EXHIBIT 99.1
SAVANNAH FOODS & INDUSTRIES, INC.
BENEFIT TRUST AGREEMENT
BENEFIT TRUST AGREEMENT ("Trust Agreement"), dated
March 14, 1996, by and between Savannah Foods & Industries, Inc.,
a Delaware corporation (the "Company"), and Wachovia Bank of
North Carolina, N.A., as trustee of the Trust created hereby (the
"Trustee").
WHEREAS, the Company and its subsidiaries and
affiliates (collectively, the "Corporation") are or may become
obligated in respect of their existing compensation and benefit
plans, agreements, programs and arrangements listed on Exhibit A
attached hereto and such existing and future plans, agreements,
programs and arrangements as may hereafter be listed on said
Exhibit A (the plans, agreements, programs and arrangements
listed on said Exhibit A from time to time being collectively
referred to herein as the "Plans") to make payments to or
contributions on behalf of past, present or future employees or
their beneficiaries; and
WHEREAS, for purposes of providing a source of funds
for the satisfaction, in whole or in part, of the obligations of
the Corporation under the Plans, the Company desires to establish
a trust (the "Trust"), which is intended to constitute a grantor
trust within the meaning of section 671 of the Internal Revenue
Code of 1986, as amended (the "Code"), the assets of which shall
be subject to the claims of the Company's existing or future
creditors;
NOW, THEREFORE, in consideration of the mutual
agreements contained herein and for other good and valuable
consideration, the parties hereto agree as follows:
ARTICLE I.
PURPOSE OF THE TRUST
SECTION 1.1 Purpose. The purpose of the Trust
is to hold equity securities of the Company ("SF Securities") or
other property as herein provided as a source of funds to satisfy
the Corporation's obligations under the Plans. The Corporation
shall continue to be liable to make all payments required to be
made by the Corporation under the terms of the Plans to the
extent such payments have not been made pursuant to this Trust
Agreement. Distributions made from the Trust in respect of the
Plans pursuant to Section 3.1 shall, to the extent of such
distributions, satisfy the Corporation's obligations under the
Plans.
ARTICLE II.
TRUST AND THE TRUST CORPUS
SECTION 2.1 Delivery of Funds and Common Stock. 1.
Concurrently with the execution of this Trust Agreement, the
Company is contributing to the Trust in cash an amount equal to
the aggregate par value of 2,500,000 shares of common stock of
the Company, par value $0.25 per share ("Common Stock").
2. Concurrently with the execution of this Trust
Agreement, the Company is selling to the Trustee 2,500,000
shares of Common Stock (the "Acquired Shares"), pursuant to the
terms of a Stock Purchase Agreement, dated the date hereof,
between the Company and the Trustee (the "Stock Purchase
Agreement"), such Acquired Shares to constitute collateral for
the repayment of the Note (as defined below) until released from
collateral as provided herein and otherwise to be administered
and disposed of by the Trustee as provided herein. Concurrently
with the execution of this Trust Agreement, and pursuant to the
terms of the Stock Purchase Agreement, the Trustee, at the
direction of the Company, is delivering to the Company, on behalf
of the Trust, (i) an amount in cash equal to the aggregate par
value of the Acquired Shares, and (ii) a Note (the "Note") of the
Trust in the original principal amount of $26,875,000, in payment
of the remainder of the purchase price for the Acquired Shares.
3. The Company may sell or otherwise deliver to the
Trustee additional amounts of cash or Cash Equivalents (as
defined in Section 2.3 hereof) or SF Securities to be held in
trust hereunder; provided, however, that the Company shall be
obligated to make the contributions specified in Section 2.2
hereof.
SECTION 2.2 Contributions to Repay Trust Indebtedness.
The Company shall contribute to the Trust in cash an amount
which, when added to cash dividends received by the Trust in
respect of Acquired Shares (or other SF Securities, as the case
may be) and not previously applied under this Section 2.2, shall
enable the Trustee to make all payments of principal and interest
due under the Note (or other indebtedness of the Trust relating
to the acquisition of SF Securities, as the case may be) on a
timely basis or to make prepayments of such principal or
interest. The Trustee shall apply all dividends and earnings
paid in respect of Acquired Shares (or other SF Securities) to
the payment of principal and interest under the Note (or such
other indebtedness, as the case may be). To the extent the
Company fails to make any contribution required under this
Section 2.2, or to the extent the Company notifies the Trustee
that it wishes to prepay any principal or interest under the Note
(or such other indebtedness) without making a contribution
hereunder, such contribution shall be deemed to have been made in
the form of forgiveness of principal and interest then due and
owing on the Note and such other indebtedness (or forgiveness of
principal and interest to the extent of such prepayment, as the
case may be). The Trustee shall be accountable for all
contributions received by it, but shall have no duty to require
any contributions to be made to it.
SECTION 2.3 Trust Corpus. As used herein, the term
"Trust Corpus" shall mean any cash or Cash Equivalents or SF
Securities delivered to the Trustee as described in Section 2.1
or 2.2 hereof, together with any earnings thereon or any proceeds
from the disposition thereof, plus any cash or Cash Equivalents
or SF Securities sold or otherwise delivered thereafter pursuant
to Section 2.1 or 2.2 hereof, together with any earnings thereon
or any proceeds from the disposition thereof (and less such
amounts distributed from the Trust pursuant to the terms hereof).
As used herein, the term "Cash Equivalents" shall mean securities
issued or directly and fully guaranteed by the United States or
any agency or instrumentality thereof (provided that the full
faith and credit of the United States is pledged in support
thereof) having maturities of less than one year from the date of
acquisition. The Trust Corpus shall at all times be limited to
SF Securities and cash or Cash Equivalents.
ARTICLE III.
RELEASE OF THE TRUST CORPUS
SECTION 3.1 Use of Assets. 1. In accordance with the
provisions hereof, the Trustee shall apply the Trust Corpus as
directed by the Company (1) to the payment of any indebtedness
(including the Note) of the Trust which is then outstanding, in
accordance with the terms thereof, (2) on behalf of the
Corporation to the satisfaction of the Corporation's obligations
under the Plans, (3) to the reimbursement of payments made by the
Corporation in satisfaction of its obligations under the Plans or
(4) to the acquisition of additional SF Securities; provided,
however, that the Trustee shall not be required to apply the
Trust Corpus in the manner described in clauses (2) - (4) above
during the period that the Company exercises its right to prevent
the Trustee from disposing of SF Securities pursuant to Section
4.3, if and to the extent that, at the time the Company's
direction to so apply the Trust Corpus is received by the
Trustee, the Trust Corpus does not contain sufficient cash or
Cash Equivalents to comply with the Company's direction without
disposing of SF Securities. A direction by the Company to apply
the Trust Corpus for a purpose described in clause (2) or (3)
above may include a direction to deliver SF Securities in kind or
to dispose of SF Securities and apply the proceeds therefrom for
such purpose.
2. Except as provided in Sections 3.1(a) and 4.3,
the Company shall have no power to direct the Trustee to take or
omit to take any action with respect to the Trust Corpus.
SECTION 3.2 Release from Collateral. On each date on
which payment is made (or deemed to have been made) of any
principal amount of the Note (a "Principal Payment Date"), the
following number of Acquired Shares (and related collateral)
shall be released from collateral: the number of Acquired Shares
held in the Trust as collateral immediately prior to the
Principal Payment Date multiplied by a fraction, the numerator of
which is the amount of the principal payment made (or deemed to
have been made) on such date and the denominator of which is the
principal amount of the Note outstanding immediately prior to
such principal payment. Any shares of SF Securities subsequently
acquired by the Trust with borrowed funds or other indebtedness
of the Trust (and related collateral) shall be released from
collateral in a manner consistent with the immediately preceding
sentence. The Acquired Shares, SF Securities and related
collateral released pursuant to this Section 3.2 (the "Released
Collateral") shall be contributed to the trust established under
a Plan or, in the case of any Plan under which no trust has been
established, directly to Participants (or Beneficiaries, if
appropriate) in accordance with the directions of the Company.
Upon receiving directions from the Company, the Trustee shall
sell any Released Collateral and transfer the proceeds of such
sale to the trust established under such Plan or, in the case of
any Plan under which no trust has been established, to such
Plan's Participants (or Beneficiaries, if appropriate). Any such
sale shall be made in the manner which the Trustee determines
will produce the greatest yield (after transaction costs), and
may be made in the open market or in a private transaction,
including (with the Company's consent) a sale to the Company.
SECTION 3.3 Deliveries to Creditors of the
Corporation. It is the intent of the parties hereto that the
Trust Corpus is and shall remain at all times subject to the
claims of the general creditors of the Company. Accordingly,
neither the Trustee nor the Company shall create a security
interest in the Trust Corpus in favor of the Plans, any
participant therein (each, a "Participant") (or any beneficiary
of such Participant) (each, a "Beneficiary")) or any creditor.
