Exhibit 10.2

 

 

DEALER MANAGER AND CONSENT SOLICITATION AGREEMENT

 

 

July 2, 2003

 

 

CREDIT SUISSE FIRST BOSTON LLC

BEAR, STEARNS & CO. INC.

CIBC WORLD MARKETS CORP.

C/O CREDIT SUISSE FIRST BOSTON LLC

Eleven Madison Avenue

New York, NY 10010-3629

 

Dear Sirs:

 

1.                                       The Tender Offer and Consent
Solicitation. Packaged Ice, Inc., a Texas corporation (“Purchaser”), is making a
tender offer (hereinafter referred to, together with any amendments, supplements
or extensions thereof, as the “Tender Offer”) to purchase for cash any and all
of the outstanding 9¾% Series A Senior Notes due 2005 and 9¾% Series B Senior
Notes due 2005 (collectively, the “Notes”) and is soliciting (the
“Solicitation”) consents (the “Consents”) of the holders of the Notes to certain
amendments to the indenture relating to the Notes (the “Indenture”).  The Tender
Offer and the Solicitation will be on the terms and subject to the conditions
set forth in the Offer to Purchase and Consent Solicitation Statement (the
“Statement”) and Consent and Letter of Transmittal (the “Consent and Letter of
Transmittal”) attached hereto as Exhibits A and B, respectively.

 

2.                                       Appointment as Dealer Managers and
Solicitation Agents. Purchaser hereby appoints each of you as Dealer Manager and
Solicitation Agent (each of Credit Suisse First Boston LLC, Bear, Stearns & Co.
Inc. and CIBC World Markets Corp., a “Dealer Manager and Solicitation Agent”
and, collectively, the “Dealer Managers and Solicitation Agents”) and authorizes
each of you to act as such in connection with the Tender Offer and
Solicitation.  As a Dealer Manager and Solicitation Agent, each of you agree, in
accordance with your customary practice, to perform those services in connection
with the Tender Offer and Solicitation as are customarily performed by
investment banks in connection with tender offers and consent solicitations of a
like nature, including, but not limited to, using reasonable efforts to solicit
tenders of Notes and delivery of Consents pursuant to the Tender Offer and
Solicitation and communicating generally regarding the Tender Offer and
Solicitation with brokers, dealers, commercial banks and trust companies and
other holders of Notes.  In such capacity, each of you, as a Dealer Manager and
Solicitation Agent, shall act as an independent contractor, and each of your
duties arising out of your engagement pursuant to this Agreement shall be owed
solely to Purchaser.

 

Purchaser further authorizes each of you to communicate with U.S. Bank National
Association, in its capacity as depositary (the “Depositary”), and with
Georgeson Shareholder, in its capacity as information agent (the “Information
Agent”), with respect to matters relating to the Tender Offer and Solicitation. 
Purchaser has instructed the Depositary to advise each of the Dealer Managers
and Solicitation Agents at least daily as to the number of Notes that have been
tendered pursuant to the Tender Offer, the

 

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number of Consents that have been delivered pursuant to the Solicitation and as
to such other matters in connection with the Tender Offer and Solicitation as
the Dealer Managers and Solicitation Agents may request.

 

3.                                       No Liability for Acts of Dealers, Banks
and Trust Companies.  None of you shall have any liability to Purchaser or any
other person for any losses, claims, damages, liabilities and expenses (each a
“Loss” and, collectively, the “Losses”) arising from any act or omission on the
part of any broker or dealer in securities (a “Dealer”), bank or trust company,
or any other person, and neither any of you nor any of your respective
affiliates shall be liable for any Losses arising from your own acts or
omissions in performing your obligations as a Dealer Manager and Solicitation
Agent or as a Dealer hereunder or otherwise in connection with the Tender Offer
or the Solicitation, except for any such Losses which are finally judicially
determined to have resulted primarily from your bad faith, gross negligence or
material breach of your obligations under this Agreement.  In soliciting or
obtaining tenders or delivery of Consents, no Dealer, bank or trust company is
to be deemed to be acting as agent for any of you or the agent of Purchaser or
any of its affiliates, and each of you, as a Dealer Manager and Solicitation
Agent, is not to be deemed the agent of any Dealer, bank or trust company or the
agent or fiduciary of Purchaser or any of its affiliates, equity holders,
creditors or of any other person.  In soliciting or obtaining tenders of Notes
or delivery of Consents, none of you shall be and none of you shall be deemed
for any purpose to act as a partner or joint venturer of or a member of a
syndicate or group with Purchaser or any of its affiliates in connection with
the Tender Offer or the Solicitation, any purchase of the Notes, any payment for
Consents or otherwise, and neither Purchaser nor any of its affiliates shall be
deemed to act as agent for any of you.  Purchaser shall have sole authority for
the acceptance or rejection of any and all tenders of Notes or deliveries of
Consents.

