Exhibit 10.1

 

 

 

SALE AND PURCHASE AGREEMENT

by and among

EDWARD BILLINGTON AND SON, LIMITED,

IMPERIAL SUGAR COMPANY

and

WSO INVESTMENTS, INC.

dated

March 7, 2012

 

 

 

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TABLE OF CONTENTS

 

ARTICLE I DEFINITIONS

     2   

Section 1.1

   Definitions      2   

Section 1.2

   Construction      17   

ARTICLE II SALE AND PURCHASE

     17   

Section 2.1

   Transfer of Purchased Shares      17   

Section 2.2

   Purchase Price      17   

Section 2.3

   Closing; Closing Date      18   

Section 2.4

   Deliveries at the Closing      18   

Section 2.5

   Purchase Price Adjustment      20   

Section 2.6

   Repurchase Transactions      22   

Section 2.7

   Tax Withholding      22   

ARTICLE III REPRESENTATIONS AND WARRANTIES OF BILLINGTON

     23   

Section 3.1

   Organization and Qualification.      23   

Section 3.2

   Due Authority      23   

Section 3.3

   Conflicts and Approvals      24   

Section 3.4

   Proceedings      24   

Section 3.5

   Ownership of the Class A Shares      24   

Section 3.6

   No Brokers      24   

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF IMPERIAL

     24   

Section 4.1

   Organization and Qualification      25   

Section 4.2

   Due Authority      25   

Section 4.3

   Conflicts and Approvals      25   

Section 4.4

   Proceedings      25   

Section 4.5

   Ownership of the Class A Shares      26   

Section 4.6

   No Brokers      26   

ARTICLE V REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY

     26   

Section 5.1

   Organization and Qualification      26   

Section 5.2

   Capitalization      26   

Section 5.3

   Conflicts and Approvals      27   

Section 5.4

   No Brokers; Transaction Bonuses      28   

Section 5.5

   Financial Statements      28   

Section 5.6

   Absence of Undisclosed Liabilities      28   

Section 5.7

   Assets      29   

Section 5.8

   Material Contracts      29   

Section 5.9

   Authorizations      31   

Section 5.10

   Compliance with Law      32   

Section 5.11

   Environmental Matters      32   

Section 5.12

   Proceedings      32   

Section 5.13

   Insurance      33   

Section 5.14

   Employee Benefit Plans      33   

Section 5.15    

   Labor and Employment Matters      34   

 

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Section 5.16

   Taxes      34   

Section 5.17

   Intellectual Property      36   

Section 5.18

   Inventory; Food Laws      37   

Section 5.19

   Accounts Receivable      38   

Section 5.20

   Absence of Certain Developments      38   

Section 5.21

   Bank Accounts; Names and Locations      38   

Section 5.22

   Affiliated Transactions      38   

Section 5.23

   Customers and Suppliers      39   

Section 5.24

   Anti-Bribery and Anti-Money Laundering Compliance      39   

Section 5.25

   Compliance with Customs and International Trade Laws      40   

ARTICLE VI REPRESENTATIONS AND WARRANTIES OF BUYER

     40   

Section 6.1

   Organization and Qualification      40   

Section 6.2

   Due Authority      41   

Section 6.3

   Conflicts and Approvals      41   

Section 6.4

   Proceedings      41   

Section 6.5

   No Brokers      41   

Section 6.6

   Purchase as Investment      41   

Section 6.7

   Availability of Funds      42   

ARTICLE VII PRE-CLOSING COVENANTS

     42   

Section 7.1

   Operation of the Business      42   

Section 7.2

   Appropriate Action; Consents; Filings      45   

Section 7.3

   Breach Notice      47   

Section 7.4

   Right of Entry; Access to Information      47   

Section 7.5

   Condition of the Company’s Assets      48   

Section 7.6

   Independent Investigation      48   

Section 7.7

   Notice to Non-Voting Stockholders      49   

Section 7.8

   Exclusivity      49   

Section 7.9

   Letters of Credit      50   

Section 7.10

   Buyer’s Financing      50   

Section 7.11

   Cooperation with Financing      52   

Section 7.12

   Contribution Agreements and Parent Equity Documents      52   

ARTICLE VIII POST-CLOSING COVENANTS AND EMPLOYEE MATTERS

     52   

Section 8.1

   Employee Matters      52   

Section 8.2

   Insurance      53   

Section 8.3

   Further Assurances      54   

Section 8.4

   Proceedings      54   

Section 8.5

   Taxes      54   

Section 8.6

   Confidentiality      57   

Section 8.7

   Use of Names      58   

Section 8.8

   Non-Competition; Non-Solicitation; Non-Disparagement.      58   

ARTICLE IX CLOSING CONDITIONS

     60   

Section 9.1

   Conditions to Obligations of Each Party Under this Agreement      60   

Section 9.2

   Additional Conditions to the Sellers’ Obligations      61   

Section 9.3    

   Additional Conditions to Buyer’s Obligations      61   

 

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ARTICLE X TERMINATION

     62   

Section 10.1

   Termination      62   

Section 10.2

   Effect of Termination; Termination Fee      65   

ARTICLE XI INDEMNIFICATION AND REMEDIES

     65   

Section 11.1

   Survival      65   

Section 11.2

   Indemnification Provisions for Benefit of Buyer      66   

Section 11.3

   Indemnification Provisions for Benefit of the Sellers      67   

Section 11.4

   Indemnification Procedures; Matters Involving Third Parties      68   

Section 11.5

   Determination of Losses      69   

Section 11.6

   Limitations on Liability      70   

Section 11.7

   No Multiple Recoveries      71   

Section 11.8

   Certain Waivers, etc      71   

Section 11.9

   Specific Performance      72   

ARTICLE XII MISCELLANEOUS

     72   

Section 12.1

   Amendment      72   

Section 12.2

   Waiver      72   

Section 12.3

   Notices      72   

Section 12.4

   Governing Law      74   

Section 12.5

   Jurisdiction; Consent to Service of Process; WAIVER OF JURY TRIAL      74   

Section 12.6

   Dispute Resolution      74   

Section 12.7

   Public Announcements      74   

Section 12.8

   Expenses      75   

Section 12.9

   Headings      75   

Section 12.10

   Severability      75   

Section 12.11

   Assignment      75   

Section 12.12

   Parties in Interest      75   

Section 12.13

   Failure or Indulgence Not Waiver      75   

Section 12.14

   Disclosure Schedules      76   

Section 12.15

   Proportionate Payments      76   

Section 12.16

   Time of the Essence      76   

Section 12.17

   Counterparts      76   

Section 12.18    

   Entire Agreement      77   

 

Exhibits

     

Exhibit A

   Knowledge Individuals

Exhibit B

   Form of Transition Services Agreement

Exhibit C

   Dispute Resolution Procedures

 

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LIST OF DEFINED TERMS

 

Acquisition Proposal

   Section 7.8(a)

Adjusted Current Assets

   Section 1.1

Adjusted Current Liabilities

   Section 1.1

Adjusted Net Working Capital

   Section 1.1

Affiliate

   Section 1.1

Affiliate Entities

   Section 1.1

Agreement

   Preamble

Applicable Rate

   Section 1.1

Assumed Deliveries

   Section 1.1

Authorization

   Section 1.1

Balance Sheet

   Section 1.1

Balance Sheet Date

   Section 1.1

Base Purchase Price

   Section 1.1

Benefit Plan

   Section 1.1

Billington

   Preamble

Billington Contributed Shares

   Section 1.1

Billington Contribution Agreement

   Section 1.1

Billington Shares

   Section 3.5

Breach Cure Period

   Section 10.1(g)

Breach Notice

   Section 7.3

Business

   Section 1.1

Business Day

   Section 1.1

Buyer

   Preamble

Buyer Indemnitees

   Section 1.1

Buyer Material Adverse Effect

   Section 1.1

Buyer Plans

   Section 8.1(b)

CERCLA

   Section 5.11(d)

Claim

   Section 1.1

Class A Shares

   Recitals

Class A Stock

   Recitals

Class B Stock

   Recitals

Class C Stock

   Recitals

Class D Stock

   Recitals

Closing

   Section 2.3

Closing Condition

   Section 1.1

Closing Date

   Section 2.3

Closing Statement

   Section 2.5(d)

COBRA

   Section 1.1

Code

   Section 1.1

Commerce

   Section 5.25(d)

commercially reasonable efforts

   Section 1.1

Commitment Letters

   Section 6.7(b)

Company

   Preamble

Company Cash

   Section 1.1

Company Funded Debt

   Section 1.1

 

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Company Intellectual Property

   Section 5.17(b)

Company Officers and Representatives

   Section 1.1

Company Partner Operations

   Section 1.1

Company Plan

   Section 1.1

Company Systems

   Section 5.17(e)

Company Transaction

   Section 1.1

Company Transaction Costs

   Section 1.1

Confidential Information

   Section 1.1

Confidentiality Agreement

   Section 1.1

Contributing Executives

   Recitals

Contribution Agreements

   Section 1.1

Contribution Amount

   Section 1.1

Covered Pre-Closing Covenants

   Section 11.1(c)

Current Products

   Section 5.18

Customs & International Trade Laws

   Section 1.1

Debt

   Section 1.1

Debt Financing

   Section 6.7(b)

Diligence Representative

   Section 7.4(b)

Disputed Matters

   Section 2.5(d)

Dollars

   Section 1.1

Electronic Delivery

   Section 12.17

Environmental Law

   Section 1.1

ERISA

   Section 1.1

ERISA Affiliate

   Section 5.14(b)

Estimated Adjusted Net Working Capital

   Section 2.5(a)

Estimated Closing Purchase Price

   Section 1.1

Estimated Closing Statement

   Section 2.5(a)

Estimated Company Cash

   Section 2.5(a)

Estimated Company Funded Debt

   Section 2.5(a)

Execution Date

   Preamble

Executive Contributed Shares

   Section 1.1

Executive Contribution Agreements

   Section 1.1

Financial Advisors Engagement Letters

   Section 1.1

Financial Statements

   Section 1.1

Food Laws

   Section 1.1

Fundamental Representations

   Section 1.1

GAAP

   Section 1.1

Governing Documents

   Section 1.1

Governmental Authority

   Section 1.1

Governmental Official

   Section 1.1

Hazardous Materials

   Section 1.1

HSR Act

   Section 1.1

Imperial

   Preamble

Imperial Insurance Policies

   Section 5.13

Imperial Shares

   Section 4.5

Indemnified Party

   Section 11.4(a)

 

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Indemnifying Party

   Section 11.4(a)

Intellectual Property

   Section 5.17

Inventory

   Section 1.1

IRS

   Section 5.14(a)

Knowledge

   Section 1.1

Law

   Section 1.1

Leases

   Section 1.1

Lien

   Section 1.1

Loss

   Section 1.1

Material Adverse Effect

   Section 1.1

Material Authorization

   Section 5.9

Material Contract

   Section 5.8(a)

Material Customers

   Section 5.23

Material Suppliers

   Section 5.23

Measurement Time

   Section 1.1

Non-Voting Stockholders

   Section 1.1

Notice of Disagreement

   Section 2.5(d)

OFAC

   Section 5.25(d)

Parent

   Section 1.1

Partnership Interest

   Section 1.1

Past Products

   Section 5.18

Payoff Letters

   Section 2.4(b)

Permitted Equity Lien

   Section 1.1

Permitted Lien

   Section 1.1

Person

   Section 1.1

Physical Assets

   Section 1.1

Pre-Closing Tax Period

   Section 8.5(d)

Products

   Section 5.18

Proceeding

   Section 1.1

Purchase Price

   Section 2.2

Purchase Price Adjustment

   Section 2.5(b)

Purchased Shares

   Recitals

Real Property

   Section 1.1

Repurchase Agreements

   Section 1.1

Repurchase Transactions

   Section 2.6

Repurchase Transactions Costs

   Section 1.1

Restricted Territories

   Section 1.1

Restrictive Covenants

   Section 8.8(d)

Seller Indemnitees

   Section 1.1

Sellers

   Preamble

Sellers Disclosure Schedule

   Section 1.1

Several or Severally

   Section 1.1

State Department

   Section 5.25(d)

Straddle Period

   Section 8.5(d)

Subsidiary

   Section 1.1

Target Adjusted Net Working Capital

   Section 1.1

 

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Tax

   Section 1.1

Tax Return

   Section 1.1

Termination Date

   Section 10.1(d)

Termination Fee

   Section 10.2(b)

Third Party Claim

   Section 11.4(b)

Third Person Consent

   Section 1.1

Trade Secrets

   Section 1.1

Transferred Employee

   Section 1.1

Transition Services Agreement

   Section 1.1

Valuation Firm

   Section 2.5(d)

Valuation Firm Submission Date

   Section 2.5(d)

WARN Act

   Section 5.15

 

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SALE AND PURCHASE AGREEMENT

This SALE AND PURCHASE AGREEMENT (this “Agreement”) is entered into as of
March 7, 2012 (the “Execution Date”), by and among EDWARD BILLINGTON AND SON,
LIMITED, a private limited company organized under the laws of England and Wales
(“Billington”), IMPERIAL SUGAR COMPANY, a Texas corporation (“Imperial” and,
together with Billington, the “Sellers”), and WSO INVESTMENTS, INC., a Delaware
corporation (“Buyer”), and, for the limited purposes set forth herein, WHOLESOME
SWEETENERS, INCORPORATED, a Delaware corporation (the “Company”).

RECITALS

WHEREAS, all of the issued and outstanding shares of Class A Common Stock, par
value $1.00 per share (the “Class A Stock”), of the Company, are owned by the
Sellers;

WHEREAS, pursuant to the Billington Contribution Agreement, Billington desires
to contribute at the Closing the Billington Contributed Shares in exchange for
the Partnership Interest set forth in the Billington Contribution Agreement;

WHEREAS, pursuant to their respective Executive Contribution Agreements, certain
executives (the “Contributing Executives”) desire to contribute at the Closing
their respective Executive Contributed Shares in exchange for the Partnership
Interest set forth in each such Contributing Executive’s Executive Contribution
Agreement;

WHEREAS, pursuant to the Repurchase Agreements, at or prior to the Closing, the
Company will acquire (i) except for Executive Contributed Shares, all of the
issued and outstanding shares of Class B Common Stock, par value $1.00 per share
(the “Class B Stock”), of the Company, (ii) except for Executive Contributed
Shares, all of the issued and outstanding shares of Class C Common Stock, par
value $0.01 per share (the “Class C Stock”), of the Company and (iii) all of the
issued and outstanding shares of Class D Common Stock, par value $0.01 per share
(the “Class D Stock”), of the Company;

WHEREAS, the Sellers desire to sell to Buyer, and Buyer desires to purchase from
the Sellers, all of the issued and outstanding shares of Class A Stock (the
“Class A Shares”) other than the Billington Contributed Shares (such purchased
Class A Shares, the “Purchased Shares”); and

WHEREAS, as a condition and inducement to the Sellers to enter into this
Agreement, Buyer has delivered, or caused to be delivered, to the Company and
the Sellers an equity commitment letter in an amount, subject to the terms and
condition set forth therein, equal to the Termination Fee;

NOW, THEREFORE, in consideration of the foregoing premises and the
representations, warranties and covenants contained herein, the parties hereto
agree as follows:

 

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ARTICLE I

DEFINITIONS

Section 1.1 Definitions. As used in this Agreement (including in the Recitals),
the following terms shall have the following meanings:

“Acquisition Proposal” has the meaning given such term in Section 7.8(a).

“Adjusted Current Assets” means the current assets of the Company as of the
Measurement Time, calculated in accordance with Section 2.5, and including,
without duplication, (i) accounts receivable, (ii) Inventory and (iii) prepaid
expenses and other current assets of the Company on the Balance Sheet; provided,
however, that for purposes of determining Adjusted Current Assets, the Company
Cash and all Tax assets shall be excluded.

“Adjusted Current Liabilities” means the current liabilities of the Company as
of the Measurement Time, calculated in accordance with Section 2.5, and
including, without duplication, (i) accounts payable, (ii) accrued liabilities
and (iii) liabilities accounted for as other current liabilities of the Company
on the Balance Sheet; provided, however, that, for purposes of determining
Adjusted Current Liabilities, the Company Funded Debt, the Company Transaction
Costs, the Repurchase Transactions Costs and all Tax liabilities shall be
excluded.

“Adjusted Net Working Capital” means the amount by which the Adjusted Current
Assets exceed the Adjusted Current Liabilities as such amounts are calculated in
accordance with Section 2.5 of the Sellers Disclosure Schedule.

“Affiliate” means any Person that directly, or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with the
Person specified. For purposes of this definition, “control” of a Person means
the power, direct or indirect, to direct or cause the direction of the
management and policies of such Person whether by contract or otherwise, and
ownership of greater than 40% of the voting securities of another Person shall
create a rebuttable presumption that such Person controls such other Person. For
purposes of this Agreement, Imperial and Billington are not Affiliates of each
other, and, with respect to the period of time prior to the Closing, Imperial
and Billington are each Affiliates of the Company.

“Affiliate Entities” means, with respect to any Person, any corporation,
partnership, limited liability company, joint venture or other legal entity (and
any successor to any such legal entity) of which such Person directly, or
indirectly through one or more intermediaries, controls the Person specified.
For purposes of this definition, “control” of a Person means the power, direct
or indirect, to direct or cause the direction of the management and policies of
such Person whether by contract or otherwise, and ownership of greater than 40%
of the voting securities of another Person shall create a rebuttable presumption
that such Person controls such other Person. For purposes of this Agreement,
Imperial and Billington are not Affiliate Entities of each other.

“Agreement” has the meaning given such term in the preamble of this Agreement.

“Applicable Rate” means, with respect to any period, the rate of interest quoted
in the Money Rates section in The Wall Street Journal as the Prime Rate, as in
effect from time to time during such period.

 

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“Assumed Deliveries” means the delivery of the items or the taking of the
actions contemplated by Sections 2.4(b)(iii), 2.4(b)(vii), 2.4(b)(ix),
2.4(b)(x), 9.2(d), 9.2(e) and 9.3(f).

“Authorization” means any franchise, permit, license, authorization, order,
certificate, registration, exemption, concession, approval, variance, waiver,
right or other consent or approval granted or issued by any Governmental
Authority pursuant to any Law.

“Balance Sheet” means the audited balance sheet of the Company as of
September 2, 2011 included in the Financial Statements.

“Balance Sheet Date” means September 2, 2011.

“Base Purchase Price” means $177,713,039.

“Benefit Plan” includes but is not limited to (i) any “employee benefit plan,”
as such term is defined in Section 3(3) of ERISA, (ii) any “multiemployer plan”
as defined in Section 3(37) of ERISA, (iii) any plan that would be an employee
benefit plan if it were subject to ERISA or the Code, such as foreign plans and
plans for directors, (iv) any stock bonus, stock ownership, stock option, stock
purchase, stock appreciation rights, phantom stock or other stock plan (whether
qualified or nonqualified), (v) any bonus, deferred compensation, excess
benefit, or incentive compensation plan, (vi) any severance agreement, plan,
program, policy or arrangement, (vii) any supplemental unemployment, sick leave,
long-term disability, post-retirement medical or life insurance, and (viii) any
other plan, program, policy, or arrangement providing benefits to employees.

“Billington” has the meaning given such term in the preamble of this Agreement.

“Billington Contributed Shares” means shares of Class A Stock with an aggregate
value of $26,000,000 to be contributed pursuant to the Billington Contribution
Agreement. For purposes of this definition, the value of a share of Class A
Stock shall be the portion of the Estimated Purchase Price that would be
received in cash by the holder of one share of Class A Stock which is treated as
a Purchased Share hereunder at the Closing.

“Billington Contribution Agreement” means the securities contribution agreement
between Parent and Billington providing for the contribution of the Billington
Contributed Shares to Parent, in substantially the same form as the most recent
draft provided to Billington by Buyer prior to the execution of this Agreement.

“Billington Shares” has the meaning given such term in Section 3.5.

“Breach Cure Period” has the meaning given such term in Section 10.1(g).

“Breach Notice” has the meaning given such term in Section 7.3.

“Business” means the business conducted by the Company, including the
development, marketing and selling of organic and Fair Trade Certified sweetener
products.

 

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“Business Day” means a day other than Saturday, Sunday or any day on which banks
located in Houston, Texas are authorized or obligated to close.

“Buyer” has the meaning given such term in the preamble of this Agreement.

“Buyer Indemnitees” means Buyer, its Affiliates (including the Company after the
Closing) and their respective officers, directors, employees, agents,
representatives, successors and assigns.

“Buyer Material Adverse Effect” means a material adverse effect on the ability
of Buyer to perform its obligations under this Agreement or consummate the
transactions contemplated by this Agreement.

“Buyer Plans” has the meaning given such term in Section 8.1(b).

“CERCLA” has the meaning given such term in Section 5.11(d).

“Claim” means (i) any demand, claim, complaint, notice of grievance or of the
commencement of any other Proceeding, or any other assertion of an obligation,
whether written or oral, for any Loss, specific performance, injunctive relief,
remediation or other equitable relief or (ii) any charge or notice of violation
issued by a Governmental Authority or securities exchange, in each of cases
(i) and (ii), whether or not ultimately determined to be valid.

“Class A Shares” has the meaning given such term in the Recitals of this
Agreement.

“Class A Stock” has the meaning given such term in the Recitals of this
Agreement.

“Class B Stock” has the meaning given such term in the Recitals of this
Agreement.

“Class C Stock” has the meaning given such term in the Recitals of this
Agreement.

“Class D Stock” has the meaning given such term in the Recitals of this
Agreement.

“Closing” has the meaning given such term in Section 2.3.

“Closing Condition” means each of the conditions to the Closing set forth in
ARTICLE IX.

“Closing Date” has the meaning given such term in Section 2.3.

“Closing Statement” has the meaning given such term in Section 2.5(d).

“COBRA” means the requirements of Part 6 of Subtitle B of Title I of ERISA and
Section 4980B of the Code and of any similar state Law.

“Code” means the Internal Revenue Code of 1986, as amended.

“Commerce” has the meaning given such term in Section 5.25(d).

 

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“commercially reasonable efforts” means the efforts that a commercially
reasonable Person desirous of achieving a result that is reasonably within the
contemplation of the parties on the date of this Agreement and that do not
require the performing party which is acting in good faith to take any
extraordinary action or expend any funds or assume any liabilities other than
expenditures and liabilities that are customary and reasonable in (in the case
of Buyer, private-equity-backed) transactions of the kind and nature
contemplated by this Agreement in order for the performing party to diligently
pursue and achieve that result as expeditiously as reasonably practicable, or
otherwise assist in the consummation of, the transactions contemplated hereby,
or to perform its obligations under this Agreement.

“Commitment Letters” has the meaning given such term in Section 6.7(b).

“Company” has the meaning given such term in the preamble of this Agreement.

“Company Cash” means all cash and cash equivalents of the Company as of the
Measurement Time, which shall be calculated net of any checks outstanding.

“Company Funded Debt” means, as of the Measurement Time, without duplication,
the amount of all Debt of the Company (as of the Measurement Time).

“Company Intellectual Property” has the meaning given such term in
Section 5.17(b).

“Company Officers and Representatives” means the directors of the Company
designated in writing by Buyer not less than three (3) Business Days prior to
the Closing Date.

“Company Partner Operations” means the operations and facilities of the
Company’s suppliers, co-packing partners, and other third-party manufacturing or
distribution facilities where the Company’s products are grown, produced,
packaged, stored or handled for or on behalf of the Company.

“Company Plan” means any Benefit Plan that is sponsored, maintained, or
contributed to as of the Execution Date by the Company for the benefit of its
current or former directors, officers or employees or to which the Company has
any liability or potential liability.

“Company Systems” has the meaning given such term in Section 5.17(e).

“Company Transaction” means any (i) reorganization, liquidation, dissolution or
recapitalization of the Company, (ii) merger or consolidation involving the
Company, (iii) purchase or sale of any assets or capital stock (or any rights to
acquire, or securities convertible into or exchangeable for, any such capital
stock) of the Company (other than (x) the purchase and sale of inventory and
other assets in the ordinary course of business and (y) the Repurchase
Transactions), or (iv) similar transaction or business combination involving the
Company or its business or assets, in each such case other than as contemplated
by this Agreement.

 

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“Company Transaction Costs” means, to the extent not paid by or on behalf of the
Company as of the Measurement Time, without duplication, all expenses of the
Company incurred with respect to the negotiation and execution of this Agreement
and the consummation by the Company of the transactions contemplated hereby,
including (i) all unpaid brokerage commissions, fees, expense reimbursements and
other amounts that are then due to any agent, consultant or financial, legal,
accounting or other advisor or service provider of the Company with respect to
the negotiation and execution of this Agreement and the consummation by the
Company of the transactions contemplated hereby (it being understood that the
Financial Advisors Engagement Letters are obligations of the respective Sellers,
the Company has no liability under the Financial Advisors Engagement Letters and
such obligations shall not be included in the Company Transaction Costs),
(ii) all unpaid transaction-related bonuses (including the general staff
transaction bonus described in Sections 5.4, 5.6 and 7.1(q) of the Sellers
Disclosure Schedule) or accelerated benefits payable to any officer, director,
employee, shareholder or Affiliate of the Company in connection with the
transactions contemplated hereby (other than the Repurchase Transactions Costs),
and (iii) all filing fees and expenses incurred by the Company in connection
with any filing by the Company with a Governmental Authority; provided, that,
pursuant to Section 7.2(a), Buyer shall bear 50% of any filing fees in
connection with any filing with any Governmental Authority.

“Confidential Information” means all information of a confidential or
proprietary nature (whether or not specifically labeled or identified as
“confidential”), in any form or medium, that relates to the business, products,
financial condition, services, or research or development of the Company or its
suppliers, distributors, customers, independent contractors or other business
relations. Confidential Information includes, but is not limited to, the
following: (i) internal business and financial information (including
information relating to strategic and staffing plans and practices, business,
finances, training, marketing, promotional and sales plans and practices, cost,
rate and pricing structures and accounting and business methods);
(ii) identities of, individual requirements of, specific contractual
arrangements with, and information about, the Company’s suppliers, distributors,
customers, independent contractors or other business relations and their
confidential information; (iii) Trade Secrets, know-how, compilations of data
and analyses, techniques, systems, formulae, recipes, research, records,
reports, manuals, documentation, models, data and databases relating thereto;
(iv) inventions, innovations, improvements, developments, methods, designs,
analyses, drawings, reports and all similar or related information (whether or
not patentable); and (v) other Intellectual Property. Notwithstanding the
foregoing, “Confidential Information” does not include any information (a) that
was or becomes generally available to the public other than as a result of a
breach of the covenants and agreements in Section 8.6, (b) that is independently
developed by a Seller or its Affiliates (other than the Company prior to the
Closing) without the use of Confidential Information or (c) to the extent not
primarily related to the Company (i.e., primarily related to the Company’s
suppliers, distributors, customers, independent contractors or other business
relations), that a Seller or its Affiliates receives from a third-party without
obligation of confidentiality.

“Confidentiality Agreement” means the Confidentiality Agreement, dated as of
October 6, 2011, by and between the Company and Arlon Food and Agriculture
Partners LP.

“Contributing Executives” has the meaning given such term in the Recitals of
this Agreement.

 

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“Contribution Agreements” means the Billington Contribution Agreement and the
Executive Contribution Agreements.

“Contribution Amount” means the aggregate dollar amount set forth in the
Contribution Agreements with respect to the Partnership Interests issued in
exchange for the Billington Contributed Shares and the Executive Contributed
Shares; provided, that the portion of the Contribution Amount with respect to
the Billington Contributed Shares shall be $26,000,000 and the portion of the
Contribution Amount with respect to the Executive Contributed Shares shall be an
amount equal to the aggregate amount that would otherwise be payable with
respect to the Executive Contributed Shares under the respective Repurchase
Agreements if the Executive Contributed Shares were repurchased in the
Repurchase Transactions.

“Covered Pre-Closing Covenants” has the meaning given such term in
Section 11.1(c).

“Current Products” has the meaning given such term in Section 5.18.