If the Trustee receives the notice provided for in Section 3.4,
or if the Trustee otherwise receives actual notice that the
Company is insolvent or bankrupt as defined in Section 3.4, the
Trustee shall make no further distributions of the Trust Corpus
as directed by the Company but shall deliver the entire amount of
the Trust Corpus only as a court of competent jurisdiction, or
duly appointed receiver or other person authorized to act by such
a court, may direct. The Trustee shall resume distribution of
the Trust Corpus as directed by the Company under the terms
hereof, upon no less than 30 days' advance notice to the Company,
if the Trustee determines that the Company was not, or is no
longer, bankrupt or insolvent. Such determination shall be made
in a timely fashion, and shall be based upon a decision of a
court of competent jurisdiction, a report of a nationally
recognized appraisal firm or a certification by the Chief
Executive Officer of the Company or a determination of the Board
of Directors of the Company (the "Board"). Unless the Trustee
has actual knowledge of the Company's bankruptcy or insolvency,
the Trustee shall have no duty to inquire whether the Company is
bankrupt or insolvent.
SECTION 3.4 Notification of Bankruptcy or Insolvency.
The Company shall advise the Trustee promptly in writing of the
Company's bankruptcy or insolvency. The Company shall be deemed
to be bankrupt or insolvent upon the occurrence of any of the
following:
a. The Company shall make an assignment
for the benefit of creditors, file a petition in
bankruptcy, petition or apply to any tribunal for the
appointment of a custodian, receiver, liquidator,
sequestrator, or any trustee for it or a substantial
part of its assets, or shall commence any case under
any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debt, dissolution,
liquidation or similar law or statute of any
jurisdiction (federal or state), whether now or
hereafter in effect; or if there shall have been filed
any such petition or application, or any such case
shall have been commenced against it, in which an order
for relief is entered or which remains undismissed for
a period of 120 days; or the Company by any act or
omission shall indicate its consent to, approval of or
acquiescence in any such petition, application or case
or order for relief or to the appointment of a
custodian, receiver or any trustee for it or any
substantial part of any of its property, or shall
suffer any such custodianship, receivership or
trusteeship to continue undischarged for a period of
120 days; or
b. The Company shall generally not pay
its debts as such debts become due or shall cease to
pay its debts generally in the ordinary course of
business.
ARTICLE IV.
ADMINISTRATION OF TRUST FUND
SECTION 4.1 Trustee. (a) The duties and
responsibilities of the Trustee shall be limited to those
expressly set forth in this Trust Agreement and the Stock
Purchase Agreement, and no implied covenants or obligations shall
be read into this Trust Agreement against the Trustee.
(b) If, under circumstances described in Section
3.4 or otherwise, all or any part of the Trust Corpus is at any
time attached, garnished, or levied upon by any court order, or
in case the payment, assignment, transfer, conveyance or delivery
of any such property shall be stayed or enjoined by any court
order, or in case any order, judgment or decree shall be made or
entered by a court affecting such property or any part thereof,
then and in any of such events the Trustee is authorized, in its
sole discretion, to rely upon and comply with any such order,
writ, judgment or decree, and it shall not be liable to the
Corporation, any Plan or any Participant or Beneficiary by reason
of such compliance even though such order, writ, judgment or
decree subsequently may be reversed, modified, annulled, set
aside or vacated.
(c) The Trustee or its agent shall maintain such
books, records and accounts as may be necessary for the proper
administration of the Trust Corpus, and shall render to the
Company, within 30 days of the end of each calendar quarter,
commencing with the calendar quarter ending March 31, 1996, until
the termination of the Trust (and on the date of such termination
or as promptly as practicable thereafter), an accounting with
respect to the Trust Corpus as of the end of the then most recent
calendar quarter (and as of the date of such termination).
(d) The Trustee shall not be liable for any act
taken or omitted to be taken hereunder if taken or omitted to be
taken by it in good faith. The Trustee shall also be fully
protected in relying upon any notice or instruction given
hereunder which it in good faith believes to be genuine and
executed and delivered in accordance with this Trust.
(e) The Trustee may consult with legal counsel to
be selected by it, including counsel to the Company, and the
Trustee shall not be liable for any action taken or omitted to be
taken by it in good faith in accordance with the advice of such
counsel.
(f) The Trustee shall be reimbursed by the Company
for its reasonable expenses incurred in connection with the
performance of its duties hereunder and shall be paid reasonable
fees for the performance of such duties. Any amounts payable to
the Trustee under this paragraph (f) may be payable from the
Trust Corpus if not paid by the Company.