 

4.                                       The Tender Offer and Consent
Solicitation Material.  Purchaser agrees to furnish each of you, at its expense,
with as many copies as you may reasonably request of the Statement, the Consent
and Letter of Transmittal, and all statements and other documents filed or to be
filed with the Securities and Exchange Commission (the “Commission”), if any, or
any other Federal, state, local or foreign governmental or regulatory
authorities or any court (each an “Other Agency” and collectively, the “Other
Agencies”), any other documents (including press releases, advertisements and
other communications, whether prior to or after the execution of this
Agreement), materials or filings relating to the Tender Offer or the
Solicitation to be used by Purchaser or authorized by Purchaser for use in
connection with the Tender Offer or the Solicitation and any amendments or
supplements to any such statements, documents, materials or filings (the
definitive forms of all of the foregoing materials are hereinafter collectively
referred to as the “Tender Offer and Consent Solicitation Material”) to be used
by Purchaser in connection with the Tender Offer and the Solicitation, and each
of you is authorized to use copies of the Tender Offer and Consent Solicitation
Material in connection with the Tender Offer and the Solicitation.  The Tender
Offer and Consent Solicitation Material has been or will be prepared and
approved by, and is the sole responsibility of, Purchaser.

 

Each of you hereby agrees severally, but not jointly, as a Dealer Manager and
Solicitation Agent, that you will not disseminate any written material for or in
connection with the solicitation of tenders of Notes and delivery of Consents
pursuant to the Tender Offer and Solicitation other than the Tender Offer and
Consent Solicitation Material, and each of you agrees that you will not make any
statements in connection with such solicitation, other than the statements that
are set forth in the Tender Offer and Consent Solicitation Material or as
otherwise authorized by Purchaser.

 

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Purchaser agrees that no Tender Offer and Consent Solicitation Material will be
used in connection with the Tender Offer and the Solicitation without first
obtaining the Dealer Managers and Solicitation Agents prior approval, which
approval shall not be unreasonably withheld.  In the event that Purchaser uses
or permits the use of any Tender Offer and Consent Solicitation Material in
connection with the Tender Offer and the Solicitation or files any such material
with the Commission or any Other Agency without the Dealer Managers and
Solicitation Agents prior approval, then the Dealer Managers and Solicitation
Agents shall be entitled to withdraw as Dealer Managers and Solicitation Agents
in connection with the Tender Offer and the Solicitation without any liability
or penalty to any withdrawing Dealer Managers and Solicitation Agents or any
Indemnified Person (as hereinafter defined), and such withdrawing Dealer
Managers and Solicitation Agents shall remain entitled to the indemnification
provided in Section 12 hereof and to receive the payment of all fees and
expenses payable under this Agreement that have accrued to the date of such
withdrawal or would otherwise be due to such withdrawing Dealer Managers and
Solicitation Agents as of such date.  If any of you withdraw as a Dealer Manager
and Solicitation Agent, the fees accrued and reimbursement for your expenses
through the date of such withdrawal shall be paid to you promptly after such
date.

 

5.                                       Compensation.  Purchaser agrees to pay
you, as compensation for your services as Dealer Manager and Solicitation Agent
in connection with the Tender Offer and the Solicitation, a fee of $ 250,000.00
payable on the date of this Agreement (the “Fee”).  The Fee for such services
shall be allocated $200,000.00 to Credit Suisse First Boston LLC, $25,000.00 to
Bear, Stearns & Co. Inc. and $25,000.00 to CIBC World Markets Corp.