“Customs & International Trade Laws” means any applicable domestic Law
concerning the importation, exportation, reexportation, or deemed exportation of
products, technical data, technology and/or services, and the terms and conduct
of transactions and making or receiving of payment related to such importation,
exportation, reexportation or deemed exportation, including, but not limited to,
as applicable, the Tariff Act of 1930, as amended, and other Laws and programs
administered or enforced by Commerce, U.S. International Trade Commission, U.S.
Customs and Border Protection, U.S. Immigration and Customs Enforcement, and
their predecessor agencies; the Export Administration Regulations, including
related restrictions with regard to transactions involving persons and entities
on the Commerce Denied Persons List or Entity List; the International Emergency
Economic Powers Act, as amended; the Trading With the Enemy Act, as amended; the
embargoes and restrictions administered by OFAC; orders of the President
regarding embargoes and restrictions on transactions with designated countries
and entities, including persons and entities designated on OFAC’s list of
Specially Designated Nationals and Blocked Persons; the antiboycott regulations
administered by Commerce; and the antiboycott regulations administered by the
U.S. Department of the Treasury.

“Debt” means, for any Person as of any date of determination, without
duplication, (i) all obligations of such Person for borrowed money or in respect
of loans or advances, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all guarantees of such
Person for borrowed money obligations, (iv) the maximum amount of any
obligations (whether or not funded) in respect of letters of credit and bankers’
acceptances issued for the account of such Person, (v) capitalized lease
obligations of such Person, (vi) any obligation of such Person representing the
deferred purchase price of property or services with respect to which a Person
is liable, contingently or otherwise, as obligor or otherwise, other than trade
payables incurred in the ordinary course of business which are included in the
calculation of Adjusted Net Working Capital as finally determined, (vii) any
obligations of such Person secured by (or for which the holder of such
indebtedness has an existing right, contingent or otherwise, to be secured by) a
Lien on the assets owned or acquired by such Person whether or not such
indebtedness, liability or obligation is otherwise non-recourse to such Person,
(viii) any obligation (determined on the basis of actual, not notional,
obligations) of such Person under any interest rate swap agreement, forward rate
agreement, interest rate cap or collar agreement or

 

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other financial agreement or arrangement entered into for the purpose of
limiting or managing interest rate risks, (ix) any obligation (determined on the
basis of actual, not notional, obligations) of such Person under any hedging
arrangements (including foreign currency exchange agreements) of such Person,
(x) all obligations arising from deferred compensation arrangements (other than
such amounts related to the Repurchase Agreements), (xi) the aggregate amount of
all deferred rent owed after the Closing Date, (xii) all obligations under
conditional sale or other title retention agreements relating to property or
assets purchased by such Person, (xiii) all guaranties, endorsements,
assumptions and other contingent obligations of such Person in respect of, or to
purchase or to otherwise acquire, indebtedness for any of the foregoing or
borrowed money of others, (xiv) the employer’s share of all payroll Taxes
attributable to the transactions contemplated under this Agreement (other than
those included as Company Transaction Costs or the Repurchase Transactions
Costs, if any), (xv) all other obligations that are required to be shown as
indebtedness on a balance sheet of such Person prepared in accordance with GAAP,
and (xvi) all accrued and unpaid (as of such date of determination) interest,
fees, premiums and penalties related to any of the foregoing.

“Debt Financing” has the meaning given such term in Section 6.7(b).

“Diligence Representative” has the meaning given such term in Section 7.4(b).

“Disputed Matters” has the meaning given such term in Section 2.5(d).

“Dollars” and the symbol “$” mean the lawful currency of the United States of
America.

“Electronic Delivery” has the meaning given such term in Section 12.17.

“Environmental Law” means any applicable Law pertaining to health (with respect
to exposure to Hazardous Materials) or the environment previously or currently
in effect, including the Clean Air Act, as amended, the Comprehensive
Environmental, Response, Compensation, and Liability Act of 1980, as amended,
the Federal Water Pollution Control Act, as amended, the Resource Conservation
and Recovery Act of 1976, as amended, the Safe Drinking Water Act, as amended,
the Toxic Substances Control Act, as amended, the Hazardous & Solid Waste
Amendments Act of 1984, as amended, the Superfund Amendments and Reauthorization
Act of 1986, as amended, the Hazardous Materials Transportation Act, as amended,
the Oil Pollution Act of 1990, as amended, and any state and local Laws
implementing or comparable to the foregoing federal Laws.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“ERISA Affiliate” has the meaning given such term in Section 5.14(b).

“Estimated Adjusted Net Working Capital” has the meaning given such term in
Section 2.5(a).

“Estimated Closing Purchase Price” means an amount equal to the Base Purchase
Price, (i)(a) plus the amount by which the Estimated Adjusted Net Working
Capital exceeds the Target Adjusted Net Working Capital or (b) minus the amount
by which the Target Adjusted Net Working Capital exceeds the Estimated Adjusted
Net Working Capital, as the case may be, (ii) plus an amount equal to the
Estimated Company Cash, (iii) minus an amount equal to the Estimated Company
Funded Debt, (iv) minus an amount equal to the Company Transaction Costs,
(v) minus an amount equal to the Repurchase Transactions Costs and (vi) minus an
amount equal to the Contribution Amount.

 

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“Estimated Closing Statement” has the meaning given such term in Section 2.5(a).

“Estimated Company Cash” has the meaning given such term in Section 2.5(a).

“Estimated Company Funded Debt” has the meaning given such term in
Section 2.5(a).

“Execution Date” has the meaning given such term in the preamble of this
Agreement.

“Executive Contributed Shares” means the shares of Class B Stock and Class C
Stock to be contributed pursuant to the Executive Contribution Agreements.

“Executive Contribution Agreements” means each of the written agreements between
Parent and a Contributing Executive with respect to such Contributing
Executive’s Executive Contributed Shares, in substantially the same form as the
most recent draft provided to the Contributing Executive thereto by Buyer prior
to the execution of this Agreement.

“Financial Advisors Engagement Letters” means (i) the letter agreement, dated
August 5, 2011, by and between Billington and William Blair & Company, L.L.C.
and (ii) the letter agreement, dated September 22, 2010, by and between Imperial
and Perella Weinberg Partners LP.

“Financial Statements” means (i) the audited financial statements (including the
footnotes thereto) of the Company as of and for the fiscal years ended
September 3, 2010 (as restated) and September 2, 2011 and (ii) the unaudited
financial statements of the Company as of February 3, 2012 and for the period
from September 3, 2011 through February 3, 2012.

“Food Laws” means any applicable Law or binding agreement with any Governmental
Authority relating to or imposing standards of conduct with respect to food
quality, food safety, industrial hygiene, or the manufacture, formulation,
packaging, testing, production, packaging, transportation, distribution,
storage, marketing, advertising, promotion, labeling or sale of food and related
products, including without limitation the Federal Food, Drug and Cosmetic Act,
the Food Safety Modernization Act, the Food Conservation and Energy Act, the
Public Health Security and Bioterrorism Preparedness and Response Act of 2002,
the Food Allergen Labeling and Consumer Protection Act of 2004, the Federal
Trade Commission Act, state unfair competition and deceptive trade practices
statutes, the Organic Foods Production Act of 1990, the Sanitary Food
Transportation Act of 2005 and any analogous laws and their respective
implementing regulations, together with all facility hazard analysis plans and
programs relating to food safety.

“Fundamental Representations” means the representations and warranties in
Section 3.1(a), Section 3.2, Section 3.5, Section 3.6, Section 4.1(a),
Section 4.2, Section 4.5, Section 4.6, Section 5.1(a), Section 5.2(a) and (b),
Section 5.4, Section 6.1(a), Section 6.2 and Section 6.5.

 

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“GAAP” means accounting principles generally accepted in the United States of
America, consistently applied.

“Governing Documents” means the articles of incorporation, certificate of
incorporation, charter, bylaws, articles or certificate of formation,
regulations, limited liability company agreement, certificate of limited
partnership, partnership agreement, and all other similar documents, instruments
or certificates executed, adopted, or filed in connection with the formation,
organization or governance of a Person, including any amendments thereto.

“Governmental Authority” means any national, federal, regional, state, local,
foreign or other governmental agency, authority, administrative agency,
regulatory body, commission, instrumentality, court or arbitral tribunal having
governmental or quasi-governmental powers; provided, however, that such term
shall not include any entity or organization that is engaged in industrial or
commercial operations and is wholly or partly owned by any government.

“Government Official” means any employee or elected official of any Governmental
Authority, any candidate for any political office of any Governmental Authority
and any other individual deemed to be a government official under applicable
Law.

“Hazardous Materials” means those pollutants, contaminants, chemicals or toxic,
hazardous or petroleum hydrocarbon substances or wastes that are regulated under
or for which liability may be imposed by any applicable Environmental Laws.

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as
amended.

“Imperial” has the meaning given such term in the preamble of this Agreement.

“Imperial Insurance Policies” has the meaning given such term in Section 5.13.

“Imperial Shares” has the meaning given such term in Section 4.5.

“Indemnified Party” has the meaning given such term in Section 11.4(a).

“Indemnifying Party” has the meaning given such term in Section 11.4(a).

“Intellectual Property” means all intellectual property and other similar
proprietary rights in any jurisdiction, whether owned or held for use, including
such rights in and to: (i) registered trademarks, pending trademark
applications, common law trademarks, service marks, logos, brand names,
certification marks, trade dress, assumed names, trade names and other
indications of origin and the goodwill associated with the foregoing;
(ii) issued patents, pending patent applications, and any and all reissues,
divisions, continuations, continuations-in-part, continuing patent applications,
reexaminations, and extensions thereof, any counterparts claiming priority
therefrom, utility models, patents of importation/confirmation, certificates of
invention, certificates of registration and like rights, and inventions,
invention disclosures, discoveries and improvements, whether or not patentable;
(iii) copyrights; (iv) any information, including a formula, pattern,
compilation, database, computer code or program, device, method, know-how,
technique, or process that falls with the definition of a trade secret as set
forth in the Uniform Trade Secrets Act, regardless of the form or format in
which the trade secrets are embodied (collectively, “Trade Secrets”);
(v) intellectual property rights in computer code (e.g., object code and source
code) and other computer software and documentation related to such code or
software; and (vi) domain names and uniform resource locators.

 

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“Inventory” means inventory owned by the Company, including raw materials,
products or work in-process, finished products, supplies and other inventories,
wherever located, including whether in transit, and whether in the possession of
the Company, its third Person warehousemen, manufacturers and distributors or
any other Person.

“IRS” has the meaning given such term in Section 5.14(a).

“Knowledge” means, in the case of (i) Billington, (ii) Imperial and (iii) the
Sellers collectively, the actual knowledge of the individuals listed in the
respective subsections of Part I of Exhibit A, in their capacities as directors,
officers or employees of the Sellers or the Company, together with such
knowledge that an individual in a similar position would reasonably be expected
to have, and, in the case of Buyer, the actual knowledge of the individuals
listed on Part II of Exhibit A, in their capacities as directors, officers or
employees of Buyer or any of its Affiliates, together with such knowledge that
an individual in a similar position would reasonably be expected to have.

“Law” means any applicable law, common law, statute or ordinance of any nation
or state, including the United States of America, and any political subdivision
thereof, including any state of the United States of America, any regulation,
policy, protocol, proclamation or executive order promulgated by any
Governmental Authority, any rule or regulation of any self-regulatory
organization such as a securities exchange, or any applicable judgment, order,
decree or decision of any court or other Governmental Authority having the
effect of law in any such jurisdiction.

“Leases” means all leases or subleases pursuant to which the Company holds any
leased Real Property.

“Lien” means any mortgage, pledge, security interest, lien (statutory or
otherwise), deed of trust, deed of charge, floating charge or other charge of
any kind, any conditional sale or other title retention agreement, security
agreement, voting agreement, encumbrance or the filing of or agreement to give
any security interest, charge or financing statement under the Laws of any
jurisdiction.

“Loss” means, subject to Section 11.5, Section 11.6 and Section 11.7, all
damages, dues, penalties, fines, costs, amounts paid in settlement, liabilities,
obligations, Taxes, Liens, losses, expenses, interest and fees, including
reasonable costs of investigation, court costs, costs of defense, costs of
settlement and reasonable attorneys’ and other professionals’ fees and expenses.

“Material Adverse Effect” means a material adverse effect on the business,
properties, financial condition or results of operations of the Company;
provided, however, that in no event shall any effect that results from any of
the following be deemed to constitute a Material Adverse Effect: (a) this
Agreement, any actions required to be taken by this Agreement or the
transactions contemplated this Agreement, (b) changes or conditions affecting
the North American sweetener

 

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industry generally or regionally, (c) changes in general economic, capital
markets, regulatory or political conditions in the United States or elsewhere
(including interest rate fluctuations), (d) changes or proposed changes after
the date hereof in Laws (including the United States sugar program and the North
American Free Trade Agreement) or GAAP or regulatory accounting requirements or
interpretations thereof, (e) fluctuations in currency exchange rates, (f) acts
of war, insurrection, sabotage, terrorism, earthquakes, hurricanes, tornados or
other natural disasters, (g) the Company’s failure to meet financial projections
(it being understood and agreed that any underlying cause to such failure may be
taken into account in determining whether there has been a Material Adverse
Effect); except, in the case of the foregoing clauses (b) and (c), for any
change that has a disproportionate effect on the Company as compared to a Person
of similar size engaged in the North American sweetener industry.
Notwithstanding the foregoing, for purposes of this Agreement, a Material
Adverse Effect will be deemed to have occurred, (i) in the event of the
departure or indictment of, or the Company’s right to terminate for cause, Nigel
Willerton or Jeff Seidel or (ii) except in the case of the foregoing clause (i),
if and only if such effect has caused, will cause, or may reasonably be expected
to cause, (x) any Loss to the Company, individually or in the aggregate, in
excess of $10,000,000 or (y) any decrease in EBITDA of the Company for the
twelve-month period ending March 31, 2013 in excess of $3,500,000 relative to
the EBITDA of the Company that would reasonably have been expected for such
period as of the date hereof, it being agreed and understood that any events or
factors that would be expected to increase EBITDA for such twelve-month period
shall be taken into account in determining whether there has been a Material
Adverse Effect under this clause (y).

“Material Authorization” has the meaning given such term in Section 5.9.

“Material Contract” has the meaning given such term in Section 5.8(a).

“Material Customers” has the meaning set forth in Section 5.23.

“Material Suppliers” has the meaning set forth in Section 5.23.

“Measurement Time” means 12:01 A.M., Houston, Texas time, on the Closing Date.

“Non-Voting Stockholders” means Pauline McKee, Jeff Seidel, Nigel Willerton, Jim
Davet, Walter Nimocks, Edward Billington, Mark Cashin, David Marshall and Lloyd
Whiteley.

“Notice of Disagreement” has the meaning given such term in Section 2.5(d).

“OFAC” has the meaning given such term in Section 5.25(d).

“Parent” means WSO Holdings, LP, a Delaware limited partnership.

“Parent Equity Documents” means the limited partnership agreement,
securityholders agreement and registration rights agreement of Parent, in each
case in substantially the same form as the most recent draft provided to
Billington by Buyer prior to the execution of this Agreement but subject to
revisions to address comments from co-investors so long as such revisions would
not adversely affect any right granted to Billington in, or change the tax
treatment of Billington’s investment in Parent under, the most recent draft
provided to Billington by Buyer prior to the execution of this Agreement.

 

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“Partnership Interest” has the meaning given such term in the limited
partnership agreement of Parent.

“Past Products” has the meaning given such term in Section 5.18.

“Permitted Equity Lien” means: (i) transfer restrictions under federal and state
securities Laws and under the Company’s Bylaws; (ii) Liens caused or created by
Buyer; and (iii) Liens arising under this Agreement.

“Permitted Lien” means:

(i) inchoate Liens and charges imposed by Law and incidental to the
construction, maintenance, development or operation of the Company’s properties
or the operation of the Business, if payment of the obligation secured thereby
is not yet overdue or if the validity or amount of which is being contested in
good faith by the Company and such payment obligation is includable in Adjusted
Net Working Capital;

(ii) Liens for Taxes, assessments, obligations under workers’ compensation,
unemployment insurance or other social welfare legislation or other similar
requirements, charges or levies of any Governmental Authority, in each case not
yet overdue, or which are being contested in good faith by the Company;

(iii) easements, servitudes, leases, rights-of-way and other rights, exceptions,
reservations, conditions, limitations, covenants and other restrictions that do
not materially interfere with the operation, value, occupancy or use of the
Physical Assets affected thereby;

(iv) defects or irregularities in title to real properties which do not
materially (A) diminish the value of any of the related surface estates or
(B) interfere with the ordinary conduct or operation of business, occupancy or
the use of any of such properties;

(v) customary provisions contained in any contracts or agreements affecting
properties under which the Company is required immediately before the
expiration, termination or abandonment of a particular property to reassign to
such Person’s predecessor in title all or a portion of such Person’s rights,
titles and interests in and to all or a portion of such property;

(vi) Liens to secure the performance of bids, tenders, trade or government
contracts (other than for repayment of borrowed money), licenses, statutory
obligations, surety bonds, performance bonds, completion bonds or as otherwise
incurred in the ordinary course of business set forth on Section 1.1(a)(vi) of
the Sellers Disclosure Schedule;

 

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(vii) any Liens consisting of (A) statutory landlord’s liens under Leases to
which the Company is a party or other Liens on leased property reserved in
leases thereof for rent or for compliance with the terms of such leases,
(B) rights reserved to or vested in any Governmental Authority to control or
regulate any property of the Company, or to limit the use of such property in
any manner which does not materially impair the use, occupancy or operation of
such property for the purposes for which it is held by the Company, or
(C) zoning or other land use ordinances of any Governmental Authority which are
not violated by the current use, occupancy or operation by the Company of any of
the properties and assets;

(vii) Liens in respect of judgments or awards with respect to which an appeal or
other proceeding for review is being prosecuted and with respect to which a stay
of execution pending such appeal or such proceeding for review has been obtained
set forth on Section 1.1(a)(vii) of the Sellers Disclosure Schedule;

(viii) Liens of carriers, warehousemen, mechanics, laborers and materialmen and
similar charges incidental to the construction, maintenance, development or
operation of any of the properties or assets of the Company incurred in the
ordinary course of business that are (A) not yet overdue as of the Closing Date,
(B) includable in Adjusted Net Working Capital and (C) either not filed of
record or not delinquent or filed of record but are being contested in good
faith by the Company;

(ix) Liens that will be paid in full or released on or prior to the Closing;

(x) Liens caused or created by Buyer; and

(xi) Liens set forth on Section 1.1(a)(xi) of the Sellers Disclosure Schedule.

“Person” means an individual, partnership, limited liability company,
corporation, joint stock company, trust, estate, joint venture, association or
unincorporated organization, or any other form of business or professional
entity.

“Physical Assets” means the Real Property and all other material tangible assets
and properties of the Company.

“Pre-Closing Tax Period” has the meaning given such term in Section 8.5(d).

“Products” has the meaning given such term in Section 5.18.

“Proceeding” means any action, case, suit, investigation, hearing, audit,
examination, order, condemnation, expropriation or other proceeding (including
regulatory or administrative proceedings) at law or in equity, commenced,
brought, conducted or heard by or before, any Governmental Authority, or any
mediator, arbitrator or board of arbitration.

“Purchase Price” has the meaning given such term in Section 2.2.

“Purchase Price Adjustment” has the meaning given such term in Section 2.5(b).

“Purchased Shares” has the meaning given such term in the Recitals of this
Agreement.

 

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“Real Property” means the real property owned, leased or subleased by the
Company or other interest in real property held by the Company as described in
Section 1.1(b) of the Sellers Disclosure Schedule, together with all buildings
and other structures, facilities or improvements currently or hereafter located
thereon, all fixtures, systems, equipment and items of personal property
attached or appurtenant thereto and all easements, licenses, rights, interests
and appurtenances relating to the foregoing.

“Repurchase Agreements” means (i) the Amended and Restated Repurchase Agreement
and Limited Power of Attorney, effective as of July 14, 2008, by and among the
Company, Billington, Imperial and Pauline McKee, (ii) the Amended and Restated
Repurchase Agreement and Limited Power of Attorney, effective as of July 14,
2008, by and among the Company, Billington, Imperial and Jeff Seidel, (iii) the
Amended and Restated Repurchase Agreement and Limited Power of Attorney,
effective as of July 14, 2008, by and among the Company, Billington, Imperial
and Nigel Willerton, (iv) the Repurchase Agreement and Limited Power of
Attorney, effective as of September 26, 2008, by and among the Company,
Billington, Imperial and Pauline McKee, (v) the Repurchase Agreement and Limited
Power of Attorney, effective as of September 26, 2008, by and among the Company,
Billington, Imperial and Jeff Seidel, (vi) the Repurchase Agreement and Limited
Power of Attorney, effective as of September 26, 2008, by and among the Company,
Billington, Imperial and Nigel Willerton, (vii) the Repurchase Agreement and
Limited Power of Attorney, effective as of September 26, 2008, by and among the
Company, Billington, Imperial and Jim Davet, (viii) the Repurchase Agreement and
Limited Power of Attorney, effective as of September 26, 2008, by and among the
Company, Billington, Imperial and Walter Nimocks, (ix) the Repurchase Agreement
and Limited Power of Attorney, effective as of April 1, 2010, by and among the
Company, Billington, Imperial and Edward Billington, (x) the Repurchase
Agreement and Limited Power of Attorney, effective as of April 1, 2010, by and
among the Company, Billington, Imperial and Mark Cashin, (xi) the Repurchase
Agreement and Limited Power of Attorney, effective as of April 1, 2010, by and
among the Company, Billington, Imperial and David Marshall and (xii) the
Repurchase Agreement and Limited Power of Attorney, effective as of April 1,
2010, by and among the Company, Billington, Imperial and Lloyd Whiteley.

“Repurchase Transactions” has the meaning given such term in Section 2.6.

“Repurchase Transactions Costs” means the aggregate amount to be paid by the
Company to the Non-Voting Stockholders in connection with the consummation of
the Repurchase Transactions. For avoidance of doubt, no amounts will be paid by
the Company to the Non-Voting Stockholders for repurchase of any Executive
Contributed Shares.

“Restricted Territories” means Canada, Mexico and the United States.

“Restrictive Covenants” has the meaning given such term in Section 8.8(d).

“Seller Indemnitees” means the Sellers, their Affiliates and their respective
officers, directors, employees, agents, representatives (including any officers,
directors, employees, agents or representatives of the Company appointed or
otherwise acting at the direction of the Sellers or their Affiliates),
successors and assigns.

“Sellers” has the meaning given such term in the preamble of this Agreement.

 

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“Sellers Disclosure Schedule” means the disclosure schedule delivered by the
Sellers to Buyer at the execution of this Agreement. The Sellers Disclosure
Schedule has been arranged in sections corresponding to the numbered Sections of
this Agreement.

“Several” or “Severally” means Billington’s or Imperial’s, as applicable, pro
rata portion of any representation, warranty, covenant or indemnification Claim,
in accordance with its respective ownership of the Class A Shares at the
execution of this Agreement.

“State Department” has the meaning given such term in Section 5.25(d).

“Straddle Period” has the meaning given such term in Section 8.5(d).

“Subsidiary” means, with respect to any Person, any corporation, partnership,
limited liability company, joint venture or other legal entity (and any
successor to any such legal entity) of which such Person owns, directly or
indirectly, more than 50% of the stock or other equity or partnership interests
the holders of which are generally entitled to vote for the election of the
board of directors or other governing body of such corporation, partnership,
limited liability company, joint venture or other legal entity.

“Target Adjusted Net Working Capital” means $70,460,576.

“Tax” means any federal, state, local, or non-U.S. income, profits, franchise,
withholding, ad valorem, employment, social security, disability, occupation,
wage, estimated, unclaimed property, property, severance excise tax, or other
tax of any kind whatsoever, together with any interest and penalties with
respect thereto, imposed by or on behalf of any Governmental Authority.

“Tax Audit” means any audit, assessment, adjustment, claim, examination or other
proceeding with respect to Taxes.

“Tax Return” means any return, declaration, report, claim for refund or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.

“Termination Date” has the meaning given such term in Section 10.1(d).

“Termination Fee” has the meaning given such term in Section 10.2(b).

“Third Party Claim” has the meaning given such term in Section 11.4(b).

“Third Person Consent” means any approval, consent, amendment or waiver of a
Person that is required under any Governing Document of the Sellers, the Company
or Buyer or under any contract to which any of the Sellers, the Company or Buyer
is a party or by which it or its assets is bound in order to effect the
transactions contemplated hereby or any part thereof, including waivers and
consents by lenders and waivers of transfer restrictions.

 

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“Transferred Employee” means an employee of the Company immediately before the
Closing Date who continues as an employee of the Company or becomes an employee
of Buyer or any of its Affiliates on or after the Closing Date.

“Transition Services Agreement” means the Transition Services Agreement, in
substantially the same form attached hereto as Exhibit B, to be entered into by
and between Imperial and the Company at the Closing.

“Valuation Firm” has the meaning given such term in Section 2.5(d).

“Valuation Firm Submission Date” has the meaning given such term in
Section 2.5(d).

“WARN Act” has the meaning given such term in Section 5.15.

Section 1.2 Construction. Whenever the context requires, the gender of all words
used in this Agreement includes the masculine, feminine and neuter. Terms
defined in the singular have the corresponding meanings in the plural, and vice
versa. All references to Articles and Sections refer to articles and sections of
this Agreement, and all references to Exhibits refer to exhibits to this
Agreement, which are attached hereto and made a part hereof for all purposes.
The word “or” is not exclusive, and the word “including” means “including, but
not limited to.” The words “hereof,” “hereby,” “herein,” “hereunder” and similar
terms in this Agreement shall refer to this Agreement as a whole and not any
particular section or article in which such words appear. Any reference to a Law
shall include any amendment thereof or any successor thereto and any rules and
regulations promulgated thereunder, all as in effect as of the Execution Date.
Currency amounts referenced herein, unless otherwise specified, are in Dollars.
Whenever this Agreement refers to a number of days, such number shall refer to
calendar days unless Business Days are specified. The phrases “made available to
Buyer” or “delivered to Buyer” or similar phrases as used in ARTICLE V and
Section 7.1 will mean that the subject documents were posted to the “Project
Earth” data room at https://services.intralinks.com prior to, and remain
accessible to Buyer on, the date that is one day prior to the date of this
Agreement.

ARTICLE II

SALE AND PURCHASE

Section 2.1 Transfer of Purchased Shares. Subject to and in accordance with the
terms and conditions of this Agreement, the Sellers agree to sell, assign,
transfer, convey and deliver the Purchased Shares to Buyer, and Buyer agrees to
purchase and accept the Purchased Shares from the Sellers, free and clear of all
Liens other than Permitted Equity Liens, for the consideration specified in
Section 2.2.

Section 2.2 Purchase Price. The aggregate purchase price for the Purchased
Shares is the Base Purchase Price, (a)(i) plus the amount by which the Adjusted
Net Working Capital exceeds the Target Adjusted Net Working Capital or
(ii) minus the amount by which the Target Adjusted Net Working Capital exceeds
the Adjusted Net Working Capital, as the case may be, (b) plus an amount equal
to the Company Cash, (c) minus an amount equal to the Company Funded Debt,
(d) minus an amount equal to the Company Transaction Costs, (e) minus an amount
equal to the Repurchase Transactions Costs and (f) minus the Contribution Amount
(collectively, the “Purchase Price”).

 

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Section 2.3 Closing; Closing Date. The closing of the transactions contemplated
by this Agreement (the “Closing”) shall take place at the offices of Baker Botts
L.L.P. in Houston, Texas, or at such other place as Buyer and the Sellers may
mutually agree, at 9:00 A.M. Central time on the tenth Business Day after the
day on which the last to be fulfilled of the Closing Conditions (other than
Closing Conditions to be fulfilled at the Closing) is fulfilled or waived by the
relevant party hereto or at such other date as the Sellers and Buyer may
mutually agree (the “Closing Date”).

Section 2.4 Deliveries at the Closing.

(a) At the Closing, Buyer shall:

(i) deliver to the Sellers the certificates referred to in Section 9.2(a) and
Section 9.2(b);

(ii) pay or cause to be paid, by wire transfer of immediately available funds to
the account or accounts designated in the Payoff Letters, the amounts set forth
in the Payoff Letters;

(iii) pay to the Sellers, by wire transfer of immediately available funds to an
account or accounts designated by the Sellers, the Estimated Closing Purchase
Price;

(iv) pay to the Company, by wire transfer of immediately available funds to an
account or accounts designated by the Company, an amount equal to the sum of
(x) the Company Transaction Costs, (y) the Repurchase Transactions Costs and
(z) the Company Funded Debt (other than Debt paid as contemplated by
Section 2.4(a)(ii) above);

(v) deliver to Billington, the Billington Contribution Agreement and the Parent
Equity Documents executed by Parent and WSO Holdings, LLC, a Delaware limited
liability company; and

(vi) accept the certificates representing the Purchased Shares from the Sellers.

