FORMATION AGREEMENT
BETWEEN
SNAKE RIVER SUGAR COMPANY
AND
THE AMALGAMATED SUGAR COMPANY
OF THE
THE AMALGAMATED SUGAR LLC
DATED AS OF
JANUARY , 1996
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TABLE OF CONTENTS
RECITALS..................................................................1
ARTICLE IDEFINITIONS......................................................1
ARTICLE IIFORMATION.......................................................7
2.1 Snake River Capital Contribution................................7
2.2 Amalgamated Contribution........................................8
2.3 Assumed Liabilities.............................................8
2.4 Closing.........................................................8
ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF AMALGAMATED..................9
3.1 Organization, Qualification and Corporate Power.................9
3.2 Authorization of Transaction....................................9
3.3 Noncontravention...............................................10
3.4 Brokers' Fees..................................................10
3.5 Title to Tangible Assets.......................................10
3.6 Subsidiaries...................................................10
3.7 Financial Statements...........................................10
3.8 Undisclosed Liabilities........................................11
3.9 Legal Compliance...............................................11
3.10 Real Property and Leases.......................................11
3.11 Contracts......................................................12
3.12 Powers of Attorney.............................................12
3.13 Litigation.....................................................12
3.14 Environment, Health, and Safety................................13
3.15 Employee Benefits..............................................13
3.16 Events Subsequent to Most Recent Fiscal Quarter End............14
ARTICLE IVREPRESENTATIONS AND WARRANTIES OF SNAKE RIVER..................14
4.1 Organization...................................................14
4.2 Authorization of Transaction...................................14
4.3 Noncontravention...............................................14
4.4 Brokers' Fees..................................................15
4.5 Disclosure.....................................................15
ARTICLE VPRE-CLOSING COVENANTS...........................................15
5.1 General........................................................15
5.2 Notices and Consents...........................................15
5.3 Operation of Business..........................................15
5.4 Obtaining Financing............................................16
5.5 Full Access....................................................16
5.6 Notice of Developments.........................................16
5.7 Exclusivity....................................................16
ARTICLE VICONDITIONS TO CLOSING..........................................17
6.1 Conditions to Obligation of Snake River........................17
6.2 Conditions to Obligation of Amalgamated........................18
ARTICLE VIITERMINATION...................................................19
7.1 Events of Termination..........................................19
7.2 Effect of Termination..........................................20
ARTICLE VIIIMISCELLANEOUS................................................20
8.1 Parties Obligated and Benefited................................20
8.2 Notices........................................................20
8.3 Attorneys' Fees................................................22
8.4 Amendment or Waiver............................................22
8.5 Captions.......................................................22
8.6 Choice of Law..................................................22
8.7 Terms..........................................................22
8.8 Further Actions................................................22
8.9 Time...........................................................22
8.10 Counterparts...................................................23
8.11 Entire Agreement...............................................23
8.12 Severability...................................................23
8.13 Construction...................................................23
8.14 Expenses.......................................................23
8.15 Press Releases and Public Announcements........................23
8.16 References.....................................................23
LIST OF EXHIBITS
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EXHIBIT A Company Agreement of The Amalgamated Sugar LLC
EXHIBIT B Officers of Amalgamated
EXHIBIT C Financial Statements
RELATED TRANSACTION AGREEMENTS
EXHIBIT D-1 Form of Office and Ground Lease
EXHIBIT D-2 Indemnification and Post Closing Agreement
EXHIBIT D-3 Form of Limited Recourse Promissory Note
EXHIBIT D-4 Form of Non-Recourse Promissory Note
EXHIBIT D-5 Form of Limited Recourse Pledge Agreement
EXHIBIT D-6 Form of Pledge Agreement (Non-Recourse Note)
EXHIBIT D-7 Form of Indemnification Pledge Agreement
EXHIBIT D-8 Four Forms of Memorandum of Agreement between Sugarbeet
Growers and Amalgamated
EXHIBIT E Directors of Snake River
EXHIBIT F Form of Employment Agreement
LIST OF SCHEDULES
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SCHEDULE 1(D) Personal Property and Interests
SCHEDULE 2.3 Excluded Liabilities
SCHEDULE 3 General Exceptions to Representations and Warranties of
Amalgamated
SCHEDULE 3.8 Undisclosed Liabilities
SCHEDULE 3.10(A) Real Property
SCHEDULE 3.10(B) Leased Real Property
SCHEDULE 3.11 Material Contracts
SCHEDULE 3.12 Powers of Attorney
SCHEDULE 3.13 Pending Litigation
SCHEDULE 3.14 Noncompliance with the Environmental, Health, and Safety Laws
SCHEDULE 3.15 Employee Benefit Plans
SCHEDULE 4 Exceptions to Representations and Warranties of Snake River
FORMATION AGREEMENT
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THIS FORMATION AGREEMENT (this "Agreement" or this "Formation
Agreement") is made as of January , 1996, between SNAKE RIVER SUGAR COMPANY,
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an Oregon cooperative (`Snake River''), and THE AMALGAMATED SUGAR COMPANY, a
Utah corporation (`Amalgamated''), and, upon its formation and the execution
and delivery of a counterpart to this Agreement, THE AMALGAMATED SUGAR LLC, a
Delaware limited liability company (the `Company''). Together, Snake River,
Amalgamated and the Company shall be referred to in this Agreement as the
`Parties.'' Capitalized terms not otherwise defined in this Agreement have the
meaning ascribed to such terms in Article I.
RECITALS
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WHEREAS, Snake River and Amalgamated desire to form a limited
liability company, to be known as `The Amalgamated Sugar LLC,'' pursuant to the
Company Agreement attached as EXHIBIT A (together with the exhibits thereto, the
"Company Agreement") to conduct a sugarbeet processing business; and
WHEREAS, upon the terms and subject to the conditions set forth in
this Agreement, Amalgamated desires to make a capital contribution to the
Company of certain assets, subject to certain liabilities, in return for which
Amalgamated shall receive a Membership Interest in the Company, as set forth in
the Company Agreement; and
WHEREAS, upon the terms and subject to the conditions set forth in
this Agreement, Snake River shall make a capital contribution to the Company of
$[ ] million in cash, in return for which Snake River shall receive a
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Membership Interest in the Company, as set forth in the Company Agreement;
NOW, THEREFORE, the Parties agree as follows:
ARTICLE I
DEFINITIONS
The following terms used in this Formation Agreement shall have the
following meanings (unless otherwise expressly provided in this Agreement);
(a)`Affiliate'' has the meaning, with respect to any Person, set
forth in Rule 12b-2 of the regulations promulgated under the Securities Exchange
Act of 1934, as amended as of the Closing Date.