 

6.                                       Expenses of The Dealer Managers and
Solicitation Agents and Others.  In addition to your compensation for your
services hereunder pursuant to Section 5 hereof, Purchaser agrees to pay
directly, or reimburse each of you, as the case may be, for (a) all expenses
incurred by you relating to the preparation, printing, filing, mailing and
publishing of all Tender Offer and Consent Solicitation Material, (b) all fees
and expenses authorized by the Purchaser and paid by you of the Depositary and
Information Agent referred to in the Statement, (c) all advertising charges paid
by you in connection with the Tender Offer and Solicitation, including those of
any public relations firm or other person or entity rendering services in
connection therewith, (d) all fees, if any, payable to Dealers (including each
of you), and banks and trust companies as reimbursement for their customary
mailing and handling expenses incurred in forwarding the Tender Offer and
Consent Solicitation Material to their customers and (e) all other reasonable
fees and expenses incurred by you in connection with the Tender Offer and
Solicitation or otherwise in connection with the performance of your services
hereunder (including reasonable fees and disbursements of your legal counsel). 
All payments to be made by Purchaser pursuant to this Section 6 shall be made
promptly against delivery to Purchaser of statements therefor.  Purchaser shall
be liable for the foregoing payments whether or not the Tender Offer or the
Solicitation is commenced, withdrawn, terminated or canceled prior to the
purchase of any Notes or the receipt of any consents or whether Purchaser or any
of its affiliates acquires any Notes or consents pursuant to the Tender Offer
and Solicitation or whether any of you withdraw pursuant to Section 4 hereof.

 

7.                                       Securityholder Lists.  Purchaser will
use its commercially reasonable efforts to cause the Dealer Managers and
Solicitation Agents to be provided with cards or lists or other records in such
form as the Dealer Managers and Solicitation Agents may reasonably request
showing the names and addresses of, and the number of Notes held by, the holders
of Notes as of a recent date and will

 

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cause the Dealer Managers and Solicitation Agents to be advised from day to day
during the period of the Tender Offer and Solicitation as to any transfers of
record of Notes.

 

8.                                       Sufficient Funds.  Purchaser represents
and warrants to each of you that it has or, at the time Purchaser becomes
obligated to purchase Notes under the Tender Offer and pay for Consents under
the Solicitation, it will have, sufficient funds to enable Purchaser to pay, and
Purchaser hereby agrees that it will pay promptly, in accordance with the terms
and conditions of the Tender Offer and Solicitation and Sections 5 and 6 hereof
and applicable law, the consideration (and related costs) for the Notes and
Consents which Purchaser has offered, and which Purchaser may be required, to
purchase under the Tender Offer and the Solicitation, and the fees and expenses
payable hereunder.

 

9.                                       Additional Representations and
Warranties of Purchaser. Purchaser represents and warrants to each of you that:

 

a)                                      Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and is duly qualified to transact business and
is in good standing (to the extent such concepts are recognized in such
jurisdictions) in each jurisdiction in which the conduct of its businesses or
the ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or to be in good standing,
considering all such cases in the aggregate, would not have a material adverse
effect on the business, properties, financial position or results of operations
of Purchaser and all of its subsidiaries and affiliates taken as a whole, as the
case may be.

 

b)                                     Purchaser has necessary corporate power
and authority to take and has duly taken all necessary corporate action to
authorize (i) the Tender Offer and the Solicitation (excluding as relates to
borrowings or other financings to be undertaken by Purchaser which are described
in the Statement), (ii) the purchase by Purchaser of the Notes pursuant to the
Tender Offer and the payment by Purchaser for Consents pursuant to the
Solicitation (assuming satisfaction by you of the conditions applicable to you
thereto) and (iii) the execution, delivery and performance of this Agreement,
and this Agreement has been duly executed and delivered on behalf of Purchaser
and, assuming due authorization, execution and delivery of this Agreement by
each of you, is a legal, valid and binding obligation of Purchaser, enforceable
against Purchaser in accordance with its terms, except that the enforceability
hereof may be limited by (x) bankruptcy, insolvency, reorganization, moratorium
and other laws now or hereafter in effect relating to creditors’ rights
generally, (y) general principles of equity and (z) limitations on the
enforceability of indemnification or contribution provisions because of
considerations of public policy.

 

c)                                      The Tender Offer and Consent
Solicitation Material complies or will comply in all material respects with the
applicable provisions of the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the Commission thereunder, and the
Tender Offer and Consent Solicitation Material does not and will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements made therein, in light of
the circumstances under which they are made, not misleading; provided, however,
that no representation is made with respect to any statements contained in or
any matter omitted from the Tender Offer and Consent Solicitation Material in
reliance upon and in conformity with information furnished or confirmed in
writing by you to Purchaser expressly for use therein.