(b) At the Closing, the Sellers shall deliver, or cause to be delivered, to
Buyer:

(i) the certificates referred to in Section 9.3(a) and Section 9.3(b);

(ii) certificates representing the Purchased Shares, free and clear of all Liens
other than Permitted Equity Liens, which certificates shall be duly endorsed in
blank (or accompanied by duly executed stock powers);

(iii) evidence of the consummation of the Repurchase Transactions that includes
a release, reasonably satisfactory to Buyer and the Sellers, from each
Non-Voting Stockholder of each of the Sellers and the Company;

 

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(iv) Billington shall deliver the Billington Contribution Agreement and the
Parent Equity Documents executed by Billington;

(v) Imperial shall deliver the Transition Services Agreement executed by
Imperial and the Company;

(vi) to the extent not in the Company’s possession, the minute books and other
corporate records of the Company;

(vii) executed resignation letters of (or resolutions removing) the Company
Officers and Representatives from their respective positions with the Company;

(viii) a certificate, in form and substance as required under Treasury
Regulation Section 1.897-2(h), of the Company certifying that the Class A
Shares, Class B Stock, Class C Stock, and Class D Stock are not United States
real property interests for purposes of Section 1445 of the Code, together with
evidence reasonably satisfactory to Buyer that the Company will provide notice
to the Internal Revenue Service in accordance with the provisions of Treasury
Regulation Section 1.897-2(h)(2) or (4); provided the Buyer’s sole remedy if the
Company fails to provide such certificate shall be to make the appropriate
withholding under Sections 897 and 1445 of the Code;

(ix) evidence of releases of all Liens (other than any Permitted Liens) relating
to the assets and properties of the Company with respect to the Company Funded
Debt identified on the Payoff Letters;

(x) payoff letters with respect to all Company Funded Debt listed on
Section 2.4(b)(x) of the Sellers Disclosure Schedule (in each case on terms and
conditions reasonably satisfactory to Buyer) (the “Payoff Letters”), as well as
UCC-3 termination statements, mortgage releases, terminations of landlord
waivers, bailee waivers, account control agreements and any other documents
required to evidence the Lien releases with respect to such Company Funded Debt,
in each case in recordable form;

(xi) copies of the Third Person Consents listed on Section 9.3 of the Sellers
Disclosure Schedule (in each case in substantially the same form as the form of
consent delivered by Buyer to the Sellers pursuant to Section 7.4(b));

(xii) evidence of the termination of (A) the Stock Purchase Agreement, dated as
of July 14, 2008, by and among Imperial, Billington and the Company and (B) the
Formation and Operating Agreement, dated as of June 22, 2001, by and among
Imperial, Billington and Wholesome Sweeteners, LLC, a Florida limited liability
company, as amended, in each case with no post-termination liability to or
obligation of the Company;

 

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(xiii) certified copies of the resolutions of each Seller’s boards of directors
authorizing the execution, delivery and performance of this Agreement and the
other agreements contemplated hereby and the consummation of the transactions
contemplated hereby and thereby;

(xiv) good-standing certificates for the Company from its jurisdiction of
incorporation and each jurisdiction in which the Company is qualified to do
business as a foreign corporation, in each case dated as of a recent date prior
to or on the Closing Date; and

(xv) such other documents or instruments as are required to be delivered by
Sellers or the Company at the Closing pursuant to the terms hereof.

(c) At the Closing, the Company shall consummate the Repurchase Transactions and
shall deliver, or cause to be delivered, to Buyer and the Sellers, evidence of
the consummation of the Repurchase Transactions. The Company shall be
responsible to pay all Company Transaction Costs.

Section 2.5 Purchase Price Adjustment.

(a) The Sellers shall deliver a notice to Buyer at least three Business Day
prior to the reasonably anticipated Closing Date (the “Estimated Closing
Statement”), including (i) the Sellers’ reasonable good faith estimates,
determined in accordance with the procedures described in Section 2.5 of the
Sellers Disclosure Schedule, (A) the amount by which Adjusted Current Assets
will exceed Adjusted Current Liabilities or Adjusted Current Liabilities will
exceed Adjusted Current Assets, as the case may be (the “Estimated Adjusted Net
Working Capital”), (B) the amount of the Company Cash (the “Estimated Company
Cash”), (C) the amount of the Company Funded Debt (the “Estimated Company Funded
Debt”), (ii) the amount of the Company Transaction Costs, (iii) the amount of
the Repurchase Transactions Costs, (iv) the amount of the Contribution Amount
and (v) the resulting calculation of the Estimated Closing Purchase Price. The
Sellers shall consider in good faith any revisions to the Estimated Closing
Statement requested or proposed by Buyer, and any such revisions that are
mutually agreed to in writing by Buyer and Sellers prior to the Closing shall be
deemed to be incorporated into the Estimated Closing Statement for all purposes
in this Agreement.

(b) If the Purchase Price as finally determined pursuant to this Section 2.5 is
greater than the Estimated Closing Purchase Price, Buyer shall make an
additional payment to the Sellers in an amount equal to the amount by which the
Purchase Price, as calculated in accordance with this Section 2.5, exceeds the
Estimated Closing Purchase Price, together with interest thereon at the
Applicable Rate from and including the Closing Date to but excluding the date of
payment, which payment shall be made by wire transfer of immediately available
funds on or before the fifth Business Day after the final determination of the
Purchase Price Adjustment in accordance with this Section 2.5. If the Purchase
Price as finally determined pursuant to this Section 2.5 is less than the
Estimated Closing Purchase Price, the Sellers shall make a payment to Buyer in
an amount equal to the amount by which the Estimated Closing Purchase Price
exceeds the Purchase Price, as calculated in accordance with this Section 2.5,
together with interest thereon at the Applicable Rate from and including the
Closing Date to but excluding the date of payment, which payment shall be made
by wire transfer of immediately available funds on or before the fifth Business
Day after the final determination of the Purchase Price Adjustment in accordance
with this Section 2.5. The payment to be made by Buyer or by the Sellers, as
applicable, is herein called the “Purchase Price Adjustment.”

 

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(c) Except as otherwise expressly provided in Section 2.5 of the Sellers
Disclosure Schedule, or in the definitions of Adjusted Current Assets, Adjusted
Current Liabilities, Company Cash, Company Funded Debt, Company Transaction
Costs and Repurchase Transactions Costs, the items included in the components of
Adjusted Current Assets, Adjusted Current Liabilities, Company Cash, Company
Funded Debt, Company Transaction Costs and Repurchase Transactions Costs shall
be determined, and the amounts of such items shall be calculated, in a manner
consistent with GAAP and, to the extent consistent with GAAP, in the same manner
as the corresponding line items were determined and calculated, and using the
same policies, practices, assumptions, procedures, classifications, methods,
estimates and judgments as were used, in preparing the Balance Sheet.

(d) Buyer shall prepare and deliver to the Sellers a statement (the “Closing
Statement”) setting forth the proposed Purchase Price, together with supporting
calculations and information, on or before the 60th day after the Closing Date.
The Sellers shall cooperate as reasonably requested in connection with the
preparation of the Closing Statement. In the event Buyer or the Company
conducts, or engages a third Person to conduct, an inspection or measurement of
the Inventory during the 60-day period after the Closing Date in connection with
the preparation of the Closing Statement, then Buyer or the Company, as the case
may be, shall give the Sellers no less than five Business Days notice of such
inspection or measurement, and the Sellers shall be permitted to have
representatives present to observe any such inspection or measurement. From the
date of receipt of the Closing Statement through the final determination of the
Purchase Price in accordance with this Section 2.5(d), Buyer shall cause the
Company and its employees to give the Sellers and their advisors reasonable
access at all reasonable times to the personnel, properties and books and
records of the Company and Buyer’s working papers for the purpose of conducting
the physical inventory and determining the Purchase Price. Unless the Sellers
give written notice (a “Notice of Disagreement”) to Buyer on or before the 15th
day after the Sellers’ receipt of the Closing Statement that the Sellers dispute
the proposed Purchase Price specified in the Closing Statement, the Purchase
Price shall be as specified in the Closing Statement. Any Notice of Disagreement
shall specify in reasonable detail the nature and dollar amount of any
disagreement so asserted. If the Sellers give a Notice of Disagreement to Buyer
on or before such 15th day that they dispute the proposed Purchase Price
specified in the Closing Statement, the Sellers and Buyer shall consult in good
faith and use commercially reasonable efforts to agree upon the calculation of
the Purchase Price. Following the delivery of a Notice of Disagreement and until
the final determination of the Purchase Price in accordance with this
Section 2.5(d), Buyer and its advisors shall be permitted to review the Sellers’
working papers supporting the Sellers’ disagreement with the Closing Statement
for the limited purposes of evaluating and resolving any of the items identified
in such Notice of Disagreement. If by the 30th day after the Sellers’ receipt of
the Closing Statement (the “Valuation Firm Submission Date”) the Sellers and
Buyer have not agreed on the Purchase Price, the parties shall submit such
matters as remain in dispute (and only such matters) (the “Disputed Matters”) to
Duff & Phelps Corporation and, if Duff & Phelps Corporation is either unable or
unwilling to act as an appraiser, Houlihan Lokey, Inc., or such other valuation
firm as the Sellers and Buyer shall agree (the “Valuation Firm”), for final
resolution, which resolution shall be binding upon the Sellers and Buyer, and
judgment upon which may be entered in any court having jurisdiction over the

 

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party against which such determination is sought to be enforced; provided that
either party can exclude any Valuation Firm if it determines in its good faith
discretion at the time of engagement of the Valuation Firm that such Valuation
Firm is not independent from the other party(ies). The fees and expenses of the
Valuation Firm for its services in resolving the Disputed Matters shall be
allocated between the Sellers and Buyer based upon the relative success (in
terms of percentages) of such party’s claims.

(e) The procedure and schedule under which the Disputed Matters shall be
submitted to the Valuation Firm shall be as follows:

(i) Within fifteen (15) days following the Valuation Firm Submission Date, the
Sellers shall submit the Disputed Matters to the Valuation Firm in writing (with
a copy to Buyer), supported by any documents or affidavits upon which the
Sellers rely.

(ii) Within fifteen (15) days following the Sellers’ submission of the Dispute
Matters as specified in subclause (i) above, Buyer shall submit its response to
the Valuation Firm in writing (with a copy to the Sellers), supported by any
documents or affidavits upon which it relies.

(iii) The parties shall cooperate with the Valuation Firm during the term of its
engagement. The Valuation Firm shall deliver its written opinion within twenty
(20) days following its receipt of the information provided for in
subclause (ii) above, or such longer period of time as the Valuation Firm
determines is necessary, but not to exceed thirty (30) days. The scope of the
disputes to be resolved by the Valuation Firm is limited to the Disputed
Matters. The parties shall instruct the Valuation Firm not to assign a value to
any item in dispute greater than the greatest value for such item assigned by
Buyer, on the one hand, or Sellers, on the other hand, or less than the smallest
value for such item assigned by Buyer, on the one hand, or Sellers, on the other
hand. The Valuation Firm’s determination shall be made in accordance with the
procedures described in this Section 2.5 and Section 2.5 of the Sellers
Disclosure Schedule. The materials to be reviewed by the Valuation Firm shall be
limited to (1) the Closing Statement and (2) the documents and affidavits
submitted by the parties to the Valuation Firm pursuant to subclauses (i) and
(ii) above.

Section 2.6 Repurchase Transactions. In connection with the Closing, the Company
shall repurchase from each of the Non-Voting Stockholders all of the issued and
outstanding shares of Class B Stock, Class C Stock and Class D Stock held by the
Non-Voting Stockholders other than the Executive Contributed Shares, in each
case in accordance with the terms of the respective Repurchase Agreements
(collectively, the “Repurchase Transactions”).

Section 2.7 Tax Withholding.

(a) Notwithstanding anything in this Agreement to the contrary, the Company
shall be entitled to deduct and withhold from the consideration otherwise
payable to any Person pursuant to this Agreement such employer and/or dividend
withholding amounts, if any, as it is required to deduct and withhold with
respect to the making of such payment under any provision of applicable Law
provided that notice shall be given in advance of any such employer and/or
dividend withholding and provided further, however, that no notice shall be
required for the Company to withhold upon any payments made pursuant to this
Agreement that are in the nature of compensation. To the extent the Company
withholds any such amounts, such amounts shall be treated for all purposes of
this Agreement as having been paid to the applicable Person in respect of which
such deduction and withholding was made.

 

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(b) Notwithstanding anything in this Agreement to the contrary, pursuant to and
on the conditions set forth in Section 2.4(b)(viii), the Buyer shall be entitled
to deduct and withhold from the consideration otherwise payable to any Seller
pursuant to this Agreement such withholding amounts as it is required to deduct
and withhold with respect to the making of such payment under Sections 897 and
1445 of the Code. To the extent the Buyer withholds any such amounts, such
amounts shall be treated for all purposes of this Agreement as having been paid
to the applicable Person in respect of which such deduction and withholding was
made.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF BILLINGTON

Except as set forth in the Sellers Disclosure Schedule, which exceptions shall
be deemed to be part of the representations and warranties made hereunder,
Billington hereby represents and warrants to Buyer as follows:

Section 3.1 Organization and Qualification.

(a) Billington is a private limited company, duly organized and validly existing
and in good standing under the Laws of England and Wales. Billington has the
requisite private limited company power and authority to carry on its business
as it is now being conducted.

(b) Billington is duly qualified as a foreign private limited company and in
good standing in each jurisdiction where the character of its properties owned
or held under lease or the nature of its activities makes such qualification
necessary, except where the failure to be so qualified would not, individually
or in the aggregate, reasonably be expected to have a material adverse effect
with respect to Billington and its Subsidiaries taken as a whole.

Section 3.2 Due Authority. Billington has full private limited company power and
authority to execute and perform this Agreement and to carry out the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement and all of the other agreements and instruments contemplated
hereby to which Billington is a party have been duly authorized by Billington,
and no other act or proceeding on the part of Billington or its governing body
is necessary to authorize the execution, delivery or performance of this
Agreement or the other agreements contemplated hereby and the consummation of
the transactions contemplated hereby or thereby. This Agreement has been duly
and validly executed by Billington and, assuming the due authorization,
execution and delivery of this Agreement by Imperial and Buyer, constitutes the
legal, valid and binding obligation of Billington enforceable in accordance with
its terms, except as enforcement may be limited by bankruptcy, insolvency or
other similar Laws affecting the enforcement of creditors’ rights generally and
except that the availability of equitable remedies, including specific
performance, is subject to the discretion of the court before which any
proceeding therefor may be brought.

 

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Section 3.3 Conflicts and Approvals. Except for the receipt of the Third Person
Consents set forth in Section 3.3 of the Sellers Disclosure Schedule, neither
the execution and delivery by Billington of this Agreement nor the performance
by Billington of its obligations hereunder will violate or breach the terms of
or cause a default under (a) any Law applicable to Billington, (b) the Governing
Documents of Billington, or (c) any contract or agreement to which Billington is
a party or by which it or any of its properties or assets is bound, except for
any matters described in this Section 3.3 that would not reasonably be expected
to have a Material Adverse Effect or materially and adversely affect the ability
of Billington to perform its obligations under this Agreement. Billington is not
a party to or bound by any written or oral agreement or understanding with
respect to a Company Transaction other than this Agreement, and Billington has
terminated all discussions with third parties (other than Buyer and its
Affiliates) regarding Company Transactions.

Section 3.4 Proceedings. As of the Execution Date, there are no Proceedings
pending for which Billington has received service of process or otherwise
written notice or, to the Knowledge of Billington, otherwise pending or
threatened against Billington, except any that, individually or, with respect to
multiple Proceedings that allege similar theories of recovery based on similar
facts, in the aggregate, would not reasonably be expected to materially and
adversely affect the ability of Billington to perform its obligations under this
Agreement.

Section 3.5 Ownership of the Class A Shares. Billington is the record owner of
25,000 shares of Class A Stock, representing 50% of the Class A Shares (the
“Billington Shares”). Except as set forth in Section 3.5 of the Sellers
Disclosure Schedule, Billington owns the Billington Shares free and clear of any
Liens, other than Permitted Equity Liens. Notwithstanding anything set forth in
Section 3.5 of the Sellers Disclosure Schedule, (i) upon the occurrence of the
Closing, the delivery of the Billington Shares (other than the Billington
Contributed Shares) to Buyer in accordance with the terms of this Agreement will
transfer good and marketable title to such Billington Shares free and clear of
any Liens, other than Permitted Equity Liens and (ii) upon the occurrence of the
closing of the transactions contemplated by the Billington Contribution
Agreement, the delivery of the Billington Contributed Shares to Parent in
accordance with the terms of the Billington Contribution Agreement will transfer
good and marketable title to such Billington Contributed Shares free and clear
of any Liens, other than Permitted Equity Liens.

Section 3.6 No Brokers. Other than as set forth in Section 5.4, no broker,
finder or investment banker is entitled to any brokerage, finder’s or other fee
or commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Billington, except any fees and
commissions that will be discharged by Billington.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF IMPERIAL

Except as set forth in the Sellers Disclosure Schedule, which exceptions shall
be deemed to be part of the representations and warranties made hereunder,
Imperial hereby represents and warrants to Buyer as follows:

 

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Section 4.1 Organization and Qualification.

(a) Imperial is a Texas corporation, duly organized and validly existing and in
good standing under the Laws of the State of Texas. Imperial has the requisite
corporate power and authority to carry on its business as it is now being
conducted.

(b) Imperial is duly qualified as a foreign corporation and in good standing in
each jurisdiction where the character of its properties owned or held under
lease or the nature of its activities makes such qualification necessary, except
where the failure to be so qualified would not, individually or in the
aggregate, reasonably be expected to have a material adverse effect with respect
to Imperial and its Subsidiaries taken as a whole.

Section 4.2 Due Authority. Imperial has full corporate power and authority to
execute and perform this Agreement and to carry out the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and all of the other agreements and instruments contemplated hereby to which
Imperial is a party have been duly authorized by Imperial, and no other act or
proceeding on the part of Imperial or its governing body is necessary to
authorize the execution, delivery or performance of this Agreement or the other
agreements contemplated hereby and the consummation of the transactions
contemplated hereby or thereby. This Agreement has been duly and validly
executed by Imperial and, assuming the due authorization, execution and delivery
of this Agreement by Billington and Buyer, constitutes the legal, valid and
binding obligation of Imperial enforceable in accordance with its terms, except
as enforcement may be limited by bankruptcy, insolvency or other similar Laws
affecting the enforcement of creditors’ rights generally and except that the
availability of equitable remedies, including specific performance, is subject
to the discretion of the court before which any proceeding therefor may be
brought.

Section 4.3 Conflicts and Approvals. Except for the receipt of the Third Person
Consents set forth in Section 4.3 of the Sellers Disclosure Schedule, neither
the execution and delivery by Imperial of this Agreement nor the performance by
Imperial of its obligations hereunder will violate or breach the terms of or
cause a default under (a) any Law applicable to Imperial, (b) the Governing
Documents of Imperial or (c) any contract or agreement to which Imperial is a
party or by which it or any of its properties or assets is bound, except for any
matters described in this Section 4.3 that would not reasonably be expected to
have a Material Adverse Effect or materially and adversely affect the ability of
Imperial to perform its obligations under this Agreement. Imperial is not a
party to or bound by any written or oral agreement or understanding with respect
to a Company Transaction other than this Agreement, and Imperial has terminated
all discussions with third parties (other than Buyer and its Affiliates)
regarding Company Transactions.

Section 4.4 Proceedings. As of the Execution Date, there are no Proceedings
pending for which Imperial has received service of process or otherwise written
notice or, to the Knowledge of Imperial, otherwise pending or threatened against
Imperial, except any that, individually or, with respect to multiple Proceedings
that allege similar theories of recovery based on similar facts, in the
aggregate, would not reasonably be expected to materially and adversely affect
the ability of Imperial to perform its obligations under this Agreement.

 

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Section 4.5 Ownership of the Class A Shares. Imperial is the record owner of
25,000 shares of Class A Stock, representing 50% of the Class A Shares (the
“Imperial Shares”). Except as set forth in Section 4.5 of the Sellers Disclosure
Schedule, Imperial owns the Imperial Shares free and clear of any Liens, other
than Permitted Equity Liens. Notwithstanding anything set forth in Section 4.5
of the Sellers Disclosure Schedule, upon the occurrence of the Closing, the
delivery of the Imperial Shares to Buyer in accordance with the terms of this
Agreement will transfer good and marketable title to the Imperial Shares free
and clear of any Liens, other than Permitted Equity Liens.

Section 4.6 No Brokers. Other than as set forth in Section 5.4, no broker,
finder or investment banker is entitled to any brokerage, finder’s or other fee
or commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Imperial, except any fees and
commissions that will be discharged by Imperial.

ARTICLE V

REPRESENTATIONS AND WARRANTIES REGARDING THE COMPANY

Except as set forth in the Sellers Disclosure Schedule, which exceptions shall
be deemed to be part of the representations and warranties made hereunder, the
Sellers, Severally but not jointly, hereby represent and warrant to Buyer as
follows:

Section 5.1 Organization and Qualification.

(a) The Company is a Delaware corporation duly organized and validly existing
and in good standing under the Laws of the State of Delaware. The Company has
the requisite corporate power and authority to carry on its business as it is
now being conducted.

(b) The Company is duly qualified as a foreign corporation and in good standing
in each jurisdiction where the character of its properties owned or held under
lease or the nature of its activities makes such qualification necessary, except
where the failure to be so qualified would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The Company
has heretofore made available to Buyer correct and complete copies of its
Governing Documents. The Company is not in default under or in violation, in any
material respect, of any provision of its Governing Documents. The minute books
(containing the records of meetings of the Company’s stockholders and board of
directors) and the stock record books of the Company are correct and complete in
all material respects. Section 5.1(b) of the Sellers Disclosure Schedule sets
forth a list of all of the officers and directors of the Company as of the
Execution Date.

Section 5.2 Capitalization.

(a) The authorized capital stock of the Company consist of (i) 100,000 shares of
Class A Stock, (ii) 10,000 shares of Class B Stock, (iii) 15,000 shares of Class
C Stock and (iv) 33,000 shares of Class D Stock. As of the Execution Date and as
of immediately prior to the closing of the Repurchase Transactions, there will
be outstanding (i) 50,000 shares of Class A Stock, (ii) 8,125 shares of Class B
Stock, 2,576 shares of which are held as treasury stock, (iii) 14,500 shares of
Class C Stock and (iv) 33,000 shares of Class D Stock. At the Closing and after
consummation of the Repurchase Transactions that occur at the Closing, (i) other
than the

 

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Executive Contributed Shares, no shares of Class B Stock, Class C Stock or Class
D Stock will be outstanding and (ii) other than the Executive Contributed
Shares, the Class A Shares will represent all the outstanding capital stock of
the Company. The Company does not have any Subsidiaries or own any interest in
any corporation, general or limited partnership, limited liability company,
joint venture, estate, trust or other association.

(b) Section 5.2 of the Sellers Disclosure Schedule sets forth a list of the
record owners of the outstanding capital stock of the Company as of the
Execution Date and their respective shares of the outstanding capital stock of
the Company held of record as of the Execution Date. Except as contemplated by
this Agreement and as set forth in Section 5.2 of the Sellers Disclosure
Schedule, (i) there is no outstanding option, warrant, right (contingent or
other, including conversion, exchange, participation, right of first refusal,
co-sale or preemptive rights) or agreement for the purchase or acquisition of
any capital stock or other equity interests in the Company, or any options,
warrants or rights convertible into or exchangeable for any thereof or the
Company does not have any securities containing profit participation features,
any stock appreciation rights or any phantom stock plan and (ii) there is no
commitment to issue, sell or transfer any capital stock or other equity
interests in the Company, or subscriptions, warrants, options, convertible or
exchangeable securities or other such rights or to distribute to holders of
capital stock of the Company any evidence of Debt or asset. Except as
contemplated by this Agreement and as set forth in Section 5.2 of the Sellers
Disclosure Schedule, (i) the Company is not a party or subject to any agreement
or understanding, and there is no agreement or understanding between or among
any holders of capital stock of the Company relating to the acquisition,
disposition, transfer or voting or giving of written consents with respect to
any security or matter; (ii) the Company has no obligation (contingent or
otherwise) to purchase, redeem or otherwise acquire any capital stock or other
securities or any interest therein or to pay any dividend or make any other
distribution in respect thereof; and (iii) there are no restrictions on the
transfer of any capital stock of the Company, other than Permitted Equity Liens.
All of the issued and outstanding shares of capital stock of the Company have
been duly authorized, are validly issued, fully paid, and nonassessable, and are
not subject to, nor were they issued in violation of, any preemptive rights or
rights of first refusal.

(c) The Company has not violated any federal or state securities Laws in
connection with the offer, sale or issuance of any shares of its capital stock.

Section 5.3 Conflicts and Approvals. Except for (a) the receipt of the Third
Person Consents set forth in Section 5.3 of the Sellers Disclosure Schedule and
(b) the effectuation of the filings and registrations with and the receipt of
the Authorizations from Governmental Authorities set forth in Section 5.3 of the
Sellers Disclosure Schedule, neither the execution and delivery by the Sellers
of this Agreement or any of the other agreements and instruments contemplated
hereby to which a Seller is a party nor the performance by the Sellers of their
respective obligations hereunder or thereunder will violate or breach the terms
of or cause a default under (whether with or without the passage of time, the
giving of notice or both), result in the creation of a Lien (other than
Permitted Equity Liens) upon the Company’s capital stock or assets pursuant to,
give any third party the right to modify, terminate or accelerate any obligation
under, or require any authorization, consent, approval, exemption or other
action of or by or notice or declaration under (i) any Law or Authorization
applicable to the Company, (ii) the Governing Documents of the Company or
(iii) any Material Contract. The Company is not a party to or bound by any
written or oral agreement or understanding with respect to a Company Transaction
other than this Agreement, and the Company has terminated all discussions with
third parties (other than Buyer and its Affiliates) regarding Company
Transactions.

 

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Section 5.4 No Brokers; Transaction Bonuses. No broker, finder or investment
banker is entitled to any brokerage, finder’s or other fee or commission in
connection with the transactions contemplated by this Agreement based upon
arrangements made by or on behalf of the Company, except any fees and
commissions that will be discharged by the Company prior to the Closing Date.
Except with respect to the Repurchase Transactions Costs, there are no special
bonuses or other similar compensation payable to any employee of the Company in
connection with the transactions contemplated hereby.

Section 5.5 Financial Statements. The Financial Statements are attached to
Section 5.5 of the Sellers Disclosure Schedule. Each of the Financial Statements
fairly present in all material respects the financial position of the Company as
of the respective dates thereof and the results of operations of the Company for
the periods covered thereby, and each of the Financial Statements included in
clause (i) of the definition of Financial Statements fairly present in all
material respects the cash flows of the Company for the periods covered thereby.
The Financial Statements have been prepared in accordance with GAAP applied on a
consistent basis throughout the periods covered (except that the unaudited
financial statements of the Company as of February 3, 2012 and for the period
from September 3, 2011 through February 3, 2012 do not (a) reflect normal,
recurring year-end adjustments and (b) include required footnote disclosures,
none of which footnote disclosures, if updated from the disclosures in the
audited financial statements (including the footnotes thereto) of the Company as
of and for the fiscal year ended September 2, 2011, would, alone or in the
aggregate, reflect an adverse change in any material respect to the business,
operations, assets, liabilities, financial condition, operating results, cash
flow or net worth of the Company taken as a whole).

Section 5.6 Absence of Undisclosed Liabilities. Except as set forth in
Section 5.6 of the Sellers Disclosure Schedule, the Company does not have or
will not have any liabilities or obligations (whether direct, indirect, accrued
or contingent) arising out of any transaction entered at or prior to the date
hereof, or any action or inaction at or prior to the date hereof, or any state
of facts existing at or prior to the date hereof, except (a) for liabilities and
obligations incurred in the ordinary course of business consistent with past
practice since September 2, 2011 (none of which is a liability for breach of
contract, breach of warranty, tort, infringement, violation of Law, Claim or
Proceeding), (b) for liabilities and obligations disclosed in the Financial
Statements, (c) for liabilities and obligations under Material Contracts or
under contracts and commitments entered into in the ordinary course of business
consistent with past practice which are not Material Contracts (but not
liabilities for any breach of any such contract or commitment occurring on or
prior to the Closing Date) and (d) for liabilities or obligations not in excess
of $100,000, individually or in the aggregate.

 

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Section 5.7 Assets.

(a) Except as set forth on Section 5.7(a) of the Sellers Disclosure Schedule,
the Company has good and marketable title to, or a valid leasehold interest in,
the Physical Assets free and clear of all Liens except for Permitted Liens. The
Company has, and will have immediately following the Closing, a valid leasehold
interest in or the valid and enforceable right to use all assets, properties
(including the Real Property), rights (including contractual rights), titles or
interests, tangible or intangible, necessary for the conduct of its business as
presently conducted. Except as set forth on Section 5.7(a) of the Sellers
Disclosure Schedule, (i) none of the Sellers or their respective Affiliates
(other than the Company) owns, utilizes or has any interest in any assets of, or
performs any material services for, or on behalf of, or provides any material
group purchasing benefits to, or with respect to, the Company and (ii) as of the
Closing Date, no entity other than the Company shall own any assets primarily
relating to the Business. Immediately after the Closing, none of the Sellers or
their respective Affiliates shall have any right, title or interest in or to any
asset, property, title or interest that is used in the Business.

(b) Section 5.7(b) of the Sellers Disclosure Schedule sets forth the address of
each leased Real Property, and a true and complete list of all Leases (including
all amendments, extensions, renewals, guaranties and other agreements with
respect thereto) for each such leased Real Property (including the date and name
of the parties to such Lease document). The Company has delivered or made
available to Buyer a true and complete copy of each such Lease document, and in
the case of any oral Lease, a written summary of the material terms of such
Lease. With respect to each of the Leases: (i) such Lease is legal, valid,
binding, enforceable and in full force and effect; (ii) the Company’s possession
and quiet enjoyment of the leased Real Property under such Lease has not been
disturbed and there are no disputes with respect to such Lease; (iii) neither
the Company nor any other party to the Lease is in breach or default under such
Lease, and no event has occurred or circumstance exists which, with the delivery
of notice, the passage of time or both, would constitute such a breach or
default, or permit the termination, modification or acceleration of rent under
such Lease; (iv) no security deposit or portion thereof deposited with respect
such Lease has been applied in respect of a breach or default under such Lease
which has not been redeposited in full; (v) the other party to such Lease is not
an Affiliate of, and otherwise does not have any economic interest in, the
Company; (vi) the Company has not subleased, licensed or otherwise granted any
Person the right to use or occupy such leased Real Property or any portion
thereof; (vii) the Company has not collaterally assigned or granted any other
security interest in such Lease or any interest therein; and (viii) there are no
Liens on the estate or interest created by such Lease, other than Permitted
Liens.

(c) The Company does not own any Real Property. The leased Real Property
identified in Section 5.7(b) of the Sellers Disclosure Schedule comprise all of
the real property used or intended to be used in, or otherwise related to, the
Business.

Section 5.8 Material Contracts.

(a) Except for the contracts required to be listed in Section 5.8(a) of the
Sellers Disclosure Schedule (the “Material Contracts”), and except for this
Agreement and any Company Plans, the Company is not a party to or bound by any
of the following:

(i) any contract relating to any Debt of the Company for borrowed money, or the
granting of any security by the Company for any such borrowing;

(ii) any contract whereby the Company guarantees an obligation in excess of any
other Person, any performance bond or similar agreement;

 

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(iii) any contract with an employee or consultant of the Company providing for
annual payment by the Company in excess of $75,000;

(iv) any contract with any officer or director of the Company, other than an
employment contract;

(v) any collective bargaining contract or other contract with a labor union or
other labor organization, any pension, profit sharing, stock option, employee
stock purchase, bonus or other plan or arrangement providing for deferred or
other compensation to employees, former employees or consultants, or any other
employee benefit plan or arrangement, or severance agreements, programs,
policies or arrangements;

(vi) any contract for the purchase or sale of food products or raw materials
that cannot be terminated on less than 60 days notice and (A) provides for
forward physical delivery on a date more than 90 days in the future or
(B) provides for the future payment by or to the Company of more than $100,000,
other than purchase orders entered into in the ordinary course of business
consistent with past practice which provide for the delivery of products within
30 days;

(vii) any contract for the supply of goods or services to the Company not
covered in any other paragraph of this Section 5.8(a) that cannot be terminated
on less than 60 days notice and provides for future payments by or to the
Company of more than $100,000, other than purchase orders entered into in the
ordinary course of business consistent with past practice which provide for the
delivery of products within 30 days;

(viii) any contract for the sale of any asset by the Company not covered in any
other paragraph of this Section 5.8(a) that cannot be terminated on less than 60
days notice and provides for the future payment by or to the Company of more
than $100,000, other than purchase orders entered into in the ordinary course of
business consistent with past practice which provide for the delivery of
products within 30 days;

(ix) any lease under which the Company is the lessor or lessee of real or
personal property that provides for an annual base rental to or from the Company
of more than $50,000;

(x) any license or other right granted by any third party to the Company to any
material Intellectual Property (not including any licenses to commercially
available software with a total replacement cost of less than $25,000);

(xi) any license or other right granted by the Company to any third party to any
material Intellectual Property;

(xii) any contract prohibiting the Company from freely engaging in any business
or competing with another Person in any business or area;

 

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(xiii) any settlement, conciliation or similar agreement with any Governmental
Authority or pursuant to which the Company, after the date of this Agreement,
will be required to pay consideration in excess of $50,000; or

(xiv) any other agreement which is material to the Company’s operation or
business prospects and either involves consideration in excess of $100,000 or
the absence of which would result in Losses to the Company in excess of
$100,000, other than purchase orders entered into in the ordinary course of
business consistent with past practice which provide for the delivery of
products within 30 days.

(b) Except as set forth on Section 5.8(b) of the Sellers Disclosure Schedule
(i) the Company has not breached the terms of any Material Contract, (ii) to the
Knowledge of the Sellers, each Material Contract is enforceable by the Company
in accordance with its terms; (iii) the Company has not received from any other
party to any Material Contract written or, to the Knowledge of the Sellers, oral
notification that such Material Contract is not in full force and effect, that
the Company has failed to perform its obligations thereunder to date, or that
any other party thereto has not performed its obligations thereunder to date,
other than immaterial corrective action requests or corrective action reports
received in the ordinary course of business, (iv) no event has occurred, and no
circumstance or condition exists, that (with or without notice or lapse of time)
would reasonably be expected to result in a breach or violation of, or a default
under, the terms of any Material Contract and (v) to the Knowledge of Sellers,
there is no breach or anticipated breach by the other parties to any Material
Contract.

(c) A true and correct copy of each of the written instruments, plans, contracts
and agreements and an accurate description of each of the oral arrangements,
contracts and agreements which are referred to on Section 5.8(a) of the Sellers
Disclosure Schedule, together with all amendments, waivers or other changes
thereto, have been made available to Buyer. To the extent applicable, the
contracts identified on Section 5.8(a) of the Sellers Disclosure Schedule are
separately identified by reference to the type of contract applicable subsection
of Section 5.8(a).

Section 5.9 Authorizations. Except as set forth on Section 5.9 of the Sellers
Disclosure Schedule, (a) the Company has obtained all Authorizations that are
necessary to carry on the Business as currently conducted (collectively, the
“Material Authorizations”), (b) no event has occurred, and no circumstance or
condition exists, that (with or without notice or lapse of time) would
reasonably be expected to constitute or result in a material violation by the
Company of, or a failure on the part of the Company to comply with the terms of,
any Authorization, (c) the Company has not received from any Governmental
Authority written or, to the Knowledge of Sellers, oral notification that any
Authorization (i) is not in full force and effect, (ii) has been violated in any
respect, or (iii) is subject to any suspension, revocation, modification or
cancellation and (d) there is no Proceeding, to the Knowledge of the Sellers,
threatened regarding suspension, revocation, modification or cancellation of any
Authorization. Section 5.9 of the Sellers Disclosure Schedule sets forth a list
of all Material Authorizations. All of the Material Authorizations will be
available for use by the Company immediately after the Closing.

 

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Section 5.10 Compliance with Law. Except as set forth on Section 5.10 of the
Sellers Disclosure Schedule, (a) the Company is, and for the past five years has
been, in compliance in all material respects with all applicable Laws, (b) the
Company has not received any written or, the Knowledge of the Sellers, oral
notification from any applicable Governmental Authority that it is not in
compliance with any applicable Laws and (c) no event has occurred, and no
circumstance or condition exists, that (with or without notice or lapse of time)
would reasonably be expected to constitute or result in a failure of the Company
to comply with the terms of any applicable Law.

Section 5.11 Environmental Matters. As of the Execution Date:

(a) the Company and the Company Partner Operations are and for the past five
(5) years have been in material compliance with all applicable Environmental
Laws;

(b) all Authorizations, if any, required to be obtained or filed by or complied
with by the Company or the Company Partner Operations under any applicable
Environmental Law in connection with their operations as they are currently
being conducted, including those relating to Hazardous Materials, have been duly
obtained or filed for, and the Company and the Company Partner Operations are in
material compliance with the terms and conditions of all such Authorizations;

(c) there are no pending or, to the Knowledge of the Sellers, threatened
Proceedings by or before any Governmental Authority under any applicable
Environmental Law relating to the Company, the Business or the Company’s
properties or Company Partner Operations, nor has the Company received any
written or, to the Knowledge of the Sellers, oral notice, claim or other
information regarding any actual or alleged violation of or liabilities arising
under any Environmental Laws;

(d) neither the Company nor, to the Knowledge of the Sellers, any of the Company
Partner Operations has treated, stored, disposed of, arranged for or permitted
the disposal of, transported, handled, released or exposed any Person to any
substance, including any Hazardous Material, or owned or operated any property
or facility contaminated by any Hazardous Material, in each case above, in a
manner that has given or would give rise to material liabilities or obligations
pursuant to the Comprehensive Environmental Response, Compensation and Liability
Act (“CERCLA”) or any other Environmental Laws; and

(e) the Company has provided Buyer with all environmental reports and other
material documents relating to any current or former operations or facilities of
the Company, the Company Partner Operations or their respective predecessors or
Affiliates that are in its possession or reasonable control.

Section 5.12 Proceedings. There are no, and for the past five years have not
been any, Proceedings pending for which the Company has received service of
process or otherwise written notice or, to the Knowledge of the Sellers,
otherwise pending or threatened against the Company.

 

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Section 5.13 Insurance. As of the Execution Date, the Company (i) owns and is a
beneficiary under insurance policies underwritten by reputable insurers or
(ii) is a beneficiary under insurance policies underwritten by reputable
insurers which are owned by Imperial (the “Imperial Insurance Policies”), in
each case as set forth on Section 5.13 of the Sellers Disclosure Schedule. All
material premiums due with respect to such insurance policies have been paid,
and such policies are in full force and effect. The Company does not have any
self-insurance or co-insurance programs, and the reserves set forth on the
Balance Sheet are adequate (and the reserves to be set forth on the Closing
Statement will be adequate) to cover all anticipated liabilities with respect to
any such self-insurance or co-insurance programs.

Section 5.14 Employee Benefit Plans.

(a) Section 5.14(a) of the Sellers Disclosure Schedule lists, as of the
Execution Date, all the Company Plans. The Sellers have delivered or made
available to Buyer correct and complete copies of the plan documents and summary
plan descriptions (or written summaries if no written document exists), the most
recent determination letter received from the Internal Revenue Service (the
“IRS”), the most recent annual report (Form 5500, with all applicable
attachments), and all related trust agreements, insurance contracts, and other
funding arrangements that implement each Company Plan. Each Company Plan has
been administered, funded and operated in material compliance with its governing
documents, ERISA, the Code and applicable Law. There are no actions, suits or
Claims pending or, to the Knowledge of the Sellers, threatened (other than
routine Claims for benefits) with respect to any Company Plan or its assets.
There is no matter pending with respect to any Company Plan before any
Governmental Authority

(b) Neither the Company, nor any entity that is considered a single employer
with the Company within the meaning of Section 414(b), (c) or (m) of the Code or
Section 4001 of ERISA (an “ERISA Affiliate”) maintains, contributes to or has an
obligation to contribute to, nor has at any time within the six years prior to
the Execution Date, maintained, contributed to or had an obligation to
contribute to (i) a multiemployer plan within the meaning of Section 3(37) of
ERISA, (ii) any plan subject to Section 4063 or 4064 of ERISA, (iii) a “multiple
employer welfare arrangement” as defined in Section 3(40) of ERISA, (iv) a plan
funded by a voluntary employees’ beneficiary association within the meaning of
Section 501(c)(9) of the Code, (v) an “employee pension benefit plan” within the
meaning of Section 3(2) of ERISA and that is not intended to be qualified under
Section 401(a) of the Code, (vi) any other “plan” (as such term is defined in
Section 3(3) of ERISA) subject to Title IV of ERISA or (vi) any employee benefit
plan, program or arrangement that provides for post-retirement medical, life
insurance or other welfare-type benefits (other than health continuation
coverage required by COBRA).

(c) The Company does not have any liability with respect to any “employee
benefit plan” (as defined in Section 3(3) of ERISA) solely by reason of being
treated as a single employer under Section 414 of the Code with any trade,
business or entity other than the Company.

(d) To the Knowledge of the Sellers, the Company and each ERISA Affiliate has
timely filed or furnished all reports, returns, notices and other documentation
that are required to have been furnished to the IRS, the United States
Department of Labor or any other Governmental Authority.

 

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(e) With respect to each Company Plan, all contributions (including all employer
contributions and employee salary reduction contributions) that are due have
been made within the time periods prescribed by ERISA and the Code, and all
contributions for any period ending on or before the Closing Date that are not
yet due have been made or properly accrued. No Company Plan has any material
unfunded liability that is not accurately reflected on the Company’s Financial
Statements, in accordance with GAAP.

(f) Except as set forth in Section 5.14(f) of the Sellers Disclosure Schedule,
neither the execution or delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (i) result in any liability under any
Company Plan, including any liability for severance pay, termination or
retention pay, (ii) increase any benefits otherwise payable under any Company
Plan or (iii) result in the acceleration of the time of payment or vesting of
any such compensation or benefits under any Company Plan.

Section 5.15 Labor and Employment Matters. Except as set forth on Section 5.15
of the Sellers Disclosure Schedule, with respect to the Business: (i) there are
no pending, or to the Knowledge of the Sellers, threatened, labor or employment
disputes or controversies, including any Proceeding alleging unlawful
harassment, employment discrimination, unfair labor practices, unpaid wages,
unlawful wage or immigration practices, or unlawful tax withholding practices
that, if adversely determined, individually or in the aggregate would reasonably
be expected to result in Losses in excess of $100,000 and no such Proceedings
have occurred within the past three (3) years; (ii) there is no collective
bargaining agreement or collective bargaining relationship with any labor
organization; (iii) to the Knowledge of the Sellers, no union organizing efforts
are underway or threatened and no such activities have occurred within the past
five (5) years; (iv) there is no strike, slowdown, work stoppage, lockout or
other material labor dispute underway or, to the Knowledge of the Sellers,
threatened, and no such disputes have occurred within the past three (3) years;
(v) with respect to this transaction, any notice required under any law or
contract has been given, and all bargaining obligations with any employee
representative have been, or prior to the Closing will be, satisfied; and,
(vi) within the past three (3) years, the Business has not implemented any plant
closing or layoff of employees that could implicate the Worker Adjustment and
Retraining Notification Act of 1988, as amended, or any similar foreign, state
or local law, regulation or ordinance (collectively, the “WARN Act”), and no
such action will be implemented without advance notification to Buyer.

Section 5.16 Taxes.

(a) (i) All federal income Tax Returns and all other material Tax Returns which
were required to be filed by or with respect to the Company have been duly and
timely filed, (ii) all federal income Taxes and all other material Taxes,
whether or not shown on each such Tax Return, have been timely paid in full,
(iii) no penalty, interest or other charge is or will become due with respect to
the late filing of any such Tax Return or late payment of any such Tax, (iv) all
such Tax Returns were true, correct and complete in all respects, (v) all Tax
withholding and deposit requirements imposed on or with respect to the Company
have been satisfied in full in all respects and (vi) the Company is not
currently the beneficiary of any extension of time within which to file any Tax
Return.

 

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(b) The Company does not have in force any waiver of any statute of limitations
in respect of Taxes or any extension of time with respect to a Tax assessment or
deficiency.

(c) The Company is not a party to any Tax allocation, indemnification, or
sharing agreement. There are no Liens for unpaid Taxes on the assets of the
Company except for Permitted Liens.

(d) No claim has been made in writing by any Governmental Authority in a
jurisdiction where the Company does not file Tax Returns that the Company is, or
may be, subject to taxation by that jurisdiction.

(e) The Company is not a party to any agreement, contract, arrangement or plan
that has resulted or could result, separately or in the aggregate, in the
payment of any “excess parachute payment” within the meaning Section 280G of the
Code (or any corresponding provision of state, local, or non-U.S. Tax law).

(f) The Company has not been a member of an affiliated group of corporations
within the meaning of Section 1504 of the Code (or any similar provision of
state, local or non-U.S. Law) and the Company has no liability for the Taxes of
any other Person under Treasury Regulation Section 1.1502-6 (or any similar
provision of state, local or non-U.S. Law), as a transferee or successor, by
contract or otherwise.

(g) The Company will not be required to include any item of income in, or
exclude any item of deduction from, taxable income for any taxable period (or
portion thereof) ending after the Closing Date as a result of any: (i) change in
method of Tax accounting for a taxable period ending on or prior to the Closing
Date; (ii) “closing agreement” as described in Section 7121 of the Code (or any
corresponding or similar provision of state, local, or non-U.S. income Tax law)
executed on or prior to the Closing Date; (iii) installment sale or open
transaction disposition made on or prior to the Closing Date; (iv) prepaid
amount received on or prior to the Closing Date; (v) election under
Section 108(i) of the Code or (vi) use of an improper method of accounting for a
taxable period ending on or prior to the Closing Date.

(h) The Company has not distributed stock of another Person, or had its stock
distributed by another Person, in a transaction that was purported or intended
to be governed in whole or in part by Sections 355 or 361 of the Code. The
Company is and has not been a party to any “reportable transaction,” as defined
in Section 6707A(c)(1) of the Code and Treasury Regulation Section 1.6011-4(b).

(i) The Company does not have a permanent establishment (within the meaning of
an applicable Tax treaty) or otherwise have an office or fixed place of business
in a country other than the country in which it is organized.

 

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(j) Each agreement, contract, plan, or other arrangement to which the Company is
a party that is a “nonqualified deferred compensation plan” subject to
Section 409A of the Code complies with the requirements of Section 409A of the
Code and any Internal Revenue Service guidance issued thereunder and no amounts
under any such agreement, contract, plan, or other arrangement is or has been
subject to the interest and additional tax set forth under Section 409A of the
Code. The Company does not have any actual or potential obligation to reimburse
or otherwise “gross-up” any Person for the interest or additional tax set forth
under Section 409A and/or Section 4999.

(k) Valid elections under Section 83(b) of the Code have been timely executed
for all of the Executive Contributed Shares, the Class B Stock and the Class C
Stock. No Class D Stock was issued to any individual subject to U.S. federal
income Tax.

(l) The unpaid Taxes of the Company (i) did not, as of Balance Sheet Date,
exceed the reserve for Tax liability (rather than any reserve for deferred Taxes
established to reflect timing differences between book and Tax income) set forth
on the face of the Balance Sheet (rather than in any notes thereto) and (ii) do
not exceed that reserve as adjusted for the passage of time through the Closing
Date in accordance with the past custom and practice of the Company in filing
its Tax Returns. Since the Balance Sheet Date, the Company has not incurred any
liability for Taxes arising from extraordinary gains or losses, as that term is
used in GAAP, outside the ordinary course of business consistent with past
custom and practice.

(m) There are no pending written proposed deficiencies or other written Claims
with respect to Taxes of the Company or any administrative or judicial
proceedings with respect to Taxes. The Company has not received from any
Governmental Authority (including jurisdictions where the Company does not file
Tax Returns) any (i) written notice indicating an intent to open an audit or
other review or request for information relating to Taxes or (ii) proposed
adjustment for any amount of Tax proposed, asserted, or assessed by any taxing
authority against the Company.

Section 5.17 Intellectual Property.

(a) Section 5.17(a) of the Sellers Disclosure Schedule contains a complete and
accurate list of all of the following that are owned by the Company: (i) all
patents and patent applications; (ii) all trademarks registrations and trademark
applications; (iii) all copyrights registrations and copyright applications;
(iv) all trade or corporate names; and (v) all Internet domain names.

(b) The Company owns and possesses all right, title and interest in and to or
otherwise has the right to use all Intellectual Property necessary for the
operation of the Business as currently conducted, free and clear of all Liens
(collectively, the “Company Intellectual Property”). All of the Company
Intellectual Property owned by the Company is valid, subsisting and enforceable
and in full force and effect. To the Knowledge of the Sellers, the Company
Intellectual Property shall survive unchanged after the consummation of the
transactions contemplated by this Agreement.

 

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(c) Except as set forth in Section 5.17(c) of the Sellers Disclosure Schedule,
(i) there are no claims against the Company that were made either within the
past six (6) years or are presently pending, and the Company has not received
within the past six (6) years any written notice of any claims or assertions,
contesting the ownership or use of any Company Intellectual Property; (ii) the
Company has not infringed, misappropriated, diluted or otherwise conflicted
with, and the operation of the Business as it is currently conducted does not
infringe, misappropriate, dilute or otherwise conflict with, any Intellectual
Property of any third party; and (iii) to the Knowledge of the Sellers, no third
party has infringed, misappropriated, diluted or otherwise conflicted with any
Company Intellectual Property owned by the Company. The Company Intellectual
Property is not subject to any outstanding consent, settlement, decree, order,
injunction, judgment or ruling restricting the use thereof.

(d) The Company has taken commercially reasonable precautions to protect its
rights in and to its copyrights and copyright applications, trademarks and
trademark applications, Trade Secrets, and other Intellectual Property,
including maintaining the confidentiality of Trade Secrets and other
Confidential Information.

(e) The computer systems, including software, used by the Company in the
operation of the Business as it is currently conducted (collectively, the
“Company Systems”) are sufficient for the immediate and anticipated future needs
of the Business as it is currently conducted. The Company maintains commercially
reasonable security, disaster recovery and business continuity plans, procedures
and facilities. In the past eighteen (18) months, there has not been any
material failure with respect to any of the Company Systems that has not been
remedied or replaced in all material respects.

Section 5.18 Inventory; Food Laws. Subject to any reserve for inventory on the
face of the Balance Sheet, the Inventory consists of items of a quality and
quantity usable and, with respect to finished goods only, salable, in each case,
in the ordinary course of business. The Company, individually or through its
third Person manufacturers and distributors, has manufactured, formulated,
processed, labeled, stored, tested, packed, transported, distributed, marketed,
advertised, promoted and sold all products (a) currently being sold,
manufactured or distributed (“Current Products”) or (b) sold, manufactured or
distributed since December 31, 2009 that are not currently being sold,
manufactured or distributed (“Past Products” and, together with Current
Products, “Products”) (including Products in process and in inventory on the
Closing Date) in material compliance with all Food Laws for the past five years.
All of the Current Products materially satisfy, and all of the Past Products
materially satisfied for the past five years, all federal and state nutritional
labeling requirements, including all regulations under the Food Laws. All
ingredients used in the Current Products materially conform, and all of the
ingredients used in the Past Products materially conformed for the past five
years, to the requirements of the Food Laws. All of the (i) Current Products in
process or in inventory on the Execution Date are not and (ii) Products
manufactured or packaged for the Company at the time of delivery thereof to the
customers of the Business were not for the past five years, “adulterated” or
“misbranded” within the meaning of the Food Laws, nor, during the past five
years, did any such Products constitute an article prohibited from introduction
into interstate commerce under the Food Laws at the time of such delivery. The
Company has not received from any Governmental Authority or other Person any
Claim, Proceeding or notice of liability pursuant to Food Laws relating to the
Business, the Company, or the Company Partner Operations which remains pending
or unresolved. During the past five years, the Company has not had a recall of
any of its Products, nor has any of the Company’s facilities or the Company
Partner Operations been shutdown by a Governmental Authority pursuant to Food
Laws. During

 

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the past five years, there has been no presence or release of any food
contaminants or adulterants, food poisoning, pests, mold or microbial agents in
any of the Company’s Products or at the Company Partner Operations that has or
would give rise to material liabilities or obligations of the Company under Food
Laws. The Sellers and the Company have made available to Buyer all material food
safety audits, reports, studies, sampling data, and other documents materially
bearing on food safety matters relating to the Business, the Company, the
Company Partner Operations or the Products, which are in their possession or
control.

Section 5.19 Accounts Receivable. Except as set forth on Section 5.19 of the
Sellers Disclosure Schedule, all accounts and notes receivable reflected on the
Balance Sheet and all accounts and notes receivable to be reflected on the
Closing Statement (net of allowances for doubtful accounts as reflected thereon
and as determined in accordance with GAAP) are or shall be valid receivables
arising in the ordinary course of business. No Person has any Lien (other than
Permitted Liens) on such receivables or any part thereof, and no agreement for
deduction, free goods, discount or other deferred price or quantity adjustment
has been made with respect to any such receivables out of the ordinary course of
business consistent with past practice. To the Knowledge of the Sellers, there
is no pending contest or dispute with respect to the amount or validity of any
amount of any such account receivables.

Section 5.20 Absence of Certain Developments. Since the Balance Sheet Date, no
fact, event or circumstance has occurred which has had or would reasonably be
expected to have a Material Adverse Effect. Since the Balance Sheet Date, the
Company has not taken or failed to take any action that, if performed after the
Execution Date and prior to the Closing, would constitute a breach of
Section 7.1, other than entering into, amending, modifying or terminating any
Material Contracts in the ordinary course of business consistent with past
practice.

Section 5.21 Bank Accounts; Names and Locations. Section 5.21(a) of the Sellers
Disclosure Schedule lists all of the Company’s bank accounts (designating each
authorized signatory and the level of each signatory’s authorization). Except
for the names set forth on Section 5.21(b) of the Sellers Disclosure Schedule,
during the five (5)-year period prior to the Execution Date, neither the Company
nor its predecessors has used any name or names under which it has invoiced
account debtors, maintained records concerning its assets or otherwise conducted
business. All of the Physical Assets are located at the locations set forth on
Section 5.21(c) of the Sellers Disclosure Schedule.

Section 5.22 Affiliated Transactions. Except as set forth on Section 5.22(a) of
the Sellers Disclosure Schedule, no officer, director, stockholder, employee or
Affiliate of the Company, including the Sellers or any of their respective
Subsidiaries (other than the Company) or, to the Knowledge of the Sellers, any
individual related by blood, marriage or adoption to any such individual or any
entity in which any such Person or individual owns any beneficial interest, is a
party to any agreement, contract, commitment or transaction with the Company or
has any interest in any property used by the Company (including any Intellectual
Property rights). Other than indemnity obligations to directors or officers
pursuant to the Company’s Governing Documents, the Company shall not owe any
amounts to the Sellers or their Affiliates after the Closing and any agreements
or arrangements purporting to require payment of any amounts by the Company to
either of the Sellers after the Closing are terminated effective as of the
Closing.

 

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Section 5.23 Customers and Suppliers. Section 5.23 of the Sellers Disclosure
Schedule sets forth (a) a list of the top twenty-five (25) customers of the
Company (on a consolidated basis) (by volume of sales to such customers) (the
“Material Customers”) and (b) a list of the top fifteen (15) suppliers of the
Company (on a consolidated basis) (by volume of purchases from such suppliers)
(the “Material Suppliers”), for the fiscal years ended September 2, 2011 and the
five (5)-month period ended February 3, 2012. The Company has not received any
indication from any Material Customer of the Company to the effect that, and the
Company does not have any reason to believe that, such Material Customer will
stop, materially decrease the rate of, or materially change the terms (whether
related to payment, price or otherwise) with respect to, buying materials,
products or services from the Company (whether as a result of the consummation
of the transactions contemplated hereby or otherwise). The Company has not
received any indication from any Material Supplier to the Company to the effect
that, and the Company does not have any reason to believe that, such Material
Supplier will stop, materially decrease the rate of, or materially change the
terms (whether related to payment, price or otherwise) with respect to,
supplying materials, products or services to the Company (whether as a result of
the consummation of the transactions contemplated hereby or otherwise).

Section 5.24 Anti-Bribery and Anti-Money Laundering Compliance.

(a) Neither the Company nor any of the Company’s Affiliates nor any agent acting
on behalf of the Company or any of its Affiliates has provided, offered, gifted
or promised, directly or indirectly, anything of value to any Government
Official, political party or candidate for government office, nor provided or
promised anything of value to any other person while knowing that all or a
portion of that thing of value would or will be offered, given, or promised,
directly or indirectly, to any Government Official, political party or candidate
for government office, for the purpose of:

(i) influencing any act or decision of such official, party or candidate in his
or her official capacity, inducing such official, party or candidate to do or
omit to do any act in violation of their lawful duty, or securing any improper
advantage for the benefit of the Company; or

(ii) inducing such official, party or candidate to use his or her influence with
his or her government or instrumentality to affect or influence any act or
decision of such government or instrumentality, in order to assist the Company
in obtaining or retaining business for or with, or directing business to, any
Person.

(b) The Company has been in compliance in all material respects and has, during
all periods for which any applicable statute of limitations has not expired,
complied with the applicable provisions of the U.S. Bank Secrecy Act and USA
PATRIOT Act of 2001, as amended, and other applicable foreign Laws relating
to anti-money laundering and similar matters.

(c) The Company utilizes effective controls and procedures and an internal
accounting controls system that is sufficient to provide reasonable assurances
that material violations of applicable anti-bribery or anti-money laundering
Laws will be prevented, detected and deterred.

 

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Section 5.25 Compliance with Customs and International Trade Laws.

(a) The Company is in compliance with all applicable Customs & International
Trade Laws in all material respects, and at no time in the last five (5) years
has the Company committed any material violation of the Customs & International
Trade Laws, and there are no material unresolved questions or claims concerning
any liability of the Company with respect to any such Laws;

(b) Without limiting the foregoing, the Company has not received any written
notice that it is subject to any civil or criminal investigation, audit or any
other inquiry involving or otherwise relating to any alleged or actual violation
of the Customs & International Trade Laws;

(c) The Company has not received any written notice that any products or
materials imported by the Company, or on behalf of the Company where the Company
is the importer of record, for which final liquidation has not yet occurred is
subject to or otherwise covered by an antidumping duty order or countervailing
duty order that remains in effect or is subject to or otherwise covered by any
pending antidumping or countervailing duty investigation by agencies of the
United States government; and

(d) Neither the Company, nor any officer or director of the Company, nor any
agent acting on behalf of the Company (i) has been or is designated on any list
of any U.S. Governmental Authority, including the U.S. Office of Foreign Assets
Control’s (“OFAC”) Specially Designated Nationals and Blocked Persons List, the
U.S. Department of Commerce (“Commerce”) Denied Persons List, the Commerce
Entity List, and the U.S. Department of State (“State Department”) Debarred
List, (ii) nor participated in any transaction involving such designated person
or entity, or any country that is subject to U.S. sanctions administered by
OFAC, (iii) nor exported (including deemed exportation) or re-exported, directly
or indirectly, any good, technology or services in violation of any applicable
U.S. export control or economic sanctions Laws, regulations or orders
administered by OFAC, Commerce or State Department, (iv) nor participated in any
export, re-export or transaction connected with any purpose prohibited by U.S.
export control and economic sanctions Laws, including, without limitation,
support for international terrorism and nuclear, chemical or biological weapons
proliferation.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby represents and warrants to each Seller as follows:

Section 6.1 Organization and Qualification.

(a) Buyer is a corporation duly organized and validly existing and in good
standing under the laws of Delaware. Buyer has the requisite corporate power and
authority to carry on its business as it is now being conducted.

(b) Buyer is duly qualified as a foreign corporation and in good standing in
each jurisdiction where the character of its properties owned or held under
lease or the nature of its activities makes such qualification necessary, except
where the failure to be so qualified would not, individually or in the
aggregate, reasonably be expected to have a Buyer Material Adverse Effect.

 

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Section 6.2 Due Authority. Buyer has full corporate power and authority to
execute and perform this Agreement and to carry out the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and all of the other agreement and instruments contemplated hereby to which
Buyer is a party have been duly authorized by Buyer, and no other act or
proceeding on the part of Buyer or its governing body is necessary to authorize
the execution, delivery or performance of this Agreement or the other agreements
contemplated hereby and the consummation of the transactions contemplated hereby
or thereby. This Agreement has been duly and validly executed by Buyer and,
assuming the due authorization, execution, and delivery of this Agreement by the
Sellers, constitutes the legal, valid and binding obligation of Buyer
enforceable in accordance with its terms, except as enforcement may be limited
by bankruptcy, insolvency or other similar Laws affecting the enforcement of
creditors’ rights generally and except that the availability of equitable
remedies, including specific performance, is subject to the discretion of the
court before which any proceeding therefor may be brought.

Section 6.3 Conflicts and Approvals. Except for any approvals required under the
HSR Act or any applicable foreign competition Law, neither the execution and
delivery by Buyer of this Agreement or any of the other agreements and
instruments contemplated hereby to which Buyer is a party nor the performance by
Buyer of its obligations hereunder or thereunder will, to the Knowledge of
Buyer, violate or breach the terms of or cause a default under (a) any Law
applicable to Buyer, (b) the Governing Documents of Buyer or (c) any contract or
agreement to which Buyer is a party or by which it or any of its properties or
assets is bound, except for any matters described in this Section 6.3 that would
not reasonably be expected to have a Buyer Material Adverse Effect.

Section 6.4 Proceedings. As of the Execution Date, there are no Proceedings
pending for which Buyer has received service of process or otherwise written
notice or, to the Knowledge of Buyer, otherwise pending or threatened against
Buyer, except any that, individually or, with respect to multiple Proceedings
that allege similar theories of recovery based on similar facts, in the
aggregate, would not reasonably be expected to have a Buyer Material Adverse
Effect.

Section 6.5 No Brokers. No broker, finder or investment banker is entitled to
any brokerage, finder’s or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Buyer, except any fees and commissions that will be discharged by
Buyer.

Section 6.6 Purchase as Investment. Buyer is purchasing the Purchased Shares for
its own account as an investment without the present intent to sell, transfer or
otherwise distribute the Purchased Shares to any other Person. Buyer, together
with its directors, executive officers and advisors, is familiar with
investments of the nature of the Purchased Shares, understands that this
investment involves certain risks, has adequately investigated the Company, and
has substantial knowledge and experience in financial and business matters such
that it is capable of evaluating, and has evaluated, the merits and risks
inherent in purchasing the Purchased Shares, and is able to bear the economic
risks of such investment.

 

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Section 6.7 Availability of Funds.

(a) Subject to the receipt of the Debt Financing, the consummation of the
transactions contemplated by the Contribution Agreements and the consummation of
the equity investment contemplated by the Commitment Letter of Triangle Capital
Corporation, BNY Mellon – Alcentra Mezzanine Partners, L.P. and Trinity
Universal Insurance Company, Buyer will at the Closing have access to sufficient
immediately available funds, in cash, to pay the Purchase Price, the Company
Transaction Costs, the Repurchase Transactions Costs, the Company Funded Debt
and any other amounts payable under this Agreement at Closing and to effect the
transactions contemplated by this Agreement, all without any third party consent
or approval required (other than the consents and approvals of the lenders
participating in the Debt Financing).

(b) Buyer has delivered to the Sellers true and complete copies of an executed
commitment letter, dated March 7, 2012, from Wells Fargo Bank, National
Association and an executed commitment letter (collectively, the “Commitment
Letters”), dated March 7, 2012, from Triangle Capital Corporation, BNY Mellon –
Alcentra Mezzanine Partners, L.P. and Trinity Universal Insurance Company
pursuant to which the lenders party thereto have committed, subject to the terms
and conditions set forth therein, to lend the amounts set forth therein for the
purpose of funding a portion of the consideration contemplated by this Agreement
(such financing, or any alternative financing secured pursuant to
Section 7.10(b), the “Debt Financing”).

(c) As of the Execution Date, the Commitment Letters have not been amended or
modified and the commitments contained in the Commitment Letters have not been
withdrawn or rescinded in any respect. As of the Execution Date, the Commitment
Letters, in the form delivered to the Sellers, are in full force and effect and
are legal, valid and binding obligations of Buyer and, to the knowledge of
Buyer, the other parties thereto. There are no conditions precedent or other
contingencies, side agreements or other arrangements or understandings related
to the funding of the full amount of the Debt Financing or the terms thereof,
other than as set forth in the Commitment Letters in the forms delivered to the
Sellers. As of the Execution Date, Buyer does not have any material reason to
believe that it will be unable to satisfy on a timely basis any term or
condition to be satisfied by it contained in the Commitment Letters. Neither
Buyer nor any of its Affiliates has incurred any commitment fees in connection
with the Commitment Letters that are due and payable on or prior to the
Execution Date. As of the Execution Date, Buyer has satisfied all terms and
conditions required to be satisfied by it on or before the Execution Date
pursuant to the terms of the Commitment Letters, and Buyer shall pay when due or
cause to be paid when due all commitment fees arising under the Commitment
Letters as and when they become payable.

ARTICLE VII

PRE-CLOSING COVENANTS

Section 7.1 Operation of the Business. Except (i) as set forth in Section 7.1 of
the Sellers Disclosure Schedule, (ii) as otherwise contemplated by this
Agreement or (iii) as otherwise consented to by Buyer, such consent not to be
unreasonably withheld, from the Execution Date until the Closing, the Sellers
shall cause the Company to:

 

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(a) operate the Business in the ordinary course consistent with past practice;

(b) operate the Business in accordance with all applicable Laws in all material
respects;

(c) use commercially reasonable efforts to preserve substantially intact its
business organization, and to preserve existing beneficial relationships with
agents, lessors, suppliers, customers and employees, subject to the effects of
the announcement of the transactions contemplated by this Agreement and Buyer’s
stated plans for the Business;

(d) not offer, sell, issue, transfer, pledge or grant, or authorize the
offering, sale, issuance, transfer, pledge or grant of, any capital stock or
other equity interests of the Company or any securities or rights convertible,
exchangeable or exercisable into any capital stock or other equity securities or
securities containing profit participation features;

(e) not acquire, whether by merger or consolidation, by purchasing an equity
interest or otherwise, any business or any corporation, partnership, association
or other business organization or division thereof;

(f) not adopt any amendments to its Governing Documents;

(g) not incur any obligations for borrowed money or purchase money Debt, whether
or not evidenced by a note, bond, debenture or similar instrument (nor enter
into any guarantees with respect to such Debt) except (i) trade debt incurred in
the ordinary course of business which will be included in the calculation of
Adjusted Net Working Capital, (ii) borrowings under the Company’s revolving
credit facility that will be paid in full at or prior to the Closing and
(iii) other Debt that will be paid in full at or prior to the Closing;

(h) not destroy any books or records of the Company or otherwise related to the
Business, or remove the books and records located at the Company’s principal
executive offices except in accordance with the Company’s record retention
policy;

(i) promptly notify Buyer of any material change in the Business or the Physical
Assets;

(j) not enter into any contract, agreement or other arrangement that would have
been a Material Contract if it would have been in effect on the Execution Date;
provided, that for purposes of this Section 7.1(j), (A) with respect to
contracts, agreements or arrangements that provide for future payments to the
Company, $2,000,000 thresholds shall be substituted for the $100,000 thresholds
set forth in Section 5.8(a)(vi) or Section 5.8(a)(vii) and (B) with respect to
contracts, agreements or arrangements that provide for future payments by the
Company, $1,000,000 thresholds shall be substituted for the $100,000 thresholds
set forth in Section 5.8(a)(vi) or Section 5.8(a)(vii);

 

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(k) not amend, modify or terminate any Material Contract, or otherwise waive,
release or assign any material rights, Claims or benefits of the Company under
any Material Contract or enter into any derivative, option, hedge or futures
contracts; provided, that for purposes of this Section 7.1(k), $1,000,000
thresholds shall be substituted for the $100,000 thresholds set forth in
Section 5.8(a)(vi) or Section 5.8(a)(vii);

(l) not mortgage or pledge any of its material properties or subject them to any
Lien, except Permitted Liens or in the ordinary course of business;

(m) not discharge or satisfy any material Lien or pay any material obligation or
liability, other than obligations and liabilities paid in the ordinary course of
business;

(n) not declare, set aside or make any payment or distribution of cash or other
property to any of its stockholders with respect to such stockholder’s capital
stock or otherwise, or, except as provided in Section 2.6 or as otherwise may be
required under the Repurchase Agreements and related documents, purchase, redeem
or otherwise acquire any shares of its capital stock or other equity securities
(including any warrants, options or other rights to acquire its capital stock or
other equity);

(o) not sale, assign, transfer, lease, license or otherwise encumber any of its
Physical Assets, except in the ordinary course of business;

(p) not sale, assign, transfer, lease, license, sublicense or otherwise encumber
any material Intellectual Property rights, or abandon or permit to lapse any
material Intellectual Property rights;

(q) not make or grant any bonus or any wage or salary increase to any employee
or group of employees, other than (i) pursuant to contracts entered into prior
to the Execution Date and previously made available to Buyer or (ii) the hiring
of new or replacement employees in the ordinary course of business;

(r) not make or grant any increase in any Company Plan, or amend or terminate
any Company Plan or adopt any new Benefit Plan or enter into, amend or terminate
any collective bargaining agreement or other employment agreement, except as
required by Law;

(s) not make capital expenditures or commitments therefor in excess of $100,000
other than in accordance with the Company’s capital expenditure budget for the
current fiscal year;

(t) not delay or postpone the payment of any material accounts payable or
commissions or any other material liability or agree or negotiate with any party
to extend the payment date of any material accounts payable or commissions or
any other material liability or accelerate the collection of (or discount) any
material accounts or notes receivable;

 

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(u) not make any charitable contributions or pledges or make any political
contributions exceeding $10,000 and for which such amounts will not have been
paid in full and satisfied prior to the Closing;

(v) not make any change in any method of accounting or accounting policies or
make any write down in the value of its Inventory that is material or that is
other than in the usual, regular and ordinary course of business or reverse any
material accruals (whether or not in the ordinary course of business or
consistent with past practice), except as required by GAAP or Law;

(w) not take any action or fail to take any action that has the effect of
accelerating to pre-Closing periods sales to customers or other revenues,
individually or in the aggregate, in excess of $500,000 that would otherwise be
expected to take place or be incurred after the Closing;

(x) not make any loans or advances to any Persons except in the ordinary course
of business consistent with past practice;

(y) not (i) make or change any Tax election, (ii) change an annual Tax
accounting period, (iii) adopt or change any Tax accounting method, (iv) fail to
pay any Tax when it becomes due and payable, (v) file any amended Tax Return,
(vi) enter into any closing agreement, (vii) settle any Tax claim or assessment,
(viii) surrender any right to claim a refund of Taxes, (ix) consent to any
extension or waiver of the limitation period applicable to any Tax claim or
assessment or (x) take any other similar action relating to the filing of any
Tax Return or the payment of any Tax, if such other election, adoption, change,
amendment, agreement, settlement, surrender, consent or other action would have
the effect of increasing (other than by an immaterial amount) the Tax liability
of the Company for any period ending after the Closing Date or decreasing (other
than by an immaterial amount) any Tax attribute of the Company existing on the
Closing Date;

(z) not implement any layoffs implicating the WARN Act; or

(aa) not agree, resolve or commit to do any of the actions prohibited in
Section 7.1(d) through (h) or (j) through (z) that would, or the effects of
which would, survive the Closing.

Section 7.2 Appropriate Action; Consents; Filings. From the Execution Date until
the Closing:

(a) The Sellers and Buyer shall each use commercially reasonable efforts to
(i) take, or cause to be taken, all actions, and do, or cause to be done, all
things that, in either case, are necessary, proper or advisable under applicable
Law or otherwise to consummate and make effective the transactions contemplated
by this Agreement and (ii) obtain from the relevant Governmental Authorities all
Authorizations required to be obtained at or prior to the Closing by the
Sellers, the Company or Buyer in connection with the authorization, execution,
delivery and

 

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performance of this Agreement and the consummation of the transactions
contemplated hereby. As promptly as practicable, the Sellers and Buyer shall
make all necessary filings, including filings under the HSR Act, and thereafter
make any other required submissions, with respect to this Agreement and the
transactions contemplated hereby required under any applicable Law at or prior
to the Closing. Buyer and the Sellers shall bear the costs and expenses of their
respective filings; provided, that Buyer and the Sellers shall each pay 50% of
the filing fee in connection with any such filings. The Sellers and Buyer shall
cooperate in connection with the making of all such filings, including by
providing copies of all such documents to the nonfiling party and its advisors
prior to filing and, if requested, accepting all reasonable additions, deletions
or changes suggested in connection therewith. The Sellers and Buyer shall each
use commercially reasonable efforts to furnish or cause to be furnished all
information required for any application or other filing to be made pursuant to
any applicable Law in connection with the transactions contemplated by this
Agreement.

(b) The Sellers and Buyer shall each timely give or cause to be given all
notices to third Persons and use commercially reasonable efforts to obtain all
Third Person Consents (i) set forth in Section 3.3, Section 4.3 and Section 5.3
of the Sellers Disclosure Schedule or (ii) required under any Material Contract
in connection with the consummation of the transactions contemplated hereby.
Within three (3) Business Days following the Execution Date, Buyer shall deliver
to the Sellers a form of notice and a form of consent for purposes of giving
such notices to third Persons and obtaining such Third Person Consents pursuant
to this Section 7.2(b).

(c) The Sellers and Buyer shall each give prompt notice to the others of the
receipt of any written notice or other written communication from (i) any Person
alleging that the consent of such Person is or may be required in connection
with the transactions contemplated hereby, (ii) any Governmental Authority in
connection with the transactions contemplated hereby, (iii) any Governmental
Authority or other Person regarding the initiation or threat of initiation of
any Proceedings against, relating to, or involving or otherwise affecting the
Company, Buyer or the Sellers that relate to the consummation of the
transactions contemplated hereby, and (iv) any Person regarding the occurrence
or nonoccurrence of any event the occurrence or nonoccurrence of which would be
reasonably likely to (A) cause any condition to the obligations of the other
party to consummate the transactions contemplated hereby not to be satisfied,
(B) cause a breach of the representations, warranties or covenants of such party
under this Agreement, or (C) delay or impede the ability of either Buyer or the
Sellers, respectively, to consummate the transactions contemplated by this
Agreement or to fulfill their respective obligations set forth herein. No
delivery of any notice pursuant to clause (iv) of this Section 7.2(c) shall cure
any breach of any representation, warranty or covenant of the party hereto
giving such notice contained in this Agreement.

(d) Buyer and the Sellers each agree to cooperate and to use commercially
reasonable efforts to vigorously contest and to resist any Proceedings, and to
have vacated, lifted, reversed or overturned any order (whether temporary,
preliminary or permanent) of any court or other Governmental Authority that is
in effect and that restricts, prevents or prohibits the consummation of the
transactions contemplated by this Agreement, including the vigorous pursuit of
all available avenues of administrative and judicial appeal and all available
legislative action. Each of Buyer and the Sellers shall take, or cause to be
taken, commercially reasonable

 

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efforts required by any Governmental Authority as a condition to the granting of
any Authorization necessary for the consummation of the transactions
contemplated hereby or as may be required to avoid, lift, vacate or reverse any
legislative, administrative or judicial action that would otherwise cause any
Closing Condition not to be satisfied; provided, however, that compliance with
this Section 7.2(d) shall not require the parties nor their respective
Affiliates to commit to any material divestitures, licenses or hold separate or
similar agreements with respect to material assets or material conduct of
business arrangements as a condition to obtaining any approvals from any
Governmental Authority for any reason in order to consummate and make effective
the transactions contemplated by this Agreement.

Section 7.3 Breach Notice. If, prior to the Closing Date, either (i) Buyer
obtains knowledge of a breach of any of Buyer’s representations, warranties or
covenants contained in this Agreement, or (ii) the Sellers obtain knowledge of a
breach of any of the Sellers’ representations, warranties or covenants contained
in this Agreement, then Buyer, in the case of clause (i) shall notify the
Sellers in writing of such information, or the Sellers, in the case of
clause (ii) shall notify Buyer in writing of such information (in any such case,
the “Breach Notice”) within three Business Days of such discovery or on the day
prior to the Closing Date, whichever is earlier. The Breach Notice shall contain
reasonable details regarding the alleged breach and Buyer’s (in the case of
clause (i)) or the Sellers’ (in the case of clause (ii)) good faith estimate of
the potential Losses associated with such breach.

Section 7.4 Right of Entry; Access to Information.

(a) From and after the Execution Date through the Closing Date, Buyer and the
Diligence Representatives shall be afforded reasonable access to the Company’s
Physical Assets, personnel, representatives, documents, books and records
(except to the extent such access is prohibited by Law or by contract), shall
furnish such information about the Company as Buyer shall reasonably request and
shall be afforded reasonable access to the customers and suppliers of the
Company (to the extent such customers and suppliers agree to and cooperate with
such access), all upon reasonable notice to the Company and in a manner that
does not interfere in any material respect with the normal operations of the
Business or the Company.

(b) Buyer hereby acknowledges that any access to the properties and other assets
of the Company utilized by Buyer or any representative, consultant or other
Person acting by or on behalf of Buyer (“Diligence Representative”) shall be at
the sole risk, cost and expense of Buyer. Buyer shall and shall ensure that each
Diligence Representative complies with all safety and similar requirements
customarily imposed by the Company on its properties; provided, that the Company
has provided to Buyer a description of such safety and other requirements.
Before and after the Closing, Buyer shall assume and indemnify, defend and hold
harmless the Seller Indemnitees from and against any and all Claims for personal
injury, death or property damage caused by Buyer’s or any Diligence
Representative’s entry upon or access to the properties and other assets of the
Company and all Losses incurred by the Seller Indemnitees with respect to each
such Claim; provided, that Buyer’s obligation to indemnify, defend and hold
harmless the Seller Indemnitees pursuant to this Section 7.4(b) shall be reduced
to the extent to which the negligence or willful misconduct of the Seller
Indemnitees, the Company or any employee of the Company or the Sellers
contributed to cause the Loss relative to all other relevant factors. For
purposes of illustration (and without limiting the generality of the foregoing),
in the event of a Loss, which is covered by Buyer’s indemnification obligations
under this Section 7.4(b), and 20% of such Loss was attributable to the
contributory negligence of an employee of the Company, then Buyer’s
indemnification obligations under this Section 7.4(b) with respect to such Loss
would be limited to 80% of such Loss.

 

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(c) Prior to the Closing, Buyer will hold any information obtained under
Section 7.4(a) in accordance with the provisions of the Confidentiality
Agreement.

Section 7.5 Condition of the Company’s Assets. In consummating the purchase and
the sale of the Purchased Shares contemplated hereunder, Buyer acknowledges
that, except for the representations, warranties and covenants expressly made by
the Sellers in this Agreement or in any certificate or agreement delivered by a
Seller to Buyer in connection with this Agreement and except for any fraud or
intentional misrepresentation, it will become the owner of the Company and its
assets and Buyer accepts such assets in their AS-IS, WHERE-IS, CONDITION, WITH
ALL FAULTS, WITHOUT ANY EXPRESS OR IMPLIED COVENANT, WARRANTY AS TO TITLE,
CONDITION (INCLUDING ANY ENVIRONMENTAL CONDITION), MERCHANTABILITY, PERFORMANCE,
FITNESS (BOTH GENERALLY AND FOR ANY PARTICULAR PURPOSE) OR OTHERWISE (WHICH
WARRANTIES THE SELLERS HEREBY EXPRESSLY DISCLAIM), OR RECOURSE, OTHER THAN AS
EXPRESSLY SET FORTH HEREIN.

Section 7.6 Independent Investigation.

(a) Buyer acknowledges and affirms that (a) it has had full access to the extent
it deems useful or necessary to all information and materials made available by
the Company and the Sellers and their representatives during the course of
Buyer’s due diligence investigation of the Company, and (b) it has had access to
the personnel, officers, professional advisors, operations and records of the
Company. As of the Closing, Buyer will have completed its independent
investigation, verification, analysis, review and evaluation of this Agreement,
the Business and the Company, as Buyer has deemed necessary or appropriate.
EXCEPT FOR THE REPRESENTATIONS, WARRANTIES AND COVENANTS EXPRESSLY MADE BY THE
SELLERS IN THIS AGREEMENT OR IN ANY CERTIFICATE OR AGREEMENT DELIVERED BY A
SELLER TO BUYER IN CONNECTION WITH THIS AGREEMENT AND EXCEPT FOR ANY FRAUD OR
INTENTIONAL MISREPRESENTATION, BUYER ACKNOWLEDGES AND AGREES THAT (a) THERE ARE
NO REPRESENTATIONS, WARRANTIES, STATEMENTS, ASSURANCES OR GUARANTEES MADE BY THE
SELLERS, EXPRESS OR IMPLIED, AS TO (i) THE COMPANY’S ASSETS, OR (ii) THE
LIABILITIES, BUSINESS, RESULTS OF OPERATIONS, CONDITION (FINANCIAL,
ENVIRONMENTAL OR OTHERWISE) OR PROSPECTS RELATING TO THE BUSINESS, AND THAT IN
MAKING ITS DECISION TO ENTER INTO THIS AGREEMENT AND TO CONSUMMATE THE PURCHASE
OF THE PURCHASED SHARES, BUYER HAS RELIED AND WILL RELY SOLELY UPON ITS OWN
INDEPENDENT INVESTIGATION, VERIFICATION, ANALYSIS AND EVALUATION; (b) THE
SELLERS DISCLAIM ALL LIABILITY AND RESPONSIBILITY FOR ANY REPRESENTATION,
WARRANTY, STATEMENT OR INFORMATION ORALLY OR IN WRITING MADE OR COMMUNICATED TO
BUYER INCLUDING ANY OPINION, INFORMATION OR ADVICE WHICH MAY HAVE BEEN PROVIDED
TO BUYER BY THE SELLERS OR THE

 

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COMPANY OR ANY OF THEIR AFFILIATES (INCLUDING ANY BACKCAST DATA OR MODELS
PROVIDED BY THE COMPANY, WHICH HAVE BEEN PROVIDED FOR ILLUSTRATION PURPOSES
ONLY); (c) NEITHER THE SELLERS NOR ANY OF THEIR AFFILIATES HAVE MADE, AND THE
SELLERS HEREBY EXPRESSLY DISCLAIM AND NEGATE, ANY IMPLIED OR EXPRESS WARRANTY OF
MERCHANTABILITY, FITNESS (BOTH GENERALLY AND FOR A PARTICULAR PURPOSE), OR
CONFORMITY TO MODELS OR SAMPLES AND ANY OTHER REPRESENTATION OR WARRANTY,
EXPRESS, STATUTORY OR IMPLIED, RELATING TO THE COMPANY OR ITS ASSETS; AND
(d) THE SELLERS MAKE NO REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE USE OR
CONDITION (INCLUDING ENVIRONMENTAL USE OR CONDITION), THE PRESENCE OR ABSENCE OF
HAZARDOUS MATERIALS AT, ON OR UNDER ANY PORTION OF THE PROPERTIES OR OTHER
ASSETS OF THE COMPANY, COMPLIANCE WITH APPLICABLE LAWS OR REQUIREMENTS RELATING
TO LEASING, ZONING, SUBDIVISION, PLANNING, LAND USE, BUILDING, FIRE, SAFETY,
HEALTH OR ENVIRONMENTAL MATTERS, COMPLIANCE WITH COVENANTS, CONDITIONS AND
RESTRICTIONS (WHETHER OR NOT OF RECORD) OR ANY OTHER AUTHORIZATIONS.
Notwithstanding anything to the contrary in this Agreement, nothing in this
Agreement shall limit or restrict a party’s right to maintain or recover amounts
in connection with fraud or intentional misrepresentation by another party.

(b) Buyer acknowledges and affirms that with respect to the representations and
warranties in ARTICLE V relating to the Company Partner Operations, neither the
Sellers nor the Company made any independent investigation of, or had any
communication with the owners and/or operators of, such operations or
facilities.

(c) Buyer acknowledges and affirms that with respect to the representations and
warranties in Section 5.17(e), that (i) the Company relies on systems and
services provided by Imperial with respect to the Company Systems as set forth
on Section 5.7(a) of the Sellers Disclosure Schedule, (ii) except as set forth
in the Transition Services Agreement, Imperial will not provide any systems and
services to the Company after the Closing and (iii) upon the termination of such
systems and services under, and in accordance with the terms of, the Transition
Services Agreement, Imperial will no longer provide any systems and services to
the Company.

