AMENDED AND RESTATED PLEDGE AGREEMENT{PRIVATE }
THIS AMENDED AND RESTATED PLEDGE AGREEMENT is entered into as of
May 14, 1997, between SNAKE RIVER SUGAR COMPANY, an Oregon cooperative (the
"COMPANY"), as secured party, and ASC HOLDINGS, INC., a Utah corporation
("AMALGAMATED"; formerly known as The Amalgamated Sugar Company), as debtor.
WHEREAS, pursuant to a Pledge Agreement and a Limited Recourse Pledge
Agreement, each dated January 3, 1997 and each between the Company and
Amalgamated (collectively, the "EXISTING PLEDGE AGREEMENTS"), Amalgamated
granted to the Company a security interest in the limited liability company
interest (the "AGM INTEREST") held by Amalgamated in The Amalgamated Sugar
Company LLC, a Delaware limited liability company (the "LLC");
WHEREAS, Amalgamated granted such security interest in order to secure
the obligations of Valhi, Inc. ("VALHI"), the indirect holder of 100% of
Amalgamated's outstanding stock under (i) that certain Subordinated Promissory
Note dated January 3, 1997, in aggregate principal amount of $37,500,000, issued
by Valhi to the Company (the "SUBORDINATED NOTE") and (ii) that certain Limited
Recourse Promissory Note dated January 3, 1997, in aggregate principal amount of
$212,500,000, issued by Valhi to the Company (the "LIMITED RECOURSE NOTE," and
together with the Subordinated Note, the "SNAKE RIVER LOAN NOTES");
WHEREAS, pursuant to a Deposit Trust Agreement (the "DEPOSIT TRUST
AGREEMENT"), dated as of the date hereof, between Amalgamated and Wilmington
Trust Company, a Delaware banking corporation, as Resident Trustee, Amalgamated
transferred its interest in the AGM Interest to the Amalgamated Collateral Trust
(the "TRUST"), in exchange for a 100% Certificate of Beneficial Interest issued
by the Trust (the "CERTIFICATE"); and
WHEREAS, in connection with the transfer of the AGM Interest by
Amalgamated to the Trust in exchange for the issuance of the Certificate by the
Trust to Amalgamated, Amalgamated and the Company desire to amend and restate
the Existing Pledge Agreements in their entirety and combine them into one
agreement in order to (i) reflect the change of the name of Amalgamated from The
Amalgamated Sugar Company to ASC Holdings, Inc., (ii) acknowledge the transfer
of the Collateral (as defined in the Existing Pledge Agreements) to the Trust,
(iii) acknowledge that the security interest in the AGM Interest granted by the
Trust pursuant to the Pledge Agreement (SPT) dated as of the date of this
Agreement has replaced and superseded the security interest in the AGM Interest
granted by the Existing Pledge Agreements, and (iv) grant to the Company a
security interest in Amalgamated's interest in the Certificate.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto hereby agree as follows:
Pledge. For value received, Amalgamated grants to the Company a
security interest (the "SECURITY INTEREST") in (i) the Certificate and the
beneficial interest of Amalgamated in the Trust, (ii) following a Snake Loan
Default (as defined below), all dividends, distributions and cash from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all of the Certificate and/or the beneficial interest in the Trust
and (iii) any other interest of Amalgamated in or relating to the AGM Interest
(and following a Snake Loan Default, all proceeds thereof) (the "COLLATERAL").
The Security Interest is created to secure all obligations and indebtedness
arising pursuant to the Snake River Loan Notes (the "OBLIGATIONS"). Except as
provided below, the Collateral includes all rights to receive future
distributions, increases, substitutions, accessions, voting rights or other
property or benefits which Amalgamated receives or is entitled to receive or
exercise on account of the Collateral. The Collateral shall not include and the
Security Interest shall terminate and be automatically released with respect to
(i) rights to Retained Amounts (as defined in the Company Agreement of LLC)
accrued prior to a Snake Loan Default and (ii) any cash distributions on account
of the Collateral paid or distributed to Amalgamated pursuant to the Deposit
Trust Agreement prior to a Snake Loan Default. The Company shall not encumber
or dispose, or attempt to encumber or dispose, of the Collateral except in
accordance with the provisions of paragraph 8 of this Agreement. "SNAKE LOAN
DEFAULT" means any default under the Snake River Loan Notes permitting or
resulting in acceleration of the Snake River Loan Notes.
Voting and Other Rights. During the term of this Agreement, so
long as the maturity dates of the Snake River Loan Notes have not been
accelerated as provided therein, Amalgamated shall have the right to vote the
Collateral on all questions. Following acceleration of the maturity date of the
Subordinated Note or the Limited Recourse Note pursuant to Section 7 or Section
6 thereof, respectively, Amalgamated's right to vote the Collateral shall
terminate (provided that in the case of a partial acceleration of either Snake
River Loan Note, Amalgamated's right to vote the Collateral shall terminate only
with respect to a portion of the Collateral equal to the portion of the Snake
River Loan Note(s) so accelerated).
Representations. Amalgamated warrants and represents (i) that
there are no restrictions on the transfer of any of the Collateral, other than
as set forth in the Deposit Trust Agreement, and (ii) this Agreement constitutes
the valid and legally binding obligation of Amalgamated, enforceable in
accordance with its terms and conditions, as enforceability may be limited by or
subject to any bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditor rights generally, and subject to general principles of
equity and public policy considerations. Amalgamated shall, at the request of
the Collateral Agent (as defined below), promptly deliver all reasonable further
instruments and documents, and take all reasonable further actions, in order to
perfect the Security Interest granted herein and to otherwise give effect to the
provisions of this Agreement. Amalgamated shall not grant any security interest
in the Collateral, other than pursuant to (i) liens for taxes, assessments or
other governmental charges not yet due and payable, (ii) statutory liens of
landlords, carriers, warehousemen, mechanics, materialmen and other similar
liens imposed by law which are incurred in the ordinary course of business for
sums not more than thirty (30) days delinquent and (iii) liens incurred or
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, trade contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of borrowed
money).