(b)`Affiliated Group'' has the meaning set forth in Code Sec. 1504.
(c)`Amalgamated'' has the meaning set forth in the recitals above.
(d)`Amalgamated Assets'' means all the properties and assets
currently owned by Amalgamated (other than Excluded Assets), whether or not
located on its premises, or shown on the Most Recent Financial Statement,
including, but not limited to, all right, title and interest in, to and under
(i) all real property, and all leaseholds and subleasheholds thereon,
improvements, fixtures and fittings thereon (such as appurtenant rights in and
to public streets), as listed on SCHEDULE 3.11(A) AND (B), (ii) all personal
property and interests, including machinery, equipment, furniture, office
equipment, communications equipment, vehicles, and other tangible property, as
listed on SCHEDULE 1(D), (iii) all Related Contracts and Licenses, (iv) all of
Amalgamated's books, records, ledgers, files, documents, correspondence, lists,
plats, architectural plans, drawings, specifications, creative materials,
advertising and promotional materials, studies, reports and other printed or
written materials, whether in hard copy or computer format, including without
limitation engineering information, manuals and data, fixed asset registers and
engineering reports, lists of present and former suppliers, personnel and
employment records, and any information relating to any Tax (other than income
or franchise Taxes); and (v) all of Amalgamated's Intellectual Property.
(e)`Amalgamated Credit Agreements'' means the Credit Agreement dated
July 1, 1993, as most recently modified on May 31, ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇ National Bank of Oregon and the banks named therein, plus the
$5,000,000 promissory note dated as of August 23, 1996 and due September 30,
1997, issued by Amalgamated in favor of United States National Bank of Oregon.
(f)`Amcorp'' means Amcorp, Inc., a Delaware corporation.
(g)`Assumed Liabilities'' has the meaning set forth in Section 2.3.
(h)`Business Day'' means any day excluding a Saturday, Sunday and any
day which is a legal holiday under the laws of the State of Utah or is a day on
which banking institutions located in such state are closed.
(i) `Closing'' has the meaning set forth in Section 2.4.
(j) `Closing Date'' means the date of the Closing.
(k)`Code" means the Internal Revenue Code of 1986, as amended, and
the temporary, proposed and final Treasury Regulations promulgated thereunder,
and any reference to a section of the Code shall include any successor section
or provision of the Code.
(l) `Company Agreement'' has the meaning set forth in the Recitals.
(m)`Confidential Information'' means any information concerning the
businesses and affairs of Amalgamated that is not already generally available to
the public.
(n) `Conveyance Documents'' has the meaning set forth in Section
2.4(d).
(o) `Drop Date'' has the meaning set forth in Section 7.1.
(p)"Employee Benefit Plan" means any (a) nonqualified deferred
compensation or retirement plan or arrangement which is an Employee Pension
Benefit Plan, (b) qualified defined contribution retirement plan or arrangement
which is an Employee Pension Benefit Plan, (c) qualified defined benefit
retirement plan or arrangement which is an Employee Pension Benefit Plan
(including any multiemployer plan as defined in Section 3(37) of ERISA), or (d)
Employee Welfare Benefit Plan.
(q)"Employee Pension Benefit Plan" has the meaning set forth in ERISA
Sec. 3(2).
(r)"Employee Welfare Benefit Plan" has the meaning set forth in ERISA
Sec. 3(1).
(s)"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
(t)"Environmental, Health, and Safety Laws" means the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, the Resource
Conservation and Recovery Act of 1976, and the Occupational Safety and Health
Act of 1970, each as amended as of the Closing Date, together with all other
laws (including rules, regulations, codes, plans, injunctions, judgments,
orders, decrees, rulings, and charges thereunder) in effect as of the Closing
Date of federal, state, local, and foreign governments (and all agencies
thereof) concerning pollution or protection of the environment, public health
and safety, or employee health and safety, including laws in effect as of the
Closing Date relating to emissions, discharges, releases, or threatened releases
of pollutants, contaminants, or chemical, industrial, hazardous, or toxic
materials or wastes into ambient air, surface water, ground water, or lands or
otherwise relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport, or handling of pollutants, contaminants, or
chemical, industrial, hazardous, or toxic materials or wastes.
(u)`Entity" means any general partnership, limited partnership,
limited liability company, corporation, joint venture, trust, business trust,
governmental authority, cooperative, association or any foreign trust or foreign
business organization or any other entity of any kind whatsoever.
(v)`Excluded Assets" means the Amalgamated corporate charter,
qualifications to conduct business as a foreign corporation, arrangements with
registered agents relating to foreign qualifications, taxpayer and other
identification numbers, seals, minute books, stock transfer books, blank stock
certificates, and other documents relating to the organization, maintenance, and
existence of Amalgamated as a corporation.
Confirm whether the beet contract is going to LLC or directly to SRSC (per ▇▇▇▇▇
memo of 10/1)
(w)`Excluded Liabilities" means (i) any Liability related to any
exercise of compensatory options to purchase Valhi stock held by employees or
former employees of Amalgamated as of the Effective Date or upon the lapse of
restrictions on restricted shares of Valhi stock held by such employees or
former employees, and (ii) and the specific Liabilities set forth on SCHEDULE
2.3 (collectively, the `Excluded Liabilities'').]
(x)"Financial Statement" has the meaning set forth in Section 3.7.
(y)"GAAP" means United States generally accepted accounting principles
as in effect from time to time.
(z)"Intellectual Property" means (i) all trademarks, patents, service
marks, trade dress, logos, trade names, and corporate names, together with all
translations, adaptations, derivations and combinations thereof and including
all goodwill associated therewith and (ii) all computer software (including data
and related documentation).
(aa)"Knowledge" means, for any matter, actual knowledge without
independent investigation of the officers of Amalgamated listed on EXHIBIT B, or
actual knowledge of facts or circumstances such that the matter should
reasonably have been actually known by such officers.
(bb)`Liability'' means any liability (whether known or unknown,
whether asserted or unasserted, whether absolute or contingent, whether accrued
or unaccrued, whether liquidated or unliquidated, and whether due or to become
due), including any liability for Taxes.
(cc)`Material Adverse Change'' means a material adverse change in the
financial condition of Amalgamated since the Most Recent Fiscal Quarter End.
Notwithstanding the foregoing, no event occurring after the Most Recent Fiscal
Quarter End generally applicable to all companies involved in the sugar
processing industry, including without limitation changes in market conditions,
trends, government regulations, consumer preferences or competition, shall be
deemed to constitute a Material Adverse Change.
(dd)`Member'' means each of the Persons with an ownership interest in
the Company and which executes a counterpart of the Company Agreement as a
Member and each of the Persons who may hereafter become Members.
(ee) `Membership Interest'' means the rights of a Member or, in the
case of an Assignee, the rights of the assigning Member in distributions
(liquidating or otherwise) and allocations of the profits, losses, gains,
deductions and credits of the Company.
(ff) "Most Recent Financial Statements" has the meaning set forth in
Section 3.7 below.
(gg) "Most Recent Fiscal Quarter End" has the meaning set forth in
Section 3.7 below.
(hh) `Ordinary Course of Business'' means the ordinary course of
Amalgamated's business consistent with Amalgamated's past custom and practice
(including with respect to quantity and frequency).
(ee) `Parties'' has the meaning set forth in the preface of this
Agreement.
(ff)`Person'' means any individual or Entity, as well as the heirs,
executors, administrators, legal representatives, successors and assigns of such
`Person'' where the context so requires.
(gg)"Related Contracts and Licenses" means all contracts and
agreements, leases, licenses, commitments, requests for proposals,
correspondence, purchase orders and other instruments, franchises, approvals,
permits, licenses, orders, registrations, certificates, variances and similar
rights obtained from governmental authorities used or held by Amalgamated.
(hh)`Required Consents'' means all franchises, licenses,
authorizations, approvals and consents required under any agreement or otherwise
for Amalgamated to transfer the Amalgamated Assets to the Company without
breaching or otherwise defaulting any representation or warranty made by
Amalgamated in this Agreement.
(mm) `Security Interest'' means any mortgage, pledge, lien,
encumbrance, charge, or other security interest, other than (a) mechanic's,
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materialmen's, and similar liens, (b) liens for Taxes not yet due and payable or
for Taxes that the taxpayer is contesting in good faith through appropriate
proceedings, (c) purchase money liens and liens securing rental payments under
capital lease arrangements, and (d) other liens arising in the Ordinary Course
of Business and not incurred in connection with the borrowing of money.
(ii)`Snake River'' has the meaning set forth in the recitals above.
(jj)`Snake River Capital Contribution'' has the meaning set forth in
Section 2.1 below.
(kk)`Snake River Materials'' means the offering circular and other
materials relating to Snake River's sale of debt and equity securities in
connection with the organization and funding of Snake River and related
transactions, including this Formation Agreement.
(qq) `Subsidiary'' means any corporation with respect to which a
specified Person (or a Subsidiary thereof) has the power to vote or direct the
voting of sufficient securities to elect a majority of the directors.
(ll)"Tax" means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental, customs duties, capital stock,
franchise, profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, or other tax of any
kind whatsoever, including any interest, penalty, or addition thereto, whether
disputed or not.
(mm)`Transaction Agreements'' means this Agreement, the Company
Agreement, the Office and Ground Lease, the form of which is attached as EXHIBIT
D-1, the Indemnification and Post Closing Agreement, the form of which is
attached as EXHIBIT D-2, the Limited Recourse Promissory Note, the form of which
is attached hereto as EXHIBIT D-3, the Non-recourse Promissory Note, the form of
which is attached hereto as EXHIBIT D-4, the Limited Recourse Pledge Agreement,
the form of which is attached hereto as EXHIBIT D-5, the Pledge Agreement (Non-
Recourse Note), the form of which is attached hereto as EXHIBIT D-6, the
Indemnification Pledge Agreement, the form of which is attached hereto as
EXHIBIT D-7, and the four Memoranda of Agreement between the Sugarbeet Growers
and Amalgamated, the form of which is attached hereto as EXHIBIT D-8.
(nn)`Valhi'' means Valhi, Inc., a Delaware corporation and the parent
of Amcorp.
(oo)`Valhi Credit Agreement'' means the Credit and Pledge Agreement
among Valhi, Amcorp and The Chase Manhattan Bank, as Agent, dated August 25,
1995, as amended August 23, 1996.
ARTICLE II
FORMATION
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2.1 Snake River Capital Contribution. Upon the terms and subject to
--------------------------------
the conditions of this Formation Agreement, Snake River shall on the Closing
Date contribute to the Company cash in immediately available funds of
$[ ] (the "Snake River Capital Contribution"), for which Snake River
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will receive a Membership Interest in the Company having the rights and
obligations set forth in the Company Agreement. Upon the making of the Snake
River Capital Contribution, Snake River will be admitted as a Member of the
Company under the terms of the Company Agreement.
2.2 Amalgamated Contribution. Upon the terms and subject to the
------------------------
conditions of this Formation Agreement, including but not limited to the
assumption of Liabilities set forth in Section 2.3, Amalgamated agrees to
convey, transfer, assign and deliver to the Company on the date hereof, free and
clear of any Security Interest, all of the Amalgamated Assets, for which
Amalgamated shall receive a Membership Interest in the Company as set forth in
the Company Agreement. Upon the contribution of the Amalgamated Assets,
Amalgamated will be admitted as a Member of the Company under the terms of the
Company Agreement.
2.3 Assumed Liabilities. Upon the terms and subject to the
-------------------
conditions of this Agreement, the Company agrees, effective at the time of
Closing, to assume all Liabilities of Amalgamated, whether presently in
existence or arising after the date of this Agreement, whether known or unknown,
whether asserted or unasserted, whether absolute or contingent, whether accrued
or unaccrued, whether liquidated or unliquidated, and whether due or to become
due (the `Assumed Liabilities''), other than Excluded Liabilities.
2.4 Closing. Unless the Parties otherwise agree, the closing (the
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`Closing'') of the transactions contemplated by this Agreement shall take place
at the offices of Amalgamated in Ogden, Utah, commencing at 9:00 a.m. local time
on January , 1996, or, if later, the second Business day following the
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satisfaction or waiver of all conditions to the obligations of the Parties to
consummate the transactions contemplated by this Agreement (other than
conditions with respect to actions the respective Parties will take at the
Closing itself) or such other date as the Parties may mutually determine (the
`Closing Date''). At the Closing:
(a) Snake River and Amalgamated shall execute the Transaction
Agreements to which each is a party.
(b) Snake River shall contribute the Snake River Capital Contribution
to the Company;
(c) The Company shall execute and deliver the assumption and
assignment agreements pursuant to which it shall assume the Assumed Liabilities;
(d) Amalgamated shall deliver or cause to be delivered to the Company
such ▇▇▇▇ of sales, warranty deeds, Required Consents, and other good and
sufficient instruments of conveyance and assignment (the `Conveyance
Documents') as Snake River and its counsel shall deem reasonably necessary or
appropriate to vest in the Company all right, title and interest in, to and
under the Amalgamated Assets.
(e) Snake River shall deliver to Amalgamated a copy of its charter
and bylaws, good standing certificates, resolutions of the board of directors,
secretaries' certificates, officers' certificates, in each case, relating to the
existence of Snake River and the authority of Snake River to execute the
Transaction Agreements to which it is a party, all in form and substance
reasonably satisfactory to Amalgamated and its counsel.
(f) Amalgamated shall deliver to Snake River a copy of its
certificate of incorporation, good standing certificates, resolutions of the
board of directors, secretaries' certificates, officer's certificates, in each
case, relating to the existence of Amalgamated and the authority and capacity of
Amalgamated to execute the Transaction Agreements to which it is a party, all in
form and substance reasonably satisfactory to Snake River and its counsel.
(g) The Company shall execute this Agreement, as of the date hereof,
and deliver to Snake River and Amalgamated resolutions of the Management
Committee, secretaries' certificates, officer's certificates, in each case,
relating to the existence of the Company and the authority and capacity of the
Company to execute this Agreement as of such date and the other Transaction
Agreements to which it is a party, all in form and substance reasonably
satisfactory to Snake River and Amalgamated and their respective counsel.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF AMALGAMATED
For the purpose of inducing Snake River and the Company to enter into
and perform this Agreement, Amalgamated represents and warrants to Snake River
and the Company that the statements contained in this Article III are correct
and complete as of the date of this Agreement and will be correct and complete
as of the Closing Date (as though made then and as though the Closing Date were
substituted for the date of this Agreement throughout this Article III), except
as set forth in SCHEDULE 3.
3.1 Organization, Qualification and Corporate Power. Amalgamated is
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a corporation duly organized, validly existing, and in good standing under the
laws of Utah. Amalgamated is duly authorized to conduct business and is in good
standing under the laws of each jurisdiction where such qualification is
required, except where the lack of such qualification would not have a material
adverse effect on the financial condition of Amalgamated. Amalgamated has the
corporate power and authority to carry on the businesses in which it is engaged
and to own and use the properties owned and used by it.
3.2 Authorization of Transaction. Amalgamated has the corporate
----------------------------
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally binding
obligation of Amalgamated, enforceable in accordance with its terms and condi-
tions, as enforceability may be limited by or subject to any bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditor rights
generally and subject to general principles of equity and public policy
considerations.
3.3 Noncontravention. Neither the execution and the delivery of this
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Agreement, nor the consummation of the transactions contemplated by this
Agreement, will (a) violate any valid constitutional provision, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to which
Amalgamated is subject or any provision of its charter or bylaws; or (b) except
for the terms of the Amalgamated Credit Agreements, and the Valhi Credit
Agreement, conflict with, result in a material breach of, constitute a material
default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any
material agreement, contract, lease, license, instrument, or other arrangement
to which Amalgamated is a party or by which it is bound or to which any of its
material assets is subject (or result in the imposition of any Security Interest
upon any of its assets); except for where the violation, conflict, breach,
default, acceleration, termination, modification, cancellation, failure to give
notice, or Security Interest would not have a material adverse effect on the
financial condition of Amalgamated or on the ability of the Parties to
consummate the transactions contemplated by this Agreement. Amalgamated does
not need to give any notice to, make any filing with, or obtain any
authorization, consent, or approval of any government or governmental agency in
order for the Parties to consummate the transactions contemplated by this
Agreement, except where the failure to give notice, to file, or to obtain any
authorization, consent, or approval would not have a material adverse effect on
the financial condition of Amalgamated or on the ability of the Parties to
consummate the transactions contemplated by this Agreement.
3.4 Brokers' Fees. Amalgamated has no Liability or obligation to pay
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any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which Snake River or the Company
could become liable or obligated.
3.5 Title to Tangible Assets. Amalgamated has insurable title to, or
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a valid leasehold interest in, the material tangible assets it use regularly in
the conduct of its businesses.
3.6 Subsidiaries. Amalgamated has no controlling interest in any
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Entity.
3.7 Financial Statements. Attached hereto as EXHIBIT C are the
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following financial statements (collectively the "Financial Statements"): (i)
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audited balance sheets and statements of income, changes in shareholder's
equity, and cash flows as of and for the fiscal years ended December 31, 1995,
December 31, 1994, and December 31, 1993 for Amalgamated; and (ii) unaudited
consolidated balance sheets and statements of income, changes in shareholder's
equity, and cash flows (the "Most Recent Financial Statements") as of and for
--------------------------------
the nine months ended September 30, 1996 (the "Most Recent Fiscal Quarter End")
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for Amalgamated. The Financial Statements (including the notes thereto) have
been prepared in accordance with GAAP applied on a consistent basis throughout
the periods covered thereby and present fairly the financial position of
Amalgamated as of such dates and the results of operations of Amalgamated for
such periods; provided, however, that the Most Recent Financial Statements are
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subject to normal year-end adjustments and lack footnotes and other presentation
items.
3.8 Undisclosed Liabilities. To the Knowledge of Amalgamated,
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Amalgamated has no any material debt or Liability (whether asserted or
unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due, including
any Liability for income Taxes), except for (i) such Liabilities included or
disclosed in the Financial Statements (including the notes thereto), (ii) such
Liabilities which have arisen after the Most Recent Fiscal Quarter End in the
Ordinary Course of Business consistent with the provisions of Section 5.3, (iii)
such Liabilities as are disclosed in SCHEDULE 3.8.
3.9 Legal Compliance. To the Knowledge of Amalgamated, Amalgamated
----------------
has complied with all applicable valid laws (including rules, regulations,
codes, plans, injunctions, judgments, orders, decrees, rulings, and charges
thereunder) of federal, state, local, and foreign governments (and all agencies
thereof) having jurisdiction over Amalgamated, except where the failure to
comply would not have a material adverse effect upon the financial condition of
Amalgamated.
3.10 Real Property and Leases.
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(a) SCHEDULE 3.10(A) lists all owned real property that is included
in the Amalgamated Assets. With respect to each such parcel, to the Knowledge
of Amalgamated, except for matters which are set forth in SCHEDULE 3.10(A) or
which would not have a material adverse effect on the financial condition of
Amalgamated:
i. Amalgamated has insurable title to the parcel of real
property, free and clear of any Security Interest (except Security Interests
arising under the Amalgamated Credit Agreement), easement, covenant, or other
restriction, except for installments of special assessments not yet delinquent,
recorded restrictions, including easements, covenants, utility easements,
building restrictions, zoning restrictions, and other easements and restrictions
existing generally with respect to properties of a similar character;
ii. there are no leases, subleases, licenses, concessions, or
other agreements granting to any party or parties the right of use or occupancy
of any portion of the parcel of real property; and
iii. there are no outstanding options or rights of first refusal
to purchase the parcel of real property, or any portion thereof or interest
therein.
(b) SCHEDULE 3.10(B) lists all real property included in the
Amalgamated Assets not owned by Amalgamated but leased or subleased by
Amalgamated. Amalgamated has made available to Snake River correct and complete
copies of the leases and subleases listed in SCHEDULE 3.10(B) (as amended to
date). To the Knowledge of Amalgamated, each lease and sublease listed in
SCHEDULE 3.10(B) is legal, valid, binding, enforceable, and in full force and
effect, except (a) for those matters set forth in SCHEDULE 3.10(B), (b) as
enforceability may be limited by or subject to any bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditor rights generally
and subject to general principles of equity and public policy considerations or
(c) where the illegality, invalidity, nonbinding nature, unenforceability, or
ineffectiveness would not have a material adverse effect on the financial
condition of Amalgamated.
3.11 Contracts. SCHEDULE 3.11 lists all written contracts and other
---------
written agreements included in the Amalgamated Assets which, to the Knowledge of
Amalgamated, Amalgamated is a party, the performance of which will involve
annual payments in excess of $100,000 or which have a remaining term greater
than three years, other than leases listed on SCHEDULE 3.10(B). Amalgamated has
made available to Snake River a correct and complete copy of each contract or
other agreement listed in SCHEDULE 3.11 (as amended to date).
3.12 Powers of Attorney. To the Knowledge of Amalgamated, there are
------------------
no outstanding powers of attorney executed on behalf of Amalgamated except as
described in SCHEDULE 3.12.
3.13 Litigation. To the Knowledge of Amalgamated, SCHEDULE 3.13 sets
----------
forth each instance in which Amalgamated (a) is subject to or is threatened to
be made subject to any outstanding injunction, judgment, order, decree or
ruling, or (b) is a party to or is threatened to be made a party to any action,
suit, proceeding, hearing, or investigation of, in, or before any court or
quasi-judicial or administrative agency of any federal, state, local, or foreign
jurisdiction, except where the injunction, judgment, order, decree, ruling,
action, suit, proceeding, hearing, or investigation (A) seeks damages of less
than $100,000, or (B) would not have a material adverse effect on the financial
condition of Amalgamated.
3.14 Environment, Health, and Safety.
-------------------------------
(a) Except as set forth in SCHEDULE 3.14, to the Knowledge of
Amalgamated, Amalgamated, (i) is in substantial compliance with the
Environmental, Health, and Safety Laws in all material respects (and, except as
set forth in SCHEDULE 3.14, to the Knowledge of Amalgamated no action, suit,
proceeding, hearing, investigation, charge, complaint, claim, demand, or notice
has been filed or commenced against any of them alleging any such failure to
comply), (ii) is in substantial compliance with all of the terms and conditions
of all material permits, licenses, and other authorizations which are required
under the Environmental, Health, and Safety Laws, and (iii) is in substantial
compliance with, in all material respects, all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules, and
timetables which are contained in the Environmental, Health, and Safety Laws.
(b) Except as set forth in SCHEDULE 3.14, to the Knowledge of
Amalgamated, Amalgamated has no material Liability (whether asserted or
unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due), and
Amalgamated has not handled or disposed of any substance, arranged for the
disposal of any substance, exposed any employee or other individual to any
substance or condition, or owned or operated any property or facility in any
manner that could give rise to any material Liability, for damage to any site,
location, or body of water (surface or subsurface), for any illness of or
personal injury to any employee or other individual under any Environmental,
Health, and Safety Law.
3.15 Employee Benefits. SCHEDULE 3.15 lists each Employee Benefit
-----------------
Plan that Amalgamated maintains or to which Amalgamated contributes.