Section 7.7 Notice to Non-Voting Stockholders. At least ten days prior to the
Closing Date, the Company shall provide notice of the Closing to each of the
Non-Voting Stockholders, in each case in accordance with the terms of the
respective Repurchase Agreements.

Section 7.8 Exclusivity.

(a) From and after the Execution Date through the Closing Date, or such earlier
date on which this Agreement is terminated in accordance with its terms, the
Sellers and the Company shall, and shall cause their respective officers,
directors and employees to, and shall use commercially reasonable efforts to
cause their respective representatives and agents to, not, directly or
indirectly, initiate any contact with, solicit, encourage or enter into or
continue any negotiations, understandings or agreements with any third Person
with respect to or in connection with, or furnish or disclose any information
regarding the Company to or otherwise assist any third Person in connection
with, any offer or proposal to acquire any direct or indirect capital stock or
other equity interests in the Company or its assets (each, an “Acquisition
Proposal”).

 

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(b) The Sellers and the Company shall, and shall cause their respective
officers, directors and employees to, and shall use commercially reasonable
efforts to cause their respective representatives and agents to, immediately
cease and cause to be terminated all discussions and negotiations, if any, that
have taken place prior to the Execution Date with any Persons with respect to
any Acquisition Proposal.

(c) The Sellers and the Company shall notify Buyer promptly (but in no event
later than two (2) Business Days) after receipt by the Sellers or the Company
(or any of their respective representatives and agents) of an Acquisition
Proposal.

Section 7.9 Letters of Credit. With respect to any obligations of the Company
under any guaranties, letters of credit, letters of comfort, bid bonds or
performance or surety bonds or cash or other collateral obtained or given by the
Company relating to any business of any Seller or its Affiliates other than the
Business, such Seller shall cause the Company to be fully released, in each
case, effective as of the Closing, with respect to all obligations of the
Company under any such guaranties.

Section 7.10 Buyer’s Financing.

(a) Buyer shall use its commercially reasonable efforts (i) to maintain in
effect the Commitment Letters, (ii) to execute and deliver or to cause to be
executed and delivered all definitive agreements with respect to the Commitment
Letters on the terms and conditions contained in the Commitment Letters (with
such other terms and conditions as are usual and customary in a borrowing of a
private-equity-backed transaction of similar nature and size) and any related
fee letters, (iii) to satisfy or to cause to be satisfied all conditions to such
definitive agreements and consummate the Debt Financing at or prior to the
Closing and (iv) to comply with its obligations under the Commitment Letters.
Buyer shall not permit, without the prior written consent of the Sellers, any
amendment or modification to be made to, or any waiver of any provision or
remedy under, the Commitment Letters, if such amendment, modification or waiver
(i) reduces the aggregate amount of the Debt Financing or (ii) imposes new or
additional conditions or otherwise expands, amends or modifies any of the
conditions to the receipt of the Debt Financing in a manner that would
reasonably be expected to (A) delay or prevent the Closing, (B) make the funding
of the Debt Financing (or satisfaction of the conditions to obtaining the Debt
Financing) less likely to occur or (C) adversely impact the ability of Buyer to
enforce its rights against the other parties to the Commitment Letters or the
definitive agreements with respect thereto. For purposes of this Section 7.10
only, “Commitment Letters” shall be deemed to include such documents as are
permitted to be amended or modified by this Section 7.10(a) or any commitment
papers or letters entered into in connection with alternative debt financing
pursuant to Section 7.10(b). Buyer shall use its commercially reasonable efforts
to cause the lenders providing the Debt Financing to fund on the Closing Date
the financing required to consummate the Closing if all the Closing Conditions
are satisfied or waived (other than Section 9.3(h) or any conditions that by
their nature can only be satisfied at the Closing and which will be satisfied at
the Closing).

 

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(b) In the event of the failure of or substantial delay in the debt financing
contemplated by the Commitment Letters entered into by Buyer on or prior to the
Execution Date, Buyer shall use its commercially reasonable efforts to take, or
cause to be taken, all actions and to do, or cause to be done, all things
necessary, proper or advisable to (i) secure alternative debt financing sources
and commitments on terms no worse than those provided in the Commitment Letters,
including paying customary and reasonable commitment fees in connection with
such alternative debt financing, (ii) enter into definitive debt financing
agreements on the terms set forth in such alternative commitments (with such
other terms and conditions as are usual and customary in a borrowing of a
private-equity-backed transaction of similar nature and size) and
(iii) consummate such alternative debt financing on or prior to the Closing
Date.

(c) From and after the Execution Date through the Closing, the Sellers and their
respective agents and representatives shall be afforded regular access once a
week upon their request to Buyer and the lenders providing the Debt Financing
for purposes of asking questions and receiving updates regarding the status of
the Debt Financing. Without limiting the generality of the foregoing, Buyer
shall give the Sellers prompt notice: (i) of any breach or default by any party
to the Commitment Letters or definitive agreements related to the Debt Financing
of which Buyer becomes aware; (ii) of the receipt of any written notice or other
written communication from any Debt Financing source with respect to any breach,
default, termination or repudiation by any party to any Commitment Letters or
any definitive agreement related to the Debt Financing of any provisions of the
Commitment Letters or any definitive agreements related to the Debt Financing;
and (iii) if for any reason Buyer believes in good faith that it will not be
able to obtain all or any portion of the Debt Financing on the terms, in the
manner or from the sources contemplated by the Commitment Letters or the
definitive agreements related to the Debt Financing. As soon as reasonably
practicable, Buyer shall provide any information reasonably requested by the
Sellers following the Sellers’ receipt of a notice described in the immediately
preceding sentence relating to any circumstance referred to in clause (i),
(ii) or (iii) of the immediately preceding sentence.

(d) Notwithstanding anything to the contrary herein, for purposes of this
Section 7.10, “commercially reasonable efforts” means the efforts that a
commercially reasonable Person desirous of achieving the consummation of the
Debt Financing at or prior to the Closing would use in similar circumstances
(including the circumstances of a private-equity-backed transaction) to achieve
that result as expeditiously as reasonably practicable, including through the
payment of the commitment fees and other fees and expenses contemplated by the
Commitment Letters (or in the case of Section 7.10(b), the payment of customary
and reasonable commitment and other fees and expenses which may be more than the
commitment fees and other fees and expenses contemplated by the Commitment
Letters).

 

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Section 7.11 Cooperation with Financing. The Sellers shall, and shall cause the
Company, its and their respective officers, directors and employees to, and
shall use commercially reasonable efforts to cause its and their representatives
and agents to, cooperate in connection with the Debt Financing as may be
reasonably requested by Buyer or Buyer’s

lender(s) or prospective lender(s); provided that (x) such requested cooperation
shall not unreasonably interfere with the ongoing operations of the Company,
(y) the Company shall not be required to pay any commitment or other similar
fees or incur any other liability or obligation in connection with any such debt
financing prior to the Closing and (z) the Sellers shall not be required to pay
any commitment or other similar fee or incur any other liability or obligation
in connection with the Debt Financing. Such cooperation shall include: (i) with
respect to the Company only, executing such agreements or instruments as are
customary in similar financings and reasonably required by Buyer’s lender(s)
(provided that such agreements or instruments do not become effective until the
Closing); (ii) consenting to the assignment of any agreements including this
Agreement, and all of the agreements contemplated by this Agreement between
Buyer, on the one hand, and a Seller, on the other hand; and (iii) providing
such information and assistance (including available financial statements and
other financial data relating to the Business) as Buyer’s lender(s) may
reasonably request and granting such access to Buyer’s lender(s) and their
representatives as may be reasonably necessary for such lender(s)’ due
diligence.

Section 7.12 Contribution Agreements and Parent Equity Documents. Subject to the
satisfaction (or waiver by the relevant party) of all the conditions in
Section 9.1 and Section 9.2, at the Closing, Billington shall enter into, and
consummate the transactions contemplated by, the Billington Contribution
Agreement and the Parent Equity Documents. Subject to the satisfaction (or
waiver by the relevant party) of all the conditions in Section 9.1 and
Section 9.3, at the Closing, Buyer shall cause, as applicable, Parent, WSO
Holdings, LLC, a Delaware limited liability company, and Arlon Wholesome
Holding LLC, a Delaware limited liability company, to enter into, and consummate
the transactions contemplated by, the Contribution Agreements and the Parent
Equity Documents.

ARTICLE VIII

POST-CLOSING COVENANTS AND EMPLOYEE MATTERS

Section 8.1 Employee Matters.

(a) From and after the Closing Date through December 31, 2012, Buyer shall
provide each Transferred Employee who remains actively employed with the
Company, Buyer or its Affiliates (i) an annual base salary or hourly base rate
of pay no less favorable than that in effect immediately prior to the Closing
Date, (ii) participation in the Benefit Plans providing for benefits that are
comparable in the aggregate to the benefits received under the Company Plans in
effect immediately prior to the Closing Date, and (iii) an annual bonus
opportunity no less favorable than the opportunity under the bonus program set
forth on Section 8.1(a) of the Sellers Disclosure Schedule.

(b) Buyer or any of its Affiliates shall cause each Transferred Employee to
receive full credit for such Transferred Employee’s service with the Company,
for purposes of eligibility and vesting, but not benefit accruals except with
respect to vacation and severance pay, under any benefit plan made available by
Buyer or an Affiliate to the Company Employees (collectively, the “Buyer Plans”)
to the same extent such service was recognized under a similar Company Plan as
of the Closing Date, except where the recognition of such service would result

 

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in a duplication of benefits with respect to the same period of service. Buyer
or any of its Affiliates shall use commercially reasonable efforts to (i) waive
any preexisting condition limitations otherwise applicable to Transferred
Employees and their eligible dependents under any plan of Buyer or any Affiliate
of Buyer that provides health benefits in which the Transferred Employees may be
eligible to participate following the Closing Date to the same extent such
condition was waived or not applicable under the corresponding Company Plan,
(ii) honor any deductible, co-payment and out-of-pocket maximums incurred by the
Transferred Employees and their eligible dependents under the health plans in
which they participated immediately prior to the Closing Date during the portion
of the calendar year prior to the Closing Date in satisfying any deductibles,
co-payments or out-of-pocket maximums under health plans of the Company, Buyer
or any Affiliate in which they are eligible to participate on and after the
Closing Date in the same plan year in which such deductibles, co-payments or
out-of-pocket maximums were incurred, and (iii) waive any waiting period
limitation or evidence of insurability requirement that would otherwise be
applicable to a Transferred Employee and his or her eligible dependents on or
after the Closing Date to the same extent such waiting periods or evidence of
insurability were not met under the corresponding Company Plan.

(c) A Transferred Employee’s unused vacation and short-term leave entitlement
prior to the Closing Date under the vacation or short term leave policy
applicable to such Transferred Employee immediately prior to the Closing Date
shall be recognized by Buyer during the calendar year following the Closing
Date.

(d) In the event that any Transferred Employee is terminated (other than for
cause) prior to December 31, 2012, Buyer will provide such terminated
Transferred Employee with severance payments and benefits at least equal to the
severance payments described in Section 8.1(d) of the Sellers Disclosure
Schedule.

(e) The parties hereto acknowledge and agree that all provisions contained in
this Section 8.1 with respect to employees of the Company are included for the
sole benefit of the respective parties hereto and shall not create any right
(i) in any other person, including any employees, former employees, any
participant or any beneficiary thereof in any Company Plan or Buyer Plan, or
(ii) to continued employment with the Company or Buyer. Nothing contained in
this Section 8.1 shall interfere with the Company’s or Buyer’s right to amend,
modify or terminate any Company Plan or Buyer Plan or to terminate the
employment of any employee of the Company for any reason.

Section 8.2 Insurance.

(a) The parties hereto agree that as of and after the Closing, the Sellers shall
not be responsible for providing insurance coverage for the Business or the
Company. Each of the parties hereto hereby acknowledges and agrees that as of
the Closing, Imperial may terminate the Imperial Insurance Policies with respect
to the Company, and the Company will no longer be a beneficiary under the
Imperial Insurance Policies; provided, that the Company will retain access to
occurrence-based coverage under those Imperial Insurance Policies that are
occurrence-based for periods prior to the earlier of March 31, 2012 or the
Closing.

 

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(b) Buyer acknowledges that the Company’s coverage under each of the Imperial
Insurance Policies will expire on the earlier of (i) March 31, 2012, in
accordance with its respective terms, or (ii) with respect to the Company, the
Closing. Imperial agrees that it will not terminate or materially modify the
Imperial Insurance Policies before the earlier of 11:59 p.m. Central time on
March 31, 2012 or the Closing. In the event the Closing does not occur on or
before 11:59 p.m. Central time on March 31, 2012, the parties acknowledge and
agree that (i) the Company shall no longer be a beneficiary under the Imperial
Insurance Policies (or any renewal or replacement policies thereof) after
March 31, 2012, (ii) the Company will need to purchase its own insurance
policies to replace the expiring Imperial Insurance Policies, and such
expiration and purchase shall not be deemed a breach of the representations and
warranties in Section 5.13 and (iii) the Company will, and Sellers will cause
the Company to, obtain insurance policies reasonably satisfactory to Buyer to
replace the expiring Imperial Insurance Policies.

Section 8.3 Further Assurances. The Sellers and Buyer each agree that from time
to time after the Closing Date they will execute and deliver, and will cause
their respective Affiliates to execute and deliver, such further instruments,
and take, and cause their respective Affiliates to take, such other actions as
may be reasonably necessary to carry out the purposes and intents of this
Agreement.

Section 8.4 Proceedings. The parties acknowledge and agree that, upon the
consummation of the purchase and sale of the Purchased Shares contemplated
hereunder and the contribution of the Billington Contributed Shares and the
Executive Contributed Shares contemplated by the Contribution Agreements, Buyer
will become the owner of the Company and, except as otherwise provided in this
Agreement (including Section 8.5 and ARTICLE XI), the assets, properties,
rights, obligations and liabilities of the Company shall be retained by the
Company after Closing, including, without limitation, all Losses related to
Proceedings, to the extent such Losses would have been retained by the Company
had the Closing not occurred.

Section 8.5 Taxes.

(a) Buyer and the Sellers agree to cooperate fully, as and to the extent
reasonably requested by any party, in connection with the filing of Tax Returns
and any audit, litigation or other proceeding with respect to Taxes. Such
cooperation shall include the retention and, as requested, the provision of
records and information that are reasonably relevant to any such audit,
litigation or other proceeding and making employees available on a mutually
convenient basis to provide additional information and explanation of any
material provided hereunder. Buyer and the Sellers agree to retain all books and
records with respect to Tax matters pertinent to the Company for any taxable
period ending on or before the Closing Date until the expiration of the
applicable statute of limitations, including any extensions. Buyer, Sellers, and
the Company agree to use their commercially reasonable efforts to obtain any
certificate or other document from any Governmental Authority or any other
Person as may be necessary to mitigate, reduce or eliminate any Tax that could
be imposed (including with respect to any of the transactions contemplated by
hereby). Buyer and the Sellers further agree, upon request, to provide the other
party with all information that either party may be required to report pursuant
to Sections 6043 or 6043A of the Code or Treasury Regulations promulgated
thereunder.

 

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(b) The payment of any transfer, documentary, sales, use, stamp, registration,
value added and other such Taxes and fees (including any penalties, interest and
additions to Tax) payable in connection with the transactions contemplated by
this Agreement shall be borne 50% by Buyer, on the one hand, and 50% by the
Sellers, on the other hand. Buyer shall file any Tax Return or other document
with respect to such Taxes or fees, subject to review and approval of Sellers
(and Sellers shall cooperate with respect thereto as necessary).

(c) All Tax sharing agreements or similar agreements with respect to or
involving the Company, including the obligation of the Company to indemnify the
Tax liability of another person (other than employees of the Company pursuant to
the Repurchase Agreements), shall be terminated as of the Closing Date and,
after the Closing Date, the Company shall not be bound thereby or have any
liability thereunder.

(d) The Sellers shall, Severally and not jointly, indemnify Buyer and the
Company and hold them harmless from and against, any loss, claim, liability,
expense, or other damage attributable to (i) all Taxes (or the non-payment
thereof) of the Company for all taxable periods ending on or before the Closing
Date and the portion through the end of the Closing Date for any taxable period
that includes (but does not end on) the Closing Date (“Pre-Closing Tax Period”),
(ii) all Taxes of any member of an affiliated, consolidated, combined or unitary
group of which the Company (or any predecessor of any of the foregoing) is or
was a member on or prior to the Closing Date, including pursuant to Treasury
Regulation Section 1.1502-6 or any analogous or similar state, local, or
non-U.S. law or regulation, (iii) any and all Taxes of any person imposed on the
Company (including the obligation of the Company to indemnify the Tax liability
of such person) as a transferee or successor, by contract or pursuant to any
law, rule, or regulation, which Taxes relate to an event or transaction
occurring before the Closing and (iv) any Tax attributable to an election made
under Section 108(i) of the Code; provided, however, that the Sellers shall be
liable only to the extent that such Taxes exceed the amount taken into account
in the Purchase Price as finally determined pursuant to Section 2.5. In the case
of any taxable period that includes (but does not end on) the Closing Date (a
“Straddle Period”), the amount of any Taxes based on or measured by income,
receipts, or payroll of the Company for the Pre-Closing Tax Period shall be
determined based on an interim closing of the books as of the close of business
on the Closing Date and the amount of other Taxes of the Company for a Straddle
Period that relates to the Pre-Closing Tax Period shall be deemed to be the
amount of such Tax for the entire taxable period multiplied by a fraction the
numerator of which is the number of days in the taxable period ending on the
Closing Date and the denominator of which is the number of days in such Straddle
Period.

(e) From and after Closing, Buyer and the Company shall indemnify Sellers and
hold them harmless for any Taxes (other than withholding Taxes) of the Company
imposed on the Sellers attributable to any taxable period that is not a
Pre-Closing Tax Period, other than those described in Section 8.5(d).

(f) From and after the Closing, Buyer and the Company shall not and shall not
permit their Affiliates (i) to file or amend any Tax Return for a Pre-Closing
Tax Period or make, revoke or amend any election with respect to a Pre-Closing
Tax Period with regard to any Pre-Closing Tax Period without the consent of the
Sellers or (ii) to extend or waive any statute of limitation for assessment or
deficiency with regard to any Pre-Closing Tax Period without the

 

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consent of the Sellers (which shall not be unreasonably conditioned, withheld,
or delayed); provided, however, consent of the Sellers is not required for the
Buyer and the Company to amend Tax Returns (i) in order to carryback net
operating losses (or any other Tax attribute reducing Taxes) from a taxable
period after the Closing Date to a Pre-Closing Tax Period, or (ii) if such
amendment or filing would not result in Seller being liable for a material
amount of Taxes under this Agreement. In addition, from and after the Closing,
Buyer and the Company shall not and shall not permit their Affiliates to take
any position with the IRS or file any Tax Return that is inconsistent with the
original reporting of the Class B Stock, the Class C Stock and the Class D Stock
as contemplated in the Repurchase Agreements; provided that the foregoing
restrictions in this sentence will not apply if the inconsistent position is as
a result of an IRS examination, or in the event the Sellers provide consent
which shall not be unreasonably withheld if the Company establishes that it no
longer has a reporting position with respect to such original reporting due to
events or facts that were not known to the Buyer prior to the Closing Date.

(g) From and after the Closing, Buyer and the Company agree to pay to each
Seller any cash refund received (and any credit received in lieu of a cash
refund) after the Closing by Buyer, the Company, or their Affiliates with
respect to a Pre-Closing Tax Period; provided that payments to Sellers under
this Section 8.5(g) shall be net of (1) any reasonable out-of-pocket costs
associated in obtaining such refund of or credit against Taxes, (2) any Tax
required to be withheld on such payment and (3) any Taxes imposed on the Buyer
and/or the Company as a result of such refunds or credits. Buyer and the Sellers
agree that any refunds or credits payable to the Buyer and/or the Company with
respect to the carryback of any net operating loss (or any other Tax attribute
reducing Taxes) from a taxable period after the Closing Date to a Pre-Closing
Tax Period shall be for the account of Buyer and the Company, except to the
extent such refund results in Tax or other costs for which Sellers are liable,
under this Agreement or otherwise, that would not have been incurred but for
such carryback. From and after the Closing, Buyer and the Company shall
cooperate with the Sellers and their Affiliates in order to take all reasonable
steps necessary to claim any such refund, and Seller shall pay for any costs
associated therewith. Any such refund received by Buyer, the Company or their
Affiliates shall be paid to each Seller within thirty (30) days after such
refund is received. Buyer and the Company agree (i) to notify a Seller promptly
following the discovery of a right to claim any material such refund and upon
receipt of any such refund, (ii) to claim any such refund as soon as possible
after the discovery of a right to claim a refund, and (iii) to furnish to each
Seller all information, records and assistance reasonably necessary to verify
the amount of the refund or overpayment. Without duplication of any amounts the
Sellers are liable under Section 8.5(d), if there is a subsequent reduction by a
Governmental Authority (or by virtue of a change in applicable Tax law), of any
amounts with respect to which a payment has been made to the Sellers by Buyer
pursuant to this Section 8.5(g), then Sellers shall pay Buyer such reduced
amount plus any interest or penalties imposed by a Governmental Authority and
paid by Buyer or the Company with respect to such reduced amount.

(h) The Buyer or the Company shall notify Sellers in writing within fifteen
(15) days of receipt of written notice of any pending or threatened Tax Audit
that relates to any item in a Pre-Closing Tax Period. If the Buyer or the
Company fails to give such timely notice to the Sellers, Sellers shall not be
liable for indemnification for any Taxes arising in connection with such Tax
Audit if such failure to give notice materially adversely affects Sellers’ right
to

 

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participate in the Tax Audit. If such Tax Audit relates to any Taxes for which
Sellers would be liable to indemnify Buyer or the Company pursuant to this
Agreement, Sellers shall have the option, at their expense, to elect in writing
to control the defense of such Tax Audit; provided that Buyer and/or the Company
(and its agents and/or advisors) may, at their own expense, participate with the
Sellers in connection with such Tax Audit; which participation shall include,
but not be limited to, (1) the Sellers providing the Company (and its agents
and/or advisors) with copies of all correspondence, notices or other written
materials received from any Governmental Authority and keeping the Company (and
its agents and/or advisors) advised of significant developments in the Tax Audit
and (2) the Company (and its agents and/or advisors) reviewing and commenting on
any communications involving representatives of the Governmental Authorities and
being able to attend all meetings with Governmental Authorities with respect to
such Tax Audit. If such Tax Audit relates to, or impacts, Taxes for which both
Sellers, on the one hand, and Buyers and/or the Company, on the other hand,
could be liable, to the extent practicable, such Tax items will be distinguished
and each party will have the option to control the defense and settlement of
those Taxes for which it so liable. If such Tax Audit relates to a taxable
period, or portion thereof, beginning on or before and ending after the Closing
Date or otherwise any Tax item cannot be identified as being a liability of only
one party or cannot be separated from a Tax item for which the other party is
liable, Buyer or the Company, at their expense, shall have the option to control
the defense and settlement of the Tax Audit, provided that Buyer or the Company
defends the items as reported on the relevant Tax Return and provided further
that no such matter shall be settled without the written consent of the Sellers,
not to be unreasonably withheld, conditioned, or delayed. Notwithstanding
anything to the contrary, (i) the Sellers shall not settle, resolve, or close
any Tax Audit without the written consent of Buyer, which consent shall not be
unreasonably withheld, conditioned, or delayed and (ii) if the Sellers control
any Tax Audit pursuant to this Section 8.5(h), they shall not extend or waive
any statute of limitation for assessment or deficiency without the consent of
the Company (which shall not be unreasonably conditioned, withheld, or delayed).

(i) Notwithstanding anything in this Agreement to the contrary (other than
Section 11.1(a)), the parties agree that the covenants and agreements of the
parties hereto contained in this Section 8.5 or which otherwise relate to Taxes
shall, with regard to any Tax (including, for the purpose of this
Section 8.5(i), any Tax of a Person imposed on another by contract,
indemnification, as a transferee or successor, or otherwise), survive the
Closing and shall remain in full force and effect until the date thirty
(30) days after the date on which the applicable statute of limitations expires.

Section 8.6 Confidentiality.

(a) Effective as of the Closing, the Confidentiality Agreement shall be
terminated and of no further force and effect. For a period of four (4) years
immediately following the Closing Date, except as may be required by any Law or
as otherwise expressly contemplated herein or as necessary to enforce any of its
rights hereunder or defend any Claim hereunder, each Seller agrees (i) not to
disclose (and to cause each of its Affiliate Entities not to disclose) any
Confidential Information, (ii) not to use (and to cause each of its Affiliate
Entities not to use) any Confidential Information in connection with, or in a
manner that would result in, a breach of Section 8.8(a) and (iii) to take
reasonable measures (and to cause each of its Affiliate Entities to take
reasonable measures) to safeguard such Confidential Information and to protect
it against disclosure, misuse, espionage, loss and theft.

 

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(b) In the event any Seller or any of its Affiliates are required by Law to
disclose any Confidential Information, such Seller shall, if permitted by Law,
promptly notify Buyer in writing, which notification shall include the nature of
the legal requirement and the extent of the required disclosure so that the
Company or Buyer may, at their sole expense, seek an appropriate protective
order; provided, however, that if in the absence of a protective order the
Sellers or any of their respective Affiliates are, based on the good faith
written advice of counsel, legally required to disclose any Confidential
Information, such Person may disclose such information without any liability
hereunder; provided, further, that such Person shall (i) give the Company
written notice of the information to be disclosed (including copies of the
relevant portions of the relevant documents) as far in advance of its disclosure
as is practicable and permitted by Law, (ii) use reasonable efforts at the
Company’s or Buyer’s sole expense to limit any such disclosure to the precise
terms of such requirement and (iii) use reasonable efforts at the Company’s or
Buyer’s sole expense to obtain an order or other reliable assurance that
confidential treatment will be accorded to such information. Without limiting
any of the foregoing, the Sellers shall, and shall cause their respective
Affiliates to, use reasonable efforts to cooperate with Buyer and the Company to
preserve the confidentiality of such information consistent with applicable Law.

Section 8.7 Use of Names. Subject to the following sentence, each Seller agrees
that, from and after the Closing, it will not (and it will cause its
Subsidiaries or Affiliates not to) use the name “Wholesome Sweeteners” or any
derivation thereof or any name likely to cause confusion with or dilute such
names. Within five (5) Business Days after the Closing Date, unless otherwise
agreed to by Buyer and Billington, Billington shall cause Wholesome Sweeteners
Ltd., a private limited company organized under the laws of England and Wales
and a wholly-owned Subsidiary of Billington, to dissolve or change its name to a
name that does not use the name “Wholesome Sweeteners” or any derivation thereof
or any name likely to cause confusion with or dilute such names.

Section 8.8 Non-Competition; Non-Solicitation; Non-Disparagement.

(a) Each Seller acknowledges and agrees that the Company would be irreparably
damaged if it were to engage in the competitive activities described in this
Section 8.8(a), and that any such competition by such Seller (or its Affiliate
Entities) would result in a significant loss of goodwill by the Company. Each
Seller further acknowledges and agrees that the covenants and agreements set
forth in this Section 8.8 were a material inducement to Buyer to enter into this
Agreement and to perform its obligations hereunder, and that Buyer and its
stockholders would not obtain the benefit of the bargain set forth in this
Agreement as specifically negotiated by the parties hereto if such Seller
breached the provisions of this Section 8.8. Therefore, each Seller agrees, in
further consideration of the amounts to be paid hereunder for the Purchased
Shares and the goodwill of the Company sold by such Seller, that until the
fourth anniversary of the Closing, such Seller shall not (and shall cause its
Affiliate Entities not to) directly or indirectly own any interest in, manage,
control or in any other manner engage in any business engaged directly or
indirectly in the sale, marketing or distribution anywhere in the Restricted
Territories of (A) organic or fair trade sweeteners, including organic or fair
trade

 

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forms of agave, honey, stevia, sucrose products, erythritol and blended products
of which any of the foregoing are a substantial component, that are marketed as
“organic” or “fair trade” by such Person, (B) unrefined specialty sugars
(limited to sucrose, including, without limitation, demerara-type) sourced from
Malawi or Mauritius, other than the “Gold ‘N Natural” products of Imperial,
(C) non-organic or non-”fair trade” erythritol (i.e., the Company’s
“Zero”-branded erythritol product) or (D) “raw” honeys (for the avoidance of
doubt, the sale, marketing and distribution of forms of honey other than “raw”
honey, is not restricted pursuant to this clause (D)); provided, that nothing
herein shall prohibit any Seller or any of such Seller’s Affiliate Entities from
being an owner of not more than 5% of the outstanding securities of any class of
a legal entity which is publicly traded so long as none of such Persons has any
active participation in the business of such legal entity. Each Seller further
agrees that for so long as such Seller has continuing obligations under this
Section 8.8(a), such Seller will be deemed to be in breach of the preceding
sentence if such Seller (or its Affiliate Entities) directly or knowingly
indirectly imports, purchases or otherwise sources organic sugars from or
originating with Azucarera Paraguaya S.A., a Paraguay corporation, or any of its
Subsidiaries or Affiliates. Each Seller acknowledges that the geographic
restrictions in the covenants set forth above are reasonable and necessary to
protect the goodwill of the Company’s business being sold by such Seller
pursuant to this Agreement.