Adjustments. In the event that, during the term of this
Agreement, any reclassification, readjustment or other change is declared or
made in the capital structure of the issuer of the Collateral, all new,
substituted and additional interests or securities issued in respect of the
Collateral by reason of any such change shall be delivered to the Collateral
Agent and held by it under the terms of this Agreement in the same manner as the
Collateral originally pledged hereunder.
Payment of the Snake River Loan Notes. Upon payment of all
principal of and other amounts due on the Snake River Loan Notes, the Security
Interest shall be canceled and the Company and the Collateral Agent shall convey
to Amalgamated all certificates, documents and other instruments representing
the Collateral.
Rights of the Collateral Agent. Amalgamated hereby appoints the
Collateral Agent as Amalgamated's attorney-in-fact to do any act which
Amalgamated is obligated by this Agreement to do and to do all things deemed
necessary by the Collateral Agent (or the Company, after payment in full in cash
of the Senior Notes (as defined below)) to perfect the Security Interest and
collect, preserve and enforce the Collateral, all at Amalgamated's cost and
without any obligation on the Collateral Agent or the Company so to act.
Default. If, pursuant to the terms and provisions of the
Subordinated Note or the Limited Recourse Note, the maturity date thereof has
been accelerated pursuant to Section 7 or Section 6 thereof, respectively, the
Collateral Agent may proceed to enforce payment of such Snake River Loan Note or
any part thereof and to exercise any and all rights and remedies in connection
with the Collateral provided by the Uniform Commercial Code in force in the
State of New York (the "CODE"), as well as other rights and remedies in
connection with the Collateral possessed by the Collateral Agent (or the
Company, after payment in full in cash of the Senior Notes (as defined below))
under this Agreement. For purposes of the notice requirements of the Code, the
Company and Amalgamated agree that notice given at least five (5) business days
prior to the taking of any action with respect to which notice is required is
reasonable. Except as otherwise provided, all rights and remedies of the
Company and Collateral Agent hereunder are cumulative and may be exercised
singly or concurrently, and the exercise of any right or remedy shall not be a
waiver of any other. Notwithstanding anything in this Agreement to the
contrary, Amalgamated shall not be liable to the Company or the Collateral Agent
(as defined below) for any deficiency or other amount constituting the
Obligations which the Company or the Collateral Agent does not recover or obtain
from the Collateral. If the amount received by the Company or the Collateral
Agent upon sale of the Collateral is less than the amount of the Obligations,
neither the Company nor the Collateral Agent shall have further recourse to any
assets or property of Amalgamated.
Acknowledgment. Amalgamated hereby acknowledges and agrees that
the Company will assign and grant a security interest in all of the Company's
rights in, to and under this Agreement and the Collateral to First Security
Bank, National Association, as Collateral Agent (the "COLLATERAL AGENT") for the
benefit of the holders of the 10.80% Senior Notes due April 30, 2009 (the
"SENIOR NOTES") issued by the Company pursuant to the Note Purchase Agreements,
each dated May 14, 1997, between the Company and the purchasers referred to
therein (the "NOTE PURCHASE AGREEMENTS"), as security for the Company's
obligations under the Senior Notes and the Note Purchase Agreements, and
thereafter the Collateral Agent shall have all of the rights granted to the
Company hereunder. So long as the Collateral Agent has any security interest in
this Agreement or the Collateral, the term "COMPANY" shall include the
Collateral Agent for all purposes under this Agreement. The Certificate and all
other certificates and other instruments which may constitute the Collateral
shall be endorsed in blank for transfer, or be accompanied by proper instruments
of assignment and transfer properly endorsed in blank, and delivered to the
Collateral Agent. After the payment in full in cash of the Senior Notes, all
references herein to the Collateral Agent shall be deemed references to the
Company.
Miscellaneous.
Parties Bound. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, legal representatives, successors, receivers,
trustees and assigns where permitted by this Agreement.
New York Law to Apply. This Agreement shall be construed in
accordance with the Code and other applicable laws of the State of New York.
Modification. This Agreement shall not be amended in any
way except by a written agreement signed by the parties hereto.
Severability. The unenforceability of any provision of this
Agreement shall not affect the enforceability or validity of any other provision
hereof.
Notice. Any notice required to be given under this
Agreement or under the Code shall be personally delivered or deposited with the
United States Postal Service, postage prepaid, certified with return receipt
requested and addressed as follows:
If to the Company:
Snake River Sugar Company
2427 Lincoln Avenue
Post Office Box 1520
Ogden, Utah 84402
If to Amalgamated:
ASC Holdings, Inc.
Three Lincoln Centre
Suite 1700
5430 LBJ Freeway
Dallas, Texas 75240
Any party hereto may change the address to which notices to such party are
required to be sent by giving notice of such change in the manner provided in
this Section 9E. All notices will be deemed to have been received on the date
of personal delivery or on the third business day after mailing in accordance
with this Section 9E, except that any notice of a change of address will be
effective only upon actual receipt.
Waiver of Amalgamated. Amalgamated hereby waives
presentment, demand, notice of dishonor, protest, notice of protest and all
other notices with respect to collection of the Collateral and the Snake River
Loan Notes.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
ASC HOLDINGS, INC.
By:______________________________
Name:
Title:
SNAKE RIVER SUGAR COMPANY
By:______________________________
Name:
Title: