** **

** **

** **

** **

**CONTRIBUTION AGREEMENT**

**dated as of**

**May 19, 2006**

**by and among**

**BRAWLEY BEEF, LLC**

**and**

**NATIONAL BEEF CALIFORNIA, LP**

**and**

**NATIONAL BEEFPACKING COMPANY, LLC**

** **

 

 

 

 

----

**TABLE OFCONTENTS**

| Article 1 - DEFINITIONS AND TERMS.                    | 1                                                                              |
|-------------------------------------------------------|--------------------------------------------------------------------------------|
|                                                  | 1.1       Certain DefinedTerms.                  | 1 |
| Article 2 -CONTRIBUTION.                              | 8                                                                              |
|                                                  | 2.1       Contributed Assets.                    | 9 |
|                                                  | 2.2       Excluded Assets.                       | 10 |
|                                                  | 2.3       Assumed Liabilities.                   | 10 |
|                                                  | 2.4       ExcludedLiabilities.                   | 10 |
|                                                  | 2.5       Proration ofCertain Taxes.             | 12 |
| Article 3 -CONSIDERATION.                             | 12                                                                             |
|                                                  | 3.1       Consideration.                         | 12 |
|                                                  | 3.2       Unit Exchange.                         | 12 |
|                                                  | 3.3       ConsiderationAdjustment                | 12 |
|                                                  | 3.4       Payment ofConsideration Adjustment     | 14 |
|                                                  | 3.5       Allocation.                            | 14 |
| Article 4 -CLOSING AND TERMINATION.                   | 14                                                                             |
|                                                  | 4.1       Closing Date.                          | 14 |
|                                                  | 4.2       Brawley's ClosingDeliveries.           | 14 |
|                                                  | 4.3       Newco's ClosingDeliveries.             | 16 |
|                                                  | 4.4       USPB's ClosingDeliveries.                   | 16 |
|                                                  | 4.5       Simultaneous Delivery.                      | 16 |
|                                                  | 4.6       Termination ofAgreement                     | 16 |
|                                                  | 4.7       Procedure UponTermination.             | 17 |
|                                                  | 4.8       Effect ofTermination.                  | 17 |
|                                                  | 4.9       Change of Name.                        | 17 |
| Article 5 -REPRESENTATIONS AND WARRANTIES OF BRAWLEY. | 17                                                                             |
|                                                  | 5.1       Organization andPower.                 | 18 |
|                                                  | 5.2       Authorization.                         | 18 |
|                                                  | 5.3       No Violation.                          | 18 |
|                                                  | 5.4       FinancialStatements.                   | 18 |
|                                                  | 5.5       No Adverse Changes.                    | 19 |
|                                                  | 5.6       Absence of CertainChanges.             | 19 |
|                                                  | 5.7       Books and Records.                     | 19 |
|                                                  | 5.8       Accounts Receivable.                   | 19 |
|                                                  | 5.9       Title toContributed Assets; Condition. | 20 |
|                                                  | 5.10     Owned Real Estate.                                | 20 |
|                                                  | 5.11     Leases.                                           | 21 |
|                                                  | 5.12     IntellectualProperty.                             | 22 |
|                                                  | 5.13     Written AssumedContracts.                         | 22 |
|                                                  | 5.14     Employees.                                        | 22 |
|                                                  | 5.15     Taxes.                                            | 23 |
|                                                  | 5.16     Litigation.                                       | 23 |
|                                                  | 5.17     Compliance with Law;Licenses and Permits.         | 23 |
|                                                  | 5.18     Insurance.                                        | 24 |

i

 

----

|                                                             | 5.19     EnvironmentalMatters.                                     | 24       |
|------------------------------------------------------------------|----------------------------------------------------------------------------------------|----------|
|                                                             | 5.20     Occupational Safetyand Health.                            | 26       |
|                                                             | 5.21     Employee BenefitPlans.                                    | 26       |
|                                                             | 5.22     Products.                                                 | 28       |
|                                                             | 5.23     Brokers and Finders.                                      | 28       |
|                                                             | 5.24     Statements True andCorrect.                               | 28       |
| Article 6 -REPRESENTATIONS AND WARRANTIES OF NATIONAL AND NEWCO. | 29                                                                                     |
|                                                             | 6.1       Organization andPower.                         | 29       |
|                                                             | 6.2       Authorization.                                 | 29       |
|                                                             | 6.3       No Violation.                                  | 29       |
|                                                             | 6.4       Capitalization.                                | 29       |
|                                                             | 6.5       Litigation.                                    | 29       |
|                                                             | 6.6       Brokers andFinders.                            | 30       |
|                                                             | 6.7       No AuthorizationRequired.                      | 30       |
|                                                             | 6.8       Financial Ability.                             | 30       |
|                                                             | 6.9       Statements True andCorrect                     | 30       |
| Article 7 -PRE-CLOSING COVENANTS.                                | 30                                                                                     |
|                                                             | 7.1       Satisfaction ofClosing Conditions.             | 30       |
|                                                             | 7.2       Access toInformation.                          | 31       |
|                                                             | 7.3       Operation of theBusiness of Brawley.           | 31       |
|                                                             | 7.4       Required Consents.                             | 32       |
|                                                             | 7.5       RegulatoryApprovals.                           | 32       |
|                                                             | 7.6       No Negotiation.                                | 33       |
|                                                             | 7.7       Supplementation andAmendment of Schedules.     | 33       |
| Article 8 -CONDITIONS TO CLOSING.                                | 34                                                                                     |
|                                                             | 8.1       ConditionsPrecedent to Obligations of Newco.   | 34       |
|                                                             | 8.2       ConditionsPrecedent to Obligations of Brawley. | 35       |
|                                                             | 8.3       Frustration ofClosing Conditions.              | 36       |
| Article 9 -ADDITIONAL AGREEMENTS.                                | 36                                                                                     |
|                                                             | 9.1       Indemnification.                               | 36       |
|                                                             | 9.2       Payment of BrawleyIndemnification Claims.      | 39       |
|                                                             | 9.3       CapitalExpenditures.                           | 40       |
|                                                             | 9.4       Employees of theBusiness.                      | 40       |
|                                                             | 9.5       ContinuingAssistance.                          | 42       |
|                                                             | 9.6       Cooperation inLitigation.                      | 42       |
|                                                             | 9.7       Expenses.                                      | 42       |
|                                                             | 9.8       Press Releases andAnnouncements.               | 43       |
|                                                             | 9.9       Continuing Accessto Records.                   | 43       |
|                                                             | 9.10     Bulk Sales.                                               | 43       |
|                                                             | 9.11     Pledge Agreement.                                         | 43       |
|                                                             | 9.12     National Guaranty.                                        | 43       |
|                                                             | 9.13     Post ClosingCovenants.                                    |  43 |
| Article 10 -MISCELLANEOUS.                                       | 44                                                                                     |
|                                                             | 10.1     Amendment and Waiver.                                     | 44       |
|                                                             | 10.2     Notices.                                                  | 44       |
|                                                             | 10.3     Assignment.                                               | 45       |

 

ii

----

 

|   | 10.4     Severability.          | 45 |
|--------|-----------------------------------------------------|----|
|   | 10.5     No StrictConstruction. | 45 |
|   | 10.6     Section Headings.      | 46 |
|   | 10.7     Complete Agreement.    | 46 |
|   | 10.8     Governing Law.         | 46 |
|   | 10.9     Counterparts.          | 46 |

 

| Exhibit A                                  | Allocation                                      |
|-----------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------|
| Exhibit B                                  | Bill of Sale                                    |
| Exhibit C                                  | Assignment and Assumption Agreement             |
| Exhibit D                                  | USPB Contribution Agreement                     |
| Exhibit E                             | USPB Membership Agreements                      |
| Exhibit F                             | Opinion Paragraphs of Brawley Counsel           |
| Exhibit G                                  | Pledge Agreement                                |
| Exhibit H                                  | Opinion Paragraphs of Newcoand National Counsel |
| Exhibit I                        | National Guaranty                               |
| Exhibit 3.3(a)                                                           | Consideration Adjustment Calculation            |
| Schedule 1.1(bb)                                                                                       | Guarantees                                      |
| Schedule 2.1(b)                                                                              | Assumed Contracts                               |
| Schedule 2.1(c)                                                                              | Tangible Purchased Assets                       |
| Schedule 2.1(d)                                                                              | Vehicles                                        |
| Schedule 2.2(a)                                                                              | Excluded Assets                                 |
| Schedule 2.3(b)                                                                              | Indebtedness                                    |
| Schedule 2.3(c)                                                                              | Current Liabilities                             |
| Schedule 2.4(d)                                                                              | Other Excluded Liabilities                      |
| Schedule 5.1                                                             | Capitalization and Ownership                    |
| Schedule 5.3                                                             | No Violation                                    |
| Schedule 5.4                                                             | Financial Statements                            |
| Schedule 5.5                                                             | No Adverse Changes                              |
| Schedule 5.6                                                             | Absence of Certain Changes                      |
| Schedule 5.7                                                             | Books and Records                               |
| Schedule 5.8                                                             | Accounts Receivable                             |
| Schedule 5.9                                                             | Title to Purchased Assets; Condition            |
| Schedule 5.10                                                                      | Owned Real Estate                               |
| Schedule 5.11                                                                      | Leases                                          |
| Schedule 5.12                                                                      | Intellectual Property                           |
| Schedule 5.13                                                                      | Written Assumed Contracts                       |
| Schedule 5.14                                                                      | Employees                                       |
| Schedule 5.16                                                                      | Litigation                                      |
| Schedule 5.17(a)                                                                                       | Compliance with Law                             |
| Schedule 5.17(b)                                                                                       | Licenses and Permits                            |
| Schedule 5.18                                                                      | Insurance                                       |
| Schedule 5.19                                                                      | Environmental Matters                           |
| Schedule 5.20                                                                      | Occupational Safety and Health                  |
| Schedule 5.21                                                                      | Employee Benefits                               |

| iii |
|-----|

 

----

| Schedule 5.22                         | Products                             |
|--------------------------------------------------------------------------------------------------------|--------------------------------------|
| Schedule 8.1(e)                                 | Required Governmental Authorizations |
| Schedule 8.1(f)                                                                                        | Required Third Party Consents        |
| Schedule 9.3                | Compliance Expenditures              |
| Schedule 9.4                | Employees of the Business            |

 

 

 

 
| iv |
|----|

 

 

----

**CONTRIBUTION AGREEMENT**

THIS CONTRIBUTION AGREEMENT (the "Agreement") is entered intoas of this ___ day of May, 2006 by and between Brawley Beef, LLC, a Californialimited liability company ("Brawley"), and National Beef California, LP, aDelaware limited partnership ("Newco") and National Beef Packing Company, LLC ("National"), a Delaware limited liability company asguarantor.

WHEREAS, Brawley owns and operates a beef packing facilitylocated at Brawley, California (the "Business"); and

WHEREAS, subject to the terms and conditions set forthherein, Brawley desires to contribute to Newco substantially all of the assets usedin the Business (other than the Excluded Assets as hereinafter defined); and

WHEREAS, subject to the terms and conditions set forth herein,Newco will assume certain obligations and liabilities of Brawley withoutassuming liability for other obligations or liabilities of Brawley arising outof the operation of the Business prior to the Closing Date (as hereinafterdefined) or the ownership prior to that date of the Contributed Assets (ashereinafter defined), and issue limited partnership units to Brawley; and

WHEREAS, National is the parent of National Carriers, Inc., thesole general partner of Newco.

NOW, THEREFORE, in consideration of the premises recited, ofthe covenants, agreements and provisions of this Agreement, and of other goodand valuable consideration, the receipt and sufficiency of which the partieshereby acknowledge, the parties hereby agree as follows:

**ARTICLE 1 -DEFINITIONS AND TERMS**

1.1        Certain Defined Terms. As used in this Agreement and in any Schedules andexhibits hereto, the following terms have the following meanings: 

(a)               "Applicable Interest Bearing Debt" means those items of AssumedIndebtedness set forth on Schedule 2.3(b) for which changes in theprincipal balance from November 30, 2005 to Closing are subject to the "ConsiderationAdjustment."  The items of Applicable Interest Bearing Debt had a principalbalance of $54,250,000 at November 30, 2005.  

(b)              "Assumed Contracts" shall have the meaning set forth for such term inSection 2.1(b) hereof.

(c)               "Assumed Liabilities" shall have the meaning set forth for such term inSection 2.3(c) hereof.

 

 

----

(d)              "Balance Sheet Date" shall have the meaning set forth for such term inSection 5.4 hereof.

(e)               "Brawley" shall have the meaning set forth for such term in theintroductory paragraph.

(f)                "Brawley's Plans" means the employee benefit plans listed in Schedule5.21 hereof.

(g)               "Business" shall have the meaning set forth for such term in the firstrecital hereof.

(h)               "Cal/OSHA" means the California Occupational Safety and HealthAdministration within the California Division of Occupational Safety andHealth.

(i)                 "Cattle Supply Agreements" shall have the meaning set forth for suchterm in Section 4.2(i).

(j)                "CERCLA" shall have the meaning set forth for such term in this Section 1.1within the definition of "Environmental Law."

(k)              "Closing" and "Closing Date" shall have the meaning set forth for suchterms in Section 4.1 hereof.

(l)                "Closing Balance Sheet" and "Closing Statement" shall have the meaningsset forth for such terms in Section 3.3(c) hereof.

(m)             "Closing Working Capital" shall have the meaning as set forth inSection 3.3(c) hereof.

(n)               "Code" means the Internal Revenue Code of 1986 (or any successor(s)thereto), as amended from time to time, and all rules and regulationspromulgated thereunder.

(o)              "Collective Bargaining Agreement" means any collective bargainingagreement of Brawley and any labor organization representing all or any portionof the Brawley's employees employed in the Business, including but not limitedto the collective bargaining agreements listed on Schedule 5.14.

(p)              "Consideration Adjustment" shall have the meaning set forth inSection 3.3(a) hereof.

(q)              "Contributed Assets" shall have the meaning set forth for such term inSection 2.1 hereof.

 

| 2 |
|---|

----

(r)                "Employment Liability" means any obligation or liability of, or Lossincurred by or brought against, Brawley or Brawley's officers, managers,members, employees, or agents, and based upon, arising out of, or in any wayrelated to:  (i) Brawley's employment of its employees at the Businessprior to the Closing Date; (ii) except as otherwise provided herein, anycontract, agreement, or commitment between Brawley and any employee of Brawleyemployed by Brawley at the Business, or any former employee of Brawley employedby Brawley at the Business, or any independent contractor engaged by Brawley atthe Business, relating to the terms or conditions of employment, compensation,deferred compensation, severance, vacation pay, sick leave, profit sharing,pension, retirement, or any other type of benefit or emolument of employment orany independent contractor relationship; (iii) any Collective BargainingAgreement; (iv) except as otherwise provided herein, the termination ofthe employment by Brawley of any of Brawley's employees, or the termination ofany independent contract relationship by Brawley; (v) Brawley's (or Brawley'sofficers', managers', members', employees', or agents') breach, violation, orfailure to comply with any law, rule, regulation, statute, ordinance, or otherauthority or legal requirement governing the employment or independent contractrelationship of Brawley's employees or independent contractors employed orlocated at the Business; or (vi) Brawley's Plans, or any "multi-employerplan" to which Brawley has or does contribute.

(s)               "Encumbrances" means any lien, charge, encumbrance, security interest,option, or restriction on the Contributed Assets.