(g) Except for any damages, losses, claims or
expenses resulting from the Trustee's gross negligence or willful
misconduct, the Company agrees to indemnify and hold harmless the
Trustee from and against any and all damages, losses, claims or
expenses as incurred (including reasonable expenses of
investigation and reasonable fees, charges and disbursements of
counsel to the Trustee and any taxes imposed on the Trust Corpus
or income of the Trust) arising out of or in connection with the
performance by the Trustee of its duties hereunder. Without
limiting the generality of the foregoing, the Trustee shall be
under no liability to any person for any loss of any kind which
may result by reason of any action taken by it pursuant to
Section 4.4 or (2) by reason of its exercising or failing to
exercise any power or authority under Section 4.4.
(h) Subject to the provisions of this Trust
Agreement, the Trustee shall have the following additional powers
and authority, in furtherance of the purpose of the Trust as
described in Section 1.1, with respect to property constituting a
part or all of the Trust Corpus:
a. At the direction of the Company, to
acquire and hold SF Securities and cash or Cash
Equivalents; to sell, exchange or transfer any such
property at public or private sale for cash or on
credit and grant options for the purchase or exchange
thereof;
b. To exercise any conversion privilege
or subscription right available in connection with any
such property; to oppose or to consent to the
reorganization, consolidation, merger or readjustment
of the finances of any corporation, company or
association, or to the sale, mortgage, pledge or lease
of the property of any corporation, company or
association, any of the securities of which may at any
time be held in the Trust and to do any act with
reference thereto, including the exercise of options,
the making of agreements or subscriptions and the
payment of expenses, assessments or subscriptions,
which may be deemed necessary or advisable in
connection therewith, and to hold and retain any
securities or other property which it may so acquire;
c. To commence or defend suits or legal
proceedings and to represent the Trust in all suits or
legal proceedings; to settle, compromise or submit to
arbitration, any claims, debts or damages, due or owing
to or from the Trust;
d. To exercise, personally or by general
or limited power of attorney, any right, including the
right to vote, appurtenant to any SF Securities or
other property; to enter into any voting agreement or
voting trust, which voting agreement or voting trust
shall be binding upon any successor trustee but shall
not survive as to any SF Securities disposed of for
value by the Trustee;
e. To engage legal counsel, including
counsel to the Company, or any other suitable agents,
to consult with such counsel or agents with respect to
the construction of this Trust Agreement, the duties of
the Trustee hereunder, the transactions contemplated by
this Trust Agreement or any act which the Trustee
proposes to take or omit to take, to rely upon the
advice of such counsel or agents, and to pay its
reasonable fees, expenses and compensation;
f. To register any securities held by it
in its own name or in the name of any custodian of such
property or of its nominee, including the nominee of
any system for the central handling of securities, with
or without the addition of words indicating that such
securities are held in a fiduciary capacity, to deposit
or arrange for the deposit of any such securities with
such a system and to hold any securities in bearer
form;
g. At the direction of the Company, to
make, execute and deliver, as Trustee, any and all
deeds, leases, notes, bonds, guarantees, mortgages,
conveyances, contracts, waivers, proxies, releases or
other instruments in writing necessary or proper for
the exercise of any of the foregoing powers; and
h. To take any other action necessary or
advisable in furtherance of the foregoing powers and
the purposes of this Trust.
SECTION 4.2 Successor Trustee. The Trustee may resign
and be discharged from its duties hereunder at any time by giving
to the Company notice in writing of such resignation specifying a
date (not less than 30 days after the giving of such notice) when
such resignation shall take effect. Promptly after such notice,
the Company shall appoint an independent financial institution as
successor trustee, such trustee to become Trustee hereunder upon
the resignation date specified in such notice. The Trustee shall
continue to serve until its successor accepts the trust and
receives delivery of the Trust Corpus. The Company may at any
time substitute an independent financial institution as successor
trustee by giving 15 days' notice thereof to the Trustee then
acting; provided, however, that, during the pendency of and
within six (6) months following the cessation of a Potential
Change in Control (as defined in Section 5.2(d)) and following a
Change in Control (as defined in Section 5.2(c)), such
substitution must be approved in writing by at least two-thirds
(2/3) of the Participants (and Beneficiaries of then-deceased
Participants) in the Section 4.5 Plans other than Section 4.5
Plans maintained for the benefit of non-employee directors of the
Company. In the event of such removal or resignation, the
Trustee shall duly file with the Company a written statement or
statements of account as provided in Section 4.1(c) for the
period since the last previous quarterly accounting of the Trust,
and if written objection to such account is not filed within 90
days, the Trustee shall to the maximum extent permitted by
applicable law be forever released and discharged from all
liability and accountability with respect to the propriety of its
acts and transactions shown in such account.
SECTION 4.3 Limitations on Sales. Except as
otherwise provided in Section 3.1(a) or 4.4(b) hereof, the
Trustee shall not sell, exchange or transfer any SF Securities or
grant any option for the purchase or exchange of any SF
Securities (each a "Securities Transaction") unless the Trustee
shall have given the Company 10 business days' prior notice of
such Securities Transaction. The Trustee's notice shall state
with respect to such Securities Transaction (i) the amount of SF
Securities involved, (ii) whether such Securities Transaction
will be effected through the public markets and (iii) the date
such Securities Transaction is proposed to be entered into. If
the Company is advised in writing by a recognized independent
investment banking firm that such Securities Transaction would
adversely affect any financing by the Company that had been
contemplated by the Company prior to the receipt of such notice
or if the Company determines in its good faith judgment that such
Securities Transaction would require the Company to disclose
material information which the Company has a bona fide business
purpose for preserving as confidential or that the Company is
unable to comply with SEC requirements prior to such Securities
Transaction, the Company may give notice to the Trustee not to
effect such Securities Transaction prior to the date specified in
the Trustee's notice. Upon receipt of such a notice from the
Company, the Trustee shall not effect such Securities Transaction
for a period not to exceed 120 days from the date of the
Company's notice or such lesser period as shall be specified in
the Company's notice.
SECTION 4.4 Voting and Tendering of Common Stock.
(a) Voting of Common Stock. As more fully set forth
herein, the manner in which shares of Common Stock held by the
Trust are to be voted on each matter brought before an annual or
special stockholders' meeting of the Company shall be exercised
by the Trustee based upon the voting provisions contained in the
Company's ESOP (or any successor or substitute employee benefit
plan of the Company which the Company and the Trustee agree shall
serve as the basis for implementing the provisions of this
Section 4.4) (such plan being referred to herein as the "Stock
Plan"). Not less than seventy-two (72) hours prior to each such
meeting of stockholders, the Company shall cause the trustee of
the Stock Plan to furnish to the Trustee a document setting forth
the aggregate votes to be cast on each matter by such trustee
with respect to shares of Common Stock (and securities
convertible into Common Stock) held by the Stock Plan as of the
record date for such stockholders' meeting, such votes to be
based upon the instructions received as of such time from Stock
Plan Participants and otherwise in accordance with the provisions
of the Stock Plan then in effect, but without regard to any
failure on the part of such trustee to follow such instructions
or otherwise to abide by such provisions by reason of, for
example, its fiduciary obligations under the Employee Retirement
Security Act of 1974, as amended ("ERISA"). Upon timely receipt
of such document by the Trustee, the Trustee shall on each such
matter vote the number of shares (including fractional shares) of
Common Stock held by the Trust in the same proportion as shares
of Common Stock (and securities convertible into Common Stock)
held by the Stock Plan are to be voted on such matter, based upon
the preceding provisions of this Section 4.4(a).
(b) Tender or Exchange of Common Stock. As more fully
set forth herein, the tender or exchange of shares of Common
Stock (and securities convertible into Common Stock) shall be
exercised by the Trustee based upon the tender or exchange
provisions contained in the Company's Stock Plan. Not less than
seventy-two (72) hours prior to the scheduled expiration date of
a tender or exchange offer for Shares of Common Stock, the
Company shall cause the trustee of the Stock Plan to furnish to
the Trustee a document setting forth the number and percentage of
shares of Common Stock (and securities convertible into Common
Stock) held by the Stock Plan which will be tendered or
exchanged, such number and percentage to be based upon the
instructions received from Stock Plan Participants and otherwise
in accordance with the provisions of the Stock Plan then in
effect, but without regard to any failure on the part of such
trustee to follow such instructions or otherwise to abide by such
provisions by reason of, for example, its fiduciary obligations
under ERISA. In the event the scheduled expiration date of such
offer is changed, the foregoing provisions of this Section 4.4(b)
shall be applied to each subsequent scheduled expiration date.
Upon timely receipt of such document by the Trustee, the Trustee
shall tender the number of shares of Common Stock held by the
Trust in the same proportion as shares of Common Stock (and
securities convertible into Common Stock) held by the Stock Plan
are to be tendered or exchanged, based upon the preceding
provisions of this Section 4.4(b).
(c) Nothing in this Section 4.4 shall be construed as
permitting or requiring the divulging or release to any person
affiliated with the Company of any confidential instructions
provided to the trustee of the Stock Plan by individual Stock
Plan Participants or Beneficiaries.
SECTION 4.5 Certain Change in Control Provisions.
Notwithstanding any other provision hereof, following a Change in
Control, (defined in Section 5.2(c)), (a) the Plans shall be
limited to those Plans which, immediately prior to such Change in
Control, are designated on Exhibit A hereto as "Section 4.5
Plans" until such time as all liabilities under such Section 4.5
Plans have been satisfied, (b) benefits under each Section 4.5
Plan shall be deemed to include payment or reimbursement to each
Participant or Beneficiary of such Section 4.5 Plan of legal fees
and other expenses incurred by such Participant or Beneficiary in
seeking to obtain benefits or otherwise to enforce his or her
rights under such Section 4.5 Plan, and (c) the Trustee shall
make payment to a Participant or Beneficiary of any such Section
4.5 Plan in accordance with written instructions received from
such Participant or Beneficiary, which instructions shall include
a certification (i) that such Participant or Beneficiary is
entitled to payment under the Section 4.5 Plan, (ii) of the
amount of such payment, (iii) that the Corporation has not made
payment of such amount, and (iv) that a copy of such instructions
has been provided to the Company. Unless the Company objects to
the payment called for by such instructions within 10 business
days of its receipt thereof (the bases for such objection by the
Company being limited to (i) the Company's Insolvency (as defined
in Section 3.4 hereof) and (ii) the amount of such payment
clearly not being payable under the appropriate Section 4.5
Plan), the Trustee shall make payment to the Participant or
Beneficiary in accordance with such instructions. In the event
the Trustee receives such objection within such 10-day period, it
shall not make payment until receipt of, and then in accordance
with, written instructions from the Company and the Participant
or Beneficiary.
ARTICLE V.
TERMINATION, AMENDMENT AND WAIVER
SECTION 5.1 Termination. The Trust shall be
terminated on the earlier of the twentieth anniversary of the
date hereof or the date on which any of the following events
occurs (the "Termination Date"): (a) the Corporation's
obligations under the Plans are satisfied in full; (b) the Trust
Corpus is exhausted; or (c) such date as may be established by
resolution of the Board, provided, however, that during the
period specified in Section 5.2(b) hereof, the Board may not act
to terminate the Trust. Upon termination of the Trust, any
remaining portion of the Trust Corpus shall be applied in the
following order: first, to satisfy any outstanding indebtedness
of the Trust; second, as directed by the Company or its delegate
pursuant to Section 3.1(a); and third, to fund obligations of the
Corporation, or otherwise provide benefits to current employees
of the Corporation, under one or more employee benefit plans,
agreements, programs or arrangements (other than Plans). In no
event shall the Company receive any distribution of the Trust
Corpus upon termination of the Trust, except in repayment of
indebtedness to the Company incurred by the Trustee or in
reimbursement of payments made by the Corporation in satisfaction
of its obligations under the Plans.
SECTIONS 5.2 Amendment and Waiver. (a) Prior to a
Potential Change in Control (as defined in Section 5.2(d), the
Company and the Trustee may amend this Trust Agreement, including
Exhibit A attached hereto, which is an integral part of this
Trust Agreement, by written instrument executed and duly
authorized by the Company and the Trustee; however, no such
amendment shall accelerate the Termination Date or permit the
Company to receive any distribution prohibited by the last
sentence of Section 5.1.
(b) During the pendency of and within six (6) months
following the cessation of a Potential Change in Control (as
defined in Section 5.2(d)) and following a Change in Control (as
defined in Section 5.2(c)), this Trust Agreement may be amended
in the manner and subject to the provisions of Section 5.2(a);
provided, however, that if any such amendment would be adverse in
any way to the interests of any Participant or Beneficiary (an
"Adverse Amendment"), then such amendment must be approved in
writing by at least two-thirds (2/3) of the Participants (and
Beneficiaries of then-deceased Participants) in the Section 4.5
Plans other than Section 4.5 Plans maintained for the benefit of
non-employee directors of the Company. For purposes of this
Section 5.2(b), an Adverse Amendment shall include, but not be
limited to, (i) an amendment which removes one or more Plans from
Exhibit A hereto or which would change the status of any Plan as
a "Section 4.5 Plan"; (ii) any amendment to Sections 2.2, 3.2 or
4.5 hereof or to this Article V.
