holder thereof, or matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, in whole or in part, on or prior to the date
which is 91 days after the final maturity date of the Notes; provided, however, that any class of Equity
Interests of such Person that, by its terms, authorizes such Person to satisfy in full its obligations with
respect to the payment of dividends or upon maturity, redemption (pursuant to a sinking fund or otherwise)
or repurchase thereof or otherwise by the delivery of Equity Interests that are not Disqualified Equity
Interests, and that is not convertible, puttable or exchangeable for Disqualified Equity Interests or
Indebtedness, will not be deemed to be Disqualified Equity Interests so long as such Person satisfies its
obligations with respect thereto solely by the delivery of Equity Interests that are not Disqualified Equity
Interests; provided, further, however, that any Equity Interests that would not constitute Disqualified Equity
Interests but for provisions thereof giving holders thereof (or the holders of any security into or for which
such Equity Interests are convertible, exchangeable or exercisable) the right to require an Issuer to redeem
such Equity Interests upon the occurrence of a change in control or asset sale occurring prior to the 91st
day after the final maturity date of the Notes shall not constitute Disqualified Equity Interests if the change
in control or asset sale provisions applicable to such Equity Interests are no more favorable to such holders
than the provisions described under “— Change of Control” and “— Certain Covenants — Limitations on
Asset Sales,” respectively, and such Equity Interests specifically provide that an Issuer will not redeem any
such Equity Interests pursuant to such provisions prior to such Issuer’s purchase of the Notes as required
pursuant to the provisions described under “— Change of Control” and “— Certain Covenants — Limitations
on Asset Sales,” respectively.
“Equity Interests” of any Person means (1) any and all shares or other equity interests (including
common stock, preferred stock, limited liability company interests and partnership interests) in such
Person and (2) all rights to purchase, warrants or options (whether or not currently exercisable),
participations or other equivalents of or interests in (however designated) such shares or other interests in
such Person.
“Event of Loss” means, with respect to any property or asset, (i) any loss or destruction of, or damage
to, such property or assets or (ii) any condemnation, seizure or taking, by exercise of the power of eminent
domain or otherwise, of such property or asset, or confiscation or requisition of the use of such property or
asset.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.
“Fair Market Value” means, with respect to any asset, the price (after taking into account any liabilities
relating to such assets) that would be negotiated in an arm’s-length transaction for cash between a willing
seller and a willing and able buyer, neither of which is under any compulsion to complete the transaction,
as such price is determined in good faith by the Board of Directors of the relevant Issuer or a duly
authorized committee thereof, as evidenced by a resolution of such Board or committee.
“First Lien Debt Cap” means the result of (a) the greater of (x) $412.5 million and (y) the Borrowing
Base (as defined in the Credit Agreement) on such date minus (b) the aggregate amount of all permanent
reductions of the Aggregate Commitments (as defined in the Credit Agreement) under the Credit
Agreement made from and after the date hereof. For the purposes of this definition, none of (i) a
Refinancing of the Credit Agreement, (ii) any reduction occurring by reason of the commencement of a
bankruptcy proceeding or (iii) termination or reduction of any of the Aggregate Commitments by reason of
the occurrence of an event of default under the Credit Agreement shall constitute a “permanent reduction.”
“Fixed Charge Coverage Ratio” means the ratio of Consolidated EBITDA during the Four-Quarter
Period ending on or prior to the Transaction Date to Consolidated Fixed Charges for the Four-Quarter

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Period. For purposes of this definition, Consolidated EBITDA and Consolidated Fixed Charges shall be
calculated after giving effect on a pro forma basis for the period of such calculation to:
(1) the incurrence of any Indebtedness or the issuance of any Preferred Stock of any Issuer or
any Restricted Subsidiary (and the application of the proceeds therefrom) and any repayment,
repurchase, defeasance or discharge of other Indebtedness or redemption of other Preferred Stock (and
the application of the proceeds therefrom) (other than the incurrence or repayment of Indebtedness in
the ordinary course of business for working capital purposes pursuant to any revolving credit
arrangement) occurring during the Four-Quarter Period or at any time subsequent to the last day of the
Four-Quarter Period and on or prior to the Transaction Date, as if such incurrence, repayment,
repurchase, defeasance, discharge issuance or redemption, as the case may be (and the application of
the proceeds therefrom), occurred on the first day of the Four-Quarter Period; and
(2) any Asset Sale or Asset Acquisition (including, without limitation, any Asset Acquisition
giving rise to the need to make such calculation as a result of any Issuer or any Restricted Subsidiary
(including any Person who becomes a Restricted Subsidiary as a result of such Asset Acquisition)
incurring Acquired Indebtedness and also including any Consolidated EBITDA (including any pro
forma expense and cost reductions calculated on a basis consistent with Regulation S-X under the
Exchange Act) associated with any such Asset Acquisition) occurring during the Four-Quarter Period
or at any time subsequent to the last day of the Four-Quarter Period and on or prior to the Transaction
Date, as if such Asset Sale or Asset Acquisition (including the incurrence of, or assumption or liability
for, any such Indebtedness or Acquired Indebtedness) occurred on the first day of the Four-Quarter
Period.
If any Issuer or any Restricted Subsidiary directly or indirectly guarantees Indebtedness of a third
Person, the preceding sentence shall give effect to the incurrence of such guaranteed Indebtedness as if
such Issuer or such Restricted Subsidiary had directly incurred or otherwise assumed such guaranteed
Indebtedness. For purposes of this definition, whenever pro forma effect is to be given to any calculation
under this definition, the pro forma calculations (including pro forma expense and cost reductions) will be
determined in good faith by a responsible financial or accounting officer of the Issuers and evidenced by an
Officers’ Certificate setting forth the basis of such calculations. If any Indebtedness bears a floating rate of
interest and is being given pro forma effect, the interest expense on such Indebtedness will be calculated as
if the rate in effect on the date of determination had been the applicable rate for the entire period (taking
into account any Hedging Obligations applicable to such Indebtedness). If any Indebtedness that is being
given pro forma effect bears an interest rate at the option of the Issuers, the interest rate shall be calculated
by applying such optional rate chosen by the Issuers.
In calculating Consolidated Fixed Charges for purposes of determining the denominator (but not the
numerator) of this Fixed Charge Coverage Ratio:
(1) interest on outstanding Indebtedness determined on a fluctuating basis as of the Transaction
Date and which will continue to be so determined thereafter shall be deemed to have accrued at a fixed
rate per annum equal to the rate of interest on this Indebtedness in effect on the Transaction Date;
(2) if interest on any Indebtedness actually incurred on the Transaction Date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank
offered rate, or other rates, then the interest rate in effect on the Transaction Date will be deemed to
have been in effect during the Four-Quarter Period; and
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a
fluctuating basis, to the extent such interest is covered by agreements relating to Hedging
Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the
operation of these agreements.
“Foreign Subsidiary” means any Restricted Subsidiary of an Issuer which (i) is not organized under the
laws of (x) the United States or any state thereof or (y) the District of Columbia and (ii) conducts
substantially all of its business operations outside the United States of America.

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 “Four-Quarter Period” the most recent four consecutive full fiscal quarters for which internal financial
statements are available.
“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 may be approved by a significant segment of the accounting
profession of the United States, as in effect on the Issue Date.
“Governmental Authority” means the government of the United States or any other nation, or of any
political subdivision thereof, whether state, local, or otherwise, and any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining to government (including any supra-
national bodies such as the European Union or the European Central Bank).
“guarantee” means a direct or indirect guarantee by any Person of any Indebtedness of any other
Person and includes any obligation, direct or indirect, contingent or otherwise, of such Person: (1) to
purchase or pay (or advance or supply funds for the purchase or payment of) Indebtedness of such other
Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase
assets, goods, securities or services (unless such purchase arrangements are on arm’s-length terms and are
entered into in the ordinary course of business), to take-or-pay, or to maintain financial statement
conditions or otherwise); or (2) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); “guarantee,” when used as a verb, and “guaranteed” have correlative meanings.
“Guarantors” means each Person that is required to, or at the election of an Issuer does, become a
Guarantor by the terms of the Indenture on or after the Issue Date, in each case, until such Person is
released from its Note Guarantee in accordance with the terms of the Indenture.
“Hedging Obligations” of any Person means the obligations of such Person pursuant to (1) any interest
rate swap agreement, interest rate collar agreement or other similar agreement or arrangement,
(2) agreements or arrangements relating to, or designed to protect such Person against, fluctuations in
foreign currency exchange rates, or (3) any forward contract, commodity swap agreement, commodity
option agreement or other similar agreement or arrangement.
“Holder” means any registered holder, from time to time, of the Notes.
“incur” means, with respect to any Indebtedness or Obligation, incur, create, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise, with respect to such
Indebtedness or Obligation; provided that (1) the Indebtedness of a Person existing at the time such Person
became a Restricted Subsidiary shall be deemed to have been incurred by such Restricted Subsidiary and
(2) neither the accrual of interest nor the accretion of original issue discount shall be deemed to be an
incurrence of Indebtedness.
“Indebtedness” of any Person at any date means, without duplication:
(1) all liabilities, contingent or otherwise, of such Person for borrowed money (whether or not
the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof);
(2) all obligations of such Person evidenced by bonds, debentures, notes or other similar
instruments;
(3) all reimbursement obligations of such Person in respect of letters of credit, letters of
guaranty, bankers’ acceptances and similar credit transactions;
(4) all obligations of such Person to pay the deferred and unpaid purchase price of property or
services, except trade payables and accrued expenses incurred by such Person in the ordinary course
of business in connection with obtaining goods, materials or services;

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 (5) the maximum fixed redemption or repurchase price of all Disqualified Equity Interests of
such Person;
(6) all Capitalized Lease Obligations of such Person, other than Specified Sale and Lease-Back
Transactions;
(7) all Indebtedness of others secured by a Lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person;
(8) all Indebtedness of others guaranteed by such Person to the extent of such guarantee;
provided that Indebtedness of an Issuer or its Subsidiaries that is guaranteed by an Issuer or an
Issuer’s Subsidiaries shall only be counted once in the calculation of the amount of Indebtedness of the
Issuers and its Subsidiaries on a consolidated basis;
(9) to the extent not otherwise included in this definition, net obligations of such Person under
Hedging Obligations (the amount of any such obligations to be equal at any time to the termination
value of such agreement or arrangement giving rise to such Obligation that would be payable by such
Person at such time); and
(10) all obligations of such Person under conditional sale or other title retention agreements
relating to assets purchased by such Person.
Notwithstanding the foregoing, Indebtedness will be deemed not to include obligations in connection
with a Specified Sale and Lease-Back Transaction. The amount of any Indebtedness which is incurred at a
discount to the principal amount at maturity thereof as of any date shall be deemed to have been incurred at
the accreted value thereof as of such date. The amount of Indebtedness of any Person at any date shall be
the outstanding balance at such date of all unconditional obligations as described above, the maximum
liability of such Person for any such contingent obligations at such date and, in the case of clause (7), the
lesser of (a) the Fair Market Value of any asset subject to a Lien securing the Indebtedness of others on the
date that the Lien attaches and (b) the amount of the Indebtedness secured. For purposes of clause (5), the
“maximum fixed redemption or repurchase price” of any Disqualified Equity Interests that do not have a
fixed redemption or repurchase price shall be calculated in accordance with the terms of such Disqualified
Equity Interests as if such Disqualified Equity Interests were redeemed or repurchased on any date on
which an amount of Indebtedness outstanding shall be required to be determined pursuant to the
Indenture.
“Independent Director” means, with respect to any transaction, a director of an Issuer who is
disinterested with respect to such transaction.
“Independent Financial Advisor” means an accounting, appraisal or investment banking firm of
nationally recognized standing that is, in the reasonable judgment of an Issuer’s Board of Directors,
qualified to perform the task for which it has been engaged and disinterested and independent with respect
to an Issuer and its Affiliates.
“Intercreditor Agreement” means the Intercreditor Agreement, to be dated as of the Issue Date, by and
among Wells Fargo Bank, National Association, in its capacity as administrative agent and collateral agent
pursuant to the Credit Agreement, the holders of any Other Pari Passu Secured Indebtedness from time to
time (or any agent or representative on their behalf), the Trustee, the Second Lien Collateral Agent, the
Issuers and the Guarantors.
“Investments” of any Person means:
(1) all direct or indirect investments by such Person in any other Person in the form of loans,
advances or capital contributions or other credit extensions constituting Indebtedness of such other
Person, and any guarantee of Indebtedness of any other Person;
(2) all purchases (or other acquisitions for consideration) by such Person of Indebtedness,
Equity Interests or other securities of any other Person (other than any such purchase that constitutes a
Restricted Payment of the type described in clause (2) of the definition thereof);

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 (3) all other items that would be classified as investments (including purchases of assets outside
the ordinary course of business) on a balance sheet of such Person prepared in accordance with GAAP;
and
(4) the Designation of any Subsidiary as an Unrestricted Subsidiary.
Except as otherwise expressly specified in this definition, the amount of any Investment (other than an
Investment made in cash) shall be the Fair Market Value thereof on the date such Investment is made. The
amount of Investment pursuant to clause (4) shall be the Designation Amount determined in accordance
with the covenant described under “— Certain Covenants — Limitations on Designation of Unrestricted
Subsidiaries.” If an Issuer or any Subsidiary sells or otherwise disposes of any Equity Interests of any direct
or indirect Subsidiary such that, after giving effect to any such sale or disposition, such Person is no longer
a Subsidiary, such Issuer shall be deemed to have made an Investment on the date of any such sale or other
disposition equal to the Fair Market Value of the Equity Interests of and all other Investments in such
Subsidiary not sold or disposed of, which amount shall be determined by the Board of Directors of such
Issuer. The acquisition by an Issuer or any Restricted Subsidiary of a Person that holds an Investment in a
third Person shall be deemed to be an Investment by such Issuer or such Restricted Subsidiary in the third
Person in an amount equal to the Fair Market Value of the Investment held by the acquired Person in the
third Person. Notwithstanding the foregoing, purchases or redemptions of Equity Interests of the Issuers
shall be deemed not to be Investments.
“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 if the applicable securities are not then rated by Moody’s or S&P, an
equivalent rating by any other Rating Agency.
“Issue Date” means the date on which the Notes are originally issued.
“Lien” means, with respect to any asset, any mortgage, deed of trust, lien (statutory or other), pledge,
lease, easement, restriction, covenant, charge, security interest or other encumbrance of any kind or nature
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, and any lease in the nature thereof, any
option or other agreement to sell, and any filing of, or agreement to give, any financing statement under the
Uniform Commercial Code (or equivalent statutes) of any jurisdiction (other than cautionary filings in
respect of operating leases).
“Moody’s” means Moody’s Investors Service, Inc., and its successors.
“Mortgage” means any mortgage, deed of trust or deed to secure debt with respect to Real Property by
an Issuer or any Guarantor, including any assignment of leases and rents, security agreement and fixture
filing relating thereto, entered into by an Issuer or any Guarantor in favor of the Second Lien Collateral
Agent for its benefit and the benefit of the Trustee and the Holders of Notes and the holders of any Other
Pari Passu Secured Indebtedness, as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time.
“Net Available Proceeds” means, with respect to any Asset Sale, the proceeds thereof in the form of
cash or Cash Equivalents, net of:
(1) brokerage commissions and other fees and expenses (including fees and expenses of legal
counsel, accountants and investment banks) of such Asset Sale;
(2) provisions for taxes payable as a result of such Asset Sale (after taking into account any
available tax credits or deductions and any tax sharing arrangements);
(3) amounts required to be paid to any Person (other than the Issuers or any Restricted
Subsidiary) owning a beneficial interest in the assets subject to the Asset Sale or having a Lien thereon;
(4) payments of unassumed liabilities (not constituting Indebtedness) relating to the assets sold
at the time of, or within 30 days after the date of, such Asset Sale; and

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 (5) appropriate amounts to be provided by the relevant Issuer or any Restricted Subsidiary, as
the case may be, as a reserve required in accordance with GAAP against any adjustment in the sale
price of such asset or assets or liabilities associated with such Asset Sale and retained by an Issuer or
any Restricted Subsidiary, as the case may be, after such Asset Sale, including pensions and other
postemployment benefit liabilities, liabilities related to environmental matters and liabilities under any
indemnification obligations (including reserves with respect to representations and warranties)
associated with such Asset Sale, all as reflected in an Officers’ Certificate delivered to the Trustee;
provided, however, that any amounts remaining after adjustments, revaluations or liquidations of such
reserves shall constitute Net Available Proceeds.
“Non-Recourse Debt” means Indebtedness of an Unrestricted Subsidiary:
(1) as to which neither an Issuer nor any Restricted Subsidiary (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 thereof 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 (other than the Notes) of an Issuer or any Restricted
Subsidiary to declare a default on the other Indebtedness or cause the payment thereof 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 Equity Interests or assets of an Issuer or any Restricted Subsidiary.
“Obligation” means any principal, interest, penalties, fees, indemnification, reimbursements, costs,
expenses, damages and other liabilities payable under the documentation governing any Indebtedness
(including all such amounts accruing following the commencement of a bankruptcy case or proceeding,
whether or not allowed or allowable in such bankruptcy case or proceeding).
“Officer” means any of the following of an Issuer: the Chairman of the Board of Directors, the Chief
Executive Officer, the Chief Financial Officer, the President, any Vice President, the Treasurer or the
Secretary.
“Officers’ Certificate” means a certificate signed by two Officers.
“Other Pari Passu Secured Indebtedness” means any Indebtedness of an Issuer or any Guarantor that
is pari passu in right of payment to the Notes or any Note Guarantee, as the case may be, and is secured by
a Lien on the Collateral that has the same priority as the Lien securing the Notes and the Note Guarantees
and that is designated in writing as such by such Issuer to the Trustee and the holders or a representative of
the holders of which enter into the Intercreditor Agreement and an appropriate agency agreement or
joinder to existing Security Documents with the Second Lien Collateral Agent, as applicable, or other
appropriate agency agreements or collateral documents with another collateral agent, as applicable,
provided that no additional agreement will be required for Additional Notes and related Note Guarantees
and any Exchange Notes and related Note Guarantees issued in exchange therefor. “Other Pari Passu
Secured Indebtedness” does not include the Notes and the Note Guarantees issued on the Issue Date, but
includes any Additional Notes and related Note Guarantees.
“Pari Passu Indebtedness” means any Indebtedness of an Issuer or any Guarantor that ranks pari passu
in right of payment with the Notes or the Note Guarantees, as applicable and is secured by a Lien on the
Collateral that has the same priority as the Lien securing the Notes and the Note Guarantees.
“Permitted Business” means the businesses engaged in by the Issuers and their Subsidiaries on the
Issue Date as described in this offering memorandum and businesses that are similar, related,
complementary, incidental or ancillary thereto or reasonable developments, expansions or extensions
thereof.

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 “Permitted Collateral Liens” shall mean (a) in the case of Collateral other than Mortgaged Property
and any pledged securities, Permitted Liens, (b) in the case of Mortgaged Property, “Permitted Collateral
Liens” shall mean the Liens described in clauses (1), (2), (5), (6), (10), (15), (17), (18) (insofar as it relates to
Liens to secure Obligations in respect of Refinancing Indebtedness of Indebtedness secured by Liens
referred to in clause (12) of the definition of “Permitted Liens”) and (23) of the definition of “Permitted
Liens” and (c) in the case of Collateral consisting of pledged securities, none other than Liens securing
Credit Facility Obligations.
“Permitted Holders” means Mark C. Simmons, M. Todd Simmons and Sarah L. Simmons and in each
case, any Affiliate of the foregoing formed by such Person for purposes of holding its equity investment in
an Issuer (but excluding any other portfolio company of any such Person).
“Permitted Investment” means:
(1) Investments by an Issuer or any Restricted Subsidiary in (a) any Restricted Subsidiary or
(b) any Person that is or will become immediately after such Investment a Restricted Subsidiary or that
will merge or consolidate into an Issuer or a Restricted Subsidiary;
(2) Investments in an Issuer by an Issuer or any Restricted Subsidiary;
(3) loans and advances to directors, employees and officers of an Issuer or any Restricted
Subsidiary for bona fide business purposes and to purchase Equity Interests of an Issuer not in excess
of $5.0 million per employee and not in excess of $10.0 million in the aggregate at any one time
outstanding;
(4) Hedging Obligations incurred pursuant to clause (4) of the second paragraph under the
covenant described under “— Certain Covenants — Limitations on Additional Indebtedness”;
(5) cash and Cash Equivalents;
(6) receivables owing to an Issuer or any Restricted Subsidiary if created or acquired in the
ordinary course of business and payable or dischargeable in accordance with customary trade terms;
provided, however, that such trade terms may include such concessionary trade terms as such Issuer or
any such Restricted Subsidiary deems reasonable under the circumstances;
(7) Investments in securities of trade creditors or customers received pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency of such trade creditors or
customers;
(8) Investments made by an Issuer or any Restricted Subsidiary as a result of consideration
received in connection with an Asset Sale made in compliance with clauses (1) and (2) of the first
paragraph of the covenant described under “— Certain Covenants — Limitations on Asset Sales”;
(9) any Person to the extent such Investments consist 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 an Issuer or any Restricted Subsidiary;
(10) stock, obligations or securities received in settlement of debts created in the ordinary
course of business and owing to an Issuer or any Restricted Subsidiary or in satisfaction of judgments;
(11) Investments, to the extent the payment for which is made in Qualified Equity Interests;
(12) Investments existing on the Issue Date;
(13) Investments in a Permitted Business or joint venture, so long as such Investments do not
exceed the greater of (x) $55.0 million and (y) 6.0% of Consolidated Total Assets at any one time
outstanding;
(14) Investments represented by guarantees otherwise permitted to be made by the Indenture;

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 (15) other Investments in an aggregate amount not to exceed the greater of (x) $55.0 million and
(y) 6.0% of Consolidated Total Assets at any one time outstanding (with each Investment being valued
as of the date made and without regard to subsequent changes in value);
(16) so long as no Default or Event of Default has occurred and is continuing, other
Investments, if, at the time of the making of such payment and after giving effect thereto, the
Consolidated Total Leverage Ratio of the Issuers would not exceed 3.5 to 1.0; and
(17) Investments by the Issuers or Guarantors consisting of the purchase of industrial revenue
bonds or similar instruments referred to in the definition of “Specified Sale and Lease-Back
Transaction”.
The amount of Investments outstanding at any time pursuant to clause (15) above shall be deemed to
be reduced:
(a) upon the disposition or repayment of or return on any Investment made pursuant to clause
(15) above, by an amount equal to the return of capital with respect to such Investment to an Issuer or
any Restricted Subsidiary (to the extent not included in the computation of Consolidated Net Income);
and
(b) upon a Redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, by an amount
equal to the lesser of (x) the Fair Market Value of an Issuer’s proportionate interest in such Subsidiary
immediately following such Redesignation, and (y) the aggregate amount of Investments in such
Subsidiary that increased (and did not previously decrease) the amount of Investments outstanding
pursuant to clause (15) above.
“Permitted Issuer Distributions” means distributions by an Issuer to the Permitted Holders; provided
that, concurrently therewith, such Permitted Holders contribute an equivalent amount of cash to another
Issuer.
“Permitted Liens” means the following types of Liens:
(1) Liens for taxes, assessments or governmental charges or claims either (a) not delinquent or
(b) contested in good faith by appropriate proceedings and as to which the Issuers or the Restricted
Subsidiaries shall have set aside on its books such reserves as may be required pursuant to GAAP and
such proceedings have the effect of preventing forfeiture or sale of the property or assets subject to any
such Lien;
(2) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers,
materialmen, repairmen and other Liens imposed by law incurred in the ordinary course of business
for sums not yet delinquent or being contested in good faith by appropriate proceedings, if adequate
reserves or other appropriate provision, if any, as shall be required by GAAP shall have been made in
respect thereof and such proceedings have the effect of preventing forfeiture or sale of the property or
assets subject to any such Lien;
(3) pledges incurred or deposits made in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, indemnity, surety and appeal bonds, bids, contracts,
leases, government contracts, performance and return-of-money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money);
(4) 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 account of such
Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(5) judgment Liens not giving rise to a Default so long as such Liens are adequately bonded and
any appropriate legal proceedings which may have been duly initiated for the review of such judgment
have not been finally terminated or the period within which the proceedings may be initiated has not
expired;

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 (6) easements, rights-of-way, zoning restrictions and other similar charges, restrictions or
encumbrances in respect of real property or immaterial imperfections of title which do not, in the
aggregate, impair in any material respect the ordinary conduct of the business of the Issuers and the
Restricted Subsidiaries taken as a whole, including without limitation, encumbrances and exceptions
to title expressly set forth as an exception to the policies of title insurance obtained to insure the Lien
of each Mortgage granted in connection with the Notes or the Credit Facilities;
(7) Liens securing reimbursement obligations with respect to commercial letters of credit which
encumber documents and other assets relating to such letters of credit and products and proceeds
thereof;
(8) Liens encumbering deposits made to secure obligations arising from statutory, regulatory,
contractual or warranty requirements of an Issuer or any Restricted Subsidiary, including rights of
offset and setoff;
(9) bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash
and Cash Equivalents on deposit in one or more of accounts maintained by an Issuer or any Restricted
Subsidiary, in each case granted in the ordinary course of business in favor of the bank or banks with
which such accounts are maintained, securing amounts owing to such bank with respect to cash
management and operating account arrangements, including those involving pooled accounts and
netting arrangements; provided that in no case shall any such Liens secure (either directly or
indirectly) the repayment of any Indebtedness;
(10) leases, licenses, subleases or other occupancy agreements granted to others in the ordinary
course of business which do not secure any Indebtedness and which do not materially interfere with
the ordinary course of business of an Issuer or any Restricted Subsidiary;
(11) Liens arising from filing Uniform Commercial Code (or equivalent statutes) financing
statements regarding leases entered into in the ordinary course of business;
(12) Liens securing the Notes (other than any Additional Notes) and any Note Guarantee;
(13) Liens existing on the Issue Date securing Indebtedness outstanding on the Issue Date;
(14) Liens in favor of an Issuer or a Guarantor;
(15) Liens securing Obligations in respect of Indebtedness under the Credit Facilities, but only
to the extent such Indebtedness is incurred in reliance on and outstanding under clause (1) in the
covenant described under “— Certain Covenants — Limitations on Additional Indebtedness”;
(16) Liens securing Purchase Money Indebtedness and Capitalized Lease Obligations; provided
that such Liens shall not extend to any asset other than the specified assets being financed and
additions and improvements thereon;
(17) Liens on assets of a Person existing at the time such Person is acquired or merged with or
into or consolidated with an Issuer or any such Restricted Subsidiary (and not created in anticipation or
contemplation thereof);
(18) Liens to secure Obligations in respect of Refinancing Indebtedness of Indebtedness
secured by Liens referred to in clauses (12), (13), (16), (17), (19) and (29); provided that in each case
such Liens do not extend to any additional assets (other than improvements thereon and replacements
thereof);
(19) Liens on property or shares of Capital Stock of another Person at the time such other Person
becomes a Subsidiary of such Person; provided, however, that the Liens may not extend to any other
property owned by such Person or any of its Restricted Subsidiaries (other than assets and property
affixed or appurtenant thereto);
(20) Liens arising from (A) operating leases and the precautionary UCC financing statement
filings in respect thereof and (B) equipment or other materials which are not owned by an Issuer or any

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 Restricted Subsidiary located on the premises of such Issuer or such Restricted Subsidiary (but not in
connection with, or as part of, the financing thereof) from time to time in the ordinary course of
business and the precautionary UCC financing statement filings in respect thereof;
(21) Liens in favor of customs and revenue authorities arising as a matter of law to secure
payment of customs duties in connection with the importation of goods;
(22) Liens not otherwise permitted under the Indenture in an aggregate amount not to exceed
the greater of (x) $55.0 million and (y) 6.0% of Consolidated Total Assets;
(23) Liens securing Hedging Obligations permitted to be incurred by clause (4) in the covenant
described under “— Certain Covenants — Limitations on Additional Indebtedness”;
(24) Liens incurred to secure Obligations in respect of the Additional Notes and Other Pari
Passu Secured Indebtedness permitted to be incurred pursuant to the covenant described above under
“— Certain Covenants — Limitations on Additional Indebtedness” in an aggregate amount not to
exceed $200.0 million;
(25) Liens to secure Indebtedness incurred pursuant to a Sale and Leaseback Transaction with
respect to property built or acquired by an Issuer or any Restricted Subsidiary after the Issue Date;
provided that any such Lien shall comply with the restrictions described under “— Certain Covenants —
Limitations on Additional Indebtedness” and “— Limitations on Asset Sales”; provided, further, that
(i) such Sale and Leaseback Transaction occurs within twelve months following the building or
acquisition of such property and (ii) any such Lien shall not extend to or cover any assets of the Issuer
or any Restricted Subsidiary other than the assets which are the subject of the Sale and Leaseback
Transaction in which such Indebtedness is incurred;
(26) Liens to secure Indebtedness of Restricted Subsidiaries that are not Guarantors permitted
under the covenant entitled “— Certain Covenants — Limitations on Additional Indebtedness;”
provided that such Liens may not extend to any property or assets of the Issuers or any Guarantor
other than the Equity Interests of such non-Guarantor Restricted Subsidiaries;
(27) encumbrances or exceptions expressly permitted pursuant to the Mortgages;
(28) Liens in connection with a Specified Sale and Lease-Back Transaction and any leasehold
mortgage or similar Lien on the associated lease; and
(29) Liens securing Indebtedness permitted to be incurred by clause (13) in the covenant
described under “— Certain Covenants — Limitations on Additional Indebtedness”; provided that such
Liens shall not extend to any other assets other than such new plants or facilities;
provided, however, that no consensual Liens shall be permitted to exist, directly or indirectly, on any
Collateral, other than Permitted Collateral Liens and Liens granted pursuant to the Security Documents
(including Mortgages), any collateral documents granting or evidencing a security interest to secure the
obligations under the Credit Facility Obligations or any Second Lien Security Document.
For purposes of determining compliance with this definition, in the event that a Lien meets the criteria
of more than one of the categories of Permitted Liens described in clauses (1) through (29) above , the
Issuers shall classify and may reclassify, in each case in their sole discretion, such Lien and may divide,
classify and reclassify such Lien in more than one of the types of Liens described, except that Liens incurred
under the Credit Agreement on the Issue Date shall be deemed to have been incurred under clause
(15) above.
“Permitted Tax Distributions” means:
(a) with respect to any taxable year ending after the Issue Date with respect to which the Issuers
are treated as “S Corporations” as defined in Section 1361 of the Code for U.S. federal and applicable
state and/or local income tax purposes, pro rata distributions to all of the Issuers’ direct owner(s) to

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 fund the income tax liabilities (including obligations to make estimated income tax payments, which
estimated income tax payment amounts shall be determined in a manner consistent with this clause
(a)) of the person(s) treated for U.S. federal income tax purposes as owning the stock of the Issuers
held by such direct owner(s) for such taxable year resulting from the Issuers being S Corporations for
U.S. federal and applicable state and/or local income tax purposes in an aggregate amount assumed to
equal the excess of (i) the product of (x) the aggregate taxable income of the Issuers for such taxable
year (determined as if all of the Issuers were a single entity) reduced (but not below zero) by any
taxable loss of the Issuers (determined as if all of the Issuers were a single entity), if any, with respect
to any prior taxable year beginning after the Issue Date to the extent that such taxable loss (A) has not
previously been offset against taxable income of the Issuers pursuant to this clause (x), and (B) is of a
character (ordinary or capital) that would permit such loss to be deducted against the taxable income of
the Issuers for the taxable year in question and (y) the highest combined marginal federal and
applicable state and/or local income tax rate (taking into account the deductibility of state and local
income taxes for U.S. federal income tax purposes and the character of the taxable income in question
(i.e., long term capital gain, qualified dividend income, etc.)) applicable to any person treated for U.S.
federal income tax purposes as the owner of the stock of the Issuers held by such direct owner of the
Issuers for such taxable year) over (ii) in the case of any such taxable year beginning prior to the Issue
Date, the aggregate amount of estimated income tax payments that were required to have been made
on or prior to the Issue Date (taking into account Internal Revenue Code Section 6654(d) and any
analogous provisions of applicable state and/or local income tax law) by the persons treated for U.S.
federal income tax purposes as owning the stock of the Issuers solely as a result of the Issuers being S
Corporations for U.S. federal and applicable state and/or local income tax purposes (determined using
the tax rate described in clause (y) above); and
(b) with respect to any taxable year ending prior to the Issue Date with respect to which the
Issuers are treated as “S Corporations” as defined in Section 1361 of the Code for U.S. federal and
applicable state and/or local income tax purposes, pro rata distributions to all of the Issuers’ direct
owner(s) to fund the income tax liabilities of the person(s) treated for U.S. federal income tax purposes
as owning the stock of the Issuers held by such direct owner(s) for such taxable year resulting from the
Issuers being S Corporations for U.S. federal and applicable state and/or local income tax purposes in
an aggregate amount equal to the product of (i) any additional taxable income for such taxable year
resulting from a tax audit adjustment made after the Issue Date and (ii) the highest combined marginal
federal and applicable state and/or local income tax rate (taking into account the deductibility of state
and local income taxes for U.S. federal income tax purposes and the character of the taxable income in
question (i.e., long term capital gain, qualified dividend income, etc.)) applicable to any person treated
for U.S. federal income tax purposes as the owner of the stock of the Issuers held by such direct owner
of the Issuers in such taxable year.
“Person” means any individual, corporation, partnership, limited liability company, joint venture,
incorporated or unincorporated association, joint-stock company, trust, unincorporated organization or
government or other agency or political subdivision thereof or other entity of any kind.
“Preferred Stock” means, with respect to any Person, any and all preferred or preference stock or other
equity interests (however designated) of such Person whether now outstanding or issued after the Issue
Date.
“Prepaid Grain Line” means any Indebtedness incurred for the purpose of procuring prepaid grain,
which Indebtedness (a) is supported by a letter of credit, corporate guarantee or similar credit enhancement
from a nationally recognized grain supplier (as recipient of funds), (b) is used to acquire grain from such
grain supplier and (c) has a maturity of no more than 11 months (with monthly amortization payments).
“Purchase Money Indebtedness” means Indebtedness, including Capitalized Lease Obligations, of an
Issuer or any Restricted Subsidiary incurred in connection with the acquisition of, or for the purpose of
financing all or any part of, the purchase price of property, plant or equipment used in the business of an

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Issuer or any Restricted Subsidiary or the cost of installation, construction or improvement thereof;
provided, however, that (1) the amount of such Indebtedness shall not exceed such purchase price or cost,
(2) such Indebtedness shall not be secured by any asset other than the specified asset being financed or, in
the case of real property or fixtures, including additions and improvements, the real property (other than
any Mortgaged Property) to which such asset is attached and the proceeds thereof and (3) such
Indebtedness shall be incurred within 180 days after such acquisition of such asset by such Issuer or such
Restricted Subsidiary or such installation, construction or improvement.
“Qualified Equity Interests” means Equity Interests of an Issuer other than Disqualified Equity
Interests; provided that such Equity Interests shall not be deemed Qualified Equity Interests to the extent
sold or owed to a Subsidiary of an Issuer or financed, directly or indirectly, using funds (1) borrowed from
an Issuer or any Subsidiary until and to the extent such borrowing is repaid or (2) contributed, extended,
guaranteed or advanced by an Issuer or any Subsidiary (including, without limitation, in respect of any
employee stock ownership or benefit plan).
“Qualified Equity Offering” means (i) an underwritten public equity offering of Qualified Equity
Interests pursuant to an effective registration statement under the Securities Act or (ii) a private equity
offering of Qualified Equity Interests of an Issuer.
“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 agency or agencies, as the case may be,
selected by the Issuers which shall be substituted for Moody’s or S&P or both, as the case may be.
“Real Property” means, collectively, all right, title and interest (including any leasehold, mineral or
other estate) in and to any and all parcels of or interests in real property owned, leased or operated by any
person, whether by lease, license or other means, together with, in each case, all easements, hereditaments
and appurtenances relating thereto, all improvements and appurtenant fixtures and equipment, all general
intangibles and contract rights and other property and rights incidental to the ownership, lease or operation
thereof.
“redeem” means to redeem, repurchase, purchase, defease, retire, discharge or otherwise acquire or
retire for value; and “redemption” shall have a correlative meaning; provided that this definition shall not
apply for purposes of “— Optional Redemption.”
“Redesignation” has the meaning given to such term in the covenant described under “— Certain
Covenants — Limitations on Designation of Unrestricted Subsidiaries.”
“refinance” means to refinance, repay, prepay, replace, renew or refund.
“Refinancing Indebtedness” means Indebtedness of an Issuer or any Restricted Subsidiary issued in
exchange for, or the proceeds from the issuance and sale or disbursement of which are used substantially
concurrently to redeem or refinance in whole or in part, or constituting an amendment of, any Indebtedness
of an Issuer or any Restricted Subsidiary (the “Refinanced Indebtedness”) in a principal amount not in
excess of the principal amount (plus fees, underwriting discounts, tender, redemption or similar premiums,
if any, and costs and expenses incurred in connection therewith) of the Refinanced Indebtedness so repaid
or amended (or, if such Refinancing Indebtedness refinances Indebtedness under a revolving credit facility
or other agreement providing a commitment for subsequent borrowings, with a maximum commitment not
to exceed the maximum commitment under such revolving credit facility or other agreement); provided
that:
(1) the issuer of, and guarantors with respect to, the Refinancing Indebtedness shall not include
any Persons who were not the issuer of, or guarantor with respect to, such Refinanced Indebtedness;
(2) if the Refinanced Indebtedness was subordinated to or pari passu with the Notes or the Note
Guarantees, as the case may be, then such Refinancing Indebtedness, by its terms, is expressly pari
passu with (in the case of Refinanced Indebtedness that was pari passu with) or subordinate in right of
payment to (in the case of Refinanced Indebtedness that was subordinated to) the Notes or the Note
Guarantees, as the case may be, at least to the same extent as the Refinanced Indebtedness;

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 (3) the Refinancing Indebtedness is scheduled to mature either (a) no earlier than the
Refinanced Indebtedness being repaid or amended or (b) after the maturity date of the Notes;
(4) the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to
the maturity date of the Notes has a Weighted Average Life to Maturity at the time such Refinancing
Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the
portion of the Refinanced Indebtedness being repaid that is scheduled to mature on or prior to the
maturity date of the Notes; and
(5) the Refinancing Indebtedness is secured only to the extent, if at all, and by the assets, that
the Refinanced Indebtedness being repaid or amended is secured, and such security interest
encumbering such assets is of the same priority as, or a lower priority than, the security interest that
secured the Refinanced Indebtedness being repaid or amended.
“Restricted Payment” means any of the following:
(1) the declaration or payment of any dividend or any other distribution on Equity Interests of an
Issuer or any Restricted Subsidiary or any payment made to the direct or indirect holders (in their
capacities as such) of Equity Interests of an Issuer or any Restricted Subsidiary, including, without
limitation, any payment in connection with any merger or consolidation involving an Issuer but
excluding (a) dividends or distributions payable solely in Qualified Equity Interests and (b) in the case
of Restricted Subsidiaries, dividends or distributions payable to an Issuer or to a Restricted Subsidiary
and pro rata dividends or distributions payable to minority stockholders of any Restricted Subsidiary;
(2) the redemption of any Equity Interests of an Issuer, any Restricted Subsidiary or any equity
holder of an Issuer, including, without limitation, any payment in connection with any merger or
consolidation involving an Issuer but excluding any such Equity Interests held by an Issuer or any
Restricted Subsidiary;
(3) any Investment other than a Permitted Investment; or
(4) any redemption, purchase, repurchase or other acquisition or retirement for value prior to the
scheduled maturity, scheduled repayment of principal or scheduled sinking fund payment, as the case
may be, of any Subordinated Indebtedness (other than the redemption, purchase,
repurchase or other acquisition for value of Subordinated Indebtedness purchased 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 purchase, repurchase or other acquisition).
“Restricted Payments Basket” has the meaning given to such term in the first paragraph of the
covenant described under “— Certain Covenants — Limitations on Restricted Payments.”
“Restricted Subsidiary” means any Subsidiary of an Issuer other than an Unrestricted Subsidiary.
“S&P” means Standard & Poor’s Ratings Services, a division of the McGraw-Hill Companies, Inc., and
its successors.
“Sale and Leaseback Transaction” means with respect to any Person an arrangement with any bank,
insurance company or other lender or investor or to which such lender or investor is a party, providing for
the leasing by such Person of any asset of such Person which has been or is being sold or transferred by
such Person to such lender or investor or to any Person to whom funds have been or are to be advanced by
such lender or investor on the security of such asset.
“SEC” means the U.S. Securities and Exchange Commission.
“Second Lien Security Document” means any security document granting or evidencing a security
interest to secure the obligations under any Other Pari Passu Secured Indebtedness.
“Second Priority Liens” means the Liens on the Collateral created in favor of the Second Lien Collateral
Agent for its benefit and the benefit of the Trustee and the Holders of the Notes, subject solely to Permitted
Liens and Liens on the Collateral securing Credit Facility Obligations on a first priority basis.

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 “Secretary’s Certificate” means a certificate signed by the Secretary of an Issuer.
“Securities Act” means the U.S. Securities Act of 1933, as amended.
“Security Documents” means the Collateral Agreement, the Mortgages and the other security
documents granting or evidencing a security interest in or Liens on any assets of any Person to secure the
Obligations under the Indenture, the Notes, the Note Guarantees and any Other Pari Passu Secured
Indebtedness as each may be amended, restated, supplemented or otherwise modified from time to time.
“Significant Subsidiary” means (1) any Restricted Subsidiary that would be a “significant subsidiary”
as defined in Regulation S-X promulgated pursuant to the Securities Act as such Regulation is in effect on
the Issue Date and (2) any Restricted Subsidiary that, when aggregated with all other Restricted
Subsidiaries that are not otherwise Significant Subsidiaries and as to which any event described in clause
(8) or (9) under “— Events of Default” has occurred and is continuing, would constitute a Significant
Subsidiary under clause (1) of this definition.
“Specified Sale and Lease-Back Transaction” means any arrangement providing for the leasing by an
Issuer or any Restricted Subsidiary of any real or tangible personal property, which property has been or is
to be sold or transferred by such Issuer or such Restricted Subsidiary to a Governmental Authority in
contemplation of such leasing, and which is in connection with the purchase by the Issuers or a Guarantor
of industrial development revenue bonds, or similar instruments, of a Governmental Authority and
pursuant to which payments of principal, premiums and interest thereon are payable solely from income
derived by such Governmental Authority from such leasing arrangement, including the arrangement
contemplated by the Act 9 Bond Documents; provided that (i) in connection with such Sale and Lease-Back
Transaction, the property subject thereto shall be mortgaged or pledged to the Collateral Agent for the
benefit of the Holders and such mortgage or security interests shall remain in effect after giving effect to
such specified Sale and Lease-Back Transaction, (ii) the Issuer or Guarantor purchasing such industrial
development revenue bonds or similar instruments shall use commercially reasonable efforts to pledge
such bonds or instruments to the Collateral Agent for the benefit of the Holders to the extent pledged to the
First Lien Agent, and (iii) the Issuer and their Restricted Subsidiaries shall cause such documents,
agreements and instruments (including intercreditor agreements) as are delivered to the First Lien Agent in
connection therewith to be delivered to and in favor of or for the benefit of the Collateral Agent, except if
such documents, agreements or instruments (including intercreditor agreements) cannot be delivered in
favor of or for the benefit of the Collateral Agent after the use of commercially reasonable efforts.
“Subordinated Indebtedness” means Indebtedness of an Issuer or any Restricted Subsidiary that is
subordinated in right of payment to the Notes or the Note Guarantees, respectively.
“Subsidiary” means, with respect to any Person:
(1) any corporation, limited liability company, association or other business entity of which
more than 50% of the total voting power of the Equity Interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Board of Directors thereof are at the time
owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of
that Person (or a combination thereof); and
(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 such Person or one
or more Subsidiaries of such Person (or any combination thereof).
Unless otherwise specified, “Subsidiary” refers to a Subsidiary of an Issuer.
“Transaction Date” means the date of the transaction giving rise to the need to calculate either the
Consolidated Total Leverage Ratio or the Fixed Charge Coverage Ratio, as the case may be.
“Transactions” means (i) the offering of the Notes and (ii) the other transactions described under “Use
of Proceeds”.

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 “UCC” means the Uniform Commercial Code as in effect in the State of New York, and any successor
statute, as in effect from time to time (except that terms used herein which are defined in the Uniform
Commercial Code as in effect in the State of New York on the date hereof shall continue to have the same
meaning notwithstanding any replacement or amendment of such statute.
“Unrestricted Subsidiary” means (1) any Subsidiary that at the time of determination shall be
designated an Unrestricted Subsidiary by the Board of Directors of the relevant Issuer in accordance with
the covenant described under “— Certain Covenants — Limitations on Designation of Unrestricted
Subsidiaries” and (2) any Subsidiary of an Unrestricted Subsidiary.
“U.S. Government Obligations” means direct non-callable obligations of, or obligations guaranteed by,
the United States of America for the payment of which guarantee or obligations the full faith and credit of
the United States is pledged.
“Voting Stock” with respect to any Person, means securities of any class of Equity Interests of such
Person (in the case of a partnership, the sole general partner or managing general partner of such Person)
entitling the holders thereof (whether at all times or only so long as no senior class of stock or other relevant
equity interest has voting power by reason of any contingency) to vote in the election of members of the
Board of Directors of such Person,
“Weighted Average Life to Maturity” when applied to any Indebtedness at any date, means 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 payment of principal, including
payment at final maturity, in respect thereof 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.
“Wholly Owned Restricted Subsidiary” means a Restricted Subsidiary of which 100% of the Equity
Interests (except for directors’ qualifying shares or certain minority interests owned by other Persons solely
due to local law requirements that there be more than one stockholder, but which interest is not in excess of
what is required for such purpose) are owned directly by an Issuer or through one or more Wholly-Owned
Restricted Subsidiaries.

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 BOOK-ENTRY, SETTLEMENT AND CLEARANCE

The Global Notes

The notes will be issued in the form of several registered notes in global form, without interest coupons
(the “Global Notes”), as follows:
• notes sold to persons reasonably believed to be QIBs under Rule 144A will be represented by the
Rule 144A Global Note; and
• notes sold in offshore transactions to non-U.S. persons in reliance on Regulation S will be
represented by temporary Global Notes in fully registered form without interest coupons (each a
“Temporary Regulation S Global Note”).
Upon issuance, each of the Global Notes will be deposited with the Trustee as custodian for The
Depository Trust Company (“DTC”) and registered in the name of Cede & Co., as nominee of DTC. Each
Temporary Regulation S Global Note will be exchangeable for a single permanent Global Note (each a
“Permanent Regulation S Global Note” and, together with a Temporary Regulation S Global Note, a
“Regulation S Global Note”) after the expiration of the “distribution compliance period” (as defined in
Regulation S) and the certification required by Regulation S. Prior to such time, a beneficial interest in the
Temporary Regulation S Global Note may be transferred to a person who takes delivery in the form of an
interest in the Rule 144A Global Note only upon receipt by the Trustee of a written certification from the
transferor to the effect that such transfer is being made to a person whom the transferor reasonably believes
is a QIB in a transaction meeting the requirements of Rule 144A. Beneficial interests in a Rule 144A Global
Note may be transferred to a person who takes delivery in the form of an interest in a Regulation S Global
Note whether before, on or after such time, only upon receipt by the Trustee of a written certification to the
effect that such transfer is being made in accordance with Regulation S.
Ownership of beneficial interests in each Global Note will be limited to persons who have accounts
with DTC (“DTC participants”) or persons who hold interests through DTC participants. We expect that
under procedures established by DTC:
• upon deposit of each Global Note with DTC’s custodian, DTC will credit portions of the principal
amount of the Global Note to the accounts of the DTC participants designated by the Initial
Purchaser; and
• ownership of beneficial interests in each Global Note will be shown on, and transfer of ownership of
those interests will be effected only through, records maintained by DTC (with respect to interests of
DTC participants) and the records of DTC participants (with respect to other owners of beneficial
interests in the Global Note) and transferred only to non-U.S. persons under Regulation S or QIBs
under Rule 144A.
Beneficial interests in the Global Notes may not be exchanged for notes in physical, certificated form
except in the limited circumstances described below.
Each Global Note and beneficial interests in each Global Note will be subject to restrictions on transfer
as described under “Notice to Investors.”

Exchanges Among the Global Notes

Beneficial interests in one Global Note may generally be exchanged for interests in another Global
Note. Depending on which Global Note the transfer is being made, the Trustee may require the seller to
provide certain written certifications in the form provided in the indenture.
A beneficial interest in a Global Note that is transferred to a person who takes delivery through another
Global Note will, upon transfer, become subject to any transfer restrictions and other procedures applicable
to beneficial interests in the other Global Note.

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Book-Entry Procedures for the Global Notes
All interests in the Global Notes will be subject to the operations and procedures of DTC. We provide
the following summaries of those operations and procedures solely for the convenience of investors. The
operations and procedures of each settlement system are controlled by that settlement system and may be
changed at any time. Neither we nor the Initial Purchaser are responsible for those operations or
procedures.
DTC has advised us that it is a:
• limited purpose trust company organized under the laws of the State of New York;
• “banking organization” within the meaning of the New York State Banking Law;
• member of the Federal Reserve System;
• “clearing corporation” within the meaning of the Uniform Commercial Code; and
• “clearing agency” registered under Section 17A of the Securities Exchange Act of 1934.
DTC was created to hold securities for its participants and to facilitate the clearance and settlement of
securities transactions between its participants through electronic book-entry changes to the accounts of its
participants. DTC’s participants include securities brokers and dealers, including the Initial Purchaser;
banks and trust companies; clearing corporations and other organizations. Indirect access to DTC’s system
is also available to others such as banks, brokers, dealers and trust companies. These indirect participants
clear through or maintain a custodial relationship with a DTC participant, either directly or indirectly.
Investors who are not DTC participants may beneficially own securities held by or on behalf of DTC only
through DTC participants or indirect participants in DTC.
So long as DTC’s nominee is the registered owner of a Global Note, that nominee will be considered
the sole owner or holder of the notes represented by that Global Note for all purposes under the indenture.
Except as provided below, owners of beneficial interests in a Global Note:
• will not be entitled to have notes represented by the Global Note registered in their names;
• will not receive or be entitled to receive physical, certificated notes; and
• will not be considered the owners or holders of the notes under the indenture for any purpose,
including with respect to the giving of any direction, instruction or approval to the Trustee under the
indenture.
As a result, each investor who owns a beneficial interest in a Global Note must rely on the procedures
of DTC to exercise any rights of a holder of the notes under the indenture (and, if the investor is not a
participant or an indirect participant in DTC, on the procedures of the DTC participant through which the
investor owns its interest).
Payments of principal, premium (if any) and interest with respect to the notes represented by a global
note will be made by the Trustee to DTC’s nominee as the registered holder of the Global Note. Neither we
nor the Trustee will have any responsibility or liability for the payment of amounts to owners of beneficial
interests in a Global Note, for any aspect of the records relating to or payments made on account of those
interests by DTC, or for maintaining, supervising or reviewing any records of DTC relating to those
interests.
Payments by participants and indirect participants in DTC to the owners of beneficial interests in a
Global Note will be governed by standing instructions and customary industry practice and will be the
responsibility of those participants or indirect participants and DTC.
Transfers between participants in DTC will be effected under DTC’s procedures and will be settled in
same-day funds.

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 DTC has agreed to the above procedures to facilitate transfers of interests in the Global Notes among
participants in those settlement systems. However, the settlement systems are not obligated to perform
these procedures and may discontinue or change these procedures at any time. Neither we nor the Trustee
will have any responsibility for the performance by DTC or its participants or indirect participants of their
obligations under the rules and procedures governing their operations.

Certificated Notes
Notes in physical certificated form will be issued and delivered to each person that DTC identifies as a
beneficial owner of the related notes only if:
• DTC notifies us at any time that it is unwilling or unable to continue as depositary for the Global
Notes and a successor depositary is not appointed within 90 days;
• DTC ceases to be registered as a clearing agency under the Securities Exchange Act of 1934 and a
successor depositary is not appointed within 90 days; or
• certain other events provided in the indenture should occur.

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 PLAN OF DISTRIBUTION
Subject to the terms and conditions set forth in the Purchase Agreement dated the date hereof (the
“Purchase Agreement”), among us, the guarantors and the Initial Purchaser, we have agreed to sell, and the
Initial Purchaser has agreed to purchase, all of the notes to be sold in this offering. The Purchase
Agreement provides that the obligation of the Initial Purchaser to pay for and accept delivery of the notes is
subject to, among other conditions, the delivery of certain legal opinions. If the Initial Purchaser takes any
of the notes, it is obligated to take and pay for all of the notes.
Under the terms of the Purchase Agreement, subject to the conditions thereof, the Initial Purchaser has
agreed to purchase the notes at a discount from the price indicated on the cover page of this offering
memorandum. The Initial Purchaser will receive customary commissions and discounts under the Purchase
Agreement upon consummation of the offering of the notes pursuant to this offering memorandum. The
Initial Purchaser will initially offer the notes at the price to investors indicated on the cover page hereof as
described in “Notice to Investors.” After the initial offering of the notes, the Initial Purchaser may from time
to time vary the offering price and other selling terms.
The notes have not been registered under the Securities Act or any state securities laws and, unless so
registered, may not be offered or sold within the United States or to, or for the account or benefit of, U.S.
persons, except pursuant to an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and other applicable securities laws. We have been advised by the Initial
Purchaser that it proposes to resell the notes to (a) qualified institutional buyers in reliance on Rule 144A
under the Securities Act or (b) outside the United States to certain persons in reliance on Regulation S
under the Securities Act. See “Notice to Investors.” In connection with sales outside the United States, the
Initial Purchaser has agreed that it will not offer, sell or deliver the notes to, or for the account or benefit of,
U.S. persons (1) as part of its distribution at any time or (2) otherwise prior to 40 days after the later of the
commencement of this offering and the date the notes were originally issued. The Initial Purchaser will
send to each dealer to whom it sells notes during such period a confirmation or other notice setting forth the
restrictions on offers and sales of the notes within the United States or to, or for the account or benefit of,
U.S. persons. As used in this paragraph, the terms used in this paragraph have the meanings given to them
in Regulation S under the Securities Act.
We have agreed with the Initial Purchaser that we will not offer or issue any other debt securities
substantially similar to the notes from the date hereof through the date that is 90 days after the date hereof
without its prior written consent.
The Purchase Agreement provides that we will indemnify the Initial Purchaser against certain
liabilities, including liabilities under the Securities Act, or will contribute to payments that the Initial
Purchaser may be required to make in respect of any such liabilities.
The notes are a new issue of securities with no established trading market and will not be listed on any
securities exchange. The Initial Purchaser has advised us that it presently intends to make a market in the
notes as permitted by applicable laws; however, it is not obligated to do so and may discontinue such
market-making at any time without providing any notice. In addition, subject to compliance with applicable
laws, the ability of the Initial Purchaser to make a market in the notes will be subject to the availability of a
current “market-maker” prospectus. Accordingly, no assurance can be given as to the liquidity of any
trading market for the notes.
In connection with the offering of the notes, the Initial Purchaser may engage in transactions that
stabilize, maintain or otherwise affect the price of the notes. Specifically, the Initial Purchaser may bid for
and purchase notes in the open market to stabilize the price of the notes. The Initial Purchaser may also
overallot in connection with the offering of the notes, creating a syndicate short position and may bid for
and purchase notes in the open market to cover the syndicate short position. In addition, the Initial
Purchaser may bid for and purchase the notes in market making transactions and impose penalty bids. Any
of these activities may stabilize or maintain the market price of the notes above independent market levels

149
that might otherwise prevail. The Initial Purchaser is not required to engage in any of these activities and
may end any of them at any time.
The notes may be sold in Canada 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 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 offering memorandum (including any amendment 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 Initial
Purchaser is not required to comply with the disclosure requirements of NI 33-105 regarding underwriter
conflicts of interest in connection with this offering.
In relation to each Member State of the European Economic Area (each, a “Relevant Member State”),
the Initial Purchaser has represented and agreed that it has not made and will not make an offer of the notes
to the public in that Relevant Member State other than:
• to any legal entity which is a qualified investor as defined in the Prospectus Directive;
• to fewer than 150 natural or legal persons (other than qualified investors as defined in the
Prospectus Directive), subject to obtaining the prior consent of the relevant dealer or dealers
nominated by the Issuers for any such offer; or
• in any other circumstances falling within Article 3(2) of the Prospectus Directive,
provided that no such offer of notes shall require any Issuer or the Initial Purchaser to publish a
prospectus pursuant to Article 3 of the Prospectus Directive or supplement a prospectus pursuant to
Article 16 of the Prospectus Directive.
For the purposes of this provision, the expression an “offer of notes to the public” in relation to any
notes in any Relevant Member State means the communication in any form and by any means of sufficient
information on the terms of the offer and the notes to be offered so as to enable an investor to decide to
purchase or subscribe the notes, as the same may be varied in that Member State by any measure
implementing the Prospectus Directive in that Member State, the expression “Prospectus Directive” means
Directive 2003/71/EC (as amended, including by Directive 2010/73/EU), and includes any relevant
implementing measure in the Relevant Member State.
The Initial Purchaser has represented and agreed that:
• it has only communicated or caused to be communicated and will only communicate or cause to be
communicated an invitation or inducement to engage in investment activity (within the meaning of
Section 21 of the Financial Services and Markets Act 2000 (the “FSMA”) received by it in connection
with the issue or sale of the notes in circumstances in which Section 21(1) of the FSMA does not
apply to us; and
• it has complied and will comply with all applicable provisions of the FSMA with respect to anything
done by it in relation to the notes in, from or otherwise involving the United Kingdom.
We expect to deliver the notes against payment for the notes on or about , 2017, which will be
the tenth business day following the date of the pricing of the notes. Under Rule 15c6-1 of the Exchange
Act (as amended effective September 5, 2017), trades in the secondary market are required to settle in two
business days, and purchasers who wish to trade notes on the date of pricing or the next succeeding
business days will be required, by virtue of the fact that the notes will settle in T + , to specify
alternative settlement arrangements to prevent a failed settlement.

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 The Initial Purchaser and its affiliates have provided in the past and may provide in the future
investment banking, commercial lending and financial advisory services to us and our affiliates, for which
they have received and may receive customary fees. The Initial Purchaser was the initial purchaser of the
2021 Notes and received fees in connection therewith. Wells Fargo Bank, National Association, serves as
the administrative agent and a lender under our senior secured credit agreement and, as a result, will
receive a portion of the net proceeds of this offering through our repayment of a portion of our outstanding
borrowings under the senior secured credit facility. Wells Fargo Bank, National Association is also the
trustee in connection with the 2021 Notes and the notes offered hereby. We intend to use the net proceeds
we receive from this offering to, among other things, purchase in the Tender Offer and/or redeem any and
all of our outstanding 2021 Notes. See ‘‘Use of Proceeds’’ and ‘‘Description of Other Indebtedness — 7.875%
Second Lien Senior Secured Notes due 2021.’’ Wells Fargo Securities, LLC is serving as dealer manager
and consent solicitation agent for the Tender Offer. The Initial Purchaser or its affiliates may hold 2021
Notes, and will receive proceeds if these 2021 Notes are tendered in the Tender Offer or in connection with
the expected redemption thereafter.
In addition, in the ordinary course of their business activities, the Initial Purchaser and its 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. Such investments and securities activities may involve securities and/or
instruments of ours or our affiliates. To the extent the Initial Purchaser or its affiliates have a lending
relationship with us, they have advised us that they routinely hedge their credit exposure to us consistent
with their customary risk management policies. Typically, the Initial Purchaser and its 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, including potentially the notes. Any such short
positions could adversely affect future trading prices of the notes. Finally, the Initial Purchaser and its
affiliates may also make investment recommendations and/or publish or express independent research
views in respect of such securities or financial instruments and may hold, or recommend to clients that they
acquire, long and/or short positions in such securities and instruments.

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 NOTICE TO INVESTORS
The notes have not been registered under the Securities Act or any securities laws of any other
jurisdiction, and may not be offered or sold within the United States or to, or for the account or benefit of,
U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and such other securities laws. Accordingly, the notes are being offered
hereby only (1) to qualified institutional buyers, as defined in Rule 144A of the Securities Act, in reliance on
the exemption from the registration requirements of the Securities Act provided by Rule 144A and
(2) outside of the United States in reliance upon Regulation S under the Securities Act to non-U.S. persons
who will be required to make certain representations to us and others prior to the investment in the notes.
Because of these restrictions and those described below, purchasers are advised to consult legal counsel
prior to making any offer, resale, pledge or other transfer of the notes.
Each purchaser of the notes will be deemed to have acknowledged, represented to and agreed with us
and the Initial Purchaser as follows:
(a) It is purchasing the notes for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is either:
(1) a “qualified institutional buyer” as defined in Rule 144A adopted under the Securities
Act (a “QIB”) and is aware that the sale to it is being made in reliance on Rule 144A; or
(2) outside the United States in compliance with Regulation S, and is not a U.S. person as
defined under Regulation S.
(b) It acknowledges that the notes have not been registered under the Securities Act or any
securities laws of any other jurisdiction, and that they may not be offered, sold, pledged or otherwise
transferred within the United States or to, or for the account or benefit of, U.S. persons except as set
forth below.
(c) It shall not offer, resell, pledge or otherwise transfer any of the notes after the original issuance of
the notes except:
(1) to us or any of our subsidiaries;
(2) inside the United States to a person whom the seller reasonably believes is a QIB that
purchases for its own account or for the account of a QIB in compliance with Rule 144A;
(3) outside the United States in compliance with Rule 904 of Regulation S under the
Securities Act;
(4) pursuant to the exemption from registration provided by Rule 144 adopted under the
Securities Act (if available);
(5) in accordance with another exemption from the registration requirements of the
Securities Act (and based upon an opinion of counsel acceptable to us); or
(6) pursuant to an effective registration statement under the Securities Act, in each of cases
(1) through (6) in accordance with all applicable securities laws of any U.S. state or other
applicable jurisdiction.
(d) It agrees that it will give to each person to whom it transfers the notes notice of any
restrictions on transfer of such notes, including those described in the indenture under which such
notes were issued and in this offering memorandum. No representation is being made as to the
availability of the exemption provided by Rule 144 for resales of the notes.
(e) It agrees that it shall not transfer or resell the notes in Canada or to or for the account of any
person resident in Canada for a period of 40 days from the original issuance of the notes, except in
compliance with law.

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 (f) Either (i) the purchaser is not acquiring or holding such notes or any interest therein with the
assets of (A) an “employee benefit plan” (as defined in Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”)) that is subject to Title I of ERISA, (B) a “plan”
that is subject to Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”), (C) any
entity deemed under ERISA to hold “plan assets” of any of the foregoing by reason of an employee
benefit plan’s or plan’s investment in such entity, or (D) a governmental plan, church plan or non-US
plan subject to provisions under any federal, state, local, non-US or other laws or regulations that are
similar to the foregoing provisions of ERISA or the Code (“Similar Law”); or (ii) the acquisition and
holding of such notes or any interest therein by the purchaser will not constitute or result in a non-
exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or a similar
violation under any applicable Similar Law.
(g) Each purchaser of the notes that is (1) an employee benefit plan subject to Title I of ERISA,
(2) a plan or account subject to Section 4975 of the Code or (3) an entity deemed to hold “plan assets”
of any such employee benefit plan, plan or account, hereby represents and warrants that a fiduciary
acting on its behalf is causing it to purchase the notes and that such fiduciary:
(i) Is a bank, an insurance carrier, a registered investment adviser, a registered broker-
dealer or an independent fiduciary with at least $50 million of assets under management or
control as specified in 29 CFR Section 2510.3-21(c)(1)(i) (excluding an IRA owner if the purchaser
is an IRA);
(ii) Is independent (for purposes of 29 CFR Section 2510.3-21(c)(1)) of each Issuer, the
Initial Purchaser and their respective affiliates (the “Transaction Parties”);
(iii) Is capable of evaluating investment risks independently, both in general and with
regard to particular transactions and investment strategies, including the purchaser’s transactions
with the Transaction Parties hereunder;
(iv) Has been advised that none of the Transaction Parties has undertaken or will undertake
to provide impartial investment advice, or has given or will give advice in a fiduciary capacity, in
connection with the purchaser’s transactions with the Transaction Parties contemplated hereby;
(v) Is a “fiduciary” under Section 3(21)(A) of ERISA or Section 4975(e)(3) of the Code, or
both, as applicable, with respect to, and is responsible for exercising independent judgment in
evaluating, the purchaser’s transactions with the Transaction Parties contemplated hereby; and
(vi) Understands and acknowledges the existence and nature of the underwriting discounts,
commissions and fees, and any other related fees, compensation arrangements or financial
interests, described in this offering memorandum; and understands, acknowledges and agrees
that no such fee or other compensation is a fee or other compensation for the provision of
investment advice, and that none of the Transaction Parties, nor any of their respective directors,
officers, members, partners, employees, principals or agents has received or will receive a fee or
other compensation from the purchaser or such fiduciary for the provision of investment advice
(rather than other services) in connection with the purchaser’s transactions with the Transaction
Parties contemplated hereby.

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 CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of certain U.S. federal income tax considerations relating to the purchase,
ownership and disposition of the notes by holders acquiring the notes pursuant to this offering (the notes
are hereinafter referred to in this summary as the “Notes”). This summary assumes that the Notes are held
as capital assets and that the holders purchase the Notes for cash upon their initial issuance at their initial
offering price. It is not a complete analysis of all the potential tax considerations relating to the purchase,
ownership and disposition of the Notes.
This summary is based on the provisions of the Internal Revenue Code of 1986, as amended, or the
Code, permanent and temporary Treasury Regulations promulgated under the Code, and currently effective
administrative rulings and judicial decisions. Any of these authorities may be changed, possibly with
retroactive effect, resulting in U.S. federal income tax consequences different from those discussed below.
We have not sought any ruling from the Internal Revenue Service, or the IRS, or any opinion of counsel
with respect to the tax consequences described below, and there can be no assurance that the IRS will not
take a position inconsistent with the tax consequences described below or that any such position taken by
the IRS would not be sustained.
This summary does not address tax considerations arising under federal non-income tax laws (such as
gift and estate tax laws), under the laws of any foreign, state or local jurisdiction, or under any applicable
tax treaty. In addition, this summary does not address all tax considerations that may be applicable to a
holder in light of that holder’s particular circumstances or that may be applicable to holders that are subject
to special tax rules, including, without limitation:
• regulated investment companies, real estate investment trusts, and real estate mortgage investment
conduits;
• holders subject to the alternative minimum tax;
• U.S. Holders (as defined below) that are individuals subject to the special rules applicable to U.S.
citizens or residents living abroad;
• banks, insurance companies, or other financial institutions;
• tax-exempt entities and retirement plans, individual retirement accounts and tax-deferred accounts;
• dealers in securities, currencies or commodities;
• traders in securities that elect to use a mark-to-market method of accounting for their securities
holdings;
• U.S. Holders whose “functional currency” is not the U.S. dollar;
• persons subject to taxation as U.S. expatriates;
• persons that will hold the Notes as a position in a hedging transaction, wash sale, constructive sale,
straddle, conversion transaction or other risk-reduction transaction or synthetic security;
• U.S. Holders that will hold the Notes through a non-U.S. broker or other non-U.S. institution or
entity;
• governments or agencies or instrumentalities thereof; and
• S corporations, partnerships or other pass-through entities, including entities and arrangements
classified as partnerships for U.S. federal income tax purposes, and beneficial owners of, or investors
in, such entities.
If an entity treated as a partnership for U.S. federal income tax purposes holds the Notes, the tax
treatment of a partner in the partnership generally will depend on the status of the partner and the activities
of the partnership. Partnerships considering an investment in the Notes (and partners in such partnerships)
should consult their tax advisors regarding the tax consequences of the purchase, ownership and
disposition of the Notes by such partnerships.

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 This summary of certain U.S. federal income tax considerations is for general information only and is
not tax advice. Prospective investors in the Notes are urged to consult their tax advisors with respect to the
application of the U.S. federal income tax laws to their particular situations as well as any tax consequences
arising under the U.S. federal estate, gift or other non-income tax laws or under the laws of any state, local,
or foreign taxing jurisdiction or under any applicable tax treaty.
The statements in this offering memorandum are not intended, and should not be construed, to be
tax or legal advice to any particular investor. Prospective investors in the Notes should seek advice
based on their particular circumstances from an independent tax advisor.

Consequences to U.S. Holders

The following is a summary of certain U.S. federal income tax consequences to a U.S. Holder of the
purchase, ownership and disposition of the Notes. “U.S. Holder” means a beneficial owner of a Note that
acquires the Note in this offering and is, for U.S. federal income tax purposes:
• an individual who is a citizen or resident of the United States;
• a corporation that is created or organized under the laws of the United States or any State thereof or
the District of Columbia;
• an estate the income of which is subject to U.S. federal income taxation regardless of its source; or
• a trust that (i) is subject to the primary supervision of a court within the United States and that has
one or more United States persons with authority to control all substantial decisions of the trust or
(ii) has a valid election in effect under applicable Treasury Regulations to be treated as a United
States person.

Payments of Interest
Subject to the discussion below, stated interest on the Notes will be taxable as ordinary income when
received or accrued by a U.S. Holder in accordance with such holder’s regular method of accounting for
U.S. federal income tax purposes.

Certain Contingent Payments

The Code and the Treasury Regulations contain special rules that apply to debt instruments that
provide for one or more contingent payments. Under certain circumstances (see “Description of Notes —
Optional Redemption”, “Description of Notes — Optional Redemption — Redemption with Proceeds from
Equity Offerings”, and “Description of Notes — Change of Control”), we may repurchase the Notes, in
whole or in part, for an amount in excess of the stated principal amount of the Notes. According to the
Treasury Regulations that address contingent payment debt instruments, the possibility that any such
repurchase will occur will not be taken into account, and so will not affect the amount of interest income a
U.S. Holder recognizes, if there is only a remote chance as of the date the Notes were issued that any such
repurchase will occur. We believe that the likelihood that we will repurchase the Notes is remote. Therefore,
we do not intend to take such a repurchase into account in determining the yield to maturity of the Notes.
Our determination that there is only a remote likelihood that we will repurchase the Notes is binding
on a U.S. Holder unless the U.S. Holder explicitly discloses on the U.S. Holder’s federal income tax return
for the year during which the U.S. Holder acquires the Notes that the U.S. Holder is taking a different
position. Our determination is not, however, binding on the IRS, and if the IRS were to challenge our
determination, a U.S. Holder might be required to accrue interest income on its Notes in excess of the
stated interest thereon, regardless of the U.S. Holder’s regular method of accounting for U.S. federal income
tax purposes, and the U.S. Holder might be required to treat certain income realized on the taxable
disposition of a Note as ordinary income rather than capital gain. In the event we repurchase Notes held by
a U.S. Holder, that repurchase could affect the timing and amount of the income recognized by the U.S.
Holder. The remainder of this discussion assumes that the Notes will not be subject to the special rules that
apply to contingent payment debt instruments.

155
 Sale or Other Taxable Disposition of the Notes
Upon the sale, exchange, redemption, retirement or other taxable disposition of a Note, a U.S. Holder
will recognize taxable gain or loss equal to the difference between (x) the amount realized in cash and the
fair market value of any property other than cash received by the U.S. Holder on such disposition (except to
the extent such cash or property is attributable to accrued interest, which will be treated as ordinary interest
income to the extent not previously included in income by such U.S. Holder), and (y) 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 cost of
the Note to the U.S. Holder, decreased by the amount of any principal payments on the Note previously
received by the U.S. Holder.
Gain or loss recognized on the taxable disposition of a Note generally will be capital gain or loss and
any such capital gain or loss will be long-term capital gain or loss if the U.S. Holder has held the Note for
more than one year at the time of such disposition. Long-term capital gains of individuals, estates and
trusts currently are generally taxed at a preferential rate. The deductibility of capital losses is subject to
limitations.

Unearned Income Medicare Tax

A 3.8% Medicare contribution tax generally applies to all or some portion of the net investment income
of a U.S. Holder who is an individual with adjusted gross income that exceeds a threshold amount
($250,000 if married filing jointly or if considered a “surviving spouse” for federal income tax purposes,
$125,000 if married filing separately, and $200,000 in other cases). This 3.8% tax also applies to all or some
portion of the undistributed net investment income of certain U.S. Holders that are estates and trusts.
Interest on the Notes and gain from the taxable disposition of the Notes would generally be taken into
account in computing such a U.S. Holder’s net investment income.

Information Reporting and Backup Withholding

In general, information reporting requirements will apply to a U.S. Holder with respect to payments of
interest on, and the proceeds of certain sales, exchanges, repurchases, redemptions or retirements of, the
Notes unless the U.S. Holder is an exempt recipient, such as a corporation. A backup withholding tax
(currently imposed at a rate of 28%) may apply to such payments to a U.S. Holder if the U.S. Holder fails to
provide the U.S. Holder’s taxpayer identification number or, if requested, certification of exempt status
(including a certification that the U.S. Holder has not been notified by the IRS that payments to the U.S.
Holder are subject to backup withholding), or the U.S. Holder otherwise fails to comply with applicable
requirements of the backup withholding rules.
Backup withholding is not an additional tax. Any amounts withheld from a U.S. Holder under the
backup withholding rules may be refunded to the U.S. Holder or credited against the U.S. Holder’s federal
income tax liability, if any, if the required information is furnished to the IRS in a timely manner.

Consequences to Non-U.S. Holders

The following is a summary of certain U.S. federal income tax consequences to a Non-U.S. Holder of
the purchase, ownership and disposition of the Notes. “Non-U.S. Holder” means a beneficial owner of a
Note that is an individual, corporation, estate or trust for U.S. federal income tax purposes and acquires the
Note in this offering and is not a U.S. Holder.
For the reasons discussed above under “Consequences to U.S. Holders — Certain Contingent
Payments”, the discussion under this caption “— Consequences to Non-U.S. Holders” assumes that the
Notes will not be subject to the special rules under the Code and Treasury Regulations that apply to
contingent payment debt instruments.

Payments of Interest
Subject to the discussion below concerning backup withholding and FATCA, a Non-U.S. Holder that is
not engaged in a trade or business in the United States to which interest on a Note is attributable generally

156
will not be subject to U.S. federal income tax on a net income basis in respect of interest on a Note and will
also be exempt from gross basis U.S. federal withholding tax on such interest under the “portfolio interest
exception”, provided that:
• the Non-U.S. Holder does not actually or constructively own 10% or more of the total combined
voting power of all classes of the voting stock of any Issuer within the meaning of the Code and
applicable Treasury Regulations;
• the Non-U.S. Holder is not a controlled foreign corporation that is related to any Issuer as
determined for purposes of Section 864(d) of the Code;
• the Non-U.S. Holder is not a bank whose receipt of interest on a Note is in respect of an extension of
credit made pursuant to a loan agreement entered into in the ordinary course of its trade or business;
and
• either (i) the Non-U.S. Holder provides its name and address and certifies, under penalties of
perjury, that it is not a United States person (which certification may be made on an IRS Form
W-8BEN or Form W-8BEN-E, as applicable), or (ii) a securities clearing organization, bank, or other
financial institution that holds customers’ securities in the ordinary course of its business holds the
Note on behalf of the Non-U.S. Holder and certifies, under penalties of perjury, that it has received
an IRS Form W-8BEN or Form W-8BEN-E, as applicable, for the Non-U.S. Holder and otherwise
complies with applicable requirements. If the Notes are held by or through certain foreign
intermediaries or certain foreign partnerships, such foreign intermediaries or partnerships also must
satisfy the certification requirements of applicable Treasury Regulations.
If the requirements described above are not satisfied with respect to Notes held by a Non-U.S. Holder,
payments of interest on the Notes will be subject to a 30% U.S. federal withholding tax on the gross amount
of the payment, unless the Non-U.S. Holder provides a properly executed (i) IRS Form W-8BEN or
W-8BEN-E (or other applicable form) claiming an exemption from or reduction in withholding tax under an
applicable tax treaty or (ii) IRS Form W-8ECI (or other applicable form) stating that interest paid on the
Notes is not subject to withholding tax because it is effectively connected with the Non-U.S. Holder’s
conduct of a trade or business in the United States.
If the Non-U.S. Holder is engaged in a trade or business in the United States and interest on a Note is
effectively connected with the conduct of that trade or business, the Non-U.S. Holder will be required to
pay U.S. federal income tax on that interest on a net income basis in the same manner as if it were a U.S.
Holder, except as otherwise provided by an applicable income tax treaty. In addition, if the Non-U.S.
Holder is a foreign corporation, any interest on the Notes received by the Non-U.S. Holder that is treated as
effectively connected with the conduct of a trade or business in the United States may be subject to an
additional branch profits tax at a rate of 30% (or such lower rate as may be specified by an applicable income
tax treaty), subject to adjustments.

Sale or Other Taxable Disposition of the Notes

Subject to the discussion below concerning backup withholding and FATCA, any gain recognized by a
Non-U.S. Holder on the sale, exchange, redemption, retirement or other taxable disposition of a Note
generally will not be subject to U.S. federal income or withholding tax unless:
• that gain is effectively connected with the Non-U.S. Holder’s conduct of a trade or business in the
United States; or
• 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 that disposition, and certain other conditions are met.

157
 The amount of gain recognized by a Non-U.S. Holder will be determined without regard to any amount
received by the Non-U.S. Holder that is attributable to accrued stated interest, which will be treated in the
manner described under “— Payments of Interest” above.
Gain described in the first bullet point above that is recognized by a Non-U.S. Holder generally will be
subject to U.S. federal income tax in the same manner as if it were recognized by a U.S. Holder, and, in
addition, in the case of a corporate Non-U.S. Holder, an additional branch profits tax at a rate of 30% (or
such lower rate as may be specified by an applicable income tax treaty) may apply subject to adjustments.
Gain described in the second bullet point above that is recognized by a Non-U.S. Holder will (unless an
applicable income tax treaty otherwise provides) be subject to a flat 30% U.S. federal income tax, which may
be offset by certain U.S. source capital losses.

Unearned Income Medicare Tax

As discussed above under “— Consequences to U.S. Holders — Unearned Income Medicare Tax,” a
3.8% Medicare contribution tax applies, in addition to regular income tax, to certain investment
income. This tax generally will not apply to Non-U.S. Holders that constitute foreign estates or trusts.
However, distributions from such a foreign estate or trust to a U.S. beneficiary thereof will constitute
investment income to such U.S. beneficiary to the extent that such amount would have constituted
investment income to the estate or trust, as applicable. Non-U.S. Holders should consult their tax advisors
about the possible application of the 3.8% Medicare tax.

Information Reporting and Backup Withholding

A Non-U.S. Holder generally will not be subject to backup withholding (as described above under
“— Consequences to U.S. Holders — Information Reporting and Backup Withholding”) with respect to
payments of interest on the Notes if the Non-U.S. Holder provides the requisite certification on IRS Form
W-8BEN or Form W-8BEN-E (or other applicable form) or otherwise establishes an exemption from
backup withholding. Information reporting generally will apply to payments of interest, whether or not such
interest is exempt from U.S. withholding tax. Copies of these information returns may also be made
available under the provisions of a specific tax treaty or agreement to the tax authorities of the country in
which the payee resides.
Payments to a Non-U.S. Holder of the gross proceeds from the sale, exchange, redemption,
repurchase, retirement, or other disposition of a Note effected by or through a U.S. office of a broker
generally will be subject to backup withholding and information reporting unless the Non-U.S. Holder
certifies as to its non-U.S. status on IRS Form W-8BEN or Form W-8BEN-E (or other applicable form) or
otherwise establishes an exemption from backup withholding. Generally, information reporting and backup
withholding will not apply to a payment to a Non-U.S. Holder of proceeds of the sale, exchange,
redemption, repurchase, retirement, or other disposition of a Note where the disposition is effected outside
the United States through a non-U.S. office of a non-U.S. broker and payment is not received by the Non-
U.S. Holder in the United States.
However, information reporting, but not backup withholding, generally will apply to a payment to a
Non-U.S. Holder of proceeds of the sale, exchange, redemption, repurchase, retirement, or other
disposition of a Note where the disposition is effected outside the United States by or through an office of a
broker that is:
• a United States person;
• a foreign person that derives 50% or more of its gross income for certain specified periods from the
conduct of a trade or business in the United States;
• a controlled foreign corporation for U.S. federal income tax purposes; or
• a foreign partnership (i) more than 50% of the capital or profits interest of which is owned by United
States persons or (ii) that is engaged in a U.S. trade or business,
unless that broker has documentary evidence in its files of the Non-U.S. Holder’s non-U.S. status and
certain other conditions are met or unless the Non-U.S. Holder otherwise establishes an exemption.

158
 Backup withholding is not an additional tax. Any amounts withheld from a Non-U.S. Holder under the
backup withholding rules may be refunded to the Non-U.S. Holder or credited against the Non-U.S.
Holder’s U.S. federal income tax liability, if any, if the required information is furnished to the IRS in a
timely manner.

Additional Withholding Tax on Payments Made to Foreign Accounts

The Foreign Account Tax Compliance Act (“FATCA”) imposes a U.S. federal gross-basis withholding
tax at a rate of 30% on payments of interest on, and the gross proceeds from the sale, exchange, redemption,
retirement or other taxable disposition of a debt instrument issued by a United States issuer, when such
interest or gross proceeds are paid to certain foreign financial institutions and certain other non-U.S.
entities, including where such an institution or entity is acting as an intermediary, unless such non-U.S.
entity complies with certain reporting requirements regarding its U.S. account holders and its U.S. owners.
Withholding under FATCA generally will apply to payments of interest on a Note regardless of when such
payments are made. However, under applicable Treasury Regulations, withholding under FATCA generally
will apply to payments of the gross proceeds from the sale, exchange, redemption, retirement or other
taxable disposition of a Note no earlier than January 1, 2019. Prospective investors should consult their tax
advisors regarding the consequences and application of the rules under FATCA.

159
 LEGAL MATTERS
Certain legal matters in connection with the offering and sale of the notes and the guarantees will be
passed upon for us by Conner & Winters, LLP, Fayetteville, Arkansas and Lowenstein Sandler LLP, New
York, New York. Certain legal matters in connection with this offering will be passed upon for the Initial
Purchaser by Cahill Gordon & Reindel LLP, New York, New York.

INDEPENDENT AUDITORS
The combined financial statements of Simmons as of December 27, 2014, January 2, 2016, and
December 31, 2016, and for the fiscal years then ended included in this offering memorandum have been
audited by Frost, PLLC, independent registered public accounting firm.

WHERE YOU CAN FIND MORE INFORMATION

We are not currently subject to the informational requirements of the Securities Exchange Act of 1934,
as amended. However, we have agreed that, for so long as any notes remain outstanding, we will furnish to
the holders and to prospective investors designated by any holder, upon their request, the information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
We will provide without charge to each person to whom a copy of this offering memorandum has been
delivered, who makes a written or oral request, a copy of any and all of the documents referred to herein,
which are summarized in this offering memorandum, by writing or calling us at the following address or
telephone number:

Simmons Foods, Inc.

Simmons Prepared Foods, Inc.
Simmons Pet Food, Inc.
Simmons Feed Ingredients, Inc.
Simmons Energy Solutions, Inc.
c/o Simmons Foods, Inc.
601 N. Hico
Siloam Springs, AR 72761
Attention: Kerry L. Hairston, I
Telephone: 479-524-8151

160
 INDEX TO FINANCIAL STATEMENTS

Page
Independent auditor’s report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-2
Combined balance sheets as of December 27, 2014, January 2, 2016 and December 31, 2016
(audited) and as of July 1, 2017 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-4
Combined statements of operations for the fiscal years ended December 27, 2014, January 2, 2016
and December 31, 2016 (audited) and for the six-month periods ended July 2, 2016 and July 1,
2017 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-5
Combined statements of shareholders’ equity for the fiscal years ended December 27,
2014, January 2, 2016 and December 31, 2016 (audited) and for the six-month period ended
July 1, 2017 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-6
Combined statements of cash flows for the fiscal years ended December 27, 2014, January 2, 2016
and December 31, 2016 (audited) and for the six-month periods ended July 2, 2016 and July 1,
2017 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-7
Notes to combined financial statements (information as of July 1, 2017 and for the six-month
periods ended July 2, 2016 and July 1, 2017 is unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-8

F-1
 INDEPENDENT AUDITOR’S REPORT
Board of Directors
Simmons Foods, Inc. and Affiliates
Siloam Springs, Arkansas
We have audited the accompanying combined financial statements of Simmons Foods, Inc. and
Affiliates, which comprise the combined balance sheets as of December 27, 2014, January 2, 2016 and
December 31, 2016, and the related combined statements of operations, shareholders’ equity and cash
flows for the years then ended, and the related notes to the combined financial statements.

Management’s Responsibility for the Combined Financial Statements

Management is responsible for the preparation and fair presentation of these combined financial
statements in accordance with accounting principles generally accepted in the United States of America;
this includes the design, implementation and maintenance of internal control relevant to the preparation
and fair presentation of combined financial statements that are free from material misstatement, whether
due to fraud or error.

Auditor’s Responsibility
Our responsibility is to express an opinion on these combined financial statements based on our
audits. We conducted our audits in accordance with auditing standards generally accepted in the United
States of America. Those standards require that we plan and perform the audits to obtain reasonable
assurance about whether the combined financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the combined financial statements. The procedures selected depend on the auditor’s judgment, including
the assessment of the risks of material misstatement of the combined financial statements, whether due to
fraud or error. In making those risk assessments, the auditor considers internal control relevant to the
entity’s preparation and fair presentation of the combined financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on
the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluating the overall presentation of the combined
financial statements.

We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.

Opinion
In our opinion, the combined financial statements referred to above present fairly, in all material
respects, the financial position of Simmons Foods, Inc. and Affiliates as of December 27, 2014, January 2,
2016 and December 31, 2016, and the results of their operations and their cash flows for the years then
ended in accordance with accounting principles generally accepted in the United States of America.

Other Matter
The combined balance sheet as of July 1, 2017, the combined statements of operations and cash flows
for the six-month periods ended July 1, 2017 and July 2, 2016, and the combined statement of
shareholders’ equity for the six months ended July 1, 2017, and the related notes to the combined financial
statements (marked “Unaudited”) were reviewed by us and we are not aware of any material modifications
that should be made to those statements for them to be in conformity with accounting principles generally

F-2
accepted in the United States of America. However a review is substantially less in scope than an audit and
does not provide a basis for the expression of an opinion on those combined financial statements.

/s/ Frost, PLLC

Certified Public Accountants
Little Rock, Arkansas
March 9, 2017 and October, 9, 2017 (Unaudited)

F-3
 SIMMONS FOODS, INC. AND AFFILIATES
COMBINED BALANCE SHEETS
(In Thousands)
December 27, January 2, December 31, July 1, 2017
2014 2016 2016 (Unaudited)
Assets
Current assets
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . $ 4,809 $ 8,694 $ 3,324 $ 6,709
Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . 92,862 95,645 113,101 115,060
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307,663 325,711 321,398 269,971
Shareholders’ receivables . . . . . . . . . . . . . . . . . . . . . . . — — — 71,141
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,510 7,550 7,709 6,038
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 420,844 437,600 445,532 468,919
Property, plant and equipment
Land and improvements . . . . . . . . . . . . . . . . . . . . . . . . 36,389 36,158 44,402 44,314
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206,514 225,680 233,659 235,329
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . 257,692 291,352 314,276 310,926
Other equipment and improvements . . . . . . . . . . . . . . 27,121 28,683 33,209 33,412
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . 24,455 18,916 29,008 52,030
552,171 600,789 654,554 676,011
Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . (320,742) (344,899) (380,246) (390,207)
Net property, plant and equipment . . . . . . . . . . . . . . . . . 231,429 255,890 274,308 285,804
Other assets
Indefinite-lived intangibles—goodwill . . . . . . . . . . . . . 57,597 57,597 57,597 57,597
Definite-lived intangibles
Customer relationships . . . . . . . . . . . . . . . . . . . . . . . 68,000 63,750 59,500 57,375
Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,200 1,000 800 700
Trademarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000 3,600 3,200 3,000
Cash surrender value life insurance . . . . . . . . . . . . . . . 9,212 9,359 12,455 15,038
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,367 4,709 2,993 2,834
Total other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146,376 140,015 136,545 136,544
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 798,649 $ 833,505 $ 856,385 $ 891,267
Liabilities and Shareholders’ Equity
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 80,459 $ 67,925 $ 79,232 $ 96,318
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,504 39,951 59,043 53,647
Current maturities of long-term debt . . . . . . . . . . . . . . 612 589 — —
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 123,575 108,465 138,275 149,965
Long-term liabilities
Long-term debt, less current maturities and
unamortized financing costs . . . . . . . . . . . . . . . . . . . 488,405 494,689 463,263 476,098
Other long-term liabilities . . . . . . . . . . . . . . . . . . . . . . 34,341 37,879 39,721 41,329
Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 522,746 532,568 502,984 517,427
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 646,321 641,033 641,259 667,392
Shareholders’ equity
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700 700 500 500
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . 463,500 562,200 679,400 679,400
Retained earnings (deficit) . . . . . . . . . . . . . . . . . . . . . . (311,872) (370,428) (464,774) (456,025)
Total shareholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . 152,328 192,472 215,126 223,875
Total liabilities and shareholders’ equity . . . . . . . . . . . . . $ 798,649 $ 833,505 $ 856,385 $ 891,267

The accompanying notes are an integral part of these combined financial statements.

F-4
 SIMMONS FOODS, INC. AND AFFILIATES
COMBINED STATEMENTS OF OPERATIONS
(In Thousands)

Years Ended Six Months Ended

December 27, January 2, December 31, July 2, 2016 July 1, 2017
2014 2016 2016 (Unaudited) (Unaudited)
Net sales . . . . . . . . . . . . . . . . . $1,409,392 $1,413,735 $1,469,229 $727,419 $775,762
Cost of sales . . . . . . . . . . . . . . 1,250,183 1,246,442 1,270,151 626,725 672,098
Gross profit . . . . . . . . . . . . . . 159,209 167,293 199,078 100,694 103,664
Operating expenses
Selling . . . . . . . . . . . . . . . . 34,084 35,054 40,946 18,518 16,086
General and
administrative . . . . . . . . 70,692 77,209 91,496 43,542 48,471
(Gain) loss on disposal of
property, plant and
equipment . . . . . . . . . . . (160) (1,294) (2,684) 12 (8)
Total operating expenses . . . 104,616 110,969 129,758 62,072 64,549
Income from operations . . . . 54,593 56,324 69,320 38,622 39,115
Other income (expense)
Interest expense and
finance costs, net . . . . . . (39,070) (36,411) (36,411) (18,292) (18,296)
Loss on early
extinguishment of
debt . . . . . . . . . . . . . . . . . (23,546) — — — —
Other . . . . . . . . . . . . . . . . . 1,696 1,477 1,615 446 (122)
Total other expense . . . . . . . . (60,920) (34,934) (34,796) (17,846) (18,418)
Net income (loss) . . . . . . . . . . $ (6,327) $ 21,390 $ 34,524 $ 20,776 $ 20,697

The accompanying notes are an integral part of these combined financial statements.

F-5
 SIMMONS FOODS, INC. AND AFFILIATES
COMBINED STATEMENTS OF SHAREHOLDERS’ EQUITY
(In Thousands)

Additional Retained Total

Common Paid-in Earnings Shareholders’
Stock Capital (Deficit) Equity
Balance—December 29, 2013 . . . . . . . . . . . . . . . . . . . $ 700 $430,450 $(264,908) $ 166,242
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (6,327) (6,327)
Contributions from shareholders . . . . . . . . . . . . . . — 33,050 — 33,050
Distributions to shareholders . . . . . . . . . . . . . . . . . — — (40,637) (40,637)
Balance—December 27, 2014 . . . . . . . . . . . . . . . . . . . 700 463,500 (311,872) 152,328
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 21,390 21,390
Contributions from shareholders . . . . . . . . . . . . . . — 98,700 — 98,700
Distributions to shareholders . . . . . . . . . . . . . . . . . — — (79,946) (79,946)
Balance—January 2, 2016 . . . . . . . . . . . . . . . . . . . . . . 700 562,200 (370,428) 192,472
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 34,524 34,524
Retirement of common stock . . . . . . . . . . . . . . . . . (200) 200 — —
Contributions from shareholders . . . . . . . . . . . . . . — 117,000 — 117,000
Distributions to shareholders . . . . . . . . . . . . . . . . . — — (128,870) (128,870)
Balance—December 31, 2016 . . . . . . . . . . . . . . . . . . . 500 679,400 (464,774) 215,126
Net income (unaudited) . . . . . . . . . . . . . . . . . . . . . — — 20,697 20,697
Distributions to shareholders (unaudited) . . . . . . . — — (11,948) (11,948)
Balance—July 1, 2017 (unaudited) . . . . . . . . . . . . . . . $ 500 $679,400 $(456,025) $ 223,875

The accompanying notes are an integral part of these combined financial statements.

F-6
 SIMMONS FOODS, INC. AND AFFILIATES
COMBINED STATEMENTS OF CASH FLOWS
(In Thousands)
Years Ended Six Months Ended
December 27, January 2, December 31, July 2, 2016 July 1, 2017
2014 2016 2016 (Unaudited) (Unaudited)
Cash flows from operating activities
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (6,327) $ 21,390 $ 34,524 $ 20,776 $ 20,697
Adjustments to reconcile net income (loss) to net
cash provided (used) by operating activities
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,329 35,127 41,452 20,293 20,502
Amortization of intangibles and deferred
financing costs . . . . . . . . . . . . . . . . . . . . . . . . . . 7,844 6,507 6,544 3,231 3,251
Amortization of bond premium . . . . . . . . . . . . . . . (460) — — — —
Loss on early extinguishment of debt . . . . . . . . . . 21,655 — — — —
(Gain) loss on disposal of property, plant and
equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (160) (1,295) (2,654) 12 (8)
Accrued long-term incentive plan . . . . . . . . . . . . 4,864 3,777 5,701 2,850 3,050
Cash surrender value of life insurance . . . . . . . . . (669) (147) (3,096) (1,791) (2,583)
Changes in operating assets and liabilities
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . (11,272) (2,783) (17,456) (6,152) (1,959)
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (48,761) (18,048) 4,313 75,011 51,427
Other current assets . . . . . . . . . . . . . . . . . . . . . . (8,109) 7,960 (159) 1,880 1,671
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307 1,658 1,716 (157) 159
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . (471) (2,972) 7,763 5,558 21,210
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . 10,098 (2,553) 19,089 3,216 (8,444)
Other long-term liabilities . . . . . . . . . . . . . . . . . (6,559) (239) (3,860) 285 1,607
Net cash provided (used) by operating activities . . . . . (8,691) 48,382 93,877 125,012 110,580
Cash flows from investing activities
Purchases of property, plant and equipment . . . . . . (55,936) (61,350) (60,118) (21,374) (31,997)
Proceeds from the sale of property, plant and
equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161 3,057 2,902 — 8
Issuance of shareholders’ notes receivable . . . . . . . . — — — (73,396) (71,141)
Net cash used by investing activities . . . . . . . . . . . . . . (55,775) (58,293) (57,216) (94,770) (103,130)
Cash flows from financing activities
Net borrowings from (repayments of) revolving
lines of credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10,168) 5,364 (3,587) (25,070) 12,045
Proceeds from issuance of long-term debt . . . . . . . . 415,000 — — — —
Repayments of long-term debt . . . . . . . . . . . . . . . . . (332,598) (612) (30,122) (291) —
Increase (decrease) in negative book cash
balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,734 (9,562) 3,548 1,017 (4,126)
Contributions from shareholders . . . . . . . . . . . . . . . 33,050 98,700 117,000 — —
Distributions to shareholders . . . . . . . . . . . . . . . . . . (40,637) (79,946) (128,870) (5,000) (11,948)
Debt issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . (7,000) (148) — — (36)
Net cash provided (used) by financing activities . . . . . 63,381 13,796 (42,031) (29,344) (4,065)
Net increase (decrease) in cash and cash
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,085) 3,885 (5,370) 898 3,385
Cash and cash equivalents—beginning of period . . . . 5,894 4,809 8,694 8,694 3,324
Cash and cash equivalents—end of period . . . . . . . . . . $ 4,809 $ 8,694 $ 3,324 $ 9,592 $ 6,709

Supplementary disclosure of cash flow information

Cash paid during the period for interest . . . . . . . . . . $ 34,509 $ 35,562 $ 35,306 $ 18,270 $ 17,681

The accompanying notes are an integral part of these combined financial statements.

F-7
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

1. Summary of Significant Accounting Policies

a. Principles of combination — The combined financial statements include the accounts of
Simmons Foods, Inc., Simmons Prepared Foods, Inc., Simmons Custom Processing, Inc.,
Simmons Feed Ingredients, Inc., Simmons Pet Food, Inc. (“Simmons Pet Food”), Simmons Energy
Solutions, Inc. and Pro*Cal™, Inc. (the “Companies”) affiliated through common ownership.
Simmons Pet Food includes the consolidated accounts and operations of its wholly-owned
subsidiaries, Simmons Pet Food Holdings, Inc., Simmons Pet Food ON, Inc. (“Simmons Pet Food
ON”)., Menu Foods South Dakota, Inc., Simmons Pet Food NJ, Inc., Inc. and Simmons Pet Food
KS, Inc. are wholly-owned subsidiaries of Simmons Pet Food Holdings, Inc.
Effective midnight December 31, 2016, Simmons Custom Processing, Inc. and Pro*Cal™, Inc.
were merged with Simmons Prepared Foods, Inc. and Simmons Feed Ingredients, Inc.,
respectively. All significant intercompany accounts and transactions have been eliminated.
b. Nature of business — The Companies operate as an integrated poultry processor and pet food
producer. The Companies’ processed and further processed poultry products are primarily sold to
restaurant, institutional and retail markets throughout North America. The Companies’ pet food
operations manufacture wet and dry pet food products for dogs and cats, as well as pet treats for
dogs. The Companies also manufacture feed ingredients and protein supplements from by-
products to be used as nutritional supplements in certain animal feeds.
The Companies operate in an economic environment wherein the commodity nature of both
the products for sale and the primary raw materials causes sales prices and purchase costs to
fluctuate, often on a short-term basis. The supply and demand factors for the products for sale and
the supply and demand factors for the primary raw materials correlate to a degree, but are not
necessarily the same. Therefore, margins between sales prices and production costs can fluctuate
significantly on a short-term basis.
c. Variable interest entities — Financial Accounting Standards Board (“FASB”) Accounting
Standards Codification (“ASC”) 810-10-05, “Consolidation of VIEs,” requires that if an enterprise
is the primary beneficiary of a variable interest entity (“VIE”), the assets, liabilities and results of
operations of the VIE should be included in the combined financial statements of the enterprise.
The Companies have determined that while Millcreek Properties, LLC (“Millcreek”) is a VIE,
the Companies are not the primary beneficiary since the Companies do not have the power to
direct the activities of Millcreek and the Companies do not have the obligation to absorb the
losses of Millcreek. Millcreek’s obligations are financed through third party financial institutions
and are not guaranteed by the Companies. As a result, the activities of Millcreek are not included.
d. Fiscal year — The Companies operate on a 52/53-week fiscal year ending on the Saturday
nearest December 31. The fiscal years ending December 27, 2014, January 2, 2016 and
December 31, 2016 include operations for 52, 53 and 52-week periods, respectively.
e. Unaudited interim financial information — The accompanying interim combined balance sheet
as of July 1, 2017, the interim combined statements of operations and cash flows for the six
months ended July 2, 2016 and July 1, 2017, and the interim combined statement of owners’
equity for the six months ended July 1, 2017 are unaudited. The unaudited interim combined
financial statements have been prepared on a basis consistent with the annual combined financial

F-8
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

1. Summary of Significant Accounting Policies (cont.)

statements and, in the opinion of management, reflect all adjustments, which include normal
recurring adjustments, considered necessary to present fairly the Companies’ combined financial
position as of July 1, 2017, and their results of operations and cash flows for the six months ended
July 2, 2016 and July 1, 2017 and the combined statement of owners’ equity for the six months
ended July 1, 2017. The financial data and the other financial information disclosed in the notes
to the combined financial statements related to the six-month periods are also unaudited. The
results of operations for the six months ended July 1, 2017 are not necessarily indicative of the
results to be expected for the year ended December 30, 2017 or for any other future annual or
interim period.

f. Estimates — The preparation of the combined financial statements in conformity with accounting
principles generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the combined financial statements and the
reported amounts of revenues and expenses during the reporting period. Actual results could
differ from these estimates.

g. Cash and cash equivalents — For purposes of the combined statements of cash flows, the
Companies consider all highly liquid cash investments purchased with an original maturity of
three months or less to be cash equivalents.

As a result of the Companies’ cash management system, checks issued, but not presented to
the banks for payment, may create a negative cash balance. Checks outstanding in excess of
related cash balances totaling approximately $22,289, $12,727, $16,275 and $12,149 are included
in accounts payable in the accompanying combined balance sheets at December 27,
2014, January 2, 2016, December 31, 2016 and July 1, 2017, respectively.

h. Accounts receivable — The Companies review their customer accounts on a periodic basis and
record a reserve for specific amounts that management feels may not be collected. In addition, the
Companies have established a general reserve for potential uncollectible accounts based on
historical bad debts. Past due status is determined based upon contractual terms. Amounts are
written off at the point when collection attempts on the accounts have been exhausted.
Management uses significant judgment in estimating uncollectible amounts. In estimating
uncollectible amounts, management considers factors such as current overall economic
conditions, industry-specific economic conditions, historical customer performance and
anticipated customer performance. While management believes the Companies’ processes
effectively address their exposure to doubtful accounts, changes in economic, industry or specific
customer conditions may require adjustment to the allowance recorded by the Companies.
Management has included amounts believed to be uncollectible in allowance for doubtful
accounts. The allowance for doubtful accounts was $1,503, $2,068 and $1,593 at December 27,
2014, January 2, 2016 and December 31, 2016, respectively, and $2,420 for the six months ended
July 1, 2017.

i. Inventories — Processed poultry inventories (finished products) are stated at the lower of cost
(first-in, first-out method) or market. Live poultry for processing is valued at the total cost

F-9
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

1. Summary of Significant Accounting Policies (cont.)

accumulated in the flock as of the end of the reporting period. Accumulated cost includes chick
cost, feed, supplies and other costs related to individual flocks. Inventories of breeder and laying
flocks are valued at the accumulated cost when the flock entered production less accumulated
amortization. Grain inventories, supplies and other materials are stated at the lower of cost (first-
in, first-out method) or market.
Pet food inventories are stated at the lower of cost or market (first-in, first-out method). Pet
food inventories include the costs directly attributable to the acquisition of raw materials, direct
labor, variable production costs and systematic allocation of fixed production overhead incurred,
based on normal production capacities.
j. Property, plant and equipment — Property, plant and equipment are stated at cost less
accumulated depreciation. Depreciation is calculated primarily by the straight-line method over
the estimated useful lives of the related assets. The cost of repairs and maintenance that do not
improve or extend asset lives are expensed as incurred. The estimated useful lives are as follows:
Land improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 - 20 years
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 - 30 years
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . 3 - 10 years
Other equipment and improvements . . . . . . . . . . . . . 3 - 10 years
k. Goodwill and other intangible assets — Goodwill is evaluated for impairment by first performing
a qualitative assessment to determine whether a quantitative goodwill test is necessary. If it is
determined, based on qualitative factors, the fair value of the reporting unit may be more likely
than not less than the carrying amount or if significant changes to macro-economic factors related
to the reporting unit have occurred that could materially impact fair value; a quantitative goodwill
impairment test would be required. Alternatively, the Companies may elect to forgo the
qualitative assessment and perform the quantitative test.
The quantitative goodwill impairment test is performed using a two-step process. The first
step is to identify if a potential impairment exists by comparing the fair value of a reporting unit
with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its
carrying amount, goodwill of the reporting unit is not considered to have a potential impairment
and the second step of the quantitative impairment test is not necessary. However, if the carrying
amount of a reporting unit exceeds its fair value, the second step is performed to determine if
goodwill is impaired and to measure the amount of impairment loss to recognize, if any.
The second step compares the implied fair value of goodwill with the carrying amount of
goodwill. If the implied fair value of goodwill exceeds the carrying amount, then goodwill is not
considered impaired. However, if the carrying amount of goodwill exceeds the implied fair value,
an impairment loss is recognized in an amount equal to that excess.
The implied fair value of goodwill is determined in the same manner as the amount of
goodwill recognized in a business combination (i.e., the fair value of the reporting unit is allocated
to all the assets and liabilities, including any unrecognized intangible assets, as if the reporting
unit had been acquired in a business combination and the fair value of the reporting unit was
determined as the exit price a market participant would pay for the same business).

F-10
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

1. Summary of Significant Accounting Policies (cont.)

Intangible assets with finite lives are amortized using the straight-line method over their
useful lives and, when indicators of impairment are present, are reviewed for recoverability using
estimated future undiscounted cash flows related to those assets. Customer relationships are
being amortized over an estimated useful life of 20 years. Technology is being amortized over an
estimated useful life of 10 years. During 2015, the Companies determined that trademarks may
not generate future cash flows indefinitely. As a result, trademarks are being amortized over an
estimated remaining useful life of 10 years. The Companies have determined that no impairment
existed at December 27, 2014, January 2, 2016, December 31, 2016 or July 1, 2017.
l. Long-lived assets — The Companies review the carrying value of long-lived assets for
impairment whenever certain triggering events or changes in circumstances indicate that the
carrying amounts of any asset may not be recoverable. Recoverability of assets to be held and
used is measured by a comparison of the carrying amount of an asset to future net cash flows
expected to be generated by the asset. If such assets are considered to be impaired, the
impairment to be recognized is measured by the excess of the carrying amount over the fair value
of the assets. Based on management’s assessment, no significant impairment was recognized
during the years ended December 27, 2014, January 2, 2016 or December 31, 2016, or the six
months ended July 2, 2016 or July 1, 2017. See Note 12 for further discussions on insurance
recoveries.
m. Income taxes — Simmons Foods, Inc., Simmons Prepared Foods, Inc., Simmons Custom
Processing, Inc., Simmons Feed Ingredients, Inc., Simmons Pet Food, Inc. (including their
qualified subchapter S subsidiaries described in Note 1.a.), Simmons Energy Solutions, Inc. and
Pro*Cal™, Inc. have elected S corporation status for federal and state income tax purposes.
Therefore, the results of operations of the Companies are included in the owners’ individual tax
returns. The Companies’ subsidiary, Simmons Pet Food ON, is subject to Canadian income taxes.
Any applicable foreign tax expense has not been significant during any reporting periods
presented in the accompanying combined financial statements. Accordingly, no provision for
income taxes related to current operations has been made for the Companies in the accompanying
combined financial statements.
The Companies’ policy with respect to evaluating uncertain tax positions is based upon
whether management believes it is more likely than not the uncertain tax positions will be
sustained upon review by the taxing authorities, then the Companies shall initially and
subsequently measure the largest amount of tax benefit that is greater than 50% likely of being
realized upon settlement with a taxing authority that has full knowledge of all relevant
information. The tax positions must meet the more-likely-than-not recognition threshold with
consideration given to the amounts and probabilities of the outcomes that could be realized upon
settlement using the facts, circumstances and information at the reporting date. The Companies
will reflect only the portion of the tax benefit that will be sustained upon resolution of the position
and applicable interest on the portion of the tax benefit not recognized. Based upon
management’s assessment, there are no uncertain tax positions expected to have a material
impact on the Companies’ combined financial statements.
The Companies are no longer subject to U.S. federal and state tax examinations by tax
authorities for years before 2014. The Companies’ federal and state tax returns are not currently

F-11
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

1. Summary of Significant Accounting Policies (cont.)

under examination. However, the Companies have determined that their prior transfer pricing
related to its wholly-owned subsidiary in Ontario, Canada operation may require additional
taxable income to prior Canadian corporate income tax returns for the years 2011 through 2015,
which will result in offsetting adjustments made to its U.S. returns. On August 31, 2017, the
Companies applied for the admission to the Canada Revenue Agency’s Voluntary Disclosure
Program to report the potential impact. The Companies believe any unfavorable outcome will not
have a material impact to the Companies’ combined financial position. The Companies recognize
interest and penalties related to unrecognized tax benefits in income tax expense. During the
years ended December 27, 2014, January 2, 2016 and December 31, 2016, and the six months
ended July 2, 2016 and July 1, 2017, the Companies did not recognize any interest or penalties.
The Companies did not have any interest or penalties accrued at December 27, 2014, January 2,
2016, December 31, 2016 or July 1, 2017.
Since the Companies have elected S corporation status for federal and state income tax
purposes, they do not pay taxes on their results of operations because the results of operations are
included in their shareholders’ individual tax returns. However, the Companies are allowed to
make tax distributions to their shareholders to fund their income tax liabilities on any additional
taxable income resulting from any tax audit adjustments. An unfavorable outcome of any future
tax examination could result in the need to utilize available cash for tax distributions to
shareholders rather than for the business operations.
n. Self-insurance — The Companies are self-insured for workers’ compensation and health and
maintain accruals to cover its related estimated liabilities. The accrual for workers’ compensation
is determined by its third party administrator. The accrual for health self-insurance liabilities is
based on claims filed and an estimate of claims incurred but not yet reported, and generally is not
discounted. The Companies consider third party actuarial valuations when making these
determinations and maintain a third party stop-loss insurance policy to cover certain liability
costs in excess of predetermined retained amounts; however, this insurance may be insufficient or
unavailable to protect the Companies against potential loss exposures. The key
assumptionsconsidered in estimating the ultimate cost to settle reported claims and the estimated
costs associated with incurred but not yet reported claims include, among other things, the
Companies’ historical and industry claims experience, trends in health care and administrative
costs and historical lag studies with regard to the timing between when a claim is incurred and
reported.
o. Other long-term liabilities — Other long-term liabilities include liabilities associated with the
Companies deferred compensation and long-term incentive plans described in Notes 7.c. and 7.d.
The balance also includes a signing bonus received from a supplier during 2012 in conjunction
with a supply agreement. Under the terms of the supply agreement, the Companies are required to
meet certain annual purchasing thresholds beginning in calendar 2014 through 2023. If the
Companies do not meet the purchasing thresholds during each of those years they are required to
refund the supplier the annual “at risk” amount of 10% (or $2,500) of the signing bonus. During
2014, the Companies began recognizing the signing bonus in earnings ratably in accordance with
the supplier agreement. At December 27, 2014, January 2, 2016, December 31, 2016 and July 1,

F-12
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

1. Summary of Significant Accounting Policies (cont.)

2017, the unamortized balance of the signing bonus was $22,500, $20,000, $17,500 and $16,250,
respectively.
p. Financial instruments — The Companies’ carrying amounts of accounts receivable, accounts
payable and accrued expenses approximates fair value due to their short-term maturities. The
stated value of the Companies’ long-term debt approximates their fair value based on current
market rates for financial instruments of the same remaining maturities with similar credit quality.
q. Revenue recognition — The Companies recognize revenue when the risk of loss is transferred to
customers, which is generally upon delivery based upon terms of sale. Revenue is recognized as
the net amount estimated to be received after deducting estimated amounts for discounts, trade
allowances and product terms. The Companies record an estimated sales allowance for returns
and discounts at the time of sale using historical trends based on actual sales and returns and
anticipated specific customer discounts and allowances. Amounts received in advance of revenue
being earned are deferred.
r. Shipping and handling — The Companies expense all shipping and handling costs as incurred
and are included in cost of sales in the accompanying combined statements of operations.
Shipping and handling fees billed to customers are included in net sales in the accompanying
combined statements of operations.
s. Recent accounting pronouncements — In May 2014, the FASB issued Accounting Standards
Update (“ASU”) 2014-09, “Revenue from Contracts with Customers (Topic 606).” ASU 2014-09 is
the product of a joint project between the FASB and the International Accounting Standards Board
to clarify the principles for recognizing revenue. ASU 2014-09 amends the ASC and creates a new
Topic 606, “Revenue from Contracts with Customers.” This new topic describes a step by step
process to achieve the FASB’s core principle that an entity should recognize revenue to depict the
transfer of promised goods or services to customers in an amount that reflects the consideration to
which the entity expects to be entitled in exchange for those goods or services. The new topic also
adds improved disclosures to help users of financial statements better understand the nature,
amount, timing and uncertainty of revenue that is recognized. ASU 2015-14, “Revenue from
Contracts with Customers (Topic 606): Deferral of the Effective Date,” issued in August 2015,
defers the implementation of ASU 2014-09 for nonpublic entities to annual reporting periods
beginning after December 15, 2018. Early adoption is permitted for reporting periods beginning
after December 15, 2016. ASU 2014-09 may be applied either retrospectively or through the use
of a modified-retrospective method. The Companies are evaluating the application of ASU 2014-
09 and the effect it will have on the Companies’ combined financial statements.
In April 2015, the FASB issued ASU 2015-03, “Interest — Imputation of Interest (Subtopic
835-30) — Simplifying the Presentation of Debt Issuance Costs.” ASU 2015-03 requires that debt
issuance costs related to a recognized debt liability be presented in the balance sheet as a direct
deduction from the carrying amount of that debt liability, consistent with debt discounts. The
recognition and measurement guidance for debt issuance costs are not affected by the
amendments in ASU 2015-03. In August 2015, the FASB issued ASU 2015-15, “Interest —
Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt
Issuance Costs Associated with Line-of-Credit Arrangements — Amendments to SEC Paragraphs

F-13
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

1. Summary of Significant Accounting Policies (cont.)

Pursuant to Staff Announcement at June 18, 2015 EITF Meeting (SEC Update),” to clarify the
Securities and Exchange Commission’s staff position on presenting and measuring debt issue
costs related to line-of-credit arrangements. ASU 2015-03 and ASU 2015-15 are effective for
interim and annual periods beginning after December 15, 2015. ASU 2015-03 and ASU 2015-15
are not expected to have a significant impact on the Companies’ financial position, results of
operations or its financial statement disclosures. The Companies adopted this pronouncement
during 2016 and the deferred financing costs of $8,434, $6,925 and $5,231 at December 27,
2014, January 2, 2016 and December 31, 2016, respectively, are reported as a reduction of the
carrying value of the related debt liability.
In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330) — Simplifying the
Measurement of Inventory.” ASU 2015-11 requires inventory within the scope of the update to be
measured at the lower of cost and net realizable value rather than the lower of cost and market.
Net realizable value is the estimated selling price in the ordinary course of business less
reasonably predictable costs of completion, disposal, and transportation. Subsequent
measurement is unchanged under this update for inventories measured using the last in, first out
or retail inventory method. The amendments applicable to this update are effective for fiscal years
beginning after December 15, 2016, with early application permitted. The adoption of ASU 2015-
11 did not have a material effect on the Companies’ combined financial statements.
In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” Accounting by
lessors is largely unchanged from existing standards. The core principle of Topic 842 is that a
lessee should recognize the assets and liabilities that arise from leases. The guidance requires all
leases to be recorded as assets and liabilities on the financial statements of the lessee. A lessee
should recognize in the statement of financial position a liability to make lease payments (the
lease liability) and a right-of-use asset representing its right to use the underlying asset for the
lease term. Under this standard, leases are considered to either be finance leases or operating
leases. This consideration determines the financial statement classification of payments on lease
liabilities during the lease term but assets and liabilities are required to be recorded for both. For
nonpublic entities, this guidance is effective for fiscal years beginning after December 15, 2019,
and interim periods within fiscal years beginning after December 15, 2020. ASU 2016-02 is to be
applied using a modified retrospective approach. The Companies are currently evaluating the
impact of ASU 2016-02 on its combined financial statements.

F-14
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

2. Inventories
Inventories consist of the following:
December 27, January 2, December 31, July 1, 2017
2014 2016 2016 (Unaudited)
Field inventory . . . . . . . . . . . . . . . . . . . . . . . . . $ 35,354 $ 36,296 $ 37,034 $ 36,440
Feed, eggs and other . . . . . . . . . . . . . . . . . . . . 123,378 145,223 141,346 70,932
Finished poultry product . . . . . . . . . . . . . . . . . 59,176 56,355 60,347 60,309
Finished pet foods products . . . . . . . . . . . . . . 47,657 45,930 43,927 60,395
Pet food ingredients and raw materials . . . . . . 17,077 16,985 13,771 15,505
Pet food packaging . . . . . . . . . . . . . . . . . . . . . 10,653 10,279 9,777 10,705
Supplies and spare parts . . . . . . . . . . . . . . . . . 14,368 14,643 15,196 15,685
$307,663 $325,711 $321,398 $269,971

3. Commodity Brokerage Accounts

The Companies hold certain commodity futures contracts in the regular course of business to
manage their exposure against severe commodity price fluctuations on anticipated purchases of
certain raw materials and ingredients. The contracts are generally for short durations of less than one
year and are considered to be a hedge against changes in the amount of future cash flows related to the
commodities procurement. Although these instruments are economic hedges, the Companies do not
designate these contracts as hedges for accounting purposes. Accordingly, these instruments are
recorded at fair value and the changes in fair value are recorded in current period earnings, commonly
referred to as the “mark to market” method. At December 27, 2014, January 2, 2016, December 31,
2016 and July 1, 2017, all hedges were marked to market.
The Companies’ derivative assets and liabilities are presented in their combined balance sheets
on a net basis. The Companies net derivative assets and liabilities, including cash collateral when a
legally enforceable master netting arrangement exists between the counterparty to a derivative
contract and the Companies. At July 1, 2017, the Companies had posted with various counterparties
$2,420 of cash collateral and held no cash collateral.

F-15
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

3. Commodity Brokerage Accounts (cont.)

The notional volumes associated with open derivative instruments were as follows:
Quantity Units
December 27, 2014
Commodity
Corn . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 contracts 15,840 bushels
Soybeans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 contracts 197 tons
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 720 MMBtu
January 2, 2016
Commodity
Corn . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 2,430 bushels
Soybeans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 4 tons
Wheat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 20 bushels
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 2,710 MMBtu
Heating oil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 504 gallons
Propane . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 420 gallons
December 31, 2016
Commodity
Corn . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 9,855 bushels
Soybeans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 68.5 tons
Wheat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 85 bushels
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 1,880 MMBtu
Heating oil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 42 gallons
Propane . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 593 gallons
July 1, 2017 (Unaudited)
Commodity
Corn . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 contract 6,850 bushels
Soybeans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 contract 111 tons
Wheat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 25 bushels
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 1,640 MMBtu
Propane . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . <1 contract 420 gallons

The fair value of all derivative instruments outstanding on the accompanying combined balance
sheets is as follows:
Combined Balance December 27, January 2, December 31, July 1, 2017
Sheets Classification 2014 2016 2016 (Unaudited)
Fair value of open positions . . . Other current assets $1,601 $1,974 $1,246 $1,745

F-16
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

3. Commodity Brokerage Accounts (cont.)

Net loss included in the accompanying combined statements of operations is as follows:

Combined
Statements
of Operations December 27, January 2, December 31, July 1, 2017
Classification 2014 2016 2016 (Unaudited)
Net loss on derivative instruments . . . Cost of sales $(4,145) $(2,285) $(4,892) $(32)

4. Definite-Lived Intangible Assets

Definite-lived intangible assets consist of customer relationships valued at $85,000, technology
valued at $2,000 and trademarks valued at $4,000, net of combined accumulated amortization of
$17,800, $22,650, $27,500 and $29,925, at December 27, 2014, January 2, 2016, December 31, 2016
and July 1, 2017, respectively.

Future aggregate amortization expense of definite-lived intangible assets at July 1, 2017 is as

follows:
Customer
Relationships Technology Trademarks
July 2018 - June 2019 . . . . . . . . . . . . . . . . . . . . $ 4,250 $200 $ 400
July 2019 - June 2020 . . . . . . . . . . . . . . . . . . . . 4,250 200 400
July 2020 - June 2021 . . . . . . . . . . . . . . . . . . . . 4,250 200 400
July 2021 - June 2022 . . . . . . . . . . . . . . . . . . . . 4,250 100 400
July 2022 - June 2023 . . . . . . . . . . . . . . . . . . . . 4,250 — 400
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,125 — 1,000
$57,375 $700 $3,000

F-17
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

5. Long-Term Debt
Long-term debt consists of the following:
December 27, January 2, December 31, July 1, 2017
2014 2016 2016 (Unaudited)
Senior secured notes payable with interest
fixed at 7.875%, with interest payments due
semiannually in October and April
through October 1, 2021, when the
balance is due in its entirety; secured by a
second lien on substantially all assets of
the Companies, including 65% of the
shares of Simmons Pet Food ON, Inc. . . . . $415,000 $415,000 $415,000 $415,000
Borrowings under a revolving credit facility
from financial institutions, interest based
on London Interbank Offered Rate
(“LIBOR”) and prime advances plus an
applicable margin (1.75% to 5.00% at
July 1, 2017), through December 2018,
secured by substantially all assets of the
Companies. . . . . . . . . . . . . . . . . . . . . . . . . . 51,714 57,081 53,494 65,539
The Industrial Development Authority of the
City of Southwest City, Missouri Variable
Rate Demand Refunding Revenue Bonds
(Simmons Foods, Inc. Project) Series 2009
Project Fund, monthly interest payable at
variable rates no sinking fund
requirements, secured by certain real and
personal property. The balance was repaid
during fiscal 2016. . . . . . . . . . . . . . . . . . . . . 26,000 26,000 — —
City of Decatur, Arkansas Industrial
Development Revenue Bond (Simmons
Prepared Foods, Inc. Project) Series 2009,
payable in monthly installments of $68
including interest at 5.96%, secured by
certain real property. The balance was
repaid during fiscal 2016. . . . . . . . . . . . . . . 4,680 4,122 — —
Capital lease obligation, with imputed
interest, monthly payments of $8 through
September 2015, when the balance was
paid in full. . . . . . . . . . . . . . . . . . . . . . . . . . . 57 — — —
497,451 502,203 468,494 480,539
Less current maturities . . . . . . . . . . . . . . . . . . 612 589 — —
Less unamortized financing costs . . . . . . . . . 8,434 6,925 5,231 4,441
Long-term debt, less current maturities and
unamortized financing costs . . . . . . . . . . . . $488,405 $494,689 $463,263 $476,098

F-18
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

5. Long-Term Debt (cont.)

Aggregate maturities of long-term debt at July 1, 2017 are as follows:

July 2017 - June 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ —
July 2018 - June 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,539
July 2019 - June 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —
July 2020 - June 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —
July 2021 - June 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 415,000
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$480,539

On December 20, 2013, the Companies entered into the Fourth Amended and Restated Credit
Agreement (the “Credit Agreement”). The Credit Agreement allows for total borrowings of $185,000,
contains an $18,500 swing line commitment and a $15,000 commitment for the Companies’ wholly-
owned subsidiary, Simmons Pet Food ON. Borrowings under the Credit Agreement are based on a
percentage of eligible accounts receivable, inventories and property, plant and equipment.
On August 29, 2014, the Companies entered into Amendment No. 1 to the Fourth Amended and
Restated Credit Agreement (the “Amendment”). The Amendment changes the definitions of such
items as earnings before interest, taxes, depreciation and amortization, fixed charges, restricted
payments and eligible inventory. At December 31, 2016, the Companies’ eligible accounts receivable,
inventories, property, plant and equipment were $185,000. Interest is charged monthly at LIBOR or an
index rate based on each specific advance plus an unused line fee margin. The Credit Agreement
requires the Companies to maintain a fixed charge coverage ratio of 1:1 in the event that availability
falls below the greater of $20,000 and 12.5% of the lesser of the borrowing base or the maximum
revolver amount. At July 1, 2017, availability on the revolver was approximately $116,815.
During the year ended December 27, 2014, the Companies issued $415,000 of senior secured
notes payable effective October 2014. The proceeds of these bonds were used to refinance the 2013
and 2010 Second Lien Senior Secured Notes. The Companies recognized a loss of $23,546 (including
$6,647 in debt issuances costs) recorded within other income (expense) as a loss on early
extinguishment of debt, net of remaining unamortized bond premium of $1,891.
The Companies’ borrowings are subject to certain financial covenants including fixed charge
coverage, minimum earnings before income taxes, depreciation and amortization and capital
expenditure limit, along with restrictions on indebtedness, dividend payments, financial guarantees,
business combinations and other related items. The Companies were in compliance with respect to
their covenants at December 31, 2016. Management has determined that the Companies were in also
in compliance with their covenants at July 1, 2017.
The 2009 Industrial Development Authority Revenue Bonds were collateralized by letters of credit
with initial amounts of $26,776 which were renewed annually through October 2020. The Companies
paid an average annual fee of 2.00% for the letters of credit. The Companies’ net availability on their
Credit Agreement was reduced by the amount of the letter of credit. These bonds were repaid during
fiscal 2016.

F-19
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

5. Long-Term Debt (cont.)

The Companies have additional outstanding letters of credit of $2,646 at July 1, 2017. The letters
of credit were issued in the favor of third parties to collateralize the Companies’ self-insured workers’
compensation liabilities.

6. Common Stock
Common stock consists of the following:
Shares Issued Common Stock Outstanding
December 27, December 27,
2014 and December 31, 2014 and December 31,
Par January 2, 2016 and January 2, 2016 and
Issuer Type Value 2016 July 1, 2017 2016 July 1, 2017
Simmons Foods, Inc. . . . Voting $1 1,000 1,000 $ 1 $ 1
Non-voting $1 99,000 99,000 99 99
Simmons Prepared
Foods, Inc. . . . . . . . . . Voting $1 1,000 1,000 1 1
Non-voting $1 99,000 99,000 99 99
Simmons Custom
Processing, Inc. . . . . . Voting $1 1,000 — 1 —
Non-voting $1 99,000 — 99 —
Simmons Feed
Ingredients, Inc. . . . . . Voting $1 1,000 1,000 1 1
Non-voting $1 99,000 99,000 99 99
Simmons Pet Food,
Inc. . . . . . . . . . . . . . . . Voting $1 1,000 1,000 1 1
Non-voting $1 99,000 99,000 99 99
Simmons Energy
Solutions, Inc. . . . . . . . Voting $1 1,000 1,000 1 1
Non-voting $1 99,000 99,000 99 99
Pro*Cal™, Inc. . . . . . . . . . Voting $1 1,000 — 1 —
Non-voting $1 99,000 — 99 —
$700 $500

Simmons Custom Processing, Inc. and Pro*Cal™, Inc.’s outstanding shares were canceled at
midnight December 31, 2016. See Note 1.

7. Commitments and Contingencies

a. The Companies lease various assets under operating lease agreements. Operating lease expense
was approximately $22,874, $26,774 and $23,880 for the years ended December 27,
2014, January 2, 2016 and December 31, 2016, respectively, and $10,079 and $12,916 for the six
months ended July 2, 2016 and July 1, 2017, respectively. The most significant obligations
assumed under the terms of certain of the leases are the upkeep of the facilities, insurance and
property taxes.

F-20
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

7. Commitments and Contingencies (cont.)

Future minimum lease payments under noncancelable operating leases at July 1, 2017 are
approximately as follows:

July 2018 - June 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,596

July 2019 - June 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,582
July 2020 - June 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,608
July 2021 - June 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,334
July 2022 - June 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,954
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,297
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $38,371

b. The Companies have a qualified salary deferral retirement plan covering all U.S employees
meeting age and length of service requirements. Additionally, the Companies have a registered
defined contribution plan for all eligible Canadian participants in the plan. Covered employees
may make deferred contributions to the plans from 2% to 13% of their compensation and the
Companies may match 50% of the participants’ minimum contribution up to 4%. The Companies’
contributions to the plans were approximately $1,144, $1,337 and $1,262 for the years ended
December 27, 2014, January 2, 2016 and December 31, 2016, respectively, and $544 and $659 for
the six months ended July 2, 2016 and July 1, 2017, respectively.
c. The Companies have a nonqualified deferred compensation plan covering certain employees
prohibited from full participation in the Companies’ qualified plan and meeting certain seniority
requirements. The Companies made contributions of $201, $337 and $327 for the years ended
December 27, 2014, January 2, 2016 and December 31, 2016, respectively, and $332 and $426 for
the six months ended July 2, 2016 and July 1, 2017, respectively. Employee salary deferrals made
to the plan were approximately $1,156, $1,569 and $2,341 for the years ended December 27,
2014, January 2, 2016 and December 31, 2016, respectively, and $1,613 and $2,074 for the six
months ended July 2, 2016 and July 1, 2017, respectively. At December 27, 2014, January 2,
2016, December 31, 2016 and July 1, 2017, liabilities related to this plan were $11,840, $13,247,
$16,833 and $19,774, respectively. In accordance with the plan agreement, the Companies have
obtained insurance to assist in providing benefits under the plan. Since the Companies do not
anticipate providing benefits within the next year, the balance was classified as long-term. The
cash surrender value of these policies was $9,212, $9,359, $12,455 and $15,038 at December 27,
2014, January 2, 2016, December 31, 2016 and July 1, 2017, respectively. Plan expenses were
approximately $6 for each of the years ended December 27, 2014, January 2, 2016 and
December 31, 2016, and approximately $6 for the six months ended July 2, 2016 and July 1,
2017.
d. The Companies maintain a long-term incentive program for certain key executives. This
agreement allows executives to accrue compensation based on certain incentive targets in the
form of bonus credits which are deposited into the executives’ bonus bank. One third of the total
bonus banked by the executive can be paid prior to March 15th of the following year assuming the
executive is still employed by the Companies. Compensation expense was $4,864, $3,777, $5,701
for the years ended December 27, 2014, January 2, 2016 and December 31, 2016, respectively,

F-21
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

7. Commitments and Contingencies (cont.)

and $3,050 for the six months ended July 1, 2017. Non-owner management fully vests after five
years of continuing service and attaining the age of 65. At December 27, 2014, January 2,
2016, December 31, 2016 and July 1, 2017, liabilities related to this plan were $4,864, $7,560,
$9,840 and $8,109, respectively.
e. The Companies maintain self-insurance programs for health care costs and workers’
compensation. The Companies are liable for health care claims up to $1,000 per plan participant
and maintain health care reinsurance policies for any claims in excess of $350 per occurrence. The
Companies are liable for workers’ compensation claims from $400 to $600 per occurrence,
depending on state law. Self-insurance costs are accrued based upon the aggregate of the liability
for reported claims and an estimated liability for claims incurred, but not yet reported. Accrued
reserves for health care costs and workers’ compensation claims of approximately $5,517, $5,710,
$4,050 and $8,923 are included in accrued expenses at December 27, 2014, January 2,
2016, December 31, 2016 and July 1, 2017, respectively. The accompanying combined
statements of operations includes expenses relating to self-insurance plans of approximately
$24,689, $25,381 and $28,114 for the years ended December 27, 2014, January 2, 2016 and
December 31, 2016, respectively, and $13,430 and $14,520 for the six months ended July 2, 2016
and July 1, 2017, respectively. Certificates of deposit and treasury notes of $1,560 are held by
financial institutions as security collateral for workers’ compensation claims and are included in
other assets in the accompanying combined balance sheets at December 27, 2014, January 2,
2016, December 31, 2016 and July 1, 2017.
f. The Companies are involved in claims and legal actions arising in the ordinary course of
business. In the opinion of management, the ultimate disposition of these matters will not have a
material adverse effect on the Companies’ financial condition or results of operations.
g. At December 27, 2014, January 2, 2016, December 31, 2016 and July 1, 2017, the Companies
employed 221, 188, 174 and 170, respectively, unionized employees at their Pennsauken, New
Jersey facility. These employees are represented by the United Food and Commercial Workers
Union (the “Union”) under a collective bargaining agreement that was renewed in March 2014
through March 31, 2018. The Companies consider their relations with the Union to be good and
have not experienced a work stoppage. No other employees are unionized and, to the best of
management’s knowledge, no such unionization is currently being contemplated.
h. The Companies, in the ordinary course of business, enter into supply agreements with various
customers. These agreements typically contain certain supply commitments, pricing
arrangements, provision for nonperformance and have various expiration terms.
i. At July 1, 2017, management committed to approximately $57,352 of capital expenditures
(including $16,510 funded through operating leases) for the next 12 months.

8. Related Party Transactions

a. The Companies lease certain broiler farms and other equipment from Millcreek. Lease expense
incurred under these agreements was approximately $4,060, $6,336 and $3,444 for the years
ended December 27, 2014, January 2, 2016 and December 31, 2016, respectively, and $1,759 and

F-22
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

8. Related Party Transactions (cont.)

$1,660 for the six months ended July 2, 2016 and July 1, 2017, respectively. Accounts receivable
from related parties were $68, $0, $17 and $2 at December 27, 2014, January 2, 2016, December 31,
2016 and July 1, 2017, respectively. Accounts payable from related parties were $49, $0, $34 and $0
at December 27, 2014, January 2, 2016, December 31, 2016 and July 1, 2017, respectively.
b. The Companies lease a cold storage facility from Snowwis Cold Storage, LLC (“Snowwis”). Lease
expense incurred under these agreements was approximately $1,200 for each of the years ended
December 27, 2014, January 2, 2016 and December 31, 2016 and $600 for each of the six months
ended July 2, 2016 and July 1, 2017. Accounts receivable from Snowwis were $205 at
December 27, 2014. There was no accounts receivable outstanding from Snowwis at January 2,
2016. Effective December 31, 2016, Snowwis was acquired by Millcreek and is now a wholly-
owned subsidiary.
c. At December 31, 2016, the Companies were owed $864 related to tax distributions from two of
their owners. During 2017, the owners repaid the balance in full.

9. Concentrations of Credit Risk

Financial instruments which potentially subject the Companies to concentrations of credit risk
consist primarily of trade accounts receivable with a variety of customers, cash investments and other
short-term investments deposited with financial institutions. The Companies generally do not require
collateral from their customers. Such credit risk is considered by management to be limited due to the
Companies’ broad customer base and their customers’ financial resources.
The Companies had sales to a major customer of approximately 9%, 10% and 10% for the years
ended December 27, 2014, January 2, 2016 and December 31, 2016, respectively, and 10% and 10% for
the six months ended July 2, 2016 and July 1, 2017, respectively. Amounts due from this customer
were approximately $4,203, $3,863, $12,604 and $10,647 included in accounts receivable in the
accompanying combined balance sheets at December 27, 2014, January 2, 2016, December 31, 2016
and July 1, 2017, respectively.
The Companies’ foreign sales are subject to various political, economic and other risks and
uncertainties inherent in the countries in which their customers reside. These risks include, among
other things, restrictions on transfer of goods, export duties, domestic and international customs and
tariffs, changing taxation policies and governmental regulations.
At December 27, 2014, January 2, 2016, December 31, 2016 and July 1, 2017 and at various
times throughout these periods, the Companies maintained cash balances and other short-term
investments with certain financial institutions in excess of the federal deposit insurance limit. This risk
is managed by maintaining all deposits in sound financial institutions.

10. Fair Value

Fair value measurements and related disclosures are based on a fair value hierarchy which prioritizes
the inputs to valuation techniques used to measure fair value into the following three broad levels.
• Level I — Quoted prices in active markets for identical assets or liabilities at the measurement
date. Level I assets and liabilities include debt and equity securities and derivative contracts that
are traded in active exchange markets.

F-23
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

10. Fair Value (cont.)

• Level II — Observable inputs (other than Level I) that are either directly or indirectly observable
for the asset or liability through correlation with market data at the measurement date and for the
duration of the instrument’s anticipated life. Level II assets include debt securities with quoted
prices that are traded less frequently than exchange traded instruments and derivative contracts
whose value is determined using a pricing model with inputs that are observable in the market
data.
• Level III — Unobservable inputs that reflect management’s best estimate of what market participants
would use in pricing the asset or liability at the measurement date. Consideration is given to the risk
inherent in the valuation technique and the risk inherent in the inputs to the model.
The fair value of the positions held in commodity brokerage accounts are calculated based on the
quoted market prices in active markets for those positions.
The following table sets forth the Companies’ financial assets that are accounted for at fair value
on a recurring basis.
Directly
or Indirectly
Observable
Market Data
(Level II) Total
December 27, 2014
Assets
Commodity brokerage accounts . . . . . . . . . . . . . . . . . . . . $1,601 $1,601
January 2, 2016
Assets
Commodity brokerage accounts . . . . . . . . . . . . . . . . . . . . $1,974 $1,974

December 31, 2016

Assets
Commodity brokerage accounts . . . . . . . . . . . . . . . . . . . . $1,246 $1,246

July 1, 2017 (Unaudited)

Assets
Commodity brokerage accounts . . . . . . . . . . . . . . . . . . . . $1,745 $1,745

11. Segment Reporting

The Companies operate in four segments: Poultry, Pet Food, Protein and Shared Services. Each
operating segment uses the same accounting principles as disclosed in Note 1. Transactions between
segments are accounted for on a net cost basis.
1. Poultry — Poultry operations include breeding and raising poultry, as well as processing live
poultry into fresh, frozen and value-added poultry, custom processing of spent hens and

F-24
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

11. Segment Reporting (cont.)

distribution of propane gas to residential and commercial customers. Products are marketed
domestically and internationally to food retailers, grocers, food service distributors, restaurant
operators and brokers selected by the Companies. During 2015, the Companies sold their custom
processing operation.
2. Pet Food — Pet Food operations include the production of both wet and dry pet food for dogs and
cats, and pet treats for dogs. Products are marketed to mass merchandisers, grocers and club store
retailers for their private label products and to a number of pet food brand owners on a contract
manufacturing basis.
3. Protein — Protein operations include the manufacturing of feed ingredients and protein feed
supplements.
4. Shared services — Shared services include corporate overhead expenses that are incurred to
operate the Companies. This includes accounting, finance, information technology, management,
human resources and other administrative functions. These costs are primarily included in
general and administrative expenses in the combined statements of operations.

Segment Results
The following tables present information about the results of operations and the assets of the
Companies reportable segments for the fiscal years presented.
December 27, January 2, December 31, July 1, 2017
Segment Profit Information 2014 2016 2016 (Unaudited)
Segment sales
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 825,996 $ 839,872 $ 871,450 $441,958
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 479,103 484,495 522,084 287,266
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104,293 87,675 75,695 46,538
Shared services . . . . . . . . . . . . . . . . . . . . . . . . — 1,693 — —
Combined segment sales . . . . . . . . . . . . . . . . . . . . $1,409,392 $1,413,735 $1,469,229 $775,762
Cost of sales
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 720,071 $ 735,538 $ 756,281 $381,037
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440,672 437,327 461,945 253,424
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85,281 72,496 55,474 37,058
Shared services . . . . . . . . . . . . . . . . . . . . . . . . 4,159 1,081 (3,549) 579
Combined cost of sales . . . . . . . . . . . . . . . . . . . . . . $1,250,183 $1,246,442 $1,270,151 $672,098
Gross profit
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 105,925 $ 104,334 $ 115,169 $ 60,921
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,431 47,168 60,139 33,842
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,012 15,179 20,221 9,480
Shared services . . . . . . . . . . . . . . . . . . . . . . . . (4,159) 612 3,549 (579)
Combined gross profit . . . . . . . . . . . . . . . . . . . . . . $ 159,209 $ 167,293 $ 199,078 $103,664

F-25
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

11. Segment Reporting (cont.)

December 27, January 2, December 31, July 1, 2017

Segment Profit Information 2014 2016 2016 (Unaudited)
Depreciation
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 13,356 $ 17,722 $ 20,789 $ 11,093
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,394 11,915 14,418 7,566
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,148 3,962 4,667 1,694
Shared services . . . . . . . . . . . . . . . . . . . . . . . . 1,431 1,528 1,578 149
Combined depreciation expense . . . . . . . . . . . . . . $ 29,329 $ 35,127 $ 41,452 $ 20,502
Amortization expense
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ — $ — $ — $ —
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,450 4,850 4,850 2,425
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — —
Shared services . . . . . . . . . . . . . . . . . . . . . . . . — — — —
Combined amortization expense . . . . . . . . . . . . . . $ 4,450 $ 4,850 $ 4,850 $ 2,425
Interest expense and finance costs, net
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20,601 $ 14,191 $ 19,950 $ 7,213
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,148 20,600 15,174 10,352
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,321 1,490 1,190 731
Shared services . . . . . . . . . . . . . . . . . . . . . . . . — 130 97 —
Combined interest expense and finance
costs, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 39,070 $ 36,411 $ 36,411 $ 18,296
Assets
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $409,219 $424,665 $439,081 $457,984
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369,167 383,709 370,691 375,597
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,263 25,249 46,613 57,686
Shared services . . . . . . . . . . . . . . . . . . . . . . . . — (118) — —
Combined assets . . . . . . . . . . . . . . . . . . . . . . . . . . . $798,649 $833,505 $856,385 $891,267
Additions to long-lived assets
Poultry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 28,551 $ 24,689 $ 27,989 $ 13,502
Pet Food . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,420 29,331 10,887 4,319
Protein . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,965 7,330 21,242 14,176
Shared services . . . . . . . . . . . . . . . . . . . . . . . . — — — —
Combined additions to long-lived assets . . . . . . . $ 55,936 $ 61,350 $ 60,118 $ 31,997

12. Insurance Claims

On February 1, 2011, the Fort Gibson, Oklahoma can manufacturing facility was damaged by a
snow storm. The snow storm completely destroyed the structure and damaged several can and lid
making lines, along with inventory held within the structure. Subsequent to July 1, 2017, the Company
collected $2.9 million from its insurance provider.

F-26
 SIMMONS FOODS, INC. AND AFFILIATES
NOTES TO COMBINED FINANCIAL STATEMENTS
Years Ended December 27, 2014, January 2, 2016 and December 31, 2016
and Six Months Ended July 2, 2016 (Unaudited) and July 1, 2017 (Unaudited)
(In Thousands, Except Share and Par Value Data)

12. Insurance Claims (cont.)

On February 25, 2014, the Companies’ Van Buren cook plant was damaged by fire. No injuries
occurred, but the fire destroyed two Fulton heating units and substantially damaged the wiring for the
plant. During fiscal 2014, the Companies received proceeds of $3,400 and recognized a gain of
approximately $3,000.
On December 1, 2015, the Companies’ Fairland feed mill was damaged by fire. No injuries
occurred, but the fire severely damage one of the grain silos. The Companies have filed a claim with
their insurance carrier and have expensed their deductible. During fiscal 2016, the Companies
recognized proceeds of approximately $2,500 and recognized a gain of approximately $2,400.

13. Subsequent Events (Unaudited)

On August 11, 2017, the Companies entered into the Fifth Amended and Restated Credit
Agreement (the “Agreement”), which matures on August 1, 2021 or August 11, 2022 if certain
conditions are met. The Agreement provides a revolving facility of up to $275 million, subject to
borrowing base limitations. In addition, the Agreement provides a Canadian subfacility on behalf of
Simmons Pet Food ON of up to $25 million subject to borrowing base limitations. Borrowings under
the Agreement bear interest at a rate per annum equal to, at the Companies option (a) a base rate
determined by reference to the highest of (1) the prime rate of Wells Fargo Bank, National Association,
(2) the federal funds effective rate plus 0.50% and (3) a LIBOR rate plus 1.00% or (b) a LIBOR rate, in
each case plus an applicable margin. The applicable margin through December 31, 2017 is (a) 0.50%
for base rate borrowings and (b) 1.50% for LIBOR rate borrowings. Thereafter, the applicable margin is
subject to adjustment each calendar month based on the average daily excess availability (as defined
under the amended and restated credit facility).
The Agreement contains a fixed charge coverage ratio covenant which becomes applicable when
excess availability (as defined under such facility) is less than the greater of (i) 12.5% of the lesser of the
borrowing base or the maximum revolving facility amount or (ii) $31.25 million. Until the time excess
availability exceeds the greater of (i) 12.5% of the lesser of the borrowing base or the maximum
revolving facility amount or (ii) $31.25 million for 60 consecutive days, such facility will require the
Companies to maintain a consolidated fixed charge coverage ratio of at least 1.0 to 1.0. The amended
and restated credit facility also requires the Companies and its subsidiaries to maintain substantially
all of their cash in accounts that are subject to the control of the collateral agent, which control
becomes applicable when (a) an event of default under the facility occurs and is continuing or
(b) excess availability is less than the greater of (i) 12.5% of the lesser of the borrowing base or the
maximum revolving facility amount or (ii) $31.25 million.
The Companies evaluated the events and transactions subsequent to their July 1, 2017 combined
balance sheet date and determined there were no additional significant events, other than noted above,
to report through October 9, 2017, which is the date the Companies issued their combined financial
statements.

F-27
 Simmons Foods, Inc.
Simmons Prepared Foods, Inc.
Simmons Pet Food, Inc.
Simmons Feed Ingredients, Inc.
Simmons Energy Solutions, Inc.

$550,000,000
% Second Lien Senior Secured Notes due 2024

PRELIMINARY
OFFERING
MEMORANDUM
, 2017

Wells Fargo Securities