(t)                "Environmental Law" means any law, rule, regulation, statute, ordinanceor other authority and all principles of common law applicable to operations ofthe Business and existing prior to or as of the Closing Date governing theregulation and protection of the environment and natural resources, including,but not limited to, any law relating to Hazardous Substances, drinking water,surface water, groundwater, wetlands, soil, landfills, open dumps, storagetanks, underground storage tanks, solid waste, hazardous waste, oil orhazardous substance handling, waste water, waste water run-off, storm waterrun-off, odors, air emissions, waste emissions, lagoons, land application areasor wells and treatment, storage, disposal or transportation, or arrangingtherefor, of any materials of any nature.  Without limiting the generality ofthe foregoing, "Environmental Law" shall encompass each of the followingstatutes and the regulations duly promulgated thereunder, and any similarapplicable state or local laws, (i) the Comprehensive EnvironmentalResponse, Compensation, and Liability Act of 1980 ("CERCLA"), (ii) theSolid Waste Disposal Act ("SWDA"), (iii) the Hazardous MaterialsTransportation Act ("HMTA"), (iv) the Toxic Substances Control Act,(v) the Clean Water Act, (vi) the Clean Air Act, (vii) the SafeDrinking Water Act, (viii) the National Environmental Policy Act of 1969and (ix) the Federal Insecticide, Fungicide and Rodenticide Act, theResource Conservation and Recovery Act ("RCRA").

 

 

| 3 |
|---|

 

----

(u)               "Environmental Matter" means (i) any known or unknown violations ofEnvironmental Law or actions or inactions forming the basis for any claimrelated to Environmental Law by Brawley that occurred or began in whole or inpart at any time prior to the Closing Date in connection with any of the ContributedAssets or the Business, or (ii) the known or unknown presence or releaseof any Hazardous Substances at any time prior to the Closing Date to soil,sediment, surface water, groundwater or air at any Contributed Asset, includingany migration of such Hazardous Substances from the Business or any ContributedAsset to any off-site location, or (iii) the presence of any HazardousSubstances or solid wastes generated by any of the Contributed Assets or theBusiness prior to the Closing Date at any location whether or not Brawleytransported, disposed of, placed or arranged for the material to betransported, disposed of or placed in such location.  

(v)               "ERISA" means the Employee Retirement Income Security Act of 1974, asamended from time to time and all regulations promulgated thereunder.

(w)             "Excluded Assets" shall have the meaning set forth for such term inSection 2.2 hereof.

(x)               "Excluded Liabilities" shall have the meaning set forth for such term inSection 2.4 hereof.

(y)               "Facility" shall mean Brawley's cattle processing facility located in Brawley, California.

(z)               "Financial Statements" shall have the meaning set forth for such term inSection 5.4 hereof.

(aa)              "GAAP" means United States generally accepted accounting principlesconsistently applied with prior periods. 

(bb)             "Guarantees" means those existing individual guarantees executed by theMembers, as shown in Schedule 1.1(bb);

(cc)            "Hazardous Substance(s)" means each and every element, compound,chemical, chemical mixture, contaminant, pollutant, material, waste or othersubstance that is defined, determined or identified as hazardous or toxic underany Environmental Law or the release, generation, handling, transportation,storage, treatment, disposal, release, discharge or emission of which is regulatedor prohibited under any Environmental Law.  Without limiting the generality ofthe foregoing, the term shall include (i) "hazardous substances" as defined inthe CERCLA, and regulations promulgated thereunder, (ii) "hazardous waste" or "solidwaste" as defined in the SWDA and regulations promulgated thereunder, (iii) "hazardousmaterials" as defined in HMTA and regulations duly promulgated thereunder, (iv)"hazardous substances" and "pollutants" as defined in the Clean Water Act, andregulations promulgated thereunder, (v) any pollutant regulated under the CleanAir Act, and regulations promulgated thereunder, (vi) petroleum and petroleumproducts and byproducts, (vi) asbestos or asbestos-containing materials and(vii) polychlorinated biphenyls.

(dd)            "Hired Employees" shall have the meaning set forth for such term inSection 9.4 hereof.

(ee)            "HMTA" shall have the meaning set forth for such term in this Section1.1 within the definition of "Environmental Laws."

| 4 |
|---|

 

 

----

(ff)              "Immigration Laws" shall have the meaning set forth for such term inSection 5.14(c) hereof. 

(gg)              "Indebtedness" shall have the meaning set forth for such term inSection 2.3(b) hereof.

(hh)              "Indemnification Claim" shall have the meaning set forth for such termin Section 9.1(c) hereof.

(ii)               "Indemnitee" shall have the meaning set forth for such term in Section 9.1hereof.

(jj)                "Indemnitor" shall have the meaning set forth for such term in Section 9.1(c)hereof.

(kk)              "Initial Working Capital" shall have the meaning set forth for such termin Section 3.3(a) hereof.

(ll)               "Intellectual Property" shall mean the following, including those itemslisted on Schedule 5.12:  (i) the trademarks, service marks,domain names and trade names listed on Schedule 5.12 hereto,(ii) the Brawley Beef trademark, (iii) the copyrights andapplications for issuance or registration of any of the foregoing and anygoodwill associated therewith, and (iv) the trade secrets, products codesand other confidential, nonpublic, or similar information used in the runningof the Business as the same is presently conducted (including, withoutlimitation, ideas, formulas, compositions, inventions (whether patentable orunpatentable and whether or not reduced to practice), know-how, manufacturingand production processes and techniques, research and development information,drawings, specifications, designs, plans, proposals, technical data,copyrightable works and customer and supplier lists and information).  Specificitems of "Intellectual Property" that are not being transferred from Brawley toNewco shall also be listed on Schedule 5.12, but shall not bedeemed to be included in the "Intellectual Property" that is being transferredto Newco for purposes of this Agreement.

(mm)          "Inventories" means all of Brawley's inventories of raw materials andproducts existing as of the Closing Date, including without limitation allboxes, labels, packaging, live animals, carcasses, meat products, meat-relateditems or finished goods (including meat and offal).

(nn)           "Knowledge" means the following:  an individual will be deemed to have "Knowledge"of a particular fact or other matter if:

     (i)                 that individual is actually aware of that fact or matter; or

     (ii)               a prudent individual could be expected to discover or otherwise becomeaware of that fact or matter in the course of conducting a reasonable investigationregarding the accuracy of any representation or warranty contained in thisAgreement.

| 5 |
|---|

 

 

----

An entity will be deemed to have Knowledge of a particularfact or other matter if any individual who is serving, as a director, officer,manager, or partner of that entity (or in any similar capacity) has Knowledgeof that fact or other matter (as set forth in (i) and (ii) above), and anysuch individual (and any individual party to this Agreement) will be deemed tohave conducted a reasonable investigation regarding the accuracy of therepresentations and warranties made herein by that entity or individual.  Withrespect to Brawley, "Knowledge" shall include the Knowledge of its Members whohave participated in the negotiation of this Agreement.

(oo)          "Leases" shall have the meaning set forth for such term in Section 5.11hereof.

(pp)          "Loss" means any cost, damage, expense, liability, loss or obligation,including but not limited to, interest or carrying costs, penalties, legal,accounting, and other professional fees and expenses incurred in thecollection, prosecution and defense of actions or claims and amounts paid insettlement by the specified person.

(qq)          "Material Adverse Effect" means a material adverse effect on(i) the business, assets, properties, results of operations or financialcondition of Brawley or of the Business; (ii) the value of the ContributedAssets or a material increase in the amount of Assumed Liabilities; (iii) theability of Brawley to conduct the Business in the regular course of business;;or (iv) the ability of Brawley to consummate the transactions contemplated bythis Agreement or perform its obligations under this Agreement.

(rr)             "McElhaney Grain Company Loan" means that certain loan agreement dated February 5, 2002, between McElhaney Grain Company and Farm Credit Services.

(ss)            "Member Guaranty" shall have the meaning set forth for such term inSection 4.2(e) hereof.

(tt)              "Members" means the members of Brawley, including Oden Family CattleCompany, LLC; William L. Brandt; Mesquite Cattle Feeders, Inc.; Moiola BrothersCattle Feeders, Ltd.; Bill Wiest Ranches, Inc.; Dominique Antchango; andCattlemen's Feed & Milling d/b/a Meloland Cattle Co. and Red RockFeeding Co.

(uu)             "National" shall have the meaning set forth for such term in theintroductory paragraph.

(vv)             "National Units" shall have the meaning set forth for such term inSection 3.2(c) hereof.

(ww)           "Newco" shall have the meaning set forth for such term in theintroductory paragraph.

(xx)             "OSHA" means the Occupational Safety and Health Administration of theU.S. Department of Labor.

 

| 6 |
|---|

 

----

(yy)           "OSH Act" means the Occupational Safety and Health Act of 1970, 29U.S.C. 654 et seq.

(zz)            "Ordinary Course of Business" means an action taken by an entity will bedeemed to have been taken in the Ordinary Course of Business only if thataction:

     (i)                 is consistent in nature, scope and magnitude with the past practices ofsuch entity and is taken in the ordinary course of the normal, day-to-dayoperations of such entity;

     (ii)               does not require authorization by the board of managers or members ofsuch entity (or by any person or group of persons exercising similar authority)and does not require any other separate or special authorization of any nature;and

     (iii)              is similar in nature, scope and magnitude to actions customarily taken,without any separate or special authorization, in the ordinary course of thenormal, day-to-day operations of other entities that are in the same line ofbusiness as such entity.

(aaa)        "Owned Real Estate" shall mean the real property described on Schedule 1.1(aaa)hereto.

(bbb)       "Permits"shall mean Brawley's governmental****licenses, permits, certificates andother public, governmental and private third party authorizations necessary tooperate the Business as presently conducted.

(ccc)        "Permitted Encumbrances" means (i) statutory liens for currentTaxes, assessments or other governmental charges not yet delinquent or theamount or validity of which is being contested in good faith by appropriateproceedings, provided an appropriate reserve has been established therefor inthe Financial Statements in accordance with GAAP; (ii) mechanics',carriers', workers' and repairers' liens that do not, individually or in theaggregate, have a Material Adverse Effect and which if filed are beingcontested in a timely manner pursuant to applicable Law and are properlyreserved against in Brawley's books and records in accordance with GAAP;(iii) zoning, entitlement and other land use and environmental regulationsby any governmental body, provided that if such regulations have been violated,such violations, individually or in the aggregate, do not have a MaterialAdverse Effect; (iv) easements, covenants, restrictions and encumbranceswhich do not, individually or in the aggregate, have a Material Adverse Effect;and (v) liens and other encumbrances created in connection with the Indebtednessbeing assumed.

(ddd)        "Pledge Agreement" means the Pledge Agreement described in Section 9.11.

(eee)        "Products" means any products manufactured, sold or delivered by Brawleyfrom the Business prior to the Closing Date, excluding the Inventories.

| 7 |
|---|

 

 

----

(fff)            "RCRA" shall have the meaning set forth for such term in thisSection 1.1 within the definition of "Environmental Laws."

(ggg)        "Required Governmental Authorizations" means those consents, approvals,permits, licenses and authorization of any government, governmental orregulatory body thereof, or political subdivision or agency thereof, requiredto be obtained to consummate the transactions contemplated hereby as identifiedon Schedule 8.1(e).

(hhh)        "Required Third Party Consents" means those consents, approvals andauthorizations of (i) counterparties to Assumed Contracts required to beobtained to assign such Assumed Contracts to Newco in accordance with thisAgreement and (ii) labor unions to transfer the Hired Employees to Newcoin accordance with this Agreement, in each case as identified on Schedule 8.1(f).

(iii)              "Schedules" means those Schedules attached hereto and made a parthereof.

(jjj)            "SWDA" shall have the meaning set forth for such term in thisSection 1.1 within the definition of "Environmental Laws."

(kkk)         "Tax"or "Taxes" shall mean any federal, state, local or foreign income, grossreceipts, license, payroll, employment, excise, severance, stamp, occupation,premium, windfall profits, environmental, customs duties, capital stock,franchise, profits, withholding, social security (or similar), unemployment,disability, real property, personal property, sales, use, transfer,registration, value added, alternative or add‐on minimum, estimated orother tax of any kind whatsoever, including any interest, penalty or additionthereto, whether disputed or not.

(lll)              "Third Party Claim" shall have the meaning set forth for such term inSection 9.1(d) hereof.

(mmm)       "USPB" means U.S. Premium Beef, LLC, a Delaware limited liabilitycompany.

(nnn)          "USPB Units" shall have the meaning set forth for such term inSection 3.2 hereof.

(ooo)          "WARNAct" means the Worker Adjustment and Retraining Notification Act, as amended,29 U.S.C. §2101 et seq.

(ppp)         "Working Capital" shall have the meaning set forth in Section 3.3(a).

**ARTICLE 2 -CONTRIBUTION**

2.1       Contributed Assets. Exceptas otherwise provided below, on and subject to the terms established in thisAgreement, Brawley hereby contributes, conveys, assigns, transfers and deliversto Newco, free and clear of all Encumbrances of any kind, except the PermittedEncumbrances, all of its right, title and interest of Brawley in and to all of itsassets, business, properties, contract rights, water rights, goodwill, rightsand claims (collectively, the "Contributed Assets"), including the following:

| 8 |
|---|

----

 

(a)               the Owned Real Estate;

(b)                the leases, contracts, licenses, guaranties, warranties and other itemsset forth on Schedule 2.1(b) (the "Assumed Contracts");

(c)               the machinery, equipment, furniture, tools, computers, office equipment,business machines, and telephones located at the Facility and such assets usedin the ordinary course of operation of the Business as set forth on Schedule 2.1(c);

(d)                the vehicles used in connection with the Business as set forth on Schedule 2.1(d);

(e)               all office supplies, production supplies and other miscellaneoussupplies located at the Business on the Closing Date;

(f)                all saleable Inventories of the Business;

(g)               all Permits relating to operation of the Business to the extenttransferable;

(h)               all of Brawley's ownership, where applicable, and/or right, title andinterest in and to Intellectual Property, together with all of such Brawley'srights to use all of the foregoing and all other rights in, to and under theforegoing; and all goodwill and going concern value of the Business;

(i)                 all accounts receivable, all records pertaining to customers andaccounts, historical sales information by customer and product, personnelrecords, and all books, ledgers, files and business records relating to the Business;

(j)                all assignable rights against third parties under any warranty, if any,with respect to any of the foregoing; 

(k)                all other similar property not referred to above which is used in Brawley'soperation of the Business, wherever located, but specifically excluding theExcluded Assets and such property which has been sold or otherwise disposed ofby Brawley in the Ordinary Course of Business; 

(l)                 the unemployment tax account maintained with the State of California for the workers employed at the Facility, to the extent transferable to Newco.

(m)               all cash, restricted cash, and cash equivalents;

(n)               investment securities and other short- and medium-term investments of Brawley;and

| 9 |
|---|

----

(o)              all rights of Brawley relating to deposits and prepaid expenses, claimsfor refunds and rights to offset in respect thereof, except to the extent theyrelate to Excluded Assets or Excluded Liabilities.

2.2        Excluded Assets.  Notwithstanding theforegoing, the parties agree that the following rights, properties and assetsof Brawley are expressly excluded from this purchase and sale and are notincluded in the Contributed Assets (the "Excluded Assets"):

(a)               all assets listed on Schedule 2.2(a);

(b)                Brawley's rights under or pursuant to this Agreement and the otheragreements with Newco or USPB contemplated hereby;

(c)               all right, title and/or interest of Brawley in and to or existing undersuch Brawley's Tax records and Tax returns (including any right to Taxrefunds), corporate charter, minute and stock record books, corporate seal,check books and cancelled checks all subject to the respective rights of Brawleyand Newco under Section 9.9 hereof; and

(d)                any and all claims or causes of action of Brawley with respect to anyMember or former Member, their former or current officers, directors, managersor employees, of whatever nature, including, without limitation, any rights orclaims relating to or arising out of the pending litigation between Brawley andits Members with Red Rock Feeding Co.

2.3      Assumed Liabilities. On and subject to the terms and conditions of this Agreement, Newco shallassume all obligations and liabilities of Brawley with respect to

(a)               Assumed Contracts (excluding any liabilities identified in Section 2.4);

(b)              all indebtedness as set forth on the attached Schedule 2.3(b) ("Indebtedness");

(c)               the current liabilities of Brawley identified on attached Schedule 2.3(c);

(d)              the McElhaney Grain Company Loan; and

(e)               any liability relating to the Business, to the extent unknown at theClosing Date and not included in the Excluded Liabilities and further providingthat Brawley has disclosed all known information about the liability that isrequired to be disclosed under this Agreement, if any 

(collectively, the "AssumedLiabilities").

2.4      Excluded Liabilities. Other than the Assumed Liabilities, Newco expressly does not assume any liabilityor obligation of Brawley including, but not limited to, any of the followingliabilities and obligations (the "Excluded Liabilities"):

| 10 |
|----|

----

(a)               any of Brawley's liabilities or obligations under this Agreement and theother agreements with Newco contemplated hereby;

(b)              any liabilities or obligations of Brawley for expenses or fees incidentto or arising out of the negotiation, preparation, approval, or authorizationof this Agreement or the consummation (or preparation for the consummation) ofthe transactions contemplated hereby, including without limitation, attorneys',accountants' and brokers' fees;

(c)               except as specifically set forth in the schedules to Section 2.3, anyliability or obligation of Brawley with respect to Taxes for any period orpartial period occurring prior to the Closing Date and any liabilities forinterest, penalties or additions to any Taxes, it being understood that Newcoshall not be deemed to be Brawley's transferee with respect to any Taxliability;

(d)              any liabilities or obligations identified on Schedule 2.4(d);

(e)               any liability or obligation of Brawley which relates to the ExcludedAssets;

(f)                any liability arising out of a breach by Brawley prior to the ClosingDate of any Assumed Contract;

(g)               any liability of Brawley to any Member or former Member, their former orcurrent officers, directors, managers employees, or affiliates, of whatevernature except as expressly included in the Assumed Liabilities;

(h)               any fines or penalties of governmental agencies or bodies, or relatingto the OSH Act, Cal/OSHA or Environmental Law, or any criminal liability;

(i)                 any liability under any debt instrument or security issued by Brawley toany present or former Member;

(j)                any liability for any penalty, default interest, or prepayment penaltyunder any Assumed Liabilities; and

(k)                any liability relating to or arising out of pending or threatened litigation,including but not limited to the litigation between Brawley and various Memberswith Red Rock Feeding Co., Inc. 

Brawley hereby acknowledges that it is retaining the ExcludedLiabilities, and Brawley shall have the sole responsibility therefor.  

| 11 |
|----|

----

2.5       Proration of Certain Taxes. All real and personal property Taxes and special assessments (but not includingany transfer or sales Taxes), if any, which are applicable to the ContributedAssets for the year 2006 shall be prorated as of the Closing Date on the basis ofthe most recently available tax bill.  Newco shall be responsible for and shallpay any and all sales, use and transfer Taxes arising out of the transactionscontemplated by this Agreement following the unit exchange described in Section3.2 below.

**ARTICLE 3 - CONSIDERATION**

3.1        Consideration.  On the terms andsubject to the conditions set forth in this Agreement, on the Closing Date, uponacceptance of the Contributed Assets, Newco agrees to provide or cause to bedelivered to Brawley the following consideration:

(a)               Newco shall assume the Assumed Liabilities by executing the Assignmentand Assumption Agreement.

(b)              Newco shall deliver to Brawley 44,160 Newco limited partnership units (the"LP Units").

3.2      Unit Exchange.  (a) On the ClosingDate, immediately following the issuance of the LP Units to Brawley, and uponexecution of a USPB membership agreement, uniform cattle delivery and marketingagreement ("Even Slot"), and USPB contribution agreement by USPB and Brawley, Brawleyshall contribute the LP Units to USPB and USPB shall issue to Brawley one ClassA Unit and one Class B Unit of USPB for each LP Unit contributed to USPB byBrawley (the " USPB Units").

(b)  The transaction between USPB and Brawley inSection 3.2(a) is contingent upon the subsequent contribution of the LP Unitsfrom USPB to National and the issuance by National to USPB of Class A andClass B-1 National Units (the "National Units").

3.3       Consideration Adjustment**. **The Consideration will be adjusted by the following amounts:

(a)               The Consideration will be adjusted by an amount (the "ConsiderationAdjustment") which will be equal to the amount determined by subtracting fromthe Initial Working Capital (as hereafter defined) (i) the Closing WorkingCapital (as hereafter defined) and (ii) the net amount of any increases orreductions in principal of the Applicable Interest Bearing Debt to be assumedsince November 30, 2005 (which amount may be positive or negative) as setforth on Schedule 2.3(b).  Exhibit 3.3(a) attached to thisAgreement provides an example of the Consideration Adjustment calculation.  "WorkingCapital" shall mean, as of a given date, the amount calculated by subtractingthe current liabilities (excluding the bank line of credit and the currentportion of long-term indebtedness classified as a current liability) of Brawleyincluded in the Assumed Liabilities as of that date from the current assets of Brawleyincluded in the Contributed Assets as of that date, in each case determined inaccordance with GAAP.  The Initial Working Capital of Brawley as of November 30,2005 was **$19,786,000** (the "Initial Working Capital").

| 12 |
|----|

----

(b)              As promptly as practicable, but no later than sixty days after theClosing Date, Newco shall cause to be prepared and delivered to Brawley anunaudited balance sheet of Brawley as of the Closing Date (the "Closing BalanceSheet") and a closing statement (the "Closing Statement") and a certificatebased on such Closing Statement setting forth Newco's calculation of WorkingCapital derived from the Closing Balance Sheet (the "Closing Working Capital"). The preparation of the Closing Statement shall be for the purpose ofdetermining the difference between Initial Closing Working Capital and ClosingWorking Capital.

(c)               If Brawley disagrees with the amounts reflected on the Closing BalanceSheet or Newco's calculation of Closing Working Capital delivered pursuant toSection 3.3(b), Brawley may, within thirty (30) days after delivery of theClosing Statement, deliver a notice to Newco disputing such amounts reflectedon the Closing Balance Sheet and/or disagreeing with such calculation ofClosing Working Capital and setting forth Brawley's calculation of such amounts. Any such notice of dispute or disagreement shall specify those items or amountsas to which Brawley disagrees, and Brawley shall be deemed to have agreed withall other items and amounts contained in the Closing Balance Sheet, the ClosingStatement and the calculation of Closing Working Capital delivered pursuant toSection 3.3(b).

(d)              If a notice of disagreement shall be duly delivered pursuant toSection 3.3(c), Newco and Brawley shall, during the thirty (30) daysfollowing such delivery, use their commercially reasonable efforts to reachagreement on the disputed items or amounts in order to determine, as may berequired, the proper amounts set forth on the Closing Balance Sheet and theamount of Closing Working Capital, which amount shall not be less than theamount thereof shown in Newco's calculation delivered pursuant toSection 3.3(b) nor more than the amount thereof shown in Brawley'scalculation delivered pursuant to Section 3.3(c).  If the parties soresolve all disputes, the Closing Balance Sheet and the computation of ClosingWorking Capital, as amended to the extent necessary to reflect the resolutionof the dispute, shall be conclusive and binding on the parties.  If during suchperiod, Newco and Brawley are unable to reach an agreement, they shall promptlythereafter cause, an independent nationally recognized accounting firm to bemutually agreed upon by Newco and Brawley, in either such case, the "IndependentAccountant") to review this Agreement and the disputed items or amounts for thepurpose of determining the proper amounts on the Closing Balance Sheet andcalculating Closing Working Capital (it being understood that in making suchdetermination and calculation, the Independent Accountant shall be functioningas an expert and not as an arbitrator).  In making such determination andcalculation, the Independent Accountant shall consider only those items oramounts in the Closing Balance Sheet, the Closing Statement and Newco'scalculation of Closing Working Capital as to which Brawley has disagreed.  TheIndependent Accountant shall deliver to Newco and Brawley, as promptly aspracticable (but in any case no later than thirty days from the date ofengagement of the Independent Accountant), a report setting forth suchdetermination and calculation, which amount shall not be less than the amountthereof shown in Newco's calculation delivered pursuant to Section 3.3(b)nor more than the amount thereof shown in Brawley's calculation deliveredpursuant to Section 3.3(c).  Such report shall be final and binding upon Newcoand Brawley.  The fees, costs and expenses of the Independent Accountant'sreview and report shall be borne equally by Newco and Brawley.

| 13 |
|----|

----

(e)               Newco and Brawley shall, and shall cause their respectiverepresentatives to, cooperate and assist in the preparation of the ClosingBalance Sheet, the Closing Statement and the calculation of Closing WorkingCapital and in the conduct of the review referred to in this Section 3.3,including the making available to the extent necessary of books, records, workpapers and personnel.

3.4       Payment of Consideration Adjustment.  The Consideration Adjustmentwill be payable five (5) days after the calculation under Section 3.3(d) hasbecome final.  If the Consideration Adjustment is negative, it shall be paid byNewco by wire transfer to Brawley to an account specified by Brawley.  If the ConsiderationAdjustment is positive, then it shall be paid by Brawley, by wire transfer to abank account designated by Newco.

3.5       Allocation. The Contributed Assets shall be allocated in accordance with Exhibit A. After the Closing, the parties shall make consistent use of the allocation,fair market value and useful lives specified in Exhibit A for all Taxpurposes and in all filings, declarations and reports with the IRS in respectthereof.  In any proceeding related to the determination of any Tax, none ofUSPB, Newco, Brawley or Members shall contend or represent that such allocationis not a correct allocation.

**ARTICLE 4 - CLOSING AND TERMINATION**

4.1      Closing Date. Subject to the satisfaction of the conditions set forth in Sections 8.1 and 8.2(or the waiver thereof by the party entitled to waive that condition), theconsummation of the contribution of the Contributed Assets and the assumptionof the Assumed Liabilities provided for in Article 2 (the "Closing") shall takeplace at the offices of Blackwell Sanders Peper Martin LLP located at 4801 MainStreet, Kansas City, Missouri (or at such other place as the parties may agree)at 10:00 a.m. (Kansas City, Missouri time) on a date to be specified by theparties, which date shall be no later than the second business day after thesatisfaction or waiver of each condition to the Closing set forth in Article 8(other than conditions that by their nature are to be satisfied at the Closing,but subject to the satisfaction or waiver of such conditions), unless anotherdate is agreed to in writing by the parties hereto.  The date on which theClosing occurs is referred to in this Agreement as the "Closing Date."

4.2       Brawley's Closing Deliveries.  At the Closing, Brawley shall deliver (or causeto be delivered) to Newco the following (documents for which there is no formattached as an Exhibit to this Agreement shall be in such form as is reasonablyacceptable to Newco):

(a)               a Bill of Sale in the form attached hereto as Exhibit B (the "Bill ofSale"), duly executed by Brawley;

(b)              an Assignment and Assumption Agreement in substantially the formattached hereto as Exhibit C (the "Assignment and Assumption Agreement"), dulyexecuted by Brawley; 

(c)               copies of all Required Third Party Consents, duly executed by the personsor entities whose consent is required;

| 14 |
|----|

----

(d)                copies of all Required Governmental Authorizations;

(e)               guaranty and indemnification agreements (each, a "Member Guaranty") byeach of the Members in favor of Newco and National, regarding therepresentations and obligations of Brawley under this Agreement, performanceunder the Cattle Supply Agreements and related matters, all in formsatisfactory to Newco and National;

(f)                a certificate of an officer or manager of Brawley confirming Brawley'scompliance with the conditions set forth in Sections 8.1(a) and (b);

(g)               a certificate issued by the Secretary of State of California certifyingas to the good standing of Brawley, dated not more than thirty (30) days priorto the Closing Date; and

(h)               a copy of all requisite resolutions, actions, or consents of Brawley'sboard of managers and Members to approve and authorize the execution anddelivery of this Agreement, and the transactions contemplated hereby andthereby, together with a certificate of the secretary or assistant secretary ofBrawley certifying as to the genuineness of such resolutions, actions, orconsents and that the same have not been amended or rescinded and are in fullforce and effect as of the Closing Date.

(i)                 executed cattle supply agreements between USPB and Brawley and between Newcoand Brawley upon terms reasonably satisfactory to USPB and Newco respectively (collectivelythe "Cattle Supply Agreements");

(j)                the executed USPB Contribution Agreement to contribute the LP units toUSPB and for USPB to issue USPB to issue the USPB Units to Brawley insubstantially the form as attached as Exhibit D;

(k)              the executed USPB Membership Agreements in substantially the form asattached as Exhibit E.

(l)                Opinions of counsel as to matters identified in Exhibit F in form andsubstance satisfactory to National and Newco;

(m)             one or more deeds of conveyance for the Owned Real Property with respectto which Brawley holds fee interests, in form acceptable to Newco, dulyexecuted and acknowledged by Brawley and in recordable form;

(n)               certificates of title for certificated motor vehicles and other titled ContributedAssets, duly executed by Brawley as may be required for transfer of such titlesto Newco pursuant to this Agreement;

(o)              such other instruments of assignment or conveyance as may be reasonablyrequested by Newco in connection with the transfer of the Contributed Assets;and

(p)              a Pledge Agreement in substantially the form attached hereto as Exhibit G.

| 15 |
|----|

----

4.3      Newco's Closing Deliveries.  At the Closing, Newco shall deliver (or causeto be delivered) to Brawley the following (documents for which there is no formattached as an Exhibit to this Agreement shall be in such form as is reasonablyacceptable to Brawley):

(a)               the LP Units;

(b)              the Assignment and Assumption Agreement, duly executed by Newco;

(c)               a certificate of an officer of Newco confirming Newco's compliance withthe conditions set forth in Sections 8.2(a) and (b);

(d)              a certificate issued by the Secretary of State of Delaware certifying asto the good standing of Newco under the laws of Delaware, dated not more than ten(10) days prior to the Closing Date;

(e)               a copy of all requisite resolutions, actions, or consents of Newco's generalpartner to approve and authorize the execution and delivery of this Agreement,and the transactions contemplated hereby and thereby, together with a certificateof the secretary or assistant secretary of Newco certifying as to thegenuineness of such resolutions, actions, or consents and that the same havenot been amended or rescinded and are in full force and effect as of theClosing Date;

(f)                opinions of counsel to National and Newco as to matters identified inExhibit H in form and substance reasonably satisfactory to Brawley; 

(g)               the executed Cattle Supply Agreement; 

(h)               the executed USPB Contribution Agreement; and

(i)                 the executed USPB Membership Agreement.

4.4       USPB's Closing Deliveries.  At the Closing USPB shall deliver (or cause tobe delivered) to Brawley the USPB Units.

4.5       Simultaneous Delivery.    All documents, LP Units, USPB Units, NationalUnits, and funds to be delivered pursuant to Sections 4.2, 4.3 and 4.4 shall beregarded as having been delivered simultaneously but sequentially, as onetransaction without any interruption so that no part of the transaction mayoccur without the entire transaction being completed; and no document or fundswill be regarded as having been delivered, and the Closing shall not be deemedto have occurred, until all such documents and funds have been delivered.

4.6        Termination of Agreement.  This Agreement may be terminated prior to theClosing only as follows:

(a)               by Brawley or Newco if the Closing shall not have occurred by the closeof business on July 31, 2006 (the "Outside Date");

| 16 |
|----|

----

(b)              by mutual written consent of Brawley and Newco;

(c)               by Brawley or Newco if there shall be in effect a final nonappealableorder of a governmental body of competent jurisdiction permanently restraining,enjoining or otherwise prohibiting the consummation of the transactionscontemplated hereby; it being agreed that the parties hereto shall promptlyappeal any adverse determination that is appealable (and pursue such appeal withreasonable diligence);

(d)              by Brawley if either (i) any of the conditions precedent to Brawley'sobligation to proceed with the Closing have become incapable of fulfillmentthrough no fault of Brawley or (ii) Newco is in material breach of anyrepresentation, warranty or covenant in this Agreement (or if suchrepresentation, warranty or covenant is qualified by materiality, Newco hasbreached the same) and such breach has continued for at least ten (10) daysafter delivery of written notice from Brawley to Newco specifying the breach;and

(e)               by Newco if either (i) any of the conditions precedent to Newco'sobligation to proceed with the Closing have become incapable of fulfillmentthrough no fault of Newco or (ii) Brawley is in material breach of anyrepresentation, warranty or covenant in this Agreement (or if suchrepresentation, warranty or covenant is qualified by materiality, Brawley hasbreached the same) and such breach has continued for at least ten (10) daysafter delivery of written notice from Newco to Brawley specifying the breach,and in each case Newco has not waived such condition or breach.

4.7       Procedure Upon Termination.  In the event of termination by Newco or Brawley,or both, pursuant to Section 4.6, written notice thereof shall forthwith begiven to the other party, and this Agreement shall terminate, and the purchaseof the Contributed Assets and the assumption of the Assumed Liabilitieshereunder shall be abandoned, without further action by Newco or Brawley.

4.8       Effect of Termination.  In the event that this Agreement is validlyterminated pursuant to Section 4.6, then each of the parties shall be relievedof their duties and obligations arising under this Agreement after the date ofsuch termination and such termination shall be without liability to Newco or Brawley;provided, however, that no such termination shall relieve anyparty hereto from liability for any breach that occurred prior to thetermination or for wrongful termination, and in such case the provisions ofArticle 9 hereof shall survive termination solely for purposes ofIndemnification Claims arising out of or in respect of such breach.

4.9        Change of Name.  Following theClosing, Newco shall own the exclusive right to the name "Brawley Beef." Brawley agrees to change its name within 45 days following the Closing Date toone sufficiently dissimilar to avoid any confusion and will inform all personsand entities doing business with Brawley after the Closing that Brawley haschanged its name.

**ARTICLE 5 - REPRESENTATIONS AND WARRANTIES OF BRAWLEY**

Brawley hereby represents and warrants to Newco as follows:

| 17 |
|----|

----

5.1        Organization and Power. Brawley is a limited liability company dulyorganized, validly existing and in good standing under the laws of the State ofCalifornia and has the power and authority to carry on its business as nowbeing conducted and to own and operate the properties and assets now owned andbeing operated by it.  Brawley is qualified for the transaction of business andis in good standing under the laws of each jurisdiction in which it owns or leasesproperties or conducts any business which to its knowledge requires suchqualification, except such jurisdictions where the failure to qualify will nothave a Material Adverse Effect.  Brawley has full power and authority toexecute, deliver and perform this Agreement and the other agreementscontemplated hereby.  The membership of Brawley is as set forth in Schedule5.1.  

5.2        Authorization. Theexecution, delivery and performance by Brawley of this Agreement and the otheragreements contemplated hereby have been duly authorized by Brawley.  ThisAgreement and the other agreements contemplated hereby, assuming their validexecution by Newco, constitute valid and binding obligations of Brawley,enforceable in accordance with their terms except as such enforceability may belimited by bankruptcy, insolvency, reorganization, moratorium or other similarlaws affecting the enforcement of creditors' rights and any equitableprinciples relating to or limiting creditors' rights generally and the right toobtain specific enforcement of any obligations of such Brawley and by generalprinciples of equity regardless of whether they are considered in a proceedingat law or in equity.

5.3        No Violation. Exceptas set forth in Schedule 5.3, the execution, delivery and performance ofthis Agreement and the other agreements contemplated hereby by Brawley and theconsummation of the transactions contemplated hereby and thereby do not andwill not (a) conflict with or result in any material breach of any of,(b) constitute a material default under, (c) result in a materialviolation of, (d) result in the creation of any Encumbrance upon the ContributedAssets under, (e) give any third party the right to accelerate anymaterial obligation under, or (f) require any authorization, consent,approval, exemption or other action by any court, other governmental body, orother third party (except for consents required under any Assumed Contracts)under the provisions of the articles of organization or operating agreement of Brawleyor any indenture, mortgage, lease, loan agreement or other material agreementor instrument by which Brawley is bound or to which any of the ContributedAssets are subject, or, any law, statute, rule, regulation, judgment or decreeto which Brawley is subject other than the approvals or consents to be obtainedas contemplated hereunder.

5.4        Financial Statements.  Schedule 5.4 contains the audited balancesheet for Brawley dated December 31, 2003 and audited financial statements of Brawleyfor the year ending January 1, 2005.  Prior to the Closing Date, Brawleywill deliver audited financial statements for the year ending December 31,2005, and unaudited financial statements for the year to date through the lastSaturday in April (together with the financial information in Schedule 5.4,the "Financial Statements").  The Financial Statements fairly present, thefinancial position and results of operations of the Business as of such date inaccordance with Brawley's accounting practices consistently applied for theperiod covered thereby.  December 31, 2005 is sometimes referred to herein asthe "Balance Sheet Date."  Except as set forth in Schedule 5.4, Brawleyhas no liabilities except for liabilities reflected or reserved against in theFinancial Statements and current liabilities incurred in the Ordinary Course ofBusiness.

| 18 |
|----|

----

5.5        No Adverse Changes. Sincethe Balance Sheet Date, except as set forth in Schedule 5.5.  Brawleyhas conducted the Business only in the ordinary course and in conformity withpast practice, and there has been no change in the assets, or employee,customer or supplier relations of the Business which would, individually or inthe aggregate, have a Material Adverse Effect.

5.6        Absence of Certain Changes. Since the Balance Sheet Date, other than in theOrdinary Course of Business and except as set forth in Schedule 5.6, Brawleyhas not, with respect to the Business: (a) sold, assigned, pledged,hypothecated or otherwise transferred any of the Contributed Assets, orimposed, suffered the imposition of, or permitted to exist, any Encumbrance onany of the Contributed Assets; (b) terminated or materially amended anyAssumed Contract; (c) suffered any damage, destruction or other casualty loss(whether or not covered by insurance) which would have a Material AdverseEffect; (d) materially increased the compensation payable or to become payableto any of the employees of the Business, materially increased any bonus,insurance, pension or other employee benefit plan, payment or arrangement madeby Brawley, for or with any such employees, or entered into or amended anyemployment or severance agreement with any employee of the Business; or (e)entered into an agreement to do any of the foregoing.

5.7        Books and Records. Except as set forth in Schedule 5.7, the books of account and otherrecords of Brawley, all of which have been made available to Newco, arecomplete and correct and represent actual, bona fide transactions and have beenmaintained in accordance with sound business practices, including themaintenance of an adequate system of internal controls given the history,nature and operations of the Business.  The minute books of Brawley, all ofwhich have been made available to Newco, contain accurate and complete recordsof all meetings held of, and action taken by, the members, the board of managersand committees of the board of managers of Brawley, and no meeting of any such members,board of managers or committee has been held for which minutes have not beenprepared or are not contained in such minute books.  

5.8        Accounts Receivable.

(a)               All accounts receivable that are reflected on the accounting records of Brawleyas of the Closing Date (but excluding any Excluded Assets) represent or willrepresent valid obligations arising from sales actually made or servicesactually performed by Brawley in the Ordinary Course of Business.  Except tothe extent paid prior to the Closing Date, such accounts receivable are or willbe as of the Closing Date current and collectible net of the respectivereserves shown on Schedule 5.8(a).  Subject to such reserves, each ofsuch accounts receivable either has been or will be collected in full, withoutany setoff, within ninety (90) days after the day on which it first becomes dueand payable.  There is no contest, claim, defense or right of setoff, otherthan returns in the Ordinary Course of Business of Brawley, under any contractwith any account debtor of an account receivable relating to the amount orvalidity of such account receivable.

| 19 |
|----|

----

(b)              With respect to the Marubeni and IcresT(the "M/I Accounts") receivables described in Schedule 5.8(b),Brawley makes no representation other than that they represent validobligations arising from sales actually made.  The M/I Accounts will be treatedprovisionally as having a value equal to 100% of the amounts shown on Schedule 5.8(b). Buyer will use commercially reasonable efforts to collect the M/I Accounts. Brawley shall cooperate with Buyer as reasonably requested, and Buyer shall notsettle the M/I Accounts without the prior approval of Brawley.  Buyer shallprovide Brawley with such information concerning collections on the accounts asBrawley may request.

(c)               On the date 180 days from the Closing Date, Buyer shall send a statementto Brawley requesting payment of an amount equal to the difference between(x) the amounts of the M/I Accounts shown on Schedule 5.8(b),minus the sum of (y) 75% of any amounts collected by Buyer on theM/I Accounts (net of reasonable collection expenses) and (z) any remainingreserve shown on Schedule 5.8(b) which as of the date of calculation hasnot been applied to uncollectible accounts.  Upon payment of the statement,Buyer shall convey to Brawley any remaining interest it may have in theM/I Accounts.  Brawley's obligation to pay the amount provided in thisSection 5.8(c) shall not be subject to, or taken into account under, theprovisions of Section 9.2.

5.9      Title to Contributed Assets; Condition.

(a)               Except as set forth in Schedule 5.9, Brawley has good andmarketable title to the Contributed Assets and none of the Contributed Assetsis subject to any lien, security interest, encumbrance or other adverse claim,except for the Permitted Encumbrances.

(b)              The Contributed Assets include substantially all of the properties andassets used by Brawley in the Business.

(c)               The Inventories have been manufactured in accordance with goodmanufacturing practices and are not (i) adulterated or misbranded withinthe meaning of the Federal Food, Drug and Cosmetic Act, as amended (the "FFDCAct"), (ii) articles which may not under FFDC Act, be introduced intointerstate commerce, or (iii) in violation of the requirements imposedupon a Brawley of products by the California Safe Drinking Water and ToxicEnforcement Act of 1986 or any other state law which imposes requirements onBrawley of products on substantially the same basis.****

5.10      Owned Real Estate. Withrespect to the Owned Real Estate:

(a)               Except as set forth in Schedule 5.10, Brawley has good andmarketable fee simple title to the Owned Real Estate, free and clear of allmortgages, pledges, security interests, encumbrances, covenants charges orother liens, easements and other restrictions, other than the PermittedEncumbrances.

(b)              There are no (A) pending or, to Brawley's Knowledge, threatenedcondemnation proceedings relating to the Owned Real Estate, or (B) pendingor threatened litigation or administrative actions relating to the Owned RealEstate.

| 20 |
|----|

----

(c)               Except as set forth on Schedule 5.10, Brawley is not a partyto any leases, subleases, licenses, concessions or other agreements, written ororal, granting to any party or parties the right of use or occupancy of anyportion of the Owned Real Estate.

(d)              Except as set forth in Schedule 5.10 Brawley is not a party toany outstanding options or rights of first refusal to purchase the Owned RealEstate, or any portion thereof or interest therein.

(e)               Except as set forth on Schedule 5.10, there are no parties (otherthan Brawley) in possession of the parcel of Owned Real Estate.

(f)                The Owned Real Estate and the real estate leases identified in Schedule 5.11comprise all of the real property currently used by the Brawley in connectionwith the Business.

5.11    Leases.  Schedule 5.11hereto contains a complete and accurate list of all material leases of real andpersonal property used exclusively in the Business to which Brawley is a party(the "Leases").  Brawley has delivered to Newco true and complete copies of allsuch Leases.  With respect to each such Lease:

(a)               To the Knowledge of Brawley, the Lease is in full force and effect andis valid, binding and enforceable in accordance with its respective terms,except to the extent such enforcement may be limited by bankruptcy, insolvency,reorganization, moratorium or other laws relating to or affecting theenforcement of creditors' rights or by general equitable principles.

(b)              No amount payable thereunder by Brawley thereunder is past due.

(c)               Brawley, and to Brawley's Knowledge the other party thereto, hascomplied with all material commitments and obligations on their part to beperformed or observed under such Lease.

(d)              Brawley has not received any written notice of a default (which has notbeen cured), offset or counterclaim under any such Lease, or any other written communicationcalling upon Brawley to comply with any provision of such Lease or assertingnoncompliance, and to Brawley's Knowledge no event or condition has happened orpresently exists which constitutes a default or, after notice or lapse of timeor both, would constitute a default under such Lease.

| 21 |
|----|

----

5.12     Intellectual Property.  Schedule 5.12 is a list of allIntellectual Property.  Brawley has not received any written notice from anyother person challenging or questioning the right of Brawley to use any of theIntellectual Property in the operation of the Business which, if resolved,other than pursuant to this Agreement, adversely to Brawley, would have aMaterial Adverse Effect.  Brawley has not granted any license or has enteredinto any other agreement relating in whole or in part to any of theIntellectual Property.  To Brawley's Knowledge, there is no infringement orother adverse claim against the rights of Brawley with respect to any of theIntellectual Property, other than pursuant to this Agreement.  Brawley has notbeen charged with, nor to its Knowledge is it threatened to be charged with or,to Brawley's Knowledge is there any basis for any charge of, infringement orother violation of any unexpired patent, trademark, trademark registration,trade name, service mark, copyright, copyright registration or otherproprietary right of any third party in connection with Brawley's operation ofthe Business as of the Closing Date.  To Brawley's Knowledge, Newco isreceiving all Intellectual Property necessary to operate the Business.

5.13     Written Assumed Contracts.  Each Assumed Contract has been reduced to writing andis listed on Schedule 5.13 hereto.  Correct and complete copies of allsuch Assumed Contracts have been delivered to Newco.  Any Assumed Contractbetween Brawley and a Member or an affiliate of a Member has been identified onSchedule 5.13.  Except as set forth in Schedule 5.13: (x) all such Assumed Contracts are in full force and effect and are valid, bindingand enforceable in accordance with their terms, except to the extent suchenforcement may be limited by bankruptcy, insolvency, reorganization, moratoriumor other laws relating to or affecting the enforcement of creditors' rightsgenerally or by general equitable principles; (y) Brawley is not, and, tothe Knowledge of Brawley, no other party to any such Assumed Contract is, inbreach of any provision of, in violation of, or in default under the terms ofany such Assumed Contract; and (z) no event has occurred which, after thegiving of notice or passage of time or otherwise, would constitute a materialdefault under or result in the material breach of any such Assumed Contracts byBrawley, or to the Knowledge of Brawley, by any other party.

5.14     Employees.

(a)                  Schedule 5.14 hereto contains a complete and accurate list anddescription of all of the following to which Brawley is a party or by which itis bound which relate to the Business:  (i) written employment contractswith officers and employees of the Business; (ii) Collective BargainingAgreements; and (iii) incentive and bonus arrangements.

| 22 |
|----|

----

(b)                 Except as set forth in Schedule 5.14, Brawley has complied withits obligations related to, is not in default under, and the transactionscontemplated hereby will not affect any of the foregoing.  Brawley hasdelivered to Newco a true and complete list of the name, position and presentrate of compensation of each employee of the Business as of a recent date.  Allpayments (including benefits) to employees of the Business which would havebeen paid in the Ordinary Course of Business on or before the Closing Dateshall have been paid or accrued as of the Closing.  Except as and to the extentset forth in Schedule 5.14, (i) Brawley is not a party to anyCollective Bargaining Agreement and, to Brawley's Knowledge, no attempt toorganize any of the employees of the Business has been made, proposed orthreatened and there are no grievances pending and no scheduled arbitrations inrelation to any Collective Bargaining Agreement, (ii) since December 31,2005, Brawley has not had any Equal Employment Opportunity Commission chargesor other claims of employment discrimination made against it by any of theemployees of the Business, (iii) since December 31, 2005, to Brawley's Knowledge,no Wage and Hour Department investigations have ever been made of Brawley withrespect to employees of the Business, (iv) no labor strike, dispute,slowdown, stoppage or lockout is pending or, to Brawley's Knowledge, threatenedagainst or affecting the Contributed Assets or the Business and since December31, 2005, there has not been any such action, (v) no unfair labor practicecharge or complaint against Brawley is pending or, to Brawley's Knowledge,threatened before the National Labor Relations Board or any similargovernmental authority with respect to employees of the Business, and(vi) Brawley has not received any notice that any management employees ofthe Business will terminate or contemplates terminating his or her employmentcurrently or at any time within sixty (60) days after the Closing Date.

(c)                  With respect to the Business, Brawley is in material compliance with andhas not materially violated the terms and provisions of the Immigration Reformand Control Act of 1986, and all related regulations promulgated thereunder(the "Immigration Laws").  With respect to each employee of the Business, Brawleyhas supplied, or shall supply at the Closing Date, to Newco, with regard to allapplicable Hired Employees, Form I‐9 (Employment EligibilityVerification Form) and all other records, documents or other papers which areretained with the Form I‐9 by Brawley pursuant to the ImmigrationLaws.  Brawley has not been warned, fined or otherwise penalized by reason ofany failure to comply with the Immigration Laws, nor is any such proceedingpending or, to the Knowledge of Brawley, threatened.  Except as set forth in Schedule5.14, Brawley has never been the subject of any inspection or investigationrelating to its compliance with or violation of the Immigration Laws withrespect to the Business.

5.15      Taxes.  Withrespect to the Facility, the Contributed Assets, all employees of the Businessand otherwise regarding the operation of the Business, all federal, state andother Tax returns, reports and declarations of every nature required to befiled by or on behalf of Brawley (either separately or as part of aconsolidated group) prior to the Closing have been timely filed or extensionshave been obtained.  All Taxes (whether or not shown on any Tax return) for allperiods ending on or before the Closing Date have been fully paid or appropriateaccruals have been made therefor.  All Taxes and other assessments and levieswhich Brawley is required by law to withhold or to collect for payment havebeen duly withheld and collected.

5.16     Litigation.Except as set forth in Schedule5.16 hereto, there are no actions, suits, proceedings, orders orinvestigations pending or, to Brawley's Knowledge, threatened against oraffecting Brawley (with respect to the Business), the Business or the ContributedAssets, at law or in equity, or before or by any federal, state, municipal orother governmental department, commission, board, bureau, agency orinstrumentality, domestic or foreign, which might materially adversely affectthe Contributed Assets, the Business or Brawley's performance under thisAgreement or the consummation of the transactions contemplated hereby. Exceptas set forth in Schedule 5.16, Brawley is not currently subject to anyjudgment, consent decree, binding arbitration or regulatory order not generallyapplicable to similar businesses, which affects the Business or any of the ContributedAssets. 

5.17      Compliance with Law; Licenses and Permits.

(a)               Except as disclosed in Schedule 5.17(a), the Business is being,and at all times during Brawley's ownership thereof has been, conducted incompliance with all laws, ordinances and regulations of any governmental entityapplicable to the Business or the Contributed Assets (including, withoutlimitation, those relating to occupational safety and health practices), exceptwhere non-compliance would not have a Material Adverse Effect.

| 23 |
|----|

----

(b)              Schedule 5.17(b) hereto lists all Permits necessary to conductthe Business.  Except as set forth in Schedule 5.17(b), all Permits havebeen complied with except where non-compliance would not have a MaterialAdverse Effect. 

5.18         Insurance. Brawley has insurance policies in full force and effect (a) for such amounts asare sufficient for all requirements of law and all agreements to which Brawleyis a party or by which it is bound and (b) which are in such amounts, with suchdeductibles and against such risks and losses, as are reasonable for thebusiness, assets and properties of Brawley.  Set forth in Schedule 5.18is a list of all insurance policies and all fidelity bonds held by orapplicable to Brawley setting forth, in respect of each such policy, the policyname, policy number, carrier, term, type and amount of coverage, annualpremium, and deductibles, whether the policies may be terminated uponconsummation of the transactions contemplated hereby and if and to what extentevents being notified to the insurer after the Closing Date are generallyexcluded from the scope of the respective policy.  Excluding insurance policiesthat have expired and been replaced in the Ordinary Course of Business, noinsurance policy has been cancelled within the last two years and, to the Knowledgeof Brawley, no threat has been made to cancel any insurance policy of Brawleyduring such period.  Except as noted on Schedule 5.18, all suchinsurance will remain in full force and effect and all such insurance isassignable or transferable to Newco.  No event has occurred, including thefailure by Brawley to give any notice of information, or Brawley giving anyinaccurate or erroneous notice or information, which limits or impairs therights of Brawley under any such insurance policies.

5.19      Environmental Matters.  Except as set forth in Schedule 5.19 attachedhereto:

(a)               The operations of Brawley, with respect to the Business, are and havebeen in compliance with all applicable Environmental Laws, which complianceincludes obtaining, maintaining in good standing and complying with all environmentalPermits necessary to operate the Business and no action or proceeding ispending or, to the Knowledge of Brawley, threatened to revoke, modify orterminate any such environmental Permit, which is necessary and material to theoperation of the Business, and, to the Knowledge of Brawley, no facts,circumstances or conditions currently exist that could adversely affect suchcontinued material compliance with Environmental Laws and environmental Permitsor require currently unbudgeted capital expenditures to achieve or maintainsuch continued material compliance with Environmental Laws and environmentalPermits.

(b)              With respect to the Business, Brawley is not the subject of anyoutstanding written order or contract with, nor has Brawley received any noticeor other communication from, any governmental body or person respecting(i) Environmental Laws, (ii) remedial action or (iii) any releaseor threatened release of a Hazardous Substance.

| 24 |
|----|

----

(c)               No claim is pending or, to the Knowledge of Brawley, threatened against Brawley,alleging, with respect to the Business, that Brawley may be in violation of anyEnvironmental Law or any environmental Permit or may have any liability underany Environmental Law including, but not limited to, claims relating to noiseor odors, or disposal of waste from the Business, other than such claims thatare routine in nature and would not, individually or in the aggregate, resultin the Business incurring material environmental costs and liabilities.

(d)              To the Knowledge of Brawley, no facts, circumstances or conditions existwith respect to the Business or any property currently or formerly owned,operated or leased by Brawley or any property upon which Hazardous Substancesor solid wastes generated by any of the Contributed Assets or the Business arepresent that could reasonably be expected to result in the Business incurringunbudgeted material environmental costs or liabilities.

(e)               To the Knowledge of Brawley, there are no investigations of theBusiness, or currently or previously owned, operated or leased property of Brawleypending or threatened which could reasonably be expected to lead to theimposition of any material environmental costs or liabilities or liens underEnvironmental Law.

(f)                There is not located at any of the Owned Real Property or real propertyleases, or at any property previously owned, operated or leased by Brawleyduring Brawley's ownership, operation or lease, any (i) underground storagetanks, (ii) landfill, (iii) surface impoundment, (iv) asbestos-containingmaterial or (v) equipment containing polychlorinated biphenyls.

(g)               There has been no release or, to the Knowledge of Brawley, threat ofrelease, of any oil or Hazardous Substance at or from the Business or at anyother location where any oil or Hazardous Substances were generated,manufactured, refined, transferred, produced, imported, used, or processed fromor by the Business, or from any other property or asset (whether real, personalor mixed) in which Brawley has or had an interest, or to the Knowledge of Brawleyany adjoining property, whether by Brawley or any other person.

(h)               Brawley with respect to the Business has no residual liability withrespect to abandoned or former properties, including any obligation to removeor demolish on-site structures or close wastewater lagoons or ponds, and, tothe Knowledge of Brawley, no Owned Real Property or real property leases haveany structures or features, including abandoned buildings or wastewater lagoonsor ponds (other than those being used in compliance with Environmental Laws)requiring removal, demolition, or closure. 

(i)                 Brawley has made available to Newco all material environmentally relatedaudits, studies, report analyses and results of investigations that have beenperformed with respect to any currently or previously owned, leased or operatedproperties of Brawley or material documentation relating to pending orthreatened claims or investigations pursuant to Environmental Laws, to theextent such materials are in the possession, custody or control of Brawley.

| 25 |
|----|

----

(j)                Prior to Closing, Brawley will use commercially reasonable efforts to takeall measures necessary to remediate and correct all instances of noncompliance withEnvironmental Law and OSHA prior to Closing, including but not limited to thepreparation and filing of any required reports or notices with governmentalagencies, installation of equipment, posting of required notices, anddevelopment of required programs with costs to be allocated between the partiesin accordance with Section 9.3.

5.20     Occupational Safety and Health.  Except as set forth on Schedule 5.20attached hereto:

(a)               The operations of Brawley, with respect to the Business, are and havebeen in compliance with respect to OSHA standards, OSH Act, Cal/OSHA Standards,and the California Occupational Safety and Health Act of 1973.

(b)              With respect to the Business, Brawley is not the subject of anyoutstanding citations under OSHA standards, OSH Act, Cal/OSHA Standards, or theCalifornia Occupational Safety and Health Act of 1973.

(c)               No claim is pending, or to the Knowledge of Brawley, threatened againstBrawley, alleging, with respect to the Business, that Brawley may be inviolation of OSHA standards, OSH Act, Cal/OSHA Standards, or the CaliforniaOccupational Safety and Health Act of 1973.

(d)              Except as described as in Section 9.3, to the Knowledge of Brawley, nofacts circumstances or conditions exist with respect to the Business that couldreasonably be expected to result in the Business incurring unbudgeted materialcosts to comply with OSHA standards, OSH Act, Cal/OSHA Standards, or theCalifornia Occupational Safety and Health Act of 1973.

(e)               To the Knowledge of Brawley there are no investigations of the Businesswhich could reasonably lead to the imposition of any material costs orliabilities associated with OSHA standards, OSH Act, Cal/OSHA Standards, or theCalifornia Occupational Safety and Health Act of 1973.

(f)                To the Knowledge of Brawley there are no violations of OSHA or Cal/OSHAStandards, OSH Act, or the California Occupational Safety and Health Act of1973 at the Facility.

5.21     Employee Benefit Plans.

| 26 |
|----|

----

(a)               Except as set forth in Schedule 5.21, neither Brawley nor anyAffiliates (as defined below) has established, sponsored, maintained, or madeany contributions to, or been parties to any contract or other arrangement orbeen subject to any statute or rule requiring it to establish, maintain,sponsor, or make any contribution to, (i) any "employee pension benefit plan" (asdefined in Section 3(2) of ERISA) ("Pension Plan"); (ii) any "employee welfarebenefit plan" (as defined in Section 3(l) of ERISA) ("Welfare Plan"); or (iii)any deferred compensation agreement, plan or arrangement; bonus plan orarrangement; stock option or stock purchase plan; incentive award plan orarrangement; personnel policy; vacation policy; severance pay plan, policy,program or agreement; retiree benefit plan or arrangement; fringe benefitprogram or practice (whether or not taxable); employee loan; consultingagreement; employment agreement; and each other employee benefit plan,agreement, arrangement, program, practice or understanding which is notdescribed above as a Pension Plan or Welfare Plan, and any insurance contractsrelating thereto ("Other Plan").  Brawley and the Affiliates have noobligations or liabilities (whether accrued, absolute, contingent, orunliquidated, and whether due or to become due) with respect to any PensionPlan, Welfare Benefit or Other Plan that arises other than in the ordinarycourse of plan sponsorship or administration that is not listed in Schedule5.21.  For purposes of this Section 5.21 only, the term "Affiliate" shallinclude all persons under common control with Brawley within the meaning ofSections 4001(a)(14) or (b)(1) of ERISA or any regulations promulgatedthereunder, or Sections 414(b), (c), (m) or (o) of the Code.

(b)              Each plan or arrangement listed in Schedule 5.21 (and any relatedtrust, insurance contract, or other vehicle pursuant to which benefits undersuch plans or arrangements are funded or paid) has been administered in allmaterial respects in compliance with its terms and is in compliance in allmaterial respects, in both form and operation, with applicable provisions ofERISA, the Code, the Consolidated Omnibus Budget Reconciliation Act ("COBRA")and other applicable law, except as noted on Schedule 5.21. All requiredgovernmental filings relating to such plans or arrangements have beenaccurately and timely filed (taking into account permissible filingextensions).  Each Pension Plan listed in Schedule 5.21 has beendetermined by the Internal Revenue Service to be qualified under Section 401(a)and, if applicable, Section 401(k) of the Code, and nothing has occurred orbeen omitted since the date of the last such determination that resulted orwill result in the revocation of such determination.  Brawley and theAffiliates have made all required contributions or payments to or under eachplan or arrangement listed in Schedule 5.21 on a timely basis and havemade adequate provision for reserves to meet contributions and payments, whicharise as a result of actions or omissions prior to Closing, under such plans orarrangements that have not been made because they are not yet due.  NeitherBrawley nor any of its Affiliates have contributed to, nor do they have anypast or present obligation to contribute to, any multiemployer plan as suchterm is defined in Section 3(37) of ERISA or any other plan subject to Title IVof ERISA.  Neither Brawley nor any of its Affiliates have any obligation toprovide life or medical benefits to former retired employees or beneficiariesthereof, other than such benefits as Brawley or its Affiliates are obligated toprovide under COBRA.

(c)               There are no pending. or, to the Knowledge of Brawley, threatened or anticipatedclaims, suits or other proceedings (including but not limited to any audit,enforcement action or similar proceeding conducted by any federal or stateagency) with respect to any plan or arrangement listed in Schedule 5.21other than ordinary claims by participants and beneficiaries thereunder.

| 27 |
|----|

----

(d)              Neither Brawley nor, to its Knowledge, its Affiliates, nor any ofdirector, officer, employee or agent of either, or any "party in interest" or "disqualifiedperson" (as such terms are defined in Section 3 of ERISA and Section 4975 ofthe Code) has, with respect to any plan or arrangement listed in Schedule5.21, engaged in or been a party to any non-exempt "prohibited transaction"(as such term is defined in Section 406 of ERISA and Section 4975 of the Code)in connection with which, directly or indirectly, Newco or National or any suchplan or arrangement could be subject to either a material penalty assessedpursuant to Section 502(i) of ERISA or a material tax imposed under Section4975 of the Code.

5.22     Products.

(a)               Brawley does not have any material liability (and, to Brawley's Knowledge,there is no reasonable basis for any present or future action, suit,proceeding, hearing, investigation, charge, complaint, claim or demand against Brawleygiving rise to any material liability) arising out of any injury to individualsor property as a result of the consumption of any Products.

(b)              Except as set forth on Schedule 5.22, there are no statements,citations or decisions by any governmental body stating that any Products aredefective or unsafe or fail to meet standards promulgated by any suchgovernmental body applicable to the Products.  Except as set forth on Schedule5.22 and to Brawley's Knowledge, there have been no recalls ordered orrequested by any such governmental body with respect to any Products.  Exceptas set forth on Schedule 5.22, to Brawley's Knowledge there is no (i)fact relating to any Products that would be reasonably likely to impose upon Brawleyor Newco a duty to recall any Products or a duty to warn customers of a defector of any Hazardous Substance in any Products, (ii) latent or overt processingor other defect in any Products or (iii) material liability for warranty claimsor returns with respect to any Products.  Brawley is in material compliancewith all applicable regulations and requirements of any federal, state or locallaw or regulation relating to the Products, and Brawley has not received anywritten notice that any party seeks to allege a violation, or impose anyprohibition or restriction with respect to the marketing, sale, manufacture orprocessing of any Product.

5.23     Brokers and Finders. Brawley has not employed any broker, finder,consultant or intermediary in connection with the transactions contemplated bythis Agreement who would be entitled to a broker's, finder's or similar fee orcommission in connection therewith or upon the consummation thereof, if theClosing does not occur.  Brawley agrees to bear all costs it incurs inconnection with the transactions contemplated by this Agreement unlessotherwise expressly provided herein. 

5.24     Statements True and Correct. No representation or warranty of Brawley in thisAgreement and no exhibit, document, statement, certificate or Schedulefurnished or to be furnished to Newco pursuant hereto, or in connection withthe transactions contemplated hereby, contains or will contain any untruestatement of a material fact, or omits or will omit to state a material factnecessary to make the statement or facts contained herein or therein notmisleading or necessary to provide Newco with adequate and complete informationas to Brawley, the Business and the Contributed Assets.  Brawley does not have Knowledgeof any fact that has specific application to Brawley (other than generaleconomic or industry conditions) and that may materially adversely affect theassets, business, prospects, financial condition or results of operations of Brawleythat has not been set forth in this Agreement.   

| 28 |
|----|

----

**ARTICLE 6 - REPRESENTATIONS ANDWARRANTIES OF NATIONAL AND NEWCO**

National and Newco hereby represent and warrant to Brawley asfollows: 

6.1        Organization and Power. Newco is a limited partnership organized, validlyexisting and in good standing under the laws of the State of Delaware.  Nationalis a limited liability company duly organized, validly existing and in goodstanding under the laws of the State of Delaware.  Each of National and Newcohas full power and authority to execute, deliver and perform this Agreement andthe other agreements contemplated hereby.  Each of National and Newco isqualified for the transaction of business and is in good standing under thelaws of each jurisdiction in which it owns or leases properties or conducts anybusiness which to its knowledge required such qualification, except suchjurisdictions where the failure to qualify will not have a Material AdverseEffect.  Each of National and Newco has full power and authority to execute,deliver and perform this Agreement and the other agreements contemplatedhereby.

6.2         Authorization. Theexecution, delivery and performance by National and Newco of this Agreement andthe other agreements contemplated hereby have been duly authorized by National andNewco.  This Agreement and the other agreements contemplated hereby, assumingtheir valid execution by Brawley, constitute valid and binding obligations of Nationaland Newco, enforceable in accordance with its terms except as suchenforceability may be limited by bankruptcy, insolvency, reorganization,moratorium or other similar laws affecting the enforcement of creditors' rightsand any equitable principles relating to or limiting creditors' rightsgenerally and the right to obtain specific enforcement of any obligations of Newcoand by general principles of equity regardless of whether they are consideredin a proceeding at law or in equity. 

6.3         No Violation. Theexecution, delivery and performance of this Agreement and the other agreementscontemplated hereby by National or Newco and the consummation of thetransactions contemplated hereby or thereby do not and will not (a) conflictwith or result in any breach of, (b) constitute a default under, (c) result ina violation of, or (d) give any third party the right to accelerate anyobligation under the provisions of National's or Newco's limited liabilitycompany operating agreement or limited partnership agreement or any indenture,mortgage, lease, loan agreement or other agreement or instrument to which Newcois bound or affected, or any law, statute, rule, regulation, judgment or decreeto which National or Newco is subject.

6.4         Capitalization.  The LP Units issuedto Brawley on the Closing date will be (i) duly and validly issued, (ii) fullypaid and non-assessable, and (iii) free of liens, encumbrances and restriction.

6.5         Litigation. There are no actions,suits, proceedings, orders or investigations pending or, to the knowledge of Nationalor Newco, threatened against or affecting National or Newco at law or inequity, or before or by any federal, state, municipal or other governmentaldepartment, commission, board, bureau, agency or instrumentality, domestic orforeign, which is reasonably likely to materially and adversely affect National'sor Newco's performance under this Agreement or the consummation of thetransactions contemplated hereby.

| 29 |
|----|

----

6.6        Brokers and Finders. NeitherNational nor Newco has employed any broker, finder, consultant or intermediaryin connection with the transactions contemplated by this Agreement who would beentitled to a broker's, finder's or similar fee or commission in connectiontherewith or upon the consummation thereof, if the Closing does not occur otherthan Christenberry Collet & Company, Inc. ("CCCO").  National and Newcoagree to bear all costs they incur in connection with the transactionscontemplated, including any fees of CCCO by this Agreement unless otherwiseexpressly provided herein.

6.7         No Authorization Required.  Except as described inSection 8.1, no consent, authorization or approval of, or exemption by, orfilings with, any governmental, public or self-regulatory body or authority orany third party is required in connection with the execution, delivery andperformance of this Agreement by Newco or National except as contemplated bythis Agreement.

6.8         Financial Ability.  Newco shall have asof the Closing the financial capability and status to assume, pay and dischargethe Assumed Liabilities, as such liabilities become due, and to consummate thetransactions contemplated by this Agreement.

6.9        Statements True and Correct.  No representation or warranty of Newco or Nationalin this Agreement and no exhibit, document, statement, certificate or Schedulefurnished or to be furnished to Brawley pursuant hereto, or in connection withthe transactions contemplated hereby, contains or will contain any untruestatement of a material fact, or omits or will omit to state a material factnecessary to make the statement or facts contained herein or therein notmisleading or necessary to provide Brawley with adequate and completeinformation as to Newco and National.  Neither Newco or National have Knowledgeof any fact that has specific application to either Newco or National (otherthan general economic or industry conditions) that would materially adverselyaffect their ability to perform their obligations hereunder and has not beendisclosed in the filings made by National with the Securities and ExchangeCommission.

**ARTICLE 7 -PRE-CLOSING COVENANTS**

7.1      Satisfaction of Closing Conditions.  Prior to the Closing, (i) Newco shall usecommercially reasonable efforts to satisfy, or cause to be satisfied, thoseclosing conditions set forth in Section 8.1 that are reasonablywithin Newco's control; and (ii) Brawley shall use commercially reasonableefforts to satisfy, or cause to be satisfied, those closing conditions setforth in Section 8.2 that are reasonably within Brawley's control.  Forpurposes of this Section 7.1, unless compliance with or performance of acovenant expressly or inherently requires the expenditure of money (wherecompliance with or performance of such covenant is a closing condition), theuse of "commercially reasonable efforts" shall not require either party toexpend money.

| 30 |
|----|

----

7.2        Access to Information.  Prior to the Closing Date, Newco shall beentitled, through its officers, employees and representatives (including its legaladvisors and accountants), to make such investigation of the Contributed Assetsand such examination of the Brawley's books, records and other documents as itreasonably requests.  Any such investigation and examination shall be conductedduring regular business hours, upon reasonable advance request and undercommercially reasonable circumstances and shall be subject to restrictionsunder applicable Law.  Brawley shall, and shall cause its officers, employees,consultants, agents, accountants, attorneys and other representatives of Brawleyto, cooperate with Newco and Newco's representatives in connection with suchinvestigation and examination, and Newco and its representatives shallcooperate with Brawley and its representatives and shall use their commerciallyreasonable efforts to minimize any disruption to the business of Brawley.  Newcoagrees to abide by any safety rules or rules of conduct reasonably imposed by Brawleyor the operator of such properties, as the case may be, with respect to Newco'saccess and any information furnished to Newco or its representatives pursuantto this Section 7.2.

7.3        Operation of the Business of Brawley.  Between the date of this Agreement and the Closing,Brawley shall:  

(a)                  conduct its business only in the Ordinary Course of Business;

(b)                 except as otherwise directed by Newco in writing, and without making anycommitment on Newco's behalf, use its commercially reasonable efforts topreserve intact its current business organization, keep available the servicesof its officers, employees and agents and maintain its relations and good willwith suppliers, customers, landlords, creditors, employees, agents and othershaving business relationships with it;

(c)                  confer with Newco prior to implementing operational decisions of amaterial nature; 

(d)                 otherwise report periodically to Newco concerning the status of itsbusiness, operations and finances; 

(e)                  make no material changes in management personnel without priorconsultation with Newco;

(f)                   maintain the Contributed Assets in a state of repair and condition thatcomplies with legal requirements and is consistent with the requirements andnormal conduct of the Business and refrain from any sale or transfer of ContributedAssets except in the Ordinary Course of Business;  

(g)                  keep in full force and effect, without amendment, all material rights relatingto the Business, including all Permits and other authorizations or licensesneeded for the operation of the Business and refrain from any modificationsthereof without Newco's prior written consent;

(h)                  comply with all applicable material legal requirements and contractualobligations applicable to the operations of the Business;

(i)                    continue in full force and effect the insurance coverage under the policiesset forth in Schedule 5.18 or substantially equivalent policies; 

| 31 |
|----|

----

(j)                   except as required to comply with ERISA or to maintain qualificationunder Section 401(a) of the Code, not amend, modify or terminate any Brawley's Planwithout the express written consent of Newco, and except as required under theprovisions of any Plan, not make any contributions to or with respect to aBrawley's Plan without the express written consent of Newco, provided that Brawleyshall contribute that amount of cash to each Plan necessary to fully fund allof the benefit liabilities of such Brawley's Plan on a plan-termination basisas of the Closing Date;  

(k)                 cooperate with Newco and assist Newco in identifying the RequiredGovernmental Authorizations needed by Newco to operate the Business from andafter the Closing Date and either transferring existing governmental authorizationsof Brawley to Newco, where permissible, or obtaining new governmental authorizationsfor Newco; 

(l)                    maintain all books and records of Brawley relating to the Business inthe Ordinary Course of Business;

(m)                deliver to Newco such additional information regarding the Business asNewco may reasonably request from time to time.

7.4    Required Consents.  Each of Brawley and Newco shall use commerciallyreasonable efforts to obtain the Required Third Party Consents prior to theClosing.

7.5     Regulatory Approvals.  

(a)               Each of Newco and Brawley shall (i) use commercially reasonableefforts to obtain or cause to be obtained all Required GovernmentalAuthorizations, (ii) make or cause to be made all filings required of eachof them or any of their respective affiliates under applicable laws withrespect to the transactions contemplated hereby as promptly as practicable and,in any event, within five (5) business days after the date of this Agreement,(iii) comply at the earliest practicable date with any request underapplicable laws for additional information, documents, or other materials fromany governmental body in respect of such filings or such transactions, and(iii) cooperate with each other in connection with any such filing(including, to the extent permitted by applicable law, responding to anyreasonable requests for copies of all such documents to the non-filing partiesprior to filing and considering all reasonable additions, deletions or changessuggested in connection therewith) and in connection with resolving anyinvestigation or other inquiry of any governmental body under any such laws(e.g., antitrust laws) with respect to any such filing or such transactions. Each such party shall use commercially reasonable efforts to furnish to eachother all information required for any application or other filing to be madepursuant to any applicable law in connection with the transactions contemplatedby this Agreement.

| 32 |
|----|

----

(b)              Any party may, as it deems advisable and necessary, reasonably designateany competitively sensitive material provided to the other parties under thisSection 7.5 as "outside counsel only."  Such materials and the informationcontained therein shall be given only to the outside legal counsel of therecipient, and the recipient shall cause such outside counsel not to disclosesuch materials or information to any employees, officers, directors or otherrepresentatives of the recipient or their affiliates, unless express writtenpermission is obtained in advance from the source of the materials.  Each suchparty shall promptly inform the other party hereto of any oral communication with,and provide copies of written communications with, any governmental bodyregarding any such filings or any such transaction.  No party hereto shallindependently participate in any formal meeting with any governmental body inrespect of any such filings, investigation, or other inquiry without giving theother party hereto prior notice of the meeting and, to the extent permitted bysuch governmental body, the opportunity to attend and/or participate.  Subjectto applicable law, the parties hereto will consult and cooperate with oneanother in connection with any analyses, appearances, presentations, memoranda,briefs, arguments, opinions and proposals made or submitted by or on behalf ofany party hereto relating to proceedings under applicable laws.

(c)               Each of Newco and Brawley shall use commercially reasonable efforts toresolve such objections, if any, as may be asserted by any governmental bodywith respect to the transactions contemplated by this Agreement underapplicable laws.  In connection therewith, if any legal proceeding isinstituted (or threatened to be instituted) challenging any transactioncontemplated by this Agreement as in violation of any applicable law, each of Newcoand Brawley shall cooperate and use commercially reasonable efforts to contestand resist any such legal proceeding, and to have vacated, lifted, reversed, oroverturned any decree, judgment, injunction or other order whether temporary,preliminary or permanent, that is in effect and that prohibits, prevents,limits or restricts consummation of the transactions contemplated by thisAgreement, including by pursuing all available avenues of administrative andjudicial appeal and all available legislative action, unless, by mutualagreement, Newco and Brawley decide that litigation is not in their respectivebest interests.  Each of Newco and Brawley shall use commercially reasonableefforts to take such action as may be required to cause the expiration of thenotice periods under applicable law with respect to such transactions aspromptly as possible after the execution of this Agreement.  

7.6       No Negotiation.  Until such time as thisAgreement shall be terminated pursuant to Section 4.6, neither Brawley nor any Memberon its behalf shall directly or indirectly solicit, initiate, encourage orentertain any inquiries or proposals from, discuss or negotiate with, provideany nonpublic information to or consider the merits of any inquiries orproposals from any person (other than Newco, National or USPB) relating to anybusiness combination transaction involving Brawley, including the sale byMembers of Brawley's membership units, the merger or consolidation of Brawleyor the sale of the Business or any of the Contributed Assets (other than in theOrdinary Course of Business).  Brawley and Members shall notify Newco of anysuch inquiry or proposal within twenty-four (24) hours of receipt or awarenessof the same.

7.7    Supplementation and Amendment of Schedules.  From time to time prior to the Closing, Brawleyshall have the right to supplement or amend the Schedules in Article 5 withrespect to any matter hereafter arising or discovered after the delivery of theSchedules pursuant to this Agreement; provided, however, no suchsupplement or amendment shall have any effect on the satisfaction of thecondition to Closing set forth in Section 8.1(a).

| 33 |
|----|

----

**ARTICLE 8 - CONDITIONSTO CLOSING**

8.1    Conditions Precedent to Obligations of Newco.  The obligation of Newco to consummate thetransactions contemplated by this Agreement is subject to the fulfillment, onor prior to the Closing Date, of each of the following conditions (any or allof which may be waived by Newco in whole or in part to the extent permitted byapplicable law):

(a)               The representations and warranties of Brawley set forth as of the dateof this Agreement in Article 5 that are qualified as to materiality shall betrue and correct, and those not so qualified shall be true and correct in allmaterial respects, at and as of the Closing Date as though made on the ClosingDate, except to the extent such representations and warranties expressly relateto an earlier date, without the benefit of any supplement or amendment pursuantto Section 7.7.

(b)              Brawley shall have performed and complied with all covenants required bythis Agreement to be performed or complied with by it on or prior to the ClosingDate.

(c)               There shall not be in effect any order by a governmental body ofcompetent jurisdiction restraining, enjoining or otherwise prohibiting theconsummation of the transactions contemplated hereby, nor shall there bepending or threatened in writing any legal proceeding seeking to restrain,enjoin or prohibit the consummation of the transactions contemplated hereby.

(d)              The waiting period applicable to the transactions contemplated by thisAgreement under the Hart-Scott-Rodino Antitrust Improvements Act shall haveexpired or early termination shall have been granted.

(e)               All Required Governmental Authorizations and Permits identified in Schedule8.1(e) have been obtained.

(f)                All Required Third Party Consents identified in Schedule 8.1(f)have been obtained.

(g)               The transactions contemplated by this Agreement shall have been approvedby the general partner of Newco, the board of managers of USPB, and the lendersand members of National Beef.

(h)               The total amount of Indebtedness comprising Assumed Liabilities shallnot exceed $54,250,000; provided, that this limit may be increased tothe extent that (i) outstanding borrowings under Brawley's existingrevolving line of credit at the Closing Date exceed $11,581,000; and (ii) theamount in clause (i) is matched by a corresponding increase in Working Capital inexcess of $19,786,000.

| 34 |
|----|

----

(i)                 The total amount of Assumed Liabilities shall not exceed $68,970,000,subject to (i) any increase in Indebtedness comprising Assumed Liabilitiesas described in Section 8.1(h); and (ii) any increase in currentliabilities (but excluding the bank line of credit and the current portion oflong-term indebtedness) matched by a corresponding increase in current assets,based on the November 30, 2005 normalized balance sheet of Brawley attached asExhibit 3.3(a).

(j)                Newco shall have received confirmation, satisfactory to it in its solediscretion, that it will be able to access economically freshwater andwastewater treatment necessary for anticipated future production levels.

(k)              Newco shall have received releases of all Encumbrances on the ContributedAssets, other than Permitted Encumbrances.

(l)                 Newco and its representatives shall have completed their due diligenceinvestigation of the Contributed Assets and the Business and related matters,and the results of such diligence shall be satisfactory to Newco in its soleand absolute discretion, including without limitation, in respect toenvironmental matters.

(m)             Brawley shall have delivered (or shall stand ready to deliver) alldocuments required to be delivered by it at Closing, as more specifically setforth in Section 4.2.

(n)               Newco shall have received from Brawley the audited financial statementsfor the year ending December 31, 2005 at least five (5) days prior to theClosing.

8.2    Conditions Precedent to Obligations of Brawley.  The obligations of Brawley to consummate thetransactions contemplated by this Agreement are subject to the fulfillment,prior to or on the Closing Date, of each of the following conditions (any orall of which may be waived by Brawley in whole or in part to the extentpermitted by applicable law):

(a)               The representations and warranties of Newco set forth in Article 6 thatare qualified as to materiality shall be true and correct, and those not soqualified shall be true and correct in all material respects, at and as of theClosing Date as though made on the Closing Date, except to the extent suchrepresentations and warranties expressly relate to an earlier date.

(b)              Newco shall have performed and complied in all material respects withall obligations and agreements required by this Agreement to be performed orcomplied with by it on or prior to the Closing Date.

(c)               There shall not be in effect any order by a governmental body ofcompetent jurisdiction restraining, enjoining or otherwise prohibiting theconsummation of the transactions contemplated hereby, nor shall there bepending or threatened in writing any legal proceeding seeking to restrain,enjoin or prohibit the consummation of the transactions contemplated hereby.

(d)              The waiting period applicable to the transactions contemplated by thisAgreement under the Hart-Scott-Rodino Antitrust Improvements Act shall haveexpired or early termination shall have been granted.

| 35 |
|----|

----

(e)               All Required Governmental Authorizations have been obtained.

(f)                Newco shall have delivered (or shall stand ready to deliver) the considerationpursuant to Section 3.1.

(g)               USPB shall stand ready to deliver the USPB Units. 

(h)               Arrangements have been made, to the reasonable satisfaction of Brawley,for the release of all Guarantees.

(i)                 Newco shall have delivered (or shall stand ready to deliver) alldocuments required to be delivered by it at Closing, as more specifically setforth in Section 4.3.

8.3    Frustration of Closing Conditions.  Neither Newco nor Brawley may rely on thefailure of any condition set forth in Sections 8.1 or 8.2, as the case maybe, if such failure was caused by such party's breach of any provision of thisAgreement.

**ARTICLE 9 - ADDITIONAL AGREEMENTS**

9.1        Indemnification.

(a)               Agreement of Brawley to Indemnify.  Subject to the terms andconditions of this Article 9, Brawley agrees to indemnify, defend and holdharmless Newco from, against, for and in respect of any and all Losses assertedagainst, or paid, suffered or incurred by, Newco and resulting from or arisingout of:  (i) the breach of any representation or warranty of Brawleycontained in or made pursuant to this Agreement or in any certificate, scheduleor exhibit furnished by Brawley in connection herewith; (ii) a breach ofor failure to perform any covenant or agreement of Brawley made in thisAgreement; (iii) any Excluded Liability; and (iv) any and allactions, suits, claims, proceedings, investigations, demands, assessments,audits, fines, judgments, costs and other expenses, (including, withoutlimitation, reasonable legal fees and expenses) incident to subsections (i),(ii) or (iii) of this Section 9.1(a) or the enforcement of thisSection 9.1(a).

(b)              Agreement of Newco to Indemnify.  Subject to the terms andconditions of this Article 9, Newco agrees to indemnify, defend and holdharmless Brawley and Members from, against, for and in respect of any and allLosses asserted against, or paid, suffered or incurred by, such Brawley and/orMembers and resulting from or arising out of:  (i) the breach of anyrepresentation or warranty of Newco contained in or made pursuant to thisAgreement or in any certificate, schedule or exhibit furnished by Newco inconnection herewith; (ii) a breach of or failure to perform any covenantor agreement of Newco made in this Agreement; (iii) any Assumed Liability;and (iv) any and all actions, suits, claims, proceedings, investigations,demands, assessments, audits, fines, judgments, costs and other expenses,(including, without limitation, reasonable legal fees and expenses) incident tosubsections (i), (ii), or (iii) of this Section 9.1(b) or the enforcement ofthis Section 9.1(b).

| 36 |
|----|

----

(c)               Procedure for Indemnification.

(i)                 Any claim for indemnification under this Section 9.1 (an "IndemnificationClaim") shall be made by the party claiming indemnification (the "Indemnitee")by delivery of a written notice to the party against whom indemnification isclaimed (the "Indemnitor") requesting indemnification and specifying the basison which indemnification is sought and the amount of asserted Losses and, inthe case of a Third Party Claim (as defined below), containing (by attachment orotherwise) such other information as such Indemnitee shall have concerning suchThird Party Claim.

(ii)               If the Indemnification Claim involves a Third Party Claim the proceduresset forth in Section 9.1(d) shall be observed by the Indemnitee and theIndemnitor. 

(iii)              If the Indemnification Claim involves a matter other than a Third PartyClaim, the Indemnitor shall have thirty (30) days to object to suchIndemnification Claim by delivery of a written notice of such objection to suchIndemnitee specifying in reasonable detail the basis for such objection. Failure to timely so object shall constitute a final and binding acceptance ofthe Indemnification Claim by the Indemnitor, and the Indemnification Claimshall be paid in accordance with subsection (iv) hereof.  

(iv)             Upon determination of the amount of an Indemnification Claim, whether byagreement between the Indemnitor and the Indemnitee or by final adjudication,the Indemnitor shall pay the amount of such Indemnification Claim within ten(10) days of the date such amount is determined.

(d)              Third Party Claims.

(i)                 For purposes of this Agreement, "Third Party Claim" means any action,arbitration, cause of action, claim, complaint, criminal prosecution,injunctions or other actions in equity, governmental or other examination orinvestigation, hearing, administrative or other proceeding (including, withoutlimitation, an audit by any taxing authority) that is instituted against anIndemnitee by a person other than an Indemnitor and which, if prosecutedsuccessfully, would result in losses for which such Indemnitee is entitled toindemnification hereunder.

(ii)               The obligations and liabilities of the parties hereunder with respect toa Third Party Claim shall be subject to the following terms and conditions:

| 37 |
|----|

----

(A)       The Indemnitee shall give the Indemnitor writtennotice of a Third Party Claim promptly after receipt by the Indemnitee ofnotice thereof, and the Indemnitor may undertake the defense, compromise andsettlement thereof by representatives of its own choosing reasonably acceptableto the Indemnitee.  The failure of the Indemnitee to notify the Indemnitor ofsuch claim shall not relieve the Indemnitor of any liability that it may havewith respect to such claim except to the extent the Indemnitor demonstratesthat the defense of such claim is prejudiced by such failure.  The assumptionof the defense, compromise and settlement of any such Third Party Claim by theIndemnitor shall be an acknowledgment of the obligation of the Indemnitor toindemnify the Indemnitee with respect to such claim hereunder.  If theIndemnitee desires to participate in, but not control, any such defense,compromise and settlement, it may do so at its sole cost and expense.  If,however, the Indemnitor fails or refuses to undertake the defense of such ThirdParty Claim within thirty (30) days after written notice of such claim has beengiven to the Indemnitor by the Indemnitee, the Indemnitee shall have the rightto undertake the defense, compromise and settlement of such claim with counselof its own choosing.  In the circumstances described in the preceding sentence,the Indemnitee shall, promptly upon its assumption of the defense of suchclaim, make an Indemnification Claim as specified in Section 9.1(c) which shallbe deemed an Indemnification Claim that is not a Third Party Claim for thepurposes of the procedures set forth herein.

(B)       No settlement of a Third Party Claim involving theasserted liability of the Indemnitors under this Section 9.1 shall be madewithout the prior written consent by or on behalf of the Indemnitor, whichconsent shall not be unreasonably withheld or delayed.  Consent shall bepresumed in the case of settlements of $25,000 or less where the Indemnitor hasnot responded within ten (10) days of notice of a proposed settlement.  If theIndemnitor assumes the defense of such a Third Party Claim, a compromise orsettlement thereof may be effected by the Indemnitor without the Indemnitee'sconsent if the sole relief provided is monetary damages that are paid in fullby the Indemnitors; provided, however, if the Indemnitee reasonably believes ona good faith basis that the Indemnitor's monetary settlement of such ThirdParty Claim would have a continuing material adverse effect on the Indemnitee'soperation of the Business then, upon written notice to the Indemnitor, theIndemnitee may so notify Indemnitor, in which event the Indemnitor's soleliability to the Indemnitee with respect to the Third Party Claim shall belimited to the amount for which the Indemnitor could have settled such Third PartyClaim.

(e)               Survival.  Subject to the provisions of subsection (f)hereinbelow, all representations, warranties and agreements contained in thisAgreement or in any certificate delivered pursuant to this Agreement shallsurvive the Closing.  A party's right to indemnification as provided inthis Section 9.1 shall not be eliminated, reduced or modified in any way as aresult of the fact that it has notice of a breach or inaccuracy of anyrepresentation, warranty or covenant contained herein.

(f)                Time Limitations.  Brawley shall have no liability to Newco underSection 9.1 unless written notice asserting an Indemnification Claim basedthereon is given to Brawley prior to the second anniversary of the ClosingDate, provided, that, the foregoing notwithstanding, no time limitationshall apply with respect to any Losses arising from or related to ExcludedLiabilities or a breach of the representations or warranties set forth in Sections 5.1,or 5.2; Brawley's liability for any breach of representation or warranty underSections 5.9, 5.13, or 5.15 shall terminate upon the expiration of theapplicable statutes of limitation, and Brawley's liability for any breachof representation or warranty under Section 5.19 shall terminate upon theexpiration of the earlier of five (5) years or the applicable statute oflimitations.

| 38 |
|----|

----

(g)               Subrogation.  Upon payment in full of any Indemnification Claim,or the payment of any judgment or settlement with respect to a Third PartyClaim, the Indemnitor shall be subrogated to the extent of such payment to therights of the Indemnitee against any person or entity with respect to thesubject matter of such Indemnification Claim or Third Party Claim.

(h)               Net Recovery.  The amount to which an Indemnitee may becomeentitled hereunder shall be net of any recovery (whether by way of payment,discount, credit, set off, tax benefit, counterclaim or otherwise) receivedfrom a third party (including any insurer or taxation authority) in respect ofsuch claim and shall take into account the tax consequences of the receipt ofthe indemnity amounts.  Any such recovery shall be promptly repaid by theIndemnitee to the Indemnitor, less all reasonable costs, charges and expensesincurred by the Indemnitee in obtaining such recovery from the third party. Any amounts paid pursuant to indemnification provisions of this Section 9.1shall be deemed and treated by the parties as an adjustment to the Considerationpaid by Newco hereunder.

(i)                 Limitation on Amounts.  The liability of Brawley to indemnify forLosses pursuant to Section 9.1(a)(i) and (a)(ii) shall be limited as follows:

(i)                 Claims for Losses under Section 9.1(a)(i) or (a)(ii) must first exceedin the aggregate Five Hundred Thousand Dollars ($500,000).

(ii)               Claims for Losses under Section 9.1(a)(i) or (a)(ii) that do notarise from Environmental Matters or OSHA Standards, OSH Act, Cal/OSHA Standardsor the California Occupational Safety and Health Act of 1973 shall be subjectto an aggregate limit of Three Million Dollars ($3,000,000).

(iii)              Claims for Losses under Section 9.1(a)(i) or (a)(ii) that do arisefrom Environmental Matters or OSHA Standards, OSH Act, Cal/OSHA Standards, orthe California Occupational Safety and Health Act of 1973 shall be subject toan aggregate limit of Ten Million Dollars ($10,000,000).

(iv)               The maximum dollar amount for indemnification obligations underSection 9.1(a)(i) and (a)(ii) shall not exceed Ten Million Dollars ($10,000,000)in the aggregate.

(v)               The limitations in this subsection (i) do not apply to other claimspayable under this Agreement including but not limited to claims relating toExcluded Liabilities, Section 3.4, Section 5.8(b) or Section 9.3.

(j)                Mitigation.  The Indemnitee will use commercially reasonableefforts to mitigate the losses, costs, expenses and damages to which it maybecome entitled to indemnification hereunder.

9.2       Payment of Brawley Indemnification Claims.  

| 39 |
|----|

----

(a)               Manner of Payment.  With respect to any payment by Brawley ofindemnification claims under Section 9.1(a)(i) and (a)(ii), Brawley may at itsoption elect to make payment by any of the following methods:

(i)                 by cash or immediately available funds;

(ii)               by deductions from payments to be made by Newco under its Cattle SupplyAgreement with Brawley (provided that such deductions may be made only againstpayments for Member supplied cattle sold by Brawley); 

(iii)              by surrender of USPB units held under the Pledge Agreement; for purposesof payment of indemnification claims under Section 9.1(a)(i) and (a)(ii), eachClass A and Class B Unit of USPB shall be deemed to have a collective value of$165.

(b)              Timing of Payment.

(i)                 Provided Brawley is not otherwise in breach of this Agreement or theCattle Supply Agreements, Brawley may elect to schedule its indemnificationpayments over a period of up to three years, in equal monthly installments ofprincipal and interest, with interest to accrue upon the unpaid amount of theclaim at the rate of eight percent (8%) per annum, compounded monthly.

(ii)               In the event the Cattle Supply Agreements between Brawley and Newcoshall terminate or otherwise cease to be in effect, then any amounts owing forindemnification claims shall become immediately due and payable.

9.3       Compliance Expenditures.  Schedule 9.3lists certain operating deficiencies of the Business (each a "Correction Item")for which the parties acknowledge that expenditures must be made to in order tobring the Business into compliance with the representations and warranties ofthis Agreement.  Following the Closing, the parties shall cooperate in takingsuch measures as are necessary to address each Correction Item and agree toshare the aggregate expenses as follows:

(a)               Newco shall be responsible for the first $750,000 in aggregate expenses.

(b)              Brawley shall be responsible for the next $250,000 in aggregateexpenses.

(c)               Newco and Brawley shall share equally in the next $2,000,000 ofaggregate expenses.

(d)              Newco shall be responsible for any additional expenses over and above$3,000,000.

9.4       Employees of the Business. 

(a)               Hired Employees.

| 40 |
|----|

----

(i)                 Prior to the Closing Date, Brawley shall have provided Newco a schedulethat sets forth, as of the date of this Agreement, the names of all employeesof Brawley.  Such schedule shall be updated up to the Closing Date as necessaryto reflect new hires or other personnel changes.  Schedule 9.4lists all employees of Brawley at the Facility whose employment has beenterminated within the ninety (90) days prior to Closing and the dates oftermination for each such employee, except employees who voluntarily terminatedtheir employment with Brawley and employees who were terminated by Brawley forcause.

(ii)               Prior to (as well as on or immediately after) the Closing Date, Newco shalloffer immediate employment to all or substantially all of Brawley's employeesat the Facility such that there shall be no break in service by the employeesin connection with the Business.  Newco shall assume all liabilities arisingout of the Collective Bargaining Agreements disclosed in Schedule 5.14. All such persons who accept Newco's offer of employment shall be referred to asthe "Hired Employees."  The Hired Employees shall become employees of Newcoeffective as of the Closing Date.  Notwithstanding the foregoing, Newco shallretain the right at any time after the Closing Date to terminate the employmentof any Hired Employee and to change the terms and conditions of theiremployment (including compensation and employee benefits provided to them).

(b)              Employee Files.  To the extent permitted by law, on the ClosingDate or as soon as practicable thereafter, Brawley shall deliver to Newco acopy of all historical personnel and medical records of each Hired Employee,including but not limited to Forms I-9, employment agreements, confidentialityagreements and non-compete agreements; provided, however, that (i) Brawleyshall provide Newco (or Newco's successors and assigns) access to the originalof any document contained in such employment files if Newco has a reasonableneed therefor (e.g., litigation); and (ii) Brawley shall provide to Newcothe originals of all Forms I-9 for each Hired Employee upon Newco's requesttherefor.  To the extent that applicable law requires the consent of Brawley'semployee(s) or former employee(s) for certain personnel or medical records tobe furnished to Newco pursuant to this Section, Brawley shall use reasonableefforts to obtain the written consent of each such employee or former employee.

(c)               Employee Benefits.  Except as set forth in Schedule 9.4,neither Newco nor National shall assume, maintain or continue any Pension Plan,Welfare Plan or Other Plan of Brawley following Closing.  With respect to anyPension Plan, Welfare Plan or Other Plan assumed by Buyer or National followingClosing as set forth in Schedule 9.4 (the "Assumed Plans"), the partiesacknowledge and agree that (i) Newco or National shall only perform theduties and obligations of the employer-sponsor and plan administrator followingthe Closing and that Brawley shall remain liable following Closing for anyviolations of applicable law or breaches of fiduciary duty or other obligationsthat occurred (irrespective of when Known) with respect to such plans prior toClosing; and (ii) neither the Members nor Brawley assume any liability,and neither the Members nor Brawley shall be deemed to assume any liability,following Closing for any benefits or coverage or for any violations ofapplicable law or breaches of fiduciary duty or other obligations that occur(irrespective of when Known) with respect to such plans on or after Closing. 

| 41 |
|----|

----

(d)              Other Matters.

(i)                 All rights and obligations created by this Agreement are solely betweenthe parties hereto.  The parties intend that there are no third partybeneficiaries under this Agreement.  Without limiting the foregoing, nothing inthis Agreement is intended to confer upon any employee of Brawley or suchemployee's legal representatives, heirs or beneficiaries any rights as a thirdparty beneficiary or any remedies of any kind whatsoever under or by reason ofthis Agreement, or the transactions contemplated hereby or thereby, includingany rights of employment or continued employment.

(ii)               Brawley warrants that, to its Knowledge, it has no oral contracts withany of its employees at the Business or any independent contractors performingservices at the Business other than as previously disclosed to Newco.

(iii)              To Brawley's Knowledge, it has no formal independent contractorrelationship with any third party performing services at the Business otherthan as previously disclosed to Newco.

9.5         Continuing Assistance.  At any time and from time to time after the Closing,at Newco's request and without further consideration or compensationwhatsoever, Brawley will execute and deliver such other instruments of sale,transfer, conveyance, assignment and confirmation and take such action as Newcomay reasonably deem necessary or desirable in order to more effectivelytransfer, convey and assign to Newco, and to confirm Newco's title to, all ofthe Contributed Assets.  Subsequent to the Closing, Brawley will refer allcustomer, supplier, and other inquires relating to the Business to Newco.  Atany time and from time to time after the Closing, at Brawley's request andwithout further consideration or compensation whatsoever, Newco will executeand deliver such other instruments of assignment and assumption and take suchaction as Brawley may reasonably deem necessary or desirable in order to moreeffectively evidence the assumption by Newco of the Assumed Liabilities.

9.6         Cooperation in Litigation.  Newco and Brawley shall reasonably cooperate with eachother, at the requesting party's expense, in the prosecution or defense of anydispute or litigation or other proceeding arising from their respectiveoperation of the Business and involving one or more third parties, includingbut not limited to making available employees, employee or other businessrecords, and other information pertinent to the litigation.

9.7         Expenses.  Except as otherwiseexpressly provided herein, each party will pay all of its expenses, includingattorneys', accountants' and brokers' fees, in connection with the negotiationof this Agreement, the performance of its obligations hereunder, and theconsummation of the transactions contemplated by this Agreement.  All state,county or local sales or use taxes and any transfer taxes shall be paid byNewco following the unit exchange described in Section 3.2 and withoutdetriment to Brawley.

| 42 |
|----|

----

9.8        Press Releases and Announcements.  No press releases, announcements or other disclosurerelated to this Agreement, the transactions contemplated herein or theconsideration paid hereunder or pursuant to any agreement ancillary hereto willbe issued by any party hereto without the joint approval of Newco and Brawley,except for any public disclosure which any party hereto in good faith believesis required by law.  In particular the parties acknowledge that National andNewco will be required to disclose certain information under the federalsecurities laws.  Newco and Brawley shall be liable for any breaches of thisprovision by any of their respective affiliates, employees or representatives.

9.9         Continuing Access to Records.  For a period of not less than three (3) years fromthe Closing Date (plus any additional time during which a party has beenadvised that (a) there is an ongoing tax audit with respect to periods prior tothe Closing Date, or (b) such period is otherwise open to assessment) Newcoagrees to give Brawley reasonable cooperation, access and staff assistance, asneeded, during normal business hours with respect to books and records andother financial data delivered to Newco hereunder, and Brawley agree to give Newcoreasonable cooperation, access, and staff assistance, as needed, during normalbusiness hours with respect to books and records and other financial datarelating solely to the Business or the Contributed Assets retained by Brawley,as may be necessary for the defense, compromise or settlement of any ThirdParty Claim or for general business purposes, including, without limitation for(x) the preparation of tax return and financial statements and (y) themanagement and handling of tax audits, to an extent as will not unreasonablyinterfere with a party's conduct of its business, and to keep such materialsreasonably accessible.  Notwithstanding the foregoing, for as long as Newco isprosecuting or defending any claims (or reasonably anticipates any claims)involving any third party (including any appeal or right to appeal), uponwritten notice to Brawley, Brawley shall preserve all records and other informationidentified by Newco as pertinent to the litigation, or, at the mutual option byNewco and Brawley, shall transfer such materials to Newco at Newco's expense.

9.10       Bulk Sales. Newco hereby waives compliance by Brawley with respect to any Bulk Sales orsimilar laws of the State of California and any jurisdiction in connection withthe sale of the Contributed Assets to Newco.

9.11       Pledge Agreement****.  To support Brawley'sobligations to indemnify Newco under Section 9.1, Brawley and Newco willexecute a pledge agreement (the "Pledge Agreement") in substantially the formattached hereto as Exhibit G.

9.12      National Guaranty.  National will guarantyto Brawley the full and punctual payment and performance, by Newco, of allobligations, liabilities, and covenants hereunder, by executing a guarantyagreement in substantially the form attached hereto as Exhibit H.

9.13      Post Closing Covenants.

(a)                  M/I Accounts.  Newco will use commercially reasonable efforts tocollect the M/I Accounts after the Closing.  Brawley shall cooperate with Newcoas reasonably requested, and Newco shall not settle the M/I Accounts without theprior approval of Brawley.  Newco shall provide Brawley with such informationconcerning collections on the accounts as Brawley may request.

| 43 |
|----|

----

(b)                 Guarantees.  Subsequent to the Closing, Newco will use its bestefforts to have all guarantees of the Members made in connection with AssumedContracts removed and terminated as soon as reasonably possible.

**ARTICLE 10 - MISCELLANEOUS**

10.1      Amendment and Waiver.

(a)               This Agreement may be amended, or any provision of this Agreement may bewaived, provided that any such amendment or waiver will be binding upon Brawleyonly if set forth in a writing executed by Brawley, and any such amendment orwaiver will be binding upon Newco only if set forth in a writing executed by Newco.

(b)              No course of dealing between or among any persons having any interest inthis Agreement will be deemed effective to modify, amend or discharge any partof this Agreement or any rights or obligations of any person under or by reasonof this Agreement.

10.2     Notices. Except as otherwiseexpressly set forth in this Agreement, all notices, demands and othercommunications to be given or delivered under or by reason of the provisions ofthis Agreement will be in writing and will be deemed to have been given whendelivered personally, or by documented overnight delivery service, or sent bytelecopy or telefax, provided a confirmation copy is also sent no later thanthe next business day by first class mail, return receipt requested. Notices,demands and communications to Newco or Brawley will, unless another address isspecified in writing, be sent to the address indicated below: 

| 44 |
|----|

----

| If to Brawley, to:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | c/o Oden Family Cattle Co.,  LLC	34673 E. County 9th Street,  Suite A	Wellton, Arizona  85356	Attn:  Larry McDonald	Fax:  (928) 785-3843 |   |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
| With a copy to:

Luce, Forward, Hamilton  & Scripps LLP	11988 El Camino Real, Suite 200	San Diego, California 92130	Attn:  Dennis J. Doucette,  Esq.	Fax:  (858) 523-4305

 
 
     
If to Newco, to:

c/o National Beef Packing Company, LLC	12200 North Ambassador Drive	Kansas City, Missouri 64163	Attn:  John R. Miller	Fax:  (816) 713-8810

** **

With copies to:

Scott H. Smith, Esq.	2690 Telemark Drive	Park City, Utah 84060	Fax:  (435) 649-5675

 

Blackwell Sanders Peper Martin LLC	4801 Main Street, Ste 1000	Kansas City, Missouri 64112	Attn:  John K. Brungardt	Fax:  (816) 983-8080

 

If to National, to:

National Beef Packing Company, LLC	12200 North Ambassador Drive	Kansas City, Missouri 64163	Attn:  John R. Miller	Fax:  (816) 713-8810

** **

** **

With copies to:

Scott H. Smith, Esq.	2690 Telemark Drive	Park City, Utah 84060	Fax:  (435) 649-5675

      

Blackwell Sanders Peper Martin LLC	4801 Main Street, Ste 1000	Kansas City, Missouri 64112	Attn:  John K. Brungardt	Fax:  (816) 983-8080

10.3      Assignment. This Agreement and all ofthe provisions hereof will be binding upon and inure to the benefit of theparties hereto and their respective successors and permitted assigns, exceptthat neither this Agreement nor any of the rights, interests or obligationshereunder may be assigned by either party without prior written consent of theother party; provided, however, that Newco may assign its rights, in whole orin part, hereunder to National or any subsidiary ofNational, and any party may assign its rights as collateral to its lenders.

10.4      Severability. Whenever possible, eachprovision of this Agreement will be interpreted in such manner as to beeffective and valid under applicable law, but if any provision of thisAgreement is held to be prohibited by or invalid under applicable law, suchprovisions will be ineffective only to the extent of such prohibition orinvalidity, without invalidating the remainder of such provision or theremaining provisions of this Agreement.

10.5       No Strict Construction. The language used in this Agreement will be deemed tobe the language chosen by the parties hereto to express their mutual intent,and no rule of strict construction will be applied against any person.

45

10.6      Section Headings. Theheadings of sections contained in this Agreement are provided for convenienceonly.  They form no part of this Agreement and shall not affect itsconstruction or interpretation.  All references to sections or subsectionsrefer to the corresponding sections and subsections of this Agreement.  Allwords used herein shall be construed to be of such gender or number as thecircumstances require.  This "Agreement" shall mean this Agreement as a wholeand as the same may, from time to time hereafter, be amended, supplemented ormodified.  The words "herein," "hereby," "hereof," "hereinabove" and "hereinbelow,"and words of similar import, refer to this Agreement as a whole and not to anyparticular section, subsection, paragraph, clause or other subdivision hereof,unless otherwise specifically noted.

10.7       Complete Agreement. This document and the documents referred to herein orattached hereto contain the complete Agreement between the parties andsupersede any prior understandings, agreements or representations by or betweenthe parties, written or oral, which may have related to the subject matterhereof in any way.

10.8       Governing Law. Thesubstantive law (and not the law of conflicts) of the State of Kansas will govern all questions concerning the construction, validity and interpretationof this Agreement and the performance of the obligations imposed by thisAgreement.

10.9     Counterparts.This Agreement may be executed in one or morecounterparts (including by means of faxed signature pages), any one of whichneed not contain the signatures of more than one party, but all suchcounterparts taken together will constitute one and the same instrument.

[REMAINDER OF PAGELEFT INTENTIONALLY BLANK]

 

 

 

 

46

IN WITNESS WHEREOF, the parties hereto have executed thisAgreement on the day and year first above written. 

**BRAWLEY BEEF, LLC**

By:  /s/ Larry L. McDonald              Name: Larry L. McDonaldTitle: Chairman of Members Committee

**NATIONAL BEEF****CALIFORNIA, LP**

By: /s/ John R. Miller                       Name: John R. MillerTitle: Chief Executive Officer

**NATIONAL BEEF PACKINGCOMPANY, LLC**

By: /s/ John R. Miller                       Name: John R. MillerTitle: Chief Executive Officer

Consentedto:

**U.S. PREMIUM BEEF, LLC**

By: /s/ Steven D. Hunt                     Name: Steven D. HuntTitle: Chief Executive Officer

 

 

 

47 |