 

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d)                                     Purchaser will file, if required, any and
all necessary amendments or supplements to the documents filed with the
Commission or Other Agencies relating to the Tender Offer and Solicitation and
will promptly furnish to each of you true and complete copies of each such
amendment and supplement upon the filing thereof.

 

e)                                      Except as set forth in the Tender Offer
and Consent Solicitation Material, the Tender Offer and the Solicitation
(including any related borrowings by Purchaser or any of its subsidiaries or
affiliates), the purchase by Purchaser of Notes pursuant to the Tender Offer,
the payment by Purchaser for Consents pursuant to the Solicitation, and the
execution, delivery and performance of this Agreement by Purchaser, comply and
will comply in all material respects with all applicable requirements of
Federal, state, local and foreign law, including, without limitation, any
applicable regulations of the Commission and Other Agencies, and all applicable
judgments, orders or decrees; and no consent, authorization, approval, order,
exemption, registration, qualification or other action of, or filing with or
notice to, the Commission or any Other Agency is required in connection with the
execution, delivery and performance of this Agreement by Purchaser, the making
or consummation by Purchaser of the Tender Offer and the Solicitation or the
consummation of the other transactions contemplated by this Agreement or the
Statement, except where the failure to obtain or make such consent,
authorization, approval, order, exemption, registration, qualification or other
action or filing or notification would not materially adversely affect the
ability of Purchaser to execute, deliver and perform this Agreement or to
commence and consummate the Tender Offer and Solicitation in accordance with its
terms.  All such required consents, authorizations, approvals, orders,
exemptions, registrations, qualifications and other actions of and filings with
and notices to the Commission and the Other Agencies will have been obtained,
taken or made, as the case may be, and all statutory or regulatory waiting
periods will have elapsed, prior to the purchase by Purchaser of the Notes
pursuant to the Tender Offer and the payment by Purchaser for Consents pursuant
to the Solicitation.

 

f)                                        The Tender Offer and the Solicitation
(including any related borrowings by Purchaser or any of its subsidiaries or
affiliates), the purchase of Notes by Purchaser pursuant to the Tender Offer and
the payment by Purchaser for Consents pursuant to the Solicitation, and the
execution, delivery and performance of this Agreement by Purchaser, do not and
will not (i) conflict with or result in a violation of any of the provisions of
the certificate of incorporation or by-laws (or similar organizational
documents) of Purchaser or any of its subsidiaries, (ii) conflict with or
violate in any material respect any law, rule, regulation, order, judgment or
decree applicable to Purchaser or any of its subsidiaries or by which any
property or asset of Purchaser or any of its subsidiaries is or may be bound or
(iii) result in a breach of any of the material terms or provisions of, or
constitute a default (with or without due notice and/or lapse of time) under,
any loan or credit agreement, indenture, mortgage, note or other agreement or
instrument to which Purchaser or any of its subsidiaries is a party or by which
any of them or any of their respective properties or assets is or may be bound.

 

g)                                     No stop order, restraining order or
denial of an application for approval has been issued and no investigation,
proceeding or litigation has been commenced or, to Purchaser’s knowledge, after
due inquiry, threatened before the Commission or any Other Agency with respect
to the making or consummation of the Tender Offer and the Solicitation
(including the obtaining or use of funds to purchase Notes or to pay for
Consents pursuant thereto) or the consummation of the other transactions
contemplated by this Agreement or the Statement or with respect to the ownership
of the Notes by Purchaser or any of its subsidiaries or affiliates.

 

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h)                                     Purchaser has no knowledge of any
material fact or information concerning Purchaser or any of its subsidiaries, or
the operations, assets, condition (financial or otherwise) or prospects of
Purchaser or any of its subsidiaries, that is required to be made generally
available to the public and that has not been, or is not being, or will not be,
made generally available to the public through the Tender Offer and Consent
Solicitation Material or otherwise.

 

i)                                         Purchaser is not, nor will be as a
result of the purchase by Purchaser of Notes that it may become obligated to
purchase pursuant to the terms of the Tender Offer, an “investment company”
under the Investment Company Act of 1940, as amended, and the rules and
regulations promulgated by the Commission thereunder.