(b) Each Seller agrees that until the fourth anniversary of the Closing it shall
not (and shall cause its Affiliate Entities not to) directly, or indirectly
through another Person: (i) induce or attempt to induce any employee of the
Company or its Subsidiaries to leave the employ of the Company, or adversely
interfere with the relationship between the Company and such individual;
provided, however, that it shall not be deemed to be a violation of this
Section 8.8(b) for the Sellers or their Affiliate Entities to (A) make general
solicitations or advertisements that are not targeted or focused on such
individuals or (B) engage or use recruitment consultants or agencies, which have
not been given specific instructions to direct recruitment activity at such
individuals; or (ii) hire any person who was an employee of the Company at any
time (x) in the case officers or key employees of the Company, during the
one (1) year period immediately prior to the date on which such hiring would
take place and (y) in the case of all other employees, during the six (6) month
period immediately prior to the date on which such hiring would take place;
provided, however, that, notwithstanding the foregoing, with respect to
employees that are terminated by the Company or in connection with any
relocation of the Company’s offices outside of Sugar Land, Texas, the
restrictions in this Section 8.8(b)(ii) shall be limited to the three (3) month
period immediately prior to the date on which such hiring would take place.

(c) Each Seller agrees that until the fourth anniversary of the Closing that it
shall not (and shall cause its Affiliate Entities not to), except to enforce any
of its rights hereunder or to defend any Claim hereunder or done in good faith
in any other Claim or Proceeding against Buyer, the Company or any of their
respective Affiliates or employees, (i) make any negative statement or
communication regarding Buyer, the Company or any of their respective Affiliates
or employees with the intent to harm the Company or Buyer or (ii) make any
derogatory or disparaging statement or communication regarding Buyer, the
Company or any of their respective Affiliates or employees with the intent to
harm the Company or Buyer. Nothing in this Section 8.8(c) shall limit such
Seller’s or its Affiliate Entities’ ability to make true and accurate statements
or communications that Seller or its Affiliate Entities reasonably believe is
required pursuant to applicable Law.

 

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(d) If, at the time of enforcement of the covenants contained in this
Section 8.8 (the “Restrictive Covenants”), a court shall hold that the duration,
scope or area restrictions stated herein are unreasonable under circumstances
then existing, the parties agree that the maximum duration, scope or area
reasonable under such circumstances shall be substituted for the stated
duration, scope or area and that the court shall be allowed and directed to
revise the restrictions contained herein to cover the maximum period, scope and
area permitted by Law. Each Seller has consulted with legal counsel regarding
the Restrictive Covenants and based on such consultation has determined and
hereby acknowledges that the Restrictive Covenants are reasonable in terms of
duration, scope and area restrictions and are necessary to protect the goodwill
of the Company’s business and the substantial investment in the Company made by
Buyer hereunder.

(e) If any Seller or any Affiliate Entity of such Seller breaches, or threatens
to commit a breach of, any of the Restrictive Covenants, the Company shall have
the following rights and remedies, each of which rights and remedies shall be
independent of the others and severally enforceable, and each of which is in
addition to, and not in lieu of, any other rights and remedies available to
Buyer, the Company or any of their respective Affiliates at Law or in equity:

(i) the right and remedy to have the Restrictive Covenants specifically enforced
by any court of competent jurisdiction, it being agreed that any breach or
threatened breach of the Restrictive Covenants would cause irreparable injury to
the Company and that money damages would not provide an adequate remedy to the
Company; and

(ii) the right and remedy to require such Seller to account for and pay over to
the Company any profits, monies, accruals, increments or other benefits derived
or received by such Person as the result of any transactions constituting a
breach of the Restrictive Covenants.

(iii) In the event of any breach or violation by a Seller of any of the
Restrictive Covenants, the time period of such covenant (and only such covenant)
shall be tolled for the period of time the respective court or arbiter of
competent jurisdiction found such Seller to be in breach or violation.

ARTICLE IX

CLOSING CONDITIONS

Section 9.1 Conditions to Obligations of Each Party Under this Agreement. The
respective obligations of Buyer and the Sellers to consummate the transactions
contemplated hereby shall be subject to the satisfaction at or prior to the
Closing of the following condition, which may be waived by the parties hereto,
in whole or in part, to the extent permitted by applicable Law:

(a) The applicable waiting period under the HSR Act or any applicable foreign
competition Law, and any extension thereof shall have terminated or expired and
no temporary restraining order, preliminary or permanent injunction or other
judgment or order issued by any court of competent jurisdiction or other
statute, rule or legal restraint of a Governmental Authority shall be in effect
preventing the consummation of the transactions contemplated hereby.

 

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(b) There shall not be pending or threatened any Proceeding to materially
restrain, prohibit or otherwise materially interfere with or obtain substantial
monetary damages in connection with the consummation of the transactions
contemplated by this Agreement.

Section 9.2 Additional Conditions to the Sellers’ Obligations. The obligations
of the Sellers to effect the transactions contemplated hereby shall be subject
to the satisfaction at or prior to the Closing of the following conditions, any
or all of which may be waived by the Sellers, in whole or in part, to the extent
permitted by applicable Law:

(a) Each of the representations and warranties of Buyer set forth in this
Agreement shall be true and correct (it being understood that, for purposes of
determining satisfaction of this Section 9.2(a), all materiality qualifications
shall be disregarded) as of the Execution Date and as of the Closing Date as
though made on and as of the Closing Date (except that, in each case,
representations and warranties that speak as of a specified date shall have been
true and correct only on such date) except for failures that would not be
reasonably likely to have, individually or in the aggregate, a Buyer Material
Adverse Effect (provided, however, that the Fundamental Representations of Buyer
shall be true and correct in all respects without giving effect to such Buyer
Material Adverse Effect qualifier), and the Sellers shall have received a
certificate of an executive officer of Buyer, dated the Closing Date, to such
effect.

(b) Buyer shall have performed or complied in all material respects with all
agreements and covenants required by this Agreement to be performed or complied
with by it on or prior to the Closing Date, and the Sellers shall have received
a certificate of an executive officer of Buyer, dated the Closing Date, to such
effect.

(c) Since the Execution Date, there must not have been any event or series of
events which has had or would reasonably be expected to have a Buyer Material
Adverse Effect.

(d) Buyer shall have delivered all documents, instruments, certificates or other
items required to be delivered at Closing by Buyer pursuant to Section 2.4(a).

(e) Billington shall have received fully executed copies of the Executive
Contribution Agreements.

Section 9.3 Additional Conditions to Buyer’s Obligations. The obligations of
Buyer to effect the transactions contemplated hereby shall be subject to the
satisfaction at or prior to the Closing of the following conditions, any or all
of which may be waived by Buyer, in whole or in part, to the extent permitted by
applicable Law:

 

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(a) Each of the representations and warranties of the Sellers set forth in this
Agreement shall be true and correct (it being understood that, for purposes of
determining satisfaction of this Section 9.3(a), all materiality qualifications
shall be disregarded) as of the Execution Date and as of the Closing Date as
though made on and as of the Closing Date (except that, in each case,
representations and warranties that speak as of a specified date shall have been
true and correct only on such date) except for failures that would not be
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect (provided, however, that the Fundamental Representations of the Sellers
shall be true and correct in all respects without giving effect to such Material
Adverse Effect qualifier), and Buyer shall have received a certificate of an
executive officer of each Seller, dated the Closing Date, to such effect.

(b) Each Seller shall have performed or complied in all material respects with
all agreements and covenants required by this Agreement to be performed or
complied with by it on or prior to Closing Date, and Buyer shall have received a
certificate of an executive officer of each Seller, dated the Closing Date, to
such effect.

(c) There shall not be pending or threatened any Proceeding to materially
restrain, prohibit or otherwise materially interfere with or obtain substantial
monetary damages in connection with Buyer’s ownership of the Class A Shares or
the Executive Contributed Shares or the Company’s operation of the Business
after Closing.

(d) All Third Person Consents and all Authorizations listed on Section 9.3 of
the Sellers Disclosure Schedule shall have been obtained.

(e) Since the Execution Date, there must not have been any event which has had
or would reasonably be expected to have a Material Adverse Effect.

(f) Buyer shall have received each of the Contribution Agreements, executed by
Billington and each of the respective Contributing Executives, accompanied by
certificates representing the Billington Contributed Shares or Executive
Contributed Shares, as applicable, free and clear of all Liens other than
Permitted Equity Liens, which certificates shall be duly endorsed in blank (or
accompanied by duly executed stock powers).

(g) The Sellers shall have executed and delivered, or cause to be delivered, all
documents, instruments, certificates or other items required to be delivered at
Closing by the Sellers pursuant to Section 2.4(b).

(h) Buyer shall have received the Debt Financing for the consummation of the
transactions contemplated hereby.

ARTICLE X

TERMINATION

Section 10.1 Termination. This Agreement may be terminated at any time prior to
the Closing:

(a) by mutual written consent of the Sellers and Buyer;

(b) by the Sellers upon notice to Buyer, if any of the conditions in Section 9.1
or Section 9.2 cannot be satisfied on or prior to the Termination Date;
provided, however, that any such failure to close is not due to any breach by
the Sellers of any their respective representations, warranties or covenants
contained in this Agreement;

 

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(c) by Buyer upon notice to the Sellers, if any of the conditions in Section 9.1
or Section 9.3 cannot be satisfied on or prior to the Termination Date;
provided, however, that any such failure to close is not due to any breach by
Buyer of any its representations, warranties or covenants contained in this
Agreement; provided, further, that, in the event Buyer is obligated under
Section 7.10(b) to seek alternative debt financing and all of the conditions in
Section 9.1 and Sections 9.3(a)—(e) have been satisfied (including the delivery
of the certificates referred to in Section 9.3(a) and Section 9.3(b) on the
Termination Date), then (i) the Sellers shall have the right, which right may
only be exercised by the Sellers on or prior to the Termination Date and may not
be exercised more than once, to elect to extend the Termination Date up to 60
additional days after the Termination Date and (ii) if Buyer receives written
notice of such election on or prior to the Termination Date, Buyer may not
terminate this Agreement under this clause (c) prior to such extended
Termination Date unless the conditions in Section 9.1 and Section 9.3 cannot be
satisfied on or prior to the expiration of such extended period;

(d) by the Sellers upon notice to Buyer, if the Closing contemplated hereby
shall not have occurred on or before 45 days after the Execution Date (the
“Termination Date”); provided, however, that any such failure to close is not
due to any breach by the Sellers of any their respective representations,
warranties or covenants contained in this Agreement; provided, further, that, in
the event that all conditions of Section 9.1 and Section 9.3 other than
termination or expiration of the waiting period under the HSR Act or any
applicable foreign competition Law are satisfied, then the Sellers may not
terminate this Agreement under this clause (d) before an additional 90 days
after the Termination Date;

(e) by Buyer upon notice to the Sellers, if the Closing contemplated hereby
shall not have occurred on or before the Termination Date; provided, however,
that any such failure to close is not due to any breach by Buyer of any its
representations, warranties or covenants contained in this Agreement; provided,
further, that, in the event that all conditions of Section 9.1 and Section 9.2
other than termination or expiration of the waiting period under the HSR Act or
any applicable foreign competition Law are satisfied, then Buyer may not
terminate this Agreement under this clause (e) before an additional 90 days
after the Termination Date; provided, further, that, in the event Buyer is
obligated under Section 7.10(b) to seek alternative debt financing and all of
the conditions in Section 9.1(b) and Sections 9.3(a)—(e) have been satisfied
(including the delivery of the certificates referred to in Section 9.3(a) and
Section 9.3(b) on the Termination Date), then (i) the Sellers shall have the
right, which right may only be exercised by the Sellers on or prior to the
Termination Date and may not be exercised more than once, to elect to extend the
Termination Date up to 60 additional days after the Termination Date and (ii) if
Buyer receives written notice of such election on or prior to the Termination
Date, Buyer may not terminate this Agreement under this clause (e) prior to such
extended Termination Date unless all of the conditions in Section 9.1 and
Section 9.3 cannot be satisfied on or prior to the expiration of such extended
period;

(f) by the Sellers upon written notice to Buyer, if (i) all of the conditions in
Section 9.1 and Section 9.3 (other than conditions that by their nature can only
be satisfied at the Closing and would be satisfied if the parties attempted to
close the transactions contemplated hereby assuming that Buyer and the third
parties that are required to take actions relating to such conditions perform
the actions required of them to satisfy the Assumed Deliveries) have been
satisfied, (ii) the Sellers have irrevocably confirmed by written notice to
Buyer not less than five

 

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(5) Business Days prior to such notice of termination that (A) all of the
conditions in Section 9.1 and Section 9.2 (other than conditions that by their
nature can only be satisfied at the Closing (other than the condition set forth
in Section 9.2(e), assuming for purposes of this clause however that Buyer will
execute and deliver the Executive Contribution Agreements at the Closing)) have
been satisfied or will be waived by the Sellers and (B) Sellers are prepared to
consummate the Closing and (iii) Buyer fails to consummate the transactions
contemplated by this Agreement during the five (5) Business Day period following
the delivery of the notice provided under subsection (ii); provided, that Buyer
shall have no liability pursuant to this Section 10.1(f) if Buyer attempts to
close the transactions contemplated hereby (i.e., Buyer takes all actions
contemplated by Section 9.2) during such five (5) Business Day period and the
conditions in Section 9.1 and Section 9.3 (including the conditions that by
their nature can only be satisfied at the Closing) are not satisfied during such
five (5) Business Day period; or

(g) by the Sellers upon written notice to Buyer, if (i) Buyer is in material
breach of any of the representations, warranties or covenants of Buyer in this
Agreement, (ii) all of the conditions in Section 9.1 and Section 9.3 (other than
the condition in Section 9.3(h) or the conditions that by their nature can only
be satisfied at the Closing and would be satisfied if the parties attempted to
close the transactions contemplated hereby assuming that Buyer and the third
parties that are required to take actions relating to such conditions perform
the actions required of them to satisfy the Assumed Deliveries) have been
satisfied, (iii) (A) all of the conditions in Section 9.1 and Section 9.2 (other
than the conditions in Sections 9.2(d) and (e) or the conditions that by their
nature can only be satisfied at the Closing and would be satisfied if the
parties attempted to close the transactions contemplated hereby assuming that
Buyer and the third parties that are required to take actions relating to such
conditions perform the actions required of them to satisfy the Assumed
Deliveries) have been satisfied or will be waived by the Sellers and (B) the
Sellers have irrevocably confirmed by written notice to Buyer that Sellers are
prepared to consummate the Closing and waive any of their conditions to Closing
not then satisfied (other than the conditions in Sections 9.2(d) and (e)) and
(iv) during the twelve (12) Business Day period (the “Breach Cure Period”)
following the receipt by Buyer of the notice under subsection (iii)(B) Buyer
fails to either (x) cure in all material respects such breach(es) or (y) have
irrevocably confirmed by written notice to Sellers its intention to close the
transactions contemplated hereby and, provided that the Company and Sellers work
in good faith to allow Buyer to consummate the transactions contemplated hereby,
does not close the transactions contemplated by this Agreement during the Breach
Cure Period; provided, that for purposes of clauses (ii) and (iii) of this
Section 10.1(g), a certificate delivered by the Sellers to Buyer whereby the
Sellers certify to Buyer that they are ready, willing and able (X) to deliver
the items contemplated by Sections 2.4(b)(i), (ii), (iv), (v), (vi), (viii),
(xii), (xiii), (xiv), (xv), and, with respect to Billington, deliver the
Billington Contribution Agreement and the Billington Contributed Shares
contemplated by Section 9.3(f), and (Y) to cause the Company to take the actions
contemplated by Section 2.4(c) assuming that Buyer takes the actions
contemplated by Section 9.2, shall satisfy the requirement in such clauses that
such conditions would be satisfied at Closing; provided, however, that Buyer
shall have no liability pursuant to this Section 10.1(g) if Buyer attempts to
close the transactions contemplated hereby (i.e., Buyer takes all actions
contemplated by Section 9.2) during the Breach Cure Period and the Sellers fail
to deliver the items listed in (X) above or to cause the Company to take the
actions contemplated by Section 2.4(c) during the Breach Cure Period; and
provided, further, that Buyer shall not be able to terminate this Agreement
under Sections 10.1(c) or (e) during the Breach Cure Period.

 

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Section 10.2 Effect of Termination; Termination Fee.

(a) Except for this Section 10.2, Section 11.6 and ARTICLE XII (and the
definitions related to any of the foregoing), this Agreement shall, upon
termination hereof pursuant to Section 10.1, forthwith become of no further
force or effect and (i) except as provided by Section 10.2(b), there shall be no
liability on the part of the Sellers or Buyer or any of their respective
officers or directors to any other party and (ii) all rights and obligations of
any party hereto shall cease; provided, however, that any such termination shall
not relieve the Sellers or Buyer from liability for any willful and material
breach of this Agreement occurring prior to such termination; provided, further,
that, other than in the case of fraud or intentional misrepresentation, Buyer’s
maximum liability hereunder is the Termination Fee and, if the Closing does not
occur, Buyer shall have no liability hereunder, except pursuant to Section 11.9,
except in the event the Termination Fee is payable in accordance with
Section 10.2(b).

(b) If this Agreement is terminated pursuant to Section 10.1(f) or (g),
(i) Buyer shall pay to each Seller an amount equal to $4,442,825.98 (the
“Termination Fee”) by wire transfer in immediately available funds within three
(3) Business Days after the date this Agreement is terminated and (ii) the
Termination Fee shall be the sole and exclusive remedy of the Sellers against
Buyer with respect to this Agreement and the transactions contemplated hereby
(including the right to specific performance). In no event shall Buyer be
required to pay the Termination Fee on more than one occasion. Each of the
parties acknowledges that the payment of the Termination Fee by Buyer is not a
penalty, but is liquidated damages in a reasonable amount that will compensate
the Sellers for the efforts and resources expended and the opportunities
foregone while negotiating this Agreement and in reliance on this Agreement and
on the expectation of the consummation of the transactions contemplated by this
Agreement, which amount would otherwise be impracticable to calculate with
precision.

ARTICLE XI

INDEMNIFICATION AND REMEDIES

Section 11.1 Survival. Subject to the limitations and other provisions of this
Agreement, the parties, intending to, where applicable, contractually shorten
the applicable statute of limitations, agree that:

(a) the representations and warranties of the parties hereto contained in this
Agreement (other than the Fundamental Representations) shall expire as of the
Closing, and, except for fraud and intentional misrepresentation, all
liabilities of and remedies exercisable by the parties, as the case may be, with
respect to the representations and warranties of the parties hereto contained in
this Agreement (other than the Fundamental Representations) shall terminate as
of the Closing;

(b) the Fundamental Representations shall survive after the Closing Date
forever;

 

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(c) the covenants and agreements of the parties hereto contained in this
Agreement, which by their terms are required to be performed on or before the
Closing, shall expire as of the Closing, and all liabilities of and remedies
exercisable by the parties, as the case may be, with respect to such covenants
and agreements shall terminate as of the Closing, other than the covenants and
agreements contained in subsections (d) through (h), (j) through (s), and
(u) through (z) of Section 7.1 and Section 7.1(aa), to the extent it relates to
the foregoing subsections of Section 7.1) (collectively, the “Covered
Pre-Closing Covenants”), which shall remain in full force and effect for a
period of nine (9) months after the Closing Date; and

(d) except as otherwise provided in Section 8.5(i), the covenants and agreements
of the parties hereto contained in this Agreement, which by their terms require
performance after the Closing, shall survive the Closing and shall remain in
full force and effect until such covenants or agreements are fully performed.

Section 11.2 Indemnification Provisions for Benefit of Buyer.

(a) If the Closing occurs, (i) Billington agrees to indemnify Buyer Indemnitees
from and against any Losses actually suffered or incurred by them arising out of
or related to (A) the breach of any Fundamental Representation of Billington
contained in ARTICLE III and (B) any liability of the Company to the extent such
liability is not related to the Business or operations of the Company and is the
result of the Company’s affiliation with Billington (or its Affiliates other
than the Company), whether by operation of Law or otherwise; (ii) Imperial
agrees to indemnify Buyer Indemnitees from and against any Losses actually
suffered or incurred by them arising out of or related to (A) the breach of any
Fundamental Representation of Imperial contained in ARTICLE IV and (B) any
liability of the Company to the extent such liability is not related to the
Business or operations of the Company and is the result of the Company’s
affiliation with Imperial (or its Affiliates other than the Company), whether by
operation of Law or otherwise; and (iii) the Sellers agree to indemnify,
Severally, but not jointly, Buyer Indemnitees from and against any Losses
actually suffered or incurred by them arising out of or related to (A) the
breach of any Fundamental Representation of the Sellers contained in ARTICLE V;
(B) (x) the breach by the Sellers of any of the Covered Pre-Closing Covenants or
(y) any covenants or agreements of the Sellers contained in this Agreement which
by their terms require performance after the Closing; (C) any outstanding
Company Transaction Costs or Company Funded Debt in existence as of the Closing
Date to the extent such amounts are not paid by the Sellers or included in the
final determination of the Purchase Price pursuant to Section 2.5 and any Losses
related to removing any Liens (other than Permitted Liens) on the assets or
properties of the Company after the Closing with respect to the Company Funded
Debt identified in the Payoff Letters; (D) any liability to any consultants or
service providers of the Company or its Affiliates (including the Sellers)
arising, vesting (whether fully or partially), or conferring any right of
immediate or future value as a result of the consummation of the transactions
contemplated hereby (whether or not such liability is immediately due and
payable upon consummation of the transactions contemplated hereby), to the
extent such amounts are not paid by the Sellers or included in the final
determination of the Purchase Price pursuant to Section 2.5; and (E) subject to
Section 8.5(f) or as otherwise provided in the agreements and documents to be
entered into in connection with the Repurchase Transactions, any Proceeding
initiated by or any Claims of any of the Non-Voting Stockholders in his or her
capacity as a stockholder of the Company or with respect to the transactions
contemplated hereby. No Claim may be asserted nor may any action be commenced
against the Sellers pursuant to subclause (A) or (B) of this Section 11.2(a)
unless written notice of such Claim or action is received by the Sellers
describing in reasonable detail (to the extent then known) the facts and
circumstances

 

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with respect to the subject matter of such Claim or action on or prior to the
date on which the representation or warranty or covenant or agreement (as
applicable) on which such Claim or action is based ceases to survive as set
forth in Section 11.1. Subject to Section 11.1(a), the representations and
warranties in this Agreement shall in no event be affected by any investigation,
inquiry or examination made for or on behalf of any party, or the knowledge of
any party’s agents, advisors or representatives or the acceptance by any party
of any certificate hereunder.

(b) No Claim may be made against the Sellers for indemnification pursuant to
Section 11.2(a)(iii)(B)(x): (i) with respect to any individual item (or group of
related items) of Loss unless such Loss exceeds $15,000 (nor shall any such Loss
below such threshold be applied to or considered for purposes of calculating the
aggregate amount of the Buyer Indemnitees’ Losses, including under clause (ii)
below) and (ii) unless the aggregate amount of all Losses of the Buyer
Indemnitees with respect to Section 11.2(a)(iii)(B)(x) shall exceed $100,000
(after which point the Sellers will be obligated only to indemnify Buyer from
and against Losses in excess of such amount).

(c) Except as provided in Section 8.5, for the rights of indemnification
provided in Section 11.2(a) and with respect to fraud or intentional
misrepresentation or as may be asserted in defense of any Claim brought by any
Seller or its Affiliates against Buyer or the Company, Buyer hereby waives and
releases any Claim or cause of action by Law or otherwise against the Sellers or
their Affiliates in connection with the transactions contemplated hereby
regarding obligations, liabilities and Losses of any nature whatsoever that are
attributable to the Business, the Class A Shares or the Company, whether arising
before or after the Closing Date.

Section 11.3 Indemnification Provisions for Benefit of the Sellers.

(a) If the Closing occurs, Buyer agrees to indemnify Seller Indemnitees from and
against any Losses actually suffered or incurred by them arising out of or
related to (i) the breach of any Fundamental Representation of Buyer contained
in ARTICLE VI, (ii) the breach of any covenants or agreements of Buyer contained
in this Agreement which by their terms require performance after the Closing,
and (iii) the Company or the operation of the Business (other than a Loss to
which the Sellers have agreed to indemnify Buyer Indemnitees under
Section 11.2(a)) but only to the extent such Loss first arises after the
Closing.

(b) Except as provided in Section 7.4(b) and Section 8.5, for the rights of
indemnification provided in Section 11.3(a) and with respect to fraud or
intentional misrepresentation or as may be asserted in defense of any Claim
brought by Buyer or its Affiliates against Seller, the Sellers hereby waive and
release any Claim or cause of action by Law or otherwise against Buyer or its
Affiliates in connection with the transactions contemplated hereby regarding
obligations, liabilities and Losses of any nature whatsoever that are
attributable to the Business, the Class A Shares or the Company, whether arising
before or after the Closing Date; provided, however, that nothing in this
Section 11.3(b) shall reduce or otherwise limit any Claims that Billington may
have in the future as a member of Buyer.

 

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Section 11.4 Indemnification Procedures; Matters Involving Third Parties.

(a) A Seller Indemnitee or Buyer Indemnitee, as the case may be (for purposes of
this Section 11.4, an “Indemnified Party”), shall give the indemnifying party
under Section 11.2 and Section 11.3, as applicable (for purposes of this
Section 11.4, an “Indemnifying Party”), prompt written notice of any matter
which it has determined has given or could give rise to a right of
indemnification under this Agreement stating the amount of the Loss, if known,
and method of computation thereof, containing a reference to the provisions of
this Agreement in respect of which such right of indemnification is claimed or
arises; provided, however, that the failure to provide such notice shall not
release the Indemnifying Party from its obligations under this ARTICLE XI except
to the extent the Indemnifying Party is actually prejudiced by such failure.

(b) If any third Person shall notify an Indemnified Party with respect to any
matter (a “Third-Party Claim”) that may give rise to a Claim for indemnification
against the Indemnifying Party under this ARTICLE XI, then the Indemnified Party
shall promptly (and in any event within five Business Days after receiving
notice of the Third-Party Claim) notify the Indemnifying Party thereof in
writing; provided, however, that the failure to provide such notice within such
time frame shall not release the Indemnifying Party from its obligations under
this ARTICLE XI except to the extent the Indemnifying Party is actually
prejudiced by such failure.

(c) The Indemnifying Party will have the right to assume and thereafter conduct
the defense of the Third-Party Claim with counsel of its choice reasonably
satisfactory to the Indemnified Party; provided, that the Indemnifying Party
first verifies to the Indemnified Party in writing that the Indemnifying Party
is fully responsible (with no reservation of any rights) for all liabilities and
obligations relating to such Third-Party Claim and that it shall provide full
indemnification (whether or not otherwise required hereunder) to the Indemnified
Party with respect to such Third-Party Claim, and provided further that the
Indemnifying Party shall not be entitled to assume control of such defense
(unless otherwise agreed to in writing by the Indemnified Party) and shall pay
the reasonable fees and expenses of counsel retained by the Indemnified Party if
(i) the claim for indemnification relates to or arises in connection with any
criminal Proceeding or Taxes; (ii) the claim seeks an injunction or equitable
relief against the Indemnified Party; (iii) the Indemnified Party provides the
Indemnifying Party with an opinion of counsel that a conflict of interest exists
between the Indemnifying Party and the Indemnified Party (other than a conflict
relating to the rights of the parties under this Article XI); or (iv) upon
petition by the Indemnified Party, the appropriate Governmental Authority rules
that the Indemnifying Party failed or is failing to vigorously prosecute or
defend such Claim. If the Indemnifying Party has assumed the defense of a
Third-Party Claim pursuant to this Section 11.4(c), the Indemnifying Party will
not, without the prior written consent of the Indemnified Party, consent to the
entry of any judgment or enter into any settlement with respect to the
Third-Party Claim if, in either case, it would (i) include the admission of any
liability or responsibility on behalf of the Indemnified Party, (ii) include any
financial obligation to be paid by the Indemnified Party or (iii) include any
injunctive relief.

(d) Unless and until the Indemnifying Party assumes the defense of the
Third-Party Claim as provided in Section 11.4(c), the Indemnified Party may
defend against the Third-Party Claim in any manner it may reasonably deem
appropriate. If the Indemnifying Party assumes the defense of the Third-Party
Claim as provided in Section 11.4(c), the Indemnified Party shall have the
right, at its own cost and expense, to participate in the defense of any
Third-Party Claim with counsel selected by it subject to the Indemnifying
Party’s right to control the defense thereof; provided, that any reasonable fees
and expenses of such separate counsel directly related to the defense of such
Third-Party Claim that are incurred prior to the date the Indemnifying Party
effectively assumes control of such defense shall be borne by the Indemnifying
Party.

 

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(e) In no event will the Indemnified Party consent to the entry of any judgment
or enter into any settlement with respect to the Third-Party Claim without the
prior written consent of the Indemnifying Party (which consent shall not be
unreasonably withheld).

Section 11.5 Determination of Losses.

(a) Subject to Section 11.1(a), for purposes of determining whether there has
been a breach and the amount of Losses that are the subject matter of a Claim
for indemnification or reimbursement hereunder, each representation and warranty
in this Agreement or in any certificate or agreement delivered in connection
with this Agreement shall be read without regard and without giving effect to
the term “material,” “Material Adverse Effect,” or any similar phrases contained
in such representation or warranty which has the effect of making such
representation and warranty less restrictive (as if such words were deleted from
such representation or warranty).

(b) The Losses giving rise to any indemnification obligation hereunder shall be
limited to the actual Loss suffered by the Indemnified Party (i.e., reduced by
any insurance proceeds or other payment or recoupment actually received,
realized or retained by the Indemnified Party as a result of the events giving
rise to the Claim for indemnification net of any expenses related to the receipt
of such proceeds, payment or recoupment, including retrospective premium
adjustments, if any, and further reduced by any reduction in Taxes attributable
to such Loss, that is actually realized in the taxable period such Loss is
incurred, a prior taxable period, or in any of the immediately succeeding
taxable periods (in any event, not to exceed the five immediately succeeding
taxable periods) prior to the occurrence of the sale of all or substantially all
of the assets of Parent (determined on a consolidated basis) or the sale of
equity securities of Parent possessing the voting power to appoint the general
partner of Parent (whether by merger, consolidation, reorganization,
combination, sale or transfer of Parent’s equity securities, securityholder or
voting agreement, proxy, power of attorney or otherwise) to a third Person or a
similar transaction or series of transactions involving Parent, of the
Indemnified Party (or the Affiliated group of which it is a member) and treating
all items attributable to such Loss as the last items in the Tax Return for such
taxable period). Notwithstanding anything to the contrary in this Agreement
(including the preceding sentence), in no event will a party’s indemnification
obligations hereunder be limited or reduced by any amounts recovered by an
Indemnified Party or its Affiliates pursuant to any representations and
warranties insurance policy. The amount of the actual Loss and the amount of the
indemnity payment shall be computed by taking into account the timing of the
Loss or payment, as applicable, using the Applicable Rate, as appropriate. The
Indemnified Party shall notify the Indemnifying Party promptly of any proceeds,
payment or monetary recoupment actually received by the Indemnified Party and if
the Indemnifying Party has previously made any payment to the Indemnified Party,
the Indemnified Party shall promptly pay any amount obtained thereby to the
Indemnifying Party to the extent of such amount being previously paid by the
Indemnifying Party to the Indemnified Party. Upon the request of the
Indemnifying Party, the Indemnified Party shall provide the Indemnifying Party
with information sufficient to allow the Indemnifying Party to calculate the
amount of the indemnity payment in accordance with this Section 11.5.

 

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Section 11.6 Limitations on Liability.

(a) BUYER ACKNOWLEDGES AND AGREES, EXCEPT AS SET FORTH IN SECTION 8.5 OR
SECTION 8.8 OR IN THE CASE OF FRAUD OR INTENTIONAL MISREPRESENTATION, THAT THE
REMEDIES SET FORTH IN THIS ARTICLE XI, INCLUDING THE DISCLAIMERS SET FORTH IN
SECTION 7.5 AND SECTION 7.6, ARE INTENDED TO BE, AND SHALL BE, THE EXCLUSIVE
REMEDIES OF BUYER WITH RESPECT TO ANY ASPECT OF THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT. IF THE CLOSING OCCURS, BUYER HEREBY RELEASES, WAIVES AND
DISCHARGES, AND COVENANTS NOT TO SUE WITH RESPECT TO, ANY CAUSE OF ACTION OR
CLAIM (I) NOT RELATED TO FRAUD OR INTENTIONAL MISREPRESENTATION, (II) NOT
ASSERTED IN DEFENSE OF ANY CLAIM BROUGHT BY ANY SELLER OR ITS AFFILIATES AGAINST
BUYER OR (III) NOT EXPRESSLY PROVIDED FOR IN THIS AGREEMENT TO THE MAXIMUM
EXTENT PERMITTED BY LAW.

(b) EACH OF THE SELLERS ACKNOWLEDGES AND AGREES THAT EXCEPT AS SET FORTH IN
SECTION 7.4(B) AND SECTION 8.5 OR IN THE CASE OF FRAUD OR INTENTIONAL
MISREPRESENTATION, THE REMEDIES SET FORTH IN ARTICLE X AND THIS ARTICLE XI ARE
INTENDED TO BE, AND SHALL BE, THE EXCLUSIVE REMEDIES OF THE SELLERS WITH RESPECT
TO ANY ASPECT OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. IF THE CLOSING
OCCURS, EACH OF THE SELLERS HEREBY RELEASES, WAIVES AND DISCHARGES, AND
COVENANTS NOT TO SUE WITH RESPECT TO, ANY CAUSE OF ACTION OR CLAIM (I) NOT
RELATED TO FRAUD OR INTENTIONAL MISREPRESENTATION, (II) NOT ASSERTED IN DEFENSE
OF ANY CLAIM BROUGHT BY BUYER OR ITS AFFILIATES AGAINST SUCH SELLER OR (III) NOT
EXPRESSLY PROVIDED FOR IN THIS AGREEMENT TO THE MAXIMUM EXTENT PERMITTED BY LAW.

(c) Notwithstanding anything to the contrary contained in this Agreement, no
party hereto shall be entitled to recover from any other party hereto any amount
in respect of punitive damages, unless payable to a third party.

(d) ALL RELEASES, DISCLAIMERS, LIMITATIONS ON LIABILITY AND INDEMNITIES IN THIS
AGREEMENT, INCLUDING THOSE IN THIS ARTICLE XI, SHALL NOT APPLY IN THE EVENT OF
FRAUD OR INTENTIONAL MISREPRESENTATION, BUT SHALL OTHERWISE APPLY EVEN IN THE
EVENT OF THE SOLE, JOINT OR CONCURRENT, ACTIVE OR PASSIVE NEGLIGENCE, STRICT
LIABILITY OR FAULT OF THE PARTY WHOSE LIABILITY IS RELEASED, DISCLAIMED, LIMITED
OR INDEMNIFIED.

 

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Section 11.7 No Multiple Recoveries. Notwithstanding anything herein to the
contrary, in the event Buyer (or any other Buyer Indemnitee) is entitled to a
payment or other benefit under more than one provision of this Agreement arising
out of or resulting from the same set of facts or circumstances and Buyer (or
any other Buyer Indemnitee) has already received payment or otherwise received a
benefit under one of those provisions, in no event shall Buyer (or any other
Buyer Indemnitee) be entitled to receive a subsequent payment or benefit under
any other provision of this Agreement to the extent that, together with any
prior payments or benefits, such subsequent payment or benefit would exceed the
amount of Losses suffered by Buyer (or any other Buyer Indemnitee) arising out
of that same set of facts or circumstances. For purposes of illustration (and
without limiting the generality of the foregoing), if a set of facts constitutes
a breach of a representation and warranty and gives rise to a Loss for which the
Sellers have agreed to indemnify the Buyer Indemnified Parties under this
Agreement but a portion of such Loss was previously taken into account in the
determination of the Adjusted Net Working Capital, then neither Buyer nor any
other Buyer Indemnitee shall be permitted to claim any right to indemnification
pursuant to this ARTICLE XI with respect to such Loss, to the extent such Loss
was previously taken into account in the determination of the Adjusted Net
Working Capital. Any liability for indemnification hereunder shall be determined
without duplication of recovery in excess of the amount of Losses suffered in
connection with such facts by reason of the facts giving rise to such liability
constituting a breach of more than one representation, warranty or covenant.

Section 11.8 Certain Waivers, etc. Each Seller hereby agrees that it shall not
make any Claim for indemnification against Buyer, the Company or any of their
respective Affiliates solely by reason of the fact that such Seller was a
stockholder of the Company (whether such Claim is pursuant to any statute,
Governing Document or otherwise) with respect to any Proceeding or Claim brought
by any of the Buyer Indemnitees against such Seller pursuant to this ARTICLE XI,
and such Seller hereby acknowledges and agrees that it shall not have any Claim
or right to contribution or indemnity from the Company with respect to any
amounts paid by it pursuant to this ARTICLE XI. Except with respect to, and as
otherwise provided in, this Agreement or the certificates and agreements
delivered in connection with this Agreement, including the agreements and
documents to be entered into in connection with the Repurchase Transactions,
effective upon the Closing, each Seller hereby irrevocably waives, releases and
discharges the Company from any and all liabilities that have arisen, occurred
or accrued on or prior to the Closing Date of any kind or nature whatsoever,
whether in the capacity as a stockholder of the Company or otherwise (including
in respect of any rights of contribution or indemnification), in each case
whether absolute or contingent, liquidated or unliquidated, known or unknown,
and whether arising under any agreement or understanding or otherwise at Law or
in equity, and each Seller agrees that it shall not seek to recover any amounts
in connection therewith or thereunder from the Company. Except with respect to,
and as otherwise provided in, this Agreement or the certificates and agreements
delivered in connection with this Agreement, including the agreements and
documents to be entered into in connection with the Repurchase Transactions,
effective upon the Closing, the Company hereby irrevocably waives, releases and
discharges each of the Sellers from any and all liabilities that have arisen,
occurred or accrued on or prior to the Closing Date of any kind or nature
whatsoever (including in respect of any rights of contribution or
indemnification), in each case whether absolute or contingent, liquidated or
unliquidated, known or unknown, and whether arising under any agreement or
understanding or otherwise at Law or in equity, including any and all
liabilities arising under the Repurchase Agreements, and the Company agrees that
it shall not seek to recover any amounts in connection therewith or thereunder
from the Sellers.

 

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Section 11.9 Specific Performance. The parties each acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed by them in accordance with the terms hereof and
that each party shall be entitled to specific performance of the terms hereof,
in addition to any other remedy at Law or equity. The parties each acknowledge
and agree that the parties shall be entitled to an injunction, specific
performance and other equitable relief to prevent breaches of this Agreement and
to enforce specifically the terms and provisions hereof. Each of the parties
agree that it will not oppose the granting of an injunction, specific
performance and other equitable relief on the basis that the other parties have
an adequate remedy at Law or an award of specific is not an appropriate remedy
for any reason at Law or equity.

ARTICLE XII

MISCELLANEOUS

Section 12.1 Amendment. This Agreement may not be amended except by an
instrument in writing authorized by the Sellers and Buyer and signed by the
Sellers and Buyer.

Section 12.2 Waiver. At any time prior to the Closing, either the Sellers, one
the one hand, or Buyer, on the other hand, may (a) extend the time for the
performance of any of the obligations or other acts of the other, (b) waive any
inaccuracies in the representations and warranties of the other contained herein
or in any document delivered pursuant hereto, and (c) waive compliance by the
other with any of the agreements or conditions contained herein. Any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed by the party hereto to be bound thereby.

Section 12.3 Notices. All notices and other communications that are required to
be or may be given pursuant to this Agreement shall be in writing and shall be
deemed to have been duly given if delivered in person or by reputable overnight
express courier or mailed by registered or certified mail (postage prepaid,
return receipt requested) to the relevant party hereto at the following
addresses or sent by facsimile to the following numbers:

If to Billington, to:

Edward Billington and Son, Limited Cunard Building, 2nd Floor

Liverpool

L3 1DS

United Kingdom

Attention: David Marshall, Finance Director

Telephone: +44.151.243.9074

Facsimile: +44.151.243.7724

 

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with a copy to:

Baker Botts L.L.P.

910 Louisiana Street

Houston, Texas 77002

Attention: Timothy S. Taylor

Telephone: 713.229.1184

Facsimile: 713.229.7784

If to Imperial, to:

Imperial Sugar Company

8016 Highway 90-A

PO Box 9

Sugar Land, TX 77487

Attention: General Counsel

Telephone: (281) 490-9775

Facsimile: (281) 490-9881

with a copy to:

Baker Botts L.L.P.

910 Louisiana Street

Houston, Texas 77002

Attention: Timothy S. Taylor

Telephone: 713.229.1184

Facsimile: 713.229.7784

If to Buyer, to:

WSO Investments, Inc.

277 Park Avenue, 50th floor

New York, New York 10172

Attention: Michelle Brooks and Michael Mayberry

Telephone: (212) 207-5200

Facsimile: 212) 207-5863 and (212) 527-1540

with a copy to:

Kirkland & Ellis LLP

300 North LaSalle Street

Chicago, Illinois 60654

Attention: Jeremy S. Liss

Telephone: (312) 862-2000

Facsimile: (312) 862-2200

 

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or to such other address or facsimile number as a Seller or Buyer may, from time
to time, designate in a written notice given in accordance with this
Section 12.3. Any such notice or communication shall be effective (a) if
delivered in person, upon actual receipt by the intended recipient, (b) if
delivered by reputable overnight express courier, one business day after being
sent, (c) if sent by facsimile transmission, upon actual receipt if received
during the recipient’s normal business hours, or at the beginning of the
recipient’s next business day after receipt if not received during recipient’s
normal business hours or (d) if mailed, upon the earlier of five days after
deposit in the mail and the date of delivery as shown by the return receipt
therefor.

Section 12.4 Governing Law. This Agreement shall be construed (both as to
validity and performance), interpreted and enforced in accordance with, and
governed by, the Laws of the State of Delaware, without regard to any conflicts
of law provisions thereof that would result in the application of the Laws of
any other jurisdiction.

Section 12.5 Jurisdiction; Consent to Service of Process; WAIVER OF JURY TRIAL.
Each of the parties to this Agreement agrees, subject to Section 12.6, that it
shall bring any action or proceeding in respect of any Claim arising out of or
related to this Agreement, whether in tort or contract or at law or in equity,
exclusively in any federal or state court in Delaware and solely in connection
with Claims arising under this Agreement or the transactions contained in or
contemplated by this Agreement, (i) irrevocably submits to the exclusive
jurisdiction of such courts, (ii) waives any objection to laying venue in any
such action or proceeding in such courts, (iii) waives any objection that such
courts are an inconvenient forum or do not have jurisdiction over it and
(iv) agrees that service of process upon it may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to it at its address specified in Section 12.3. The
foregoing consents to jurisdiction and service of process shall not constitute
general consents to service of process in the State of Texas for any purpose
except as provided herein and shall not be deemed to confer rights on any Person
other than the parties to this Agreement. EACH PARTY HEREBY KNOWINGLY AND
INTENTIONALLY, IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.

Section 12.6 Dispute Resolution. Except as otherwise expressly provided herein
(but only with respect thereto), all controversies, Claims or disputes that
arise out of or relate to this Agreement or the construction, interpretation,
performance, breach, termination, enforceability or validity of this Agreement,
or the commercial, economic or other relationship of the parties, whether such
controversy, Claim or dispute is based on rights, privileges or interests
recognized by or based upon statute, contract, tort, common law or otherwise,
shall be resolved in accordance with the Dispute Resolution Procedures set forth
in Exhibit C.

Section 12.7 Public Announcements. Neither the Sellers nor Buyer will issue or
make any press releases or similar public announcements concerning this
Agreement or the transactions contemplated hereby without the other parties’
prior written consent, which shall not be unreasonably withheld, except as may
be required by applicable Law. In the event that a party believes it is required
to issue or make any press release or announcement, such party shall (a) give
prompt notice thereof to the other parties, (b) allow such other parties
reasonable opportunity to review and provide comments with respect to the
content of such press release or announcement and (c) use commercially
reasonable efforts to incorporate any reasonable comment from any other party
prior to any release or announcement.

 

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Section 12.8 Expenses. Except as otherwise expressly provided herein, all costs
and expenses incurred by the Sellers in connection with this Agreement and the
transactions contemplated hereby shall be paid by the Sellers, and all costs and
expenses incurred by Buyer in connection with this Agreement and the
transactions contemplated hereby shall be paid by Buyer; provided, however, that
all filing fees with any Governmental Authority shall be borne 50% by Buyer and
50% by the Sellers.

Section 12.9 Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

Section 12.10 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of Law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any party hereto. Except as otherwise provided in Section 8.8, on
such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties hereto
as closely as possible in an acceptable manner to the end that transactions
contemplated hereby are fulfilled to the extent possible.

Section 12.11 Assignment. Subject to the following sentence, this Agreement
shall not be assigned by any party hereto except with the prior written consent
of the other parties or by operation of Law. Buyer may assign its rights and
obligations pursuant to this Agreement, and each of the other agreements and
instruments contemplated hereby, in whole or in part, in connection with any
disposition or transfer of all or any portion of the Company or its businesses
in any form of transaction without the consent of any of the other parties
hereto, and Buyer and the Company may assign any or all of their rights pursuant
to this Agreement, and each of the other agreements and instruments contemplated
hereby, including their rights to indemnification, to any of their lenders as
collateral security; provided, however, that, in each case, Buyer will remain
liable to the Sellers and each Seller Indemnitee to perform its obligations
under this Agreement. Any purported assignment of this Agreement in violation of
this Section 12.11 shall be null and void.

Section 12.12 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto and its successors and
permitted assigns, and to the benefit of (a) Buyer Indemnitees and (b) Seller
Indemnitees, and nothing in this Agreement, express or implied, is intended to
or shall confer upon any other Person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.

Section 12.13 Failure or Indulgence Not Waiver. No failure or delay on the part
of any party hereto in the exercise of any right hereunder shall impair such
right or be construed to be a waiver of, or acquiescence in, any breach of any
representation, warranty, covenant or agreement herein, nor shall any single or
partial exercise of any such right preclude other or further exercise thereof or
of any other right.

 

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Section 12.14 Disclosure Schedules. Any matter disclosed by the Sellers in the
Sellers Disclosure Schedule pursuant to any Section of this Agreement shall be
deemed to have been disclosed by the Sellers for purposes of each other
representation and warranty of this Agreement to which the relevance of such
disclosure is reasonably apparent on its face. The listing (or inclusion of a
copy) of a document or other item in the Sellers Disclosure Schedule shall be
adequate to disclose an exception to a representation or warranty made herein if
the nature and relevance of such exception is reasonably apparent from the
listing (or inclusion of a copy) of such document.

Section 12.15 Proportionate Payments. Except as specifically set forth in this
Agreement, any payments to Buyer pursuant to this Agreement by the Sellers,
including any payments required by ARTICLE XI hereof, shall be made by them pro
rata in proportion to the Class A Shares owned, directly or indirectly, at the
execution of this Agreement as set forth on Section 5.2 of the Sellers
Disclosure Schedule; provided, however, that the aggregate Estimated Closing
Purchase Price payable in accordance with Section 2.4(a)(iii) shall be paid to
the Sellers in accordance with the written instructions of the Sellers delivered
to Buyer at least two Business Days (or such shorter period of time mutually
agreed to among the parties) prior to the Closing. Similarly, except as
specifically set forth in this Agreement, any payments by Buyer pursuant to this
Agreement to the Sellers shall be made to them pro rata in proportion to the
Class A Shares owned, directly or indirectly, at the execution of this Agreement
by the Sellers as set forth on Section 5.2 of the Sellers Disclosure Schedule.

Section 12.16 Time of the Essence. Time is of the essence in this Agreement. If
the date specified in this Agreement for giving any notice or taking any action
is not a Business Day (or if the period during which any notice is required to
be given or any action taken expires on a date which is not a Business Day),
then the date for giving such notice or taking such action (and the expiration
date of such period during which notice is required to be given or action taken)
shall be the next day which is a Business Day.

Section 12.17 Counterparts. This Agreement may be executed in multiple
counterparts and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement. Any such counterpart, to
the extent delivered by means of a facsimile machine or by .pdf, .tif, .gif,
.peg or similar attachment to electronic mail (any such delivery, an “Electronic
Delivery”) shall be treated in all manner and respects as an original executed
counterpart and shall be considered to have the same binding legal effect as if
it were the original signed version thereof delivered in person. At the request
of any party hereto, each other party hereto or thereto shall re-execute the
original form of this Agreement and deliver such form to all other parties. No
party hereto shall raise the use of Electronic Delivery to deliver a signature
or the fact that any signature or agreement or instrument was transmitted or
communicated through the use of Electronic Delivery as a defense to the
formation of a contract, and each such party forever waives any such defense,
except to the extent such defense relates to lack of authenticity.

 

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Section 12.18 Entire Agreement. This Agreement (together with the Exhibits and
the Sellers Disclosure Schedule) constitute the entire agreement of the parties
hereto, and supersede all prior agreements and undertakings, both written and
oral, among the parties hereto, with respect to the subject matter hereof;
provided, however, that the Confidentiality Agreement is

hereby incorporated herein by reference and shall constitute a part of this
Agreement for all purposes and shall remain in full force and effect following
the execution of this Agreement until terminated in accordance with its terms;
provided, further, however, that, immediately after the Closing, the
Confidentiality Agreement shall automatically terminate without any further
action by any party thereto.

[Balance of page intentionally left blank]

 

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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed as of the date first written above by its officer thereunto duly
authorized.

EDWARD BILLINGTON AND SON, LIMITED

 

By:     /s/ Mark Cashin

Name: Mark Cashin

Title: Director

IMPERIAL SUGAR COMPANY

By:     /s/ H. P. Mechler

            H. P. Mechler

            Senior Vice President and Chief Financial Officer

And, for the limited purposes of indicating its agreement to the covenants and
agreements in Section 2.4(c), Section 2.6, Section 7.7 and Section 7.8:

WHOLESOME SWEETENERS, INCORPORATED

By:     /s/ Nigel Willerton

Name: Nigel Willerton

Title: CEO

[Signature Page to Sale and Purchase Agreement]

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WSO INVESTMENTS, INC.

By:     /s/ Michelle Brooks

Name: Michelle Brooks

Title: President

[Signature Page to Sale and Purchase Agreement]

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EXHIBIT A

KNOWLEDGE INDIVIDUALS

Part I—The Sellers

(i) Edward Billington and Son, Limited

Mark Cashin

David Marshall

(ii) Imperial Sugar Company

John Sheptor

Hal Mechler

(iii) The Sellers collectively

Mark Cashin

Patrick Henneberry

David Marshall

John Sheptor

Hal Mechler

Nigel Willerton

Jeff Seidel

Walter Nimocks

Jim Davet

Pauline McKee

Part II—Buyer

Michelle Brooks

Alex Bernstein

 

A- 1

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EXHIBIT B

FORM OF TRANSITION SERVICES AGREEMENT

[Attached.]

 

B- 1

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EXHIBIT C

DISPUTE RESOLUTION PROCEDURES

For purposes of this Exhibit C, the term “Agreement” refers to the Sale and
Purchase Agreement, dated as of March 7, 2011, by and among Edward Billington
and Son, Limited, a private limited company organized under the laws of England
and Wales, Imperial Sugar Company, a Texas corporation, and WSO Investments,
Inc., a Delaware corporation, and, for the limited purposes set forth in the
Agreement, Wholesome Sweeteners, Incorporated, a Delaware corporation. All
capitalized terms used but not defined in this Exhibit C shall have the
respective meanings assigned to them in the Agreement and, except where
otherwise indicated, all section references used in this Exhibit C refer to
sections of this Exhibit C.

 

  1. Negotiation; Mediation.

(a) In the event of any dispute or disagreement between two or more of the
parties as to the interpretation of any provision of the Agreement (or the
performance of obligations under the Agreement), the matter, on written request
of any party, shall be referred to representatives of such parties for decision,
each party being represented by a senior executive officer (the
“Representatives”). The Representatives shall promptly meet in a good faith
effort to resolve the dispute. If the Representatives do not agree upon a
decision within thirty (30) calendar days after reference of the matter to them,
the parties shall be free to exercise the remedies available under Section 2.

(b) The Representatives may, if they desire, agree to undertake mediation and
may, if they choose, do so in accordance with the International Institute for
Conflict Prevention & Resolution (“CPR”) Mediation Rules then in effect, either
as written or as modified by mutual agreement. A written agreement to undertake
mediation may be made at any time. If arbitration proceedings have been
instituted, they shall be stayed until the mediation process is terminated.

 

  2. Arbitration.

(a) In order to minimize the cost, time and inconvenience to the parties and to
achieve streamlined and efficient resolution of any controversy, dispute or
claim among the parties, the parties agree that any controversy, dispute or
claim arising out of or relating in any way to the Agreement or the transactions
arising thereunder that cannot be resolved by negotiation or mediation pursuant
to Section 1 shall be settled exclusively by final and binding arbitration in
accordance with the CPR Rules for Non-Administered Arbitrations then in effect.
The hearing for any such arbitration shall be conducted exclusively in Delaware.
The arbitrator shall apply the laws of the State of Delaware.

(b) Such arbitration shall be conducted by a sole, independent arbitrator
selected by mutual agreement of the parties, if possible. If the parties fail to
reach agreement regarding appointment of an arbitrator within thirty (30) days
following receipt by one party of the other party’s notice of arbitration, the
arbitrator shall be selected from the CPR Panel. Unless the parties agree
otherwise, the arbitrator shall be a licensed attorney with at least ten years
of experience in the practice of law. The selection process shall be that which
is set forth in the CPR Rules for Non-Administered Arbitrations then in effect.
If the arbitrator should die, withdraw or otherwise become incapable of serving,
a replacement shall be selected and appointed in a like manner.

 

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(c) The arbitrator shall render an opinion setting forth findings of fact and
conclusions of law with the reasons therefore stated. A transcript of the
evidence adduced at the hearing shall be made and shall, upon request, be made
available to either party. The fees and expenses of the arbitrator shall be
shared equally by the parties and advanced by them from time to time as
required; provided that at the conclusion of the arbitration, the arbitrator may
award costs and expenses to the prevailing party in the arbitration (including
the costs of the arbitration previously advanced and the fees and expenses of
attorneys, accountants and other experts). Pre-hearing discovery shall be
permitted on terms agreed to by the parties, or if the parties are unable to
agree, by the arbitrator after taking into account the scope and nature of the
dispute and the intentions of the parties in selecting arbitration as set forth
in the first sentence of Section 2(a) of this Exhibit, including examination of
the witnesses and documents that the other party intends to introduce in its
case-in-chief at the arbitration hearing. The arbitrator shall render his or her
award within ninety (90) days of the conclusion of the arbitration hearing. The
arbitrator shall not be empowered to award to either party any punitive damages
in connection with any dispute between them arising out of or relating in any
way to the Agreement or the transactions arising thereunder, and each party
hereby irrevocably waives any right to recover such damages. The arbitration
hearings and award shall be maintained in confidence.

(d) Notwithstanding anything to the contrary provided in this Section 2 and
without prejudice to the above procedures, either party may, subject to
Section 12.5 of the Agreement, apply to any court of competent jurisdiction for
temporary injunctive or other provisional judicial relief or to specifically
enforce the terms of the Agreement if such action is necessary to avoid
irreparable damage or to preserve the status quo until such time as the
arbitrator is selected and available to hear such party’s request for temporary
relief. The award rendered by the arbitrator shall be final and not subject to
judicial review and judgment thereon may be entered in any court of competent
jurisdiction.

 

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