(c) A "Change in Control" shall be deemed to have
occurred when and only when the first of the following events
occurs:
a. any "person" (as that term is used in
Sections 13(d) and 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), other
than (1) any employee plan established by the
Corporation, (2) the Corporation, (3) an underwriter
temporarily holding securities pursuant to an offering
of such securities, or (4) a corporation owned,
directly or indirectly, by stockholders of the
Corporation in substantially the same proportions as
their ownership of the Corporation) is or becomes the
beneficial owner, directly or indirectly, of securities
of the Company representing 20% or more of the combined
voting power of the Company's then outstanding voting
securities; or
b. during any period of two consecutive
years, individuals who at the beginning of such period
constituted the Board and any new director (other than
an individual whose nomination for election is in
connection with an actual or threatened election
contest relating to the election of the directors of
the Company, as such terms are used in Rule 14a-11 of
Regulation 14A under the Exchange Act) whose
appointment, election, or nomination for election by
the Company's shareholders, was approved by a vote of
at least two-thirds (2/3) of the directors then still
in office who either were directors at the beginning of
the period or whose appointment, election or nomination
for election was previously so approved, cease for any
reason to constitute a majority of the Board; or
c. there is consummated a merger or
consolidation of the Company or a subsidiary thereof
with or into any other corporation, other than a merger
or consolidation which would result in the holders of
the voting securities of the Company outstanding
immediately prior thereto holding securities which
represent immediately after such merger or
consolidation more than 80% of the combined voting
power of the voting securities of either the Company or
the other entity which survives such merger or
consolidation or the parent of the entity which
survives such merger or consolidation; or
d. there is consummated a sale or
disposition by the Company of all or substantially all
the Company's assets.
(d) A "Potential Change in Control" shall be deemed to
have occurred if the conditions set forth in any one of the
following paragraphs shall have been satisfied:
(i) any person (as defined in Section
5.2(c)(i) above) is or becomes the beneficial owner,
directly or indirectly, of securities of the Company
representing fifteen percent (15%) or more of the
combined voting power of the Company's then outstanding
voting securities; or
(ii) the Company enters into an
agreement, the consummation of which would result in
the occurrence of a Change in Control; or
(iii) any person (as defined in Section
5.2(c)(i) above) publicly announces an intention to
take or to consider taking actions which, if
consummated, would constitute or result in a Change in
Control; or
(iv) any person (as defined in Section
5.2(c)(i) above) commences a solicitation (as defined
in Rule 14a-1 of the General Rules and Regulations
under the Exchange Act) of proxies or consents which
has the purpose of effecting or would (if successful)
result in a Change in Control; or
(v) a tender or exchange offer for voting
securities of the Company, made by a person (as defined
in Section 5.2(c)(i) above), is first published or sent
or given (within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act).
ARTICLE VI
GENERAL PROVISIONS
SECTION 6.1 Certain Provisions Relating to This Trust
Agreement. (a) This Trust Agreement shall be binding upon and
inure to the benefit of the parties and their respective
successors and legal representatives.
(b) This Trust Agreement shall be governed by and
construed in accordance with the laws of Delaware, without
reference to any provisions of such laws regarding choice of laws
or conflict of laws.
(c) In the event that any provision of this Trust
Agreement or the application thereof to any person or
circumstances shall be determined by a court of proper
jurisdiction to be invalid or unenforceable to any extent, the
remainder of this Trust Agreement, or the application of such
provision to persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected
thereby, and each other provision of this Trust Agreement shall
be valid and enforced to the fullest extent permitted by law.
SECTION 6.2 Notices. Any notice, report, demand or
waiver required or permitted hereunder shall be in writing and
shall be given personally, delivered by overnight delivery
service or sent by telecopier, addressed as follows:
If to the Company:
Savannah Foods & Industries, Inc.
2 East Bryan Street
Savannah, Georgia 31401
Attention: Senior Vice President, Chief Financial
Officer and Treasurer
If to the Trustee:
Wachovia Bank of North Carolina, N.A.
P.O. Box 3099
Winston-Salem, North Carolina 27150
Mail Code NC-31013
Attention: Beverley H. Wood
Senior Vice President
Notices shall be effective only upon receipt.
The Company or Trustee may change the address to which
notices, requests and other communications are to be sent to it
by giving written notice of such address change to the other
parties in conformity with this Section 6.2.
SECTION 6.3 Gender and Number. Wherever any words are
used herein in the masculine gender, they shall be construed as
though they were also used in the feminine gender in all cases
where they would so apply, and wherever any words are used herein
in the singular form, they shall be construed as though they were
also used in the plural form in all cases where they would so
apply. Likewise, wherever any words are used herein in the
plural form, they shall be construed as though they were also
used in the singular form in all cases where they would so apply.
SECTION 6.4 Headings. The headings and subheadings of
this Agreement have been inserted for convenience of reference
and are to be ignored in any construction of the provisions
hereof.
SECTION 6.5 No Third Party Beneficiaries. Nothing in
this Trust, express or implied, is intended to or shall confer on
any particular person, other than the Company and the Trustee,
any right, benefit or remedy of any nature whatsoever under or by
reason of this Trust, and no such person shall have any right,
title or interest in or any claim to the Trust Corpus except to
the extent expressly provided in Section 5.1 upon termination of
this Trust. In particular, it is the express intent of the
parties that (i) this Trust shall not form part of any of the
Plans, (ii) neither any Plan nor any Participant in any of the
Plans (nor any Beneficiary of such Participant) shall have any
right, title or beneficial ownership or other interest in or any
claim (preferred or otherwise) to the Trust Corpus, nor shall any
such participant have any right to compel, restrain or otherwise
direct the exercise of the respective powers of Trustee and the
Company hereunder, it being understood that the rights of each
such Participant (and Beneficiary) shall be determined in
accordance with the provisions of the Plans and (iii) the Trust
Corpus shall not be deemed to be held under any trust for the
benefit of any such Participant (or Beneficiary) or to be
collateral security for the performance of the obligations of the
Corporation.
SECTION 6.6 Counterparts. This Agreement may be
executed in any number of counterparts, each of which shall be
deemed to be an original, but all of which together constitute
but one instrument, which may be sufficiently evidenced by any
counterpart.
SECTION 6.7 Directions by Company. Except as
otherwise provided herein, all directions by the Company to the
Trustee shall be effected by any two officers of the Company from
the group of officers consisting of the Chief Executive Officer,
Chief Financial Officers, Executive Vice Presidents and Senior
Vice Presidents. The Company shall provide to the Trustee an
incumbency certificate with respect to each member of the
foregoing group of officers and, in the absence of actual
knowledge to the contrary, the Trustee shall be conclusively
entitled to rely on such certificates as to each such
individual's authority to provide directions to the Trustee
hereunder.
IN WITNESS WHEREOF, the parties have caused this
Agreement to be executed under seal in their respective names by
their duly authorized officers the day and year first above
written.
SAVANNAH FOODS & INDUSTRIES, INC.
By /s/ GREGORY H. SMITH
Name: Gregory H. Smith
Title: Senior Vice President, Chief
Financial Officer and Treasurer
WACHOVIA BANK OF NORTH CAROLINA, N.A.,
solely in its capacity as
trustee under this Trust
Agreement
By /s/ BEVERLY H. WOOD
Name: Beverly H. Wood
Title: Senior Vice President
EXHIBIT A
SAVANNAH FOODS & INDUSTRIES, INC.
PLANS
Section 4.5 Plans
1. Deferred Compensation Plan for Key Employees of Savannah
Foods & Industries, Inc. and Subsidiaries (effective August
1, 1990), as amended, and all deferred compensation
agreements or elections made thereunder
2. Deferred Compensation Plan for Key Employees of Savannah
Foods & Industries, Inc. (Amendment and Restatement
effective August 12, 1983), as amended, and all deferred
compensation agreements or elections made thereunder
3. Deferred Compensation Plan for Key Employees of Michigan
Sugar Company (initially effective January 1, 1985), as
amended, and all deferred compensation agreements or
elections made thereunder
4. Deferred Compensation Plan for directors of Savannah Foods &
Industries, Inc. (amended and restated effective August 4,
1989), as amended, and all deferred compensation agreements
or elections made thereunder
5. Supplemental Executive Retirement Plan (SERP) of Savannah
Foods & Industries, Inc. and Subsidiaries (Second Amendment
and Restatement Effective January 1, 1989), as amended, and
all deferred compensation agreements or elections made
thereunder
6. Deferred Compensation Agreement between Walter C. Scott and
Savannah Foods & Industries, Inc. (dated December 27, 1984)
7. Deferred Compensation Agreement between William W. Sprague,
Jr. and Savannah Foods & Industries, Inc. (dated October 5,
1992)
8. Deferred Compensation Agreement between Ernest Flegenheimer
and Michigan Sugar Company (dated September 8, 1992)
Other Plans
1. Savannah Foods & Industries, Inc. Employee Stock Ownership
Plan, amended and restated effective January 1, 1989
2. Retirement Income Plan for Employees of Savannah Foods &
Industries, Inc., effective July 1, 1934