 

j)                                         Each of the representations and
warranties set forth in this Agreement will be true and correct on and as of the
date on which the Tender Offer and Solicitation is commenced and on and as of
the date on which any Notes are purchased or Consents are paid for pursuant to
the Tender Offer and the Solicitation.

 

10.                                 Opinions of Purchaser’s Counsel.  Purchaser
shall deliver to you opinions addressed to you and dated the date hereof of Akin
Gump Strauss Hauer & Feld LLP and Cahill Gordon & Reindel LLP, with respect to
the matters set forth in Exhibits C-1 and C-2, respectively.

 

11.                                 Notification of Certain Events.  Purchaser
shall advise the Dealer Manager and Solicitation Agents promptly of (a) the
occurrence of any event that could reasonably be expected to cause Purchaser to
withdraw, rescind or terminate the Tender Offer or Solicitation or would permit
Purchaser to exercise any right not to purchase Notes tendered under the Tender
Offer or to pay for any Consents delivered pursuant to the Solicitation, (b) the
occurrence of any event, or the discovery of any fact, the occurrence or
existence of which it believes would require the making of any change in any of
the Tender Offer and Consent Solicitation Material then being used or would
cause any representation or warranty contained in this Agreement to be untrue or
inaccurate in any material respect, (c) any proposal or requirement to make,
amend or supplement any filing required by the Exchange Act in connection with
the Tender Offer and the Solicitation or to make any filing in connection with
the Tender Offer and the Solicitation pursuant to any other applicable law, rule
or regulation, (d) the issuance by the Commission or any Other Agency of any
comment or order or the taking of any other action concerning the Tender Offer
and the Solicitation (and, if in writing, will furnish you with a copy thereof),
(e) any material developments in connection with the Tender Offer and the
Solicitation or the financing thereof, including, without limitation, the
commencement of any lawsuit concerning the Tender Offer and the Solicitation and
(f) any other information relating to the Tender Offer and the Solicitation, the
Tender Offer and Consent Solicitation Material or this Agreement which any
Dealer Manager and Solicitation Agent may from time to time reasonably request.

 

12.                                 Indemnification. 

 

a)                                      Purchaser agrees to hold harmless and
indemnify the Dealer Managers and Solicitation Agents (including any affiliated
companies of any Dealer Manager and Solicitation Agent) and any officer, member,
director, partner, employee or agent of any Dealer Manager and Solicitation
Agent (or any of such affiliated companies of any Dealer Manager and
Solicitation Agent) and any entity or person controlling (within the meaning of
Section 20(a) of the Exchange Act) any Dealer Manager and Solicitation Agent)
including any affiliated companies of any Dealer Manager and Solicitation Agent)
(collectively, the “Indemnified Persons”) from and against any and all Losses
whatsoever (including, but not limited to, any and all expenses incurred in
investigating, preparing or defending against any litigation or

 

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proceeding, commenced or threatened, or any claims whatsoever whether or not
resulting in any liability) (i) arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in the Tender
Offer and Consent Solicitation Material or in any other material used by
Purchaser, or authorized by Purchaser for use in connection with the Tender
Offer and the Solicitation or the transactions contemplated thereby, or arising
out of or based upon the omission or alleged omission to state in any such
document a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading (other than statements or omissions made in reliance upon
information furnished by any Dealer Manager and Solicitation Agent in writing to
Purchaser expressly for use therein), (ii) arising out of or based upon any
withdrawal by Purchaser of, or failure by Purchaser to make or consummate, the
Tender Offer, the Solicitation or the other transactions contemplated by this
Agreement or the Tender Offer and Consent Solicitation Material or any other
failure to comply with the terms and conditions specified in the Tender Offer
and Consent Solicitation Material, (iii) arising out of the breach or alleged
breach by Purchaser of any representation, warranty or covenant set forth in
this Agreement (iv) arising out of, relating to or in connection with any other
action taken or omitted to be taken by an Indemnified Person or (v) otherwise
arising out of, relating to or in connection with the Tender Offer and the
Solicitation, the other transactions described in the Tender Offer and Consent
Solicitation Material or any Dealer Manager and Solicitation Agent’s services as
Dealer Manager and Solicitation Agent hereunder.  Purchaser shall not, however,
be responsible for any Loss pursuant to clauses (iv) or (v) of the preceding
sentence of this Section 12 that has been finally judicially determined to have
resulted primarily from the bad faith or gross negligence on the part of any
Indemnified Person or material breach by and of you of your obligations
contained in this Agreement, other than any Loss arising out of or resulting
from actions performed at the direct request of, with the explicit consent of,
or in conformity with information directly provided or supplied by, Purchaser.

 

b)                                     Purchaser and the Dealer Managers and
Solicitation Agents agree that if any indemnification sought by any Indemnified
Person pursuant to this Section 12 is unavailable for any reason or insufficient
to hold the Dealer Managers and Solicitation Agents harmless, then Purchaser and
the Dealer Managers and Solicitation Agents shall contribute to the Losses for
which such indemnification is held unavailable or insufficient in such
proportion as is appropriate to reflect the relative benefits received (or
anticipated to be received) by Purchaser, on the one hand, and actually received
by the Dealer Managers and Solicitation Agents, on the other hand, in connection
with the transactions contemplated by this Agreement or the Tender Offer and
Consent Solicitation Material or, if such allocation is not permitted by
applicable law, not only such relative benefits but also the relative faults of
Purchaser, on the one hand, and the Dealer Managers and Solicitation Agents, on
the other hand, as well as any other equitable considerations, subject to the
limitation that in any event the aggregate contribution by the Dealer Managers
and Solicitation Agents to all Losses with respect to which contribution is
available hereunder shall not exceed the fees actually received by the Dealer
Manager and Solicitation Agent in connection with its engagement hereunder.  It
is hereby agreed that the relative benefits to Purchaser, on the one hand, and
the Dealer Manager and Solicitation Agents, on the other hand, with respect to
the Tender Offer and the Solicitation and the transactions contemplated by this
Agreement and the Tender Offer and Consent Solicitation Material shall be deemed
to be in the same proportion as (i) the total value paid or proposed to be paid
to holders of Notes pursuant to the Tender Offer and the Solicitation (whether
or not the Tender Offer and the Solicitation or such transactions are
consummated) bears to (ii) the fees actually received by the Dealer Manager and
Solicitation Agent from Purchaser in connection with its engagement hereunder.

 

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c)                                      The foregoing rights to indemnity and
contribution shall be in addition to any other right that the Dealer Managers
and Solicitation Agents and the other Indemnified Persons may have against
Purchaser at common law or otherwise.  If any litigation or proceeding is
brought against any Indemnified Person in respect of which indemnification may
be sought against Purchaser pursuant to this Section 12, such Indemnified Person
shall promptly notify Purchaser in writing of the commencement of such
litigation or proceeding, but the failure so to notify Purchaser shall relieve
Purchaser from any liability which it may have hereunder only if, and to the
extent that, such failure results in the forfeiture by Purchaser of substantial
rights and defenses, and will not in any event relieve Purchaser from any other
obligation or liability that it may have to any Indemnified Person other than
under this Agreement.  In case any such litigation or proceeding shall be
brought against any Indemnified Person and such Indemnified Person shall notify
Purchaser in writing of the commencement of such litigation or proceeding,
Purchaser shall be entitled to participate in such litigation or proceeding,
and, after written notice from Purchaser to such Indemnified Person, to assume
the defense of such litigation or proceeding with counsel of its choice at its
expense; provided, however, that such counsel shall be satisfactory to the
Indemnified Person in the exercise of its reasonable judgment.  Notwithstanding
the election of Purchaser to assume the defense of such litigation or
proceeding, such Indemnified Person shall have the right to employ separate
counsel and to participate in the defense of such litigation or proceeding, and
Purchaser shall bear the reasonable fees, costs and expenses of such separate
counsel and shall pay such fees, costs and expenses at least quarterly (provided
that with respect to any single litigation or proceeding or with respect to
several litigations or proceedings involving substantially similar legal claims,
Purchaser shall not be required to bear the fees, costs and expenses of more
than one such counsel in addition to any local counsel) if (i) in the reasonable
judgment of such Indemnified Person the use of counsel chosen by Purchaser to
represent such Indemnified Person would present such counsel with a conflict of
interest, (ii) the defendants in, or targets of, any such litigation or
proceeding include both an Indemnified Person and Purchaser, and such
Indemnified Person shall have reasonably concluded that there may be legal
defenses available to it or to other Indemnified Persons that are different from
or additional to those available to Purchaser (in which case Purchaser shall not
have the right to direct the defense of such action on behalf of the Indemnified
Person), (iii) Purchaser shall not have employed counsel satisfactory to such
Indemnified Person, in the exercise of the Indemnified Person’s reasonable
judgment, to represent such Indemnified Person within a reasonable time after
notice of the institution of such litigation or proceeding or (iv) Purchaser
shall authorize in writing such Indemnified Person to employ separate counsel at
the expense of Purchaser.  In any action or proceeding the defense of which
Purchaser assumes, the Indemnified Person shall have the right to participate in
such litigation and retain its own counsel at such Indemnified Person’s own
expense.  Purchaser and each of you agree to notify the other promptly of the
assertion of any claim against it, any of its directors or officers or any
entity or person who controls it within the meaning of Section 20(a) of the
Exchange Act in connection with the Tender Offer and the Solicitation.  The
foregoing indemnification commitments shall apply whether or not the Indemnified
Person is a formal party to such litigation or proceeding.

 

d)                                     Purchaser agrees to reimburse each
Indemnified Person for all expenses (including reasonable fees and disbursements
of counsel) as they are incurred by such Indemnified Person in connection with
investigating, preparing for, defending or providing evidence (including
appearing as a witness) with respect to any action, claim, investigation,
inquiry, arbitration or other proceeding referred to in this Section 12 for
which indemnification may be sought hereunder or enforcing this Agreement,
whether or not in connection with pending or threatened litigation in which any
Indemnified Person is a party.

 

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e)                                      Purchaser agrees that it will not,
without the prior written consent of the Dealer Managers and Solicitation
Agents, settle, compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding in respect of which
indemnification may be sought hereunder (whether or not any Dealer Manager and
Solicitation Agent, any other Indemnified Person or Purchaser is an actual or
potential party), unless such settlement, compromise or consent (i) includes an
unconditional release of each Indemnified Person from all liability arising out
of such claim, action or proceeding and (ii) does not include a statement as to,
or an admission of, fault, culpability or a failure to act by or on behalf of an
Indemnified Person.  As a condition to any indemnity or contribution hereunder,
without Purchaser’s prior written consent, which consent will not be
unreasonably withheld, no Indemnified Person will settle, compromise or consent
to entry of judgment in connection with any pending or threatened claim, action
or proceeding in respect of which indemnity or contribution may be sought
hereunder (whether or not Purchaser is an actual or potential party to such
claim, action or proceeding).

 

13.                                 Conditions to Obligations of the Dealer
Manager and Solicitation Agent.  Your obligations hereunder shall at all times
be subject to the conditions that (a) all representations, warranties and other
statements of Purchaser contained herein are now, and at all times during the
period of the Tender Offer and the Solicitation shall be, true and correct in
all material respects and (b) Purchaser at all times shall have performed in all
material respects all its obligations hereunder theretofore to be performed.

 

14.                                 Termination.  This Agreement shall terminate
upon the expiration, termination or withdrawal of the Tender Offer and the
Solicitation or, with respect to any withdrawing Dealer Manager and Solicitation
Agent, upon withdrawal by you as Dealer Manager and Solicitation Agent pursuant
to Section 4 hereof, it being understood that Sections 3, 5, 6, 8, 9, 12, 14,
16, 17, 19, 20, 21, 22 and 23 hereof shall survive any termination of this
Agreement.

 

15.                                 Notices.  All notices and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be given (and shall be deemed to have been given upon
receipt) by delivery in person, by cable, by telecopy, by telegram, by telex or
by registered or certified mail (postage prepaid, return receipt requested) to
the applicable party at the addresses indicated below:

 

a)  if to the Dealer Managers and Solicitation Agents:

 

C/O

CREDIT SUISSE FIRST BOSTON LLC

 

Eleven Madison Avenue

 

New York, NY 10010-3629

 

Telecopy No.:

 

Attention:

 

 

 

Bear, Stearns & Co. Inc.

 

383 Madison Avenue

 

New York, NY 10179

 

Telecopy No.:  (212) 272-5100

 

Attention:  John C. Maguire, Senior Managing Director, Global Liability
Management Group

 

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CIBC World Markets Corp.

 

425 Lexington Avenue

 

New York, NY 10017

 

Telecopy No.:  (800) 274-2746

 

Attention:  Brian Perman

 

 

 

with a copy to:

 

 

 

Cravath, Swaine & Moore LLP

 

Worldwide Plaza

 

825 Eighth Avenue

 

New York, NY 10019

 

Telecopy No.: (212) 474-3700

 

Attention: Kris F. Heinzelman, Esq.