(a) To the Knowledge of Amalgamated, each such Employee Benefit Plan
(and each related trust, insurance contract, or fund) complies in form and in
operation in all respects with the applicable requirements of ERISA and the
Code, except where the failure to comply would not have a material adverse
effect on the financial condition of Amalgamated.
(b) Except as set forth in SCHEDULE 3.15, all contributions
(including all employer contributions and employee salary reduction contribu-
tions) which are required to be paid to each such Employee Benefit Plan which is
an Employee Pension Benefit Plan have been paid.
(c) Except as set forth in SCHEDULE 3.15, each such Employee Benefit
Plan which is an Employee Pension Benefit Plan has received a determination
letter from the Internal Revenue Service to the effect that at the time of its
issuance such plan met the requirements of Code Sec. 401(a).
(d) Amalgamated has made available to Snake River correct and
complete copies of the plan documents and summary plan descriptions, the most
recent determination letter received from the Internal Revenue Service, the most
recent Form 5500 Annual Report, and all related trust agreements, insurance
contracts, and other funding agreements which implement each such Employee
Benefit Plan.
3.16 Events Subsequent to Most Recent Fiscal Quarter End. To the
---------------------------------------------------
Knowledge of Amalgamated, since the Most Recent Fiscal Quarter end, there has
not been any Material Adverse Change. Without limiting the generality of the
foregoing, since the Most Recent Fiscal Quarter End, Amalgamated has not engaged
in any practice, taken any action, or entered into any transaction outside the
Ordinary Course of Business other than in connection with this Formation
Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SNAKE RIVER
Snake River represents and warrants to each of Amalgamated and the
Company that the statements contained in this Article IV are correct and
complete as of the date of this Agreement and will be correct and complete as of
the Closing Date (as though made then and as though the Closing Date were
substituted for the date of this Agreement throughout this Article IV), except
as set forth in SCHEDULE 4.
4.1 Organization. Snake River is a cooperative corporation duly
------------
organized, validly existing, and in good standing under the laws of Oregon.
EXHIBIT E lists the directors of Snake River. Snake River is duly authorized to
conduct business and is in good standing under the laws each other jurisdiction
where such qualification is required, except where the lack of such
qualification would not have a material adverse effect on the financial
condition of Snake River. Snake River has the power and authority to carry on
the businesses in which it is engaged and to own and use the properties owned
and used by it.
4.2 Authorization of Transaction. Snake River has power and
----------------------------
authority to execute and deliver this Agreement and to perform its obligations
hereunder. This Agreement constitutes the valid and legally binding obligation
of Snake River, enforceable in accordance with its terms and conditions.
4.3 Noncontravention. Neither the execution and the delivery of this
----------------
Agreement, nor the consummation of the transactions contemplated by this
Agreement, will (a) violate any valid constitutional provision, statute, regula-
tion, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction of any government, governmental agency, or court to which Snake
River is subject or any provision of its charter or bylaws or (b) conflict with,
result in a material breach of, constitute a material default under, result in
the acceleration of, create in any party the right to accelerate, terminate,
modify, or cancel, or require any notice under any material agreement, contract,
lease, license, instrument, or other arrangement to which Snake River is a party
or by which it is bound or to which any of its material assets is subject.
Snake River does not need to give any notice to, make any filing with, or obtain
any authorization, consent, or approval of any government or governmental agency
in order for the Parties to consummate the transactions contemplated by this
Agreement, except where the failure to give notice, to file, or to obtain any
authorization, consent, or approval would not have a material adverse effect on
the financial condition of Snake River taken as a whole or on the ability of the
Parties to consummate the transactions contemplated by this Agreement.
4.4 Brokers' Fees. Snake River has no Liability or obligation to pay
-------------
any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which Amalgamated or the Company
could become liable or obligated.
4.5 Disclosure. The Snake River Materials do not contain any untrue
----------
statement of a material fact or omit to state a material fact necessary in order
to make the statements made therein not misleading in the light of the circum-
stances under which they will be made.
ARTICLE V
PRE-CLOSING COVENANTS
The Parties agree as follows with respect to the period between the
execution of this Agreement and the Closing.
5.1 General. Each of the Parties will use its reasonable best
-------
efforts to take all actions and to do all things necessary or advisable in order
to consummate and make effective the transactions contemplated by this Agreement
(including satisfaction, but not waiver, of the closing conditions set forth in
Article VI below).
5.2 Notices and Consents. Each of the Parties will give any notices
--------------------
to, make any filings with, and use its reasonable best efforts to obtain any
authorizations, consents, and approvals of governments and governmental agencies
in connection with the matters referred to in Sections 3.3 and 4.3 above.
5.3 Operation of Business. Amalgamated will not engage in any
---------------------
practice, take any action, or enter into any transaction outside the Ordinary
Course of Business if such transaction could reasonably be expected to result in
a Material Adverse Change.
5.4 Obtaining Financing. Snake River shall use its reasonable best
-------------------
efforts, including the payment of all commitment and other fees and expenses of
prospective lenders, to obtain the necessary debt and equity financing to
consummate the transactions contemplated by this Agreement and the loan by Snake
River to Valhi.
5.5 Full Access. Amalgamated will permit representatives of Snake
-----------
River to have full access at all reasonable times upon reasonable advance
notice, and in a manner so as not to interfere with the normal business
operations of Amalgamated, to all premises, properties, personnel, books,
records (including income Tax records), contracts, and documents of or
pertaining to Amalgamated. In addition, Amalgamated will use reasonable efforts
to assist Snake River in obtaining access for representatives of Snake River to
any properties sold or otherwise transferred by Amalgamated prior to the
Closing. Snake River and its representatives will treat and hold as such any
Confidential Information it receives from Amalgamated in the course of the
reviews contemplated by this Section 5.5, will not use any of the Confidential
Information except in connection with this Agreement, will not provide any trade
secrets included in the Confidential Information to any person, including any
competitor of Amalgamated, and, if this Agreement is terminated for any reason
whatsoever, will promptly return to Amalgamated all tangible embodiments (and
all copies) of the Confidential Information which it has received or created.
5.6 Notice of Developments.
----------------------
(a) Amalgamated will give written notice to Snake River of any
development causing a breach of any of the representations and warranties in
Article III promptly upon Amalgamated becoming aware of such development.
Unless Snake River has the right to terminate this Agreement pursuant to Section
7.1(b) below by reason of the development and exercises that right within the
period of 10 Business days referred to in Section 7.1(b)(i) below, the written
notice pursuant to this Section 5.6(a) will be deemed to have amended Schedule
3, to have qualified the representations and warranties contained in Article
III, and to have cured any misrepresentation or breach of warranty that
otherwise might have existed hereunder by reason of the development.
(b) Snake River will give written notice to Amalgamated of any
development causing a breach of any of the representations and warranties in
Article IV above promptly upon Snake River becoming aware of such development.
No disclosure by Snake River pursuant to this Section 5.6(b), however, shall be
deemed to prevent or cure any misrepresentation or breach of warranty.
5.7 Exclusivity. Amalgamated will not solicit, initiate, or
-----------
encourage the submission of any proposal or offer from any Person relating to
the acquisition of all or substantially all of the capital stock or assets of
Amalgamated (including any acquisition structured as a merger, consolidation, or
share exchange); provided, however, that Amalgamated and its directors and
-------- -------
officers will remain free to participate in any discussions or negotiations
regarding, furnish any information with respect to, assist or participate in, or
facilitate in any other manner any effort or attempt by any Person to do or seek
any of the foregoing to the extent their fiduciary duties may require.
ARTICLE VI
CONDITIONS TO CLOSING
6.1 Conditions to Obligation of Snake River. The obligation of Snake
---------------------------------------
River to consummate the transactions to be performed by it in connection with
the Closing is subject to satisfaction of the following conditions:
(a) the representations and warranties set forth in Article III above
shall be true and correct in all material respects at and as of the Closing
Date;
(b) Amalgamated shall have performed and complied with all of its
pre-closing covenants hereunder in all material respects through the Closing;
(c) there shall not be any injunction, judgment, order, decree,
ruling, or charge in effect preventing consummation of any of the transactions
contemplated by this Agreement;
(d) Amalgamated shall have delivered to Snake River a certificate to
the effect that each of the conditions specified above in Section 6.1(a), (b)
and (c) is satisfied in all respects;
(e) the Parties shall have received all other authorizations,
consents, and approvals of governments and governmental agencies referred to in
Section 3.3 and Section 4.3 above;
(f) the Transaction Agreements in form and substance as set forth in
EXHIBITS D-1 through D-8 attached hereto and the same shall be in full force and
effect;
(g) each of the officers of Amalgamated identified in EXHIBIT B shall
have entered into an employment agreement with the Company in a form
substantially similar to the employment agreements attached hereto as EXHIBIT F;
and
(h) all actions to be taken by Amalgamated in connection with
consummation of the transactions contemplated hereby and all certificates,
instruments, and other documents required to effect the transactions contem-
plated hereby will be reasonably satisfactory in form and substance to Snake
River.
Snake River may waive any condition specified in this Section 6.1 if
it executes a writing so stating at or prior to the Closing.
6.2 Conditions to Obligation of Amalgamated. The obligation of
---------------------------------------
Amalgamated to consummate the transactions to be performed by it in connection
with the Closing is subject to satisfaction of the following conditions:
(a) the representations and warranties set forth in Article IV above
shall be true and correct in all material respects at and as of the Closing
Date;
(b) Snake River shall have performed and complied with all of its
covenants hereunder in all material respects through the Closing;
(c) there shall not be any injunction, judgment, order, decree,
ruling, or charge in effect preventing consummation of any of the transactions
contemplated by this Agreement;
(d) Valhi shall have borrowed $250 million from Snake River pursuant
to the note and pledge agreements attached hereto as EXHIBITS D-3 through D-7,
inclusive;
(e) Amalgamated shall be reasonably satisfied with the equity
structure of Snake River and Snake River's financing;
(f) Snake River shall have delivered to Amalgamated a certificate to
the effect that each of the conditions specified above in Section 6.2 (a), (b)
and (c) is satisfied in all respects;
(g) the Parties shall have received all other authorizations,
consents, and approvals of governments and governmental agencies referred to in
Section 3.3 and Section 4.3;
(h) the Transaction Agreements in form and substance as set forth in
EXHIBITS D-1 through D-8 attached hereto and the same shall be in full force and
effect; and
(i) all actions to be taken by Snake River in connection with
consummation of the transactions contemplated hereby and all certificates,
opinions, instruments, and other documents required to effect the transactions
contemplated hereby will be reasonably satisfactory in form and substance to
Amalgamated.
Amalgamated may waive any condition specified in this Section 6.2 if
it executes a writing so stating at or prior to the Closing.
ARTICLE VII
TERMINATION
7.1 Events of Termination. Either of the Parties may terminate this
---------------------
Agreement as provided below:
(a) Snake River and Amalgamated may terminate this Agreement by
mutual written consent at any time prior to the Closing;
(b) Snake River may terminate this Agreement by giving written notice
to Amalgamated at any time prior to the Closing in the event (i) Amalgamated has
within the then previous 10 Business days given Snake River any notice pursuant
to Section 5.6 above and (ii) the development that is the subject of the notice
has resulted in a Material Adverse Change;
(c) Snake River may terminate this Agreement by giving written notice
to Amalgamated at any time prior to the Closing (i) in the event Amalgamated has
breached any material representation, warranty, or covenant contained in this
Agreement in any material respect, Snake River has notified Amalgamated of the
breach, and the breach has continued without cure for a period of 30 days after
the notice of breach or (ii) if the Closing shall not have occurred on or before
the Drop Date (as defined below) by reason of the failure of any condition
precedent under Section 6.1 hereof (unless the failure results primarily from
Snake River itself breaching any representation, warranty, or covenant contained
in this Agreement); and
(d) Amalgamated may terminate this Agreement by giving written notice
to Snake River at any time prior to the Closing, (i) in the event Snake River
has breached any material representation, warranty, or covenant contained in
this Agreement in any material respect, Amalgamated has notified Snake River of
the breach, and the breach has continued without cure for a period of 30 days
after the notice of breach or (ii) at any time prior to Closing, if the Closing
shall not have occurred on or before the Drop Date by reason of the failure of
any condition precedent under Section 6.2 hereof (unless the failure results
primarily from Amalgamated breaching any representation, warranty, or covenant
contained in this Agreement).
For purposes of this Agreement, the `Drop Date'' shall mean January , 1997,
--
provided, however, that if the parties have not received any consent required by
federal or state law on or prior to , 199 , then the Drop Date shall
--------- -- -
be automatically extended to a date two business days after receipt of such
consent, but in no event later than January , 1997.
--
7.2 Effect of Termination. If any Party terminates this Agreement
---------------------
pursuant to Section 7.1 above, all rights and obligations of the Parties
hereunder shall terminate without any Liability of any Party to any other Party
(except for any Liability of any Party then in breach); provided, however, that
-------- -------
the confidentiality provisions contained in Section 5.5 above shall survive any
such termination.
ARTICLE VIII
MISCELLANEOUS
8.1 Parties Obligated and Benefited. Subject to the limitations set
-------------------------------
forth below, this Agreement will be binding upon the Parties and their
respective permitted assigns and successors in interest and will inure solely to
the benefit of the Parties and their respective permitted assigns and successors
in interest, and no other Person will be entitled to any of the benefits
conferred by this Agreement. In connection with any such assignment or
delegation, the transferring Party shall remain subject to all of its
obligations hereunder, pursuant to this Agreement.
8.2 Notices. Any notice, request, demand, waiver or other
-------
communication required or permitted to be given under this Agreement will be in
writing and will be deemed to have been duly given only if delivered in person
or by first class, prepaid, registered or certified mail, or sent by courier or,
if receipt is confirmed, by telecopier:
If to the Company:
-----------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Amalgamated Sugar LLC
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
If to Amalgamated:
-----------------
The Amalgamated Sugar Company
Three Lincoln Centre, Suite 700
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Atten: General Counsel
With a copy to:
---------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Bartlit ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Snake River:
-----------------
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
With a copy to:
--------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Jones, Waldo, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Any Party may change the address to which notices are required to be sent by
giving notice of such change in the manner provided in this Section 8.2. All
notices will be deemed to have been received on the date of delivery or on the
third Business Day after mailing in accordance with this Section 8.2, except
that any notice of a change of address will be effective only upon actual
receipt.
8.3 Attorneys' Fees. In the event of any action or suit based upon
---------------
or arising out of any alleged breach by any party of any representation,
warranty, covenant or agreement contained in this Agreement, the prevailing
party will be entitled to recover reasonable attorneys' fees and other costs of
such action or suit from the other party.
8.4 Amendment or Waiver. This Agreement or any of its provisions may
-------------------
not be amended, modified or waived except in a writing that refers to this
Agreement. The failure of any Party to enforce any right arising under this
Agreement on one or more occasions will not operate as a waiver of that or any
other right on that or any other occasion.
8.5 Captions. The article and section captions of this Agreement are
--------
for convenience only and do not constitute a part of this Agreement.
8.6 Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
-------------
IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF DELAWARE WITHOUT GIVING
EFFECT TO ANY CHOICE OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE
OF DELAWARE OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE
LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE.
8.7 Terms. Terms used with initial capital letters will have the
-----
meanings specified, applicable to both singular and plural forms, for all
purposes of this Agreement. The word `include'' and derivatives of that word
are used in this Agreement in an illustrative sense rather than limiting sense.
8.8 Further Actions. The Parties will execute and deliver, from time
---------------
to time at or after the Closing, for no additional consideration and at no
additional cost to the requesting party, such further assignments, certificates,
instruments, records, or other documents, assurances or things as may be
reasonably necessary to give full effect to this Agreement and to allow each
Party fully to enjoy and exercise the rights accorded and acquired by it under
this Agreement.
8.9 Time. Time is of the essence under this Agreement. If the last
----
day permitted for the giving of any notice or the performance of any act
required or permitted under this Agreement falls on a day which is not a
Business Day, the time for the giving of such notice or the performance of such
act will be extended to the next succeeding Business Day.
8.10 Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which will be deemed an original and all of which together
shall constitute a single agreement.
8.11 Entire Agreement. This Agreement (including the Schedules and
----------------
Exhibits referred to in this Agreement, which are incorporated in and constitute
a part of this Agreement), contains the entire agreement of the Parties and
supersedes all prior oral or written agreements and understandings with respect
to the subject matter of this Agreement.
8.12 Severability. Any term or provision of this Agreement which is
------------
invalid or unenforceable will be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining rights
of the Person intended to be benefitted by such provision or any other
provisions of this Agreement.
8.13 Construction. This Agreement has been negotiated by Snake River,
------------
Amalgamated and their respective legal counsel, and legal or equitable
principles that might require the construction of this Agreement or any
provision of this Agreement against the Party drafting this Agreement will not
apply in any construction or interpretation of this Agreement.
8.14 Expenses. Except as otherwise expressly provided in this
--------
Agreement, each Party will pay all of its expenses, including attorneys' and
accountants' fees, in connection with the negotiation of this Agreement, the
performance of its obligations and the consummation of the transactions
contemplated by this Agreement.
8.15 Press Releases and Public Announcements. No Party shall issue
---------------------------------------
any press release or make any public announcement relating to the subject matter
of this Agreement prior to the Closing without the prior written approval of the
other Party.
8.16 References. Numerical or alphabetic references to Recitals,
----------
Articles, sections, paragraphs, Schedules, exhibits and appendices in this
Agreement are to Recitals, Articles, sections, paragraphs, Schedules and
Exhibits of this Agreement unless otherwise stated.
* * * * *
The Parties have executed this Agreement as of the day and year first above
written.
SNAKE RIVER SUGAR COMPANY
By:
--------------------------------
Title:
-----------------------------
THE AMALGAMATED SUGAR COMPANY
By:
--------------------------------
Title:
-----------------------------
THE AMALGAMATED SUGAR LLC
By:
--------------------------------
Title:
-----------------------------