 

 

 

b)  if to Purchaser:

 

 

 

Packaged Ice, Inc.

 

3535 Travis Street, Suite 170

 

Dallas, TX 75204

 

Telecopy No.:

 

Attention:

 

 

 

with a copy to:

 

 

 

Cahill Gordon & Reindel LLP

 

80 Pine Street

 

New York, NY 10005

 

Telecopy No.:  (212) 269-5420

 

Attention: Geoffrey Liebmann, Esq.

 

16.                                 Consent to Jurisdiction; Service of
Process.  Purchaser hereby (a) submits to the jurisdiction of any New York State
or Federal court sitting in the City of New York with respect to any actions and
proceedings arising out of or relating to this Agreement, (b) agrees that all
claims with respect to such actions or proceedings may be heard and determined
in such New York State or Federal court, (c) waives the defense of an
inconvenient forum, (d) agrees not to commence any action or proceeding relating
to this Agreement other than in a New York State or Federal court sitting in the
City of New York and (e) agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law.

 

17.                                 Joint and Several Obligations, Etc.  In the
event that Purchaser makes the Tender Offer and the Solicitation through one or
more of its affiliates, each reference in this Agreement to Purchaser shall be
deemed to be a reference to Purchaser and any such affiliates, and the
representations, warranties, covenants and agreements of Purchaser and any such
affiliates hereunder shall be joint and several.

 

18.                                 Entire Agreement.  This Agreement
constitutes the entire agreement among the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements and undertakings, both
written and oral, among the parties, or any of them, with respect to the subject
matter hereof.

 

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19.                                 Amendment.  This Agreement may not be
amended except in writing signed by each party to be bound thereby.

 

20.                                 Governing Law.  The validity and
interpretation of this Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of New York, without regard
to conflicts of law principles thereof.

 

21.                                 Waiver of Jury Trial. PURCHASER HEREBY
AGREES ON ITS OWN BEHALF AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ON
BEHALF OF ITS SECURITY HOLDERS, TO WAIVE ANY RIGHT TO A TRIAL BY JURY WITH
RESPECT TO ANY CLAIM, COUNTER-CLAIM OR ACTION ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (INCLUDING, WITHOUT
LIMITATION, THE TENDER OFFER).

 

22.                                 Counterparts; Severability.  This Agreement
may be executed in two or more separate counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.  Any term or provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or enforceability of any of the terms or provisions of
this Agreement in any other jurisdiction.

 

23.                                 Parties in Interest.  This Agreement,
including rights to indemnity and contribution hereunder, shall be binding upon
and inure solely to the benefit of each party hereto, the Indemnified Persons
and their respective successors, heirs and assigns, 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.

 

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Please indicate your willingness to act as Dealer Manager and Solicitation Agent
and your acceptance of the foregoing provisions by signing in the space provided
below for that purpose and returning to us a copy of this Agreement so signed,
whereupon this Agreement and your acceptance shall constitute a binding
agreement between us.

 

 

Very truly yours,

 

 

 

PACKAGED ICE, INC.

 

 

 

 

 

By:

/s/ STEVEN J. JANUSEK

 

 

Name:  Steven J. Janusek

 

 

Title:  Chief Financial Officer

 

 

Accepted as of the
date first above written:

 

 

 

CREDIT SUISSE FIRST BOSTON LLC

 

BEAR, STEARNS & CO. INC.

 

CIBC WORLD MARKETS CORP.

 

 

 

 

 

BY: CREDIT SUISSE FIRST BOSTON LLC

 

 

 

 

 

By:

/s/ MITCHELL GOLDSTEIN

 

 

 

Name:  Mitchell Goldstein

 

 

Title:  Director

 

 

 

 

 

By: BEAR, STEARNS & CO. INC.

 

 

 

 

 

By:

/s/ JOHN C. MAGUIRE

 

 

 

Name:  John C. Maguire

 

 

Title:  Senior Managing Director

 

 

 

 

 

By: CIBC WORLD MARKETS CORP.

 

 

 

 

 

By:

/s/ BRIAN S. PERMAN

 

 

 

Name:  Brian S. Perman

 

 

Title:  Managing Director

 

 

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