{"id":43286,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/asset-purchase-agreement-california-and-hawaii-sugar-co-inc2.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"asset-purchase-agreement-california-and-hawaii-sugar-co-inc2","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/planning\/asset-purchase-agreement-california-and-hawaii-sugar-co-inc2.html","title":{"rendered":"Asset Purchase Agreement &#8211; California and Hawaii Sugar Co. Inc., A &#038; B &#8211; Hawaii Inc., and McBryde Sugar Co. Ltd."},"content":{"rendered":"<pre>                             AMENDED AND RESTATED\n\n                            ASSET PURCHASE AGREEMENT\n\n                                  BY AND AMONG\n\n                  CALIFORNIA AND HAWAIIAN SUGAR COMPANY, INC.\n\n                              A &amp; B - HAWAII, INC.\n\n                         MCBRYDE SUGAR COMPANY, LIMITED\n\n                                      AND\n\n                         SUGAR ACQUISITION CORPORATION\n\n                         DATED AS OF DECEMBER 24, 1998\n\n\n\n\n\n\n\n\n                               TABLE OF CONTENTS\n                               -----------------\n\n                                                              Page\n\nARTICLE I  DEFINITIONS..........................................1\n        1.01. Definitions ......................................1\n        1.02. Index of Other Defined Terms ....................10\n        1.03. Rules of Interpretation .........................12\n\nARTICLE II  TRANSFER OF ASSETS.................................12\n        2.01. Transfer of Assets by Seller ....................12\n        2.02. Excluded Assets .................................15\n        2.03. Assumption of Liabilities .......................15\n        2.04. Excluded Liabilities ............................15\n        2.05. Assignment of Contracts and Rights ..............16\n        2.06. Purchase Consideration ..........................17\n        2.07. Closing .........................................18\n        2.08.  Purchase Consideration Allocation ..............19\n        2.09. Preparation of Final Statement of Working\n              Capital..........................................20\n        2.10. Adjustments Resulting From The Statement of\n              Working Capital..................................22\n\nARTICLE III  REPRESENTATIONS AND WARRANTIES OF SELLER..........23\n        3.01. Corporate Existence and Power ...................23\n        3.02. Authorization ...................................24\n        3.03. Governmental Authorization ......................24\n        3.04. Non-Contravention ...............................24\n        3.05. Financial Statements; Undisclosed Liabilities ...25\n        3.06. Absence of Certain Changes ......................26\n        3.07. Properties; Leases; Tangible Assets .............27\n        3.08. Sufficiency of and Title to the Transferred\n              Assets...........................................28\n        3.09. Litigation ......................................29\n        3.10. Contracts .......................................29\n        3.11. Permits; Required Consents ......................32\n        3.12. Compliance with Applicable Laws .................33\n        3.13. Employment Agreements; Change in Control;\n              and Employee Benefits ...........................33\n        3.14. Labor and Employment Matters ....................36\n        3.15. Intellectual Property ...........................37\n        3.16. Advisory Fees ...................................39\n        3.17. Environmental Compliance ........................39\n        3.18. Insurance .......................................40\n        3.19. Tax Matters .....................................41\n        3.20. Investment Representations ......................43\n        3.21. Transactions with Affiliates ....................44\n        3.22. Accounts Receivable and Inventory ...............45\n        3.23. Substantial Customers and Suppliers .............45\n        3.24. Disclosure ......................................46\n\nARTICLE IV  REPRESENTATIONS AND WARRANTIES OF NEWCO............46\n        4.01. Corporate Existence and Power ...................46\n        4.02. Corporate Authorization .........................46\n        4.03. Capital Stock ...................................47\n        4.04. Governmental Authorization ......................47\n        4.05. Non-Contravention ...............................48\n        4.06. Advisory Fees ...................................48\n        4.07. Litigation ......................................48\n        4.08. Conduct of Newco ................................48\n\nARTICLE V  COVENANTS OF SELLER.................................49\n        5.01. Conduct of the Business; Distributions ..........49\n        5.02. Access to Information ...........................51\n        5.03. Compliance with Terms of Required Governmental\n              Approvals and Required Contractual Consents .....52\n        5.04. Maintenance of Insurance Policies ...............52\n        5.05. Change of Name ..................................54\n        5.06. Administration of Accounts ......................54\n        5.07. Notice of Events ................................54\n        5.08. Bulk Sale Filings ...............................55\n        5.09. Exclusivity .....................................55\n        5.10. Confidentiality .................................56\n        5.11. Non-Competition .................................57\n        5.12. Specific Performance ............................57\n        5.13. Termination of Intercompany Arrangements ........58\n        5.14. Amendment of the HSTC Sugar Contract ............41\n\nARTICLE VI  COVENANTS OF NEWCO.................................58\n        6.01. Access to Information ...........................58\n        6.02. Compliance with Terms of Required Governmental\n              Approvals and Required Contractual Consents .....59\n        6.03. Confidentiality .................................59\n        6.04. Specific Performance ............................60\n        6.05. Amendment of Certificate of Incorporation .......60\n        6.06. Company Employees ...............................61\n        6.07. Payment of ASRS Note and Pollution Control Bond\n              Interest ........................................61\n        6.08. Performance of Certain Obligations by Newco .....61\n        6.09. Re-marketing of Debentures ......................63\n\nARTICLE VII  COVENANTS OF ALL PARTIES..........................64\n        7.01. Further Assurances ..............................64\n        7.02. Certain Filings .................................65\n        7.03. Public Announcements ............................65\n        7.04. Disposition of Benefit Plans ....................66\n        7.05. Working Capital Facility ........................68\n        7.06. Cooperation in Tax Matters ......................68\n        7.07. Registration Rights Agreement ...................68\n        7.08. Indenture .......................................69\n        7.09. Disposition of Certain Properties ...............69\n\nARTICLE VIII  CONDITIONS TO CLOSING............................69\n        8.01. Conditions of All Parties .......................69\n        8.02. Conditions to Obligation of Newco ...............72\n        8.03. Conditions to Obligation of Sellers .............74\n\nARTICLE IX   INDEMNIFICATION...................................74\n        9.01. Agreement to Indemnify ..........................74\n        9.02. Survival of Representation, Warranties and\n              Covenants .......................................77\n        9.03. Claims for Indemnification ......................77\n        9.04. Defense of Claims ...............................78\n        9.05.  Nature of Payments .............................79\n        9.06.  ABHI's Financial Condition .....................79\n\nARTICLE X  TERMINATION.........................................79\n        10.01. Grounds for Termination ........................80\n        10.02. Effect of Termination ..........................82\n\nARTICLE XI  MISCELLANEOUS......................................82\n        11.01. Notices ........................................82\n        11.02. Amendments; No Waivers .........................84\n        11.03. Expenses .......................................84\n        11.04. Successors and Assigns .........................85\n        11.05. Governing Law ..................................85\n        11.06. Counterparts; Effectiveness ....................85\n        11.07. Entire Agreement ...............................85\n        11.08. Captions .......................................86\n        11.09. Severability ...................................86\n        11.10. Construction ...................................86\n        11.11. Cumulative Remedies ............................87\n        11.12. Third Party Beneficiaries ......................87\n        11.13. Knowledge ......................................87\n\n\n                                    EXHIBITS\n\nEXHIBIT A            Form of Newco Charter\nEXHIBIT B            Form of Stock Sale Agreement\nEXHIBIT C            Warrant Terms\nEXHIBIT D            Form of Newco Note\nEXHIBIT E            Form of Exchange Debenture Indenture\nEXHIBIT F            Standby Financing Agreement\n\n\n\n                                   SCHEDULES\n                                   ---------\n\nSchedule 1.01(a)    Permitted Liens\nSchedule 2.08       Purchase Consideration Allocation\nSchedule 2.09(a)    Estimated Working Capital Amount\nSchedule 3.04(c)    Conflicts\nSchedule 3.05(c)    Undisclosed Liabilities\nSchedule 3.06       Absence of Certain Changes\nSchedule 3.07(a)    Encumbrances on Property\nSchedule 3.07(c)    Leases\nSchedule 3.08       Sufficiency of and Title to the Transferred Assets\nSchedule 3.09       Litigation\nSchedule 3.10(a)    Scheduled Contracts\nSchedule 3.10(b)    Valid and Binding Contracts\nSchedule 3.11(a)    Permits\nSchedule 3.11(b)    Required Consents\nSchedule 3.12       Compliance with Applicable Laws\nSchedule 3.13(a)    Employment Agreements\nSchedule 3.13(b)    Benefit Plans\nSchedule 3.13(c)    Pension Plans\nSchedule 3.13(d)    Multiemployer Plans\nSchedule 3.13(e)    Individuals Entitled to Certain Rights\nSchedule 3.13(g)    Benefit Claims\nSchedule 3.13(j)    Retiree Benefits\nSchedule 3.14(a)    Labor and Employment Matters\nSchedule 3.14(b)    Labor Disputes\nSchedule 3.15(a)    Intellectual Property Rights\nSchedule 3.15(b)    Actions Affecting Intellectual Property\nSchedule 3.15(c)    Ownership of Intellectual Property Rights\nSchedule 3.15(d)    Infringement of Intellectual Property Rights\nSchedule 3.17(a)    Environmental Permits\nSchedule 3.17(b)    Compliance with Environmental Laws\nSchedule 3.17(c)    Continuing Compliance with Environmental Laws\nSchedule 3.17(d)    Continuing Compliance with Environmental Laws\nSchedule 3.18       Insurance Policies\nSchedule 3.19       Tax Matters\nSchedule 3.21       Transactions with Affiliates\nSchedule 3.23       Substantial Customers and Suppliers\nSchedule 7.04(a)    Seller Benefit Plans\nSchedule 11.13      Persons to Whom Knowledge is Attributed\n\n\n                            ASSET PURCHASE AGREEMENT\n                            ------------------------\n   \n       This AMENDED AND RESTATED ASSET PURCHASE AGREEMENT (the \"Agreement\"),\ndated as of December 24, 1998, is by and among CALIFORNIA AND HAWAIIAN SUGAR\nCOMPANY, INC., a Hawaii corporation (the \"Seller\"), A &amp; B - HAWAII, INC., a\nHawaii corporation (\"ABHI\"), McBRYDE SUGAR COMPANY, LIMITED, a Hawaii\ncorporation (\"McBryde\"), and SUGAR ACQUISITION CORPORATION, a Delaware\ncorporation (\"Newco\").\n                                R E C I T A L S\n\n          A.   WHEREAS, Seller is engaged in the business of sugar refining and\ndistribution (the \"Business\");\n\n          B.   WHEREAS, Seller desires to sell and transfer to Newco, and Newco\ndesires to buy from Seller, substantially all of Seller's assets in\nconsideration of Newco's obligations hereunder; and\n\n          C.   WHEREAS, Seller, ABHI, McBryde and Newco entered into an Asset\nPurchase Agreement, dated as of August 5, 1998, pursuant to which Seller\nproposed to sell to Newco, and Newco proposed to buy from Seller, substantially\nall of Seller's assets; and, as of the date hereof, the parties desire to amend\nand restate the Asset Purchase Agreement as provided herein\n\n                               A G R E E M E N T\n\n          NOW, THEREFORE, in consideration of the premises, and the mutual\nrepresentations, warranties, covenants and agreements hereinafter set forth,\nthe parties hereto agree as follows.\n\n                                   ARTICLE I\n\n                                  DEFINITIONS\n\n          1.01.  Definitions.  The following terms, as used herein, have the\n                 -----------\nfollowing meanings:\n\n          \"A&amp;B\" means Alexander &amp; Baldwin, Inc., a Hawaii corporation.\n\n          \"Affiliate\" means, with respect to any Person, (i) any Person\ndirectly or indirectly controlling, controlled by or under direct or indirect\ncommon control with such other Person and includes (a) any shareholder,\nofficer, director or employee of a particular Person, and (b) any individual\nrelated byblood, marriage or adoption to a Person or to any partner,\nshareholder, officer, director or employee of a particular Person, (ii) any\nPerson in which any of the foregoing owns a beneficial interest or (iii) any\ncorporation or other business organization of which such Person is an officer\nor is the beneficial owner, directly or indirectly, of ten percent (10%) or\nmore of any class of equity securities.  For purposes of this definition, the\nterm \"control\" means the possession, directly or indirectly, of the power to\ndirect or cause the direction of the management and policies of a Person,\nwhether through the ownership of voting securities, by contract or otherwise,\nand the terms \"controlled\" and \"controlling\" have meanings correlative thereto.\n\n          \"Applicable Law\" means, with respect to any Person, any domestic or\nforeign, federal, state or local statute, law, ordinance, rule, administrative\ninterpretation, regulation, order, writ, injunction, judgment, decree or other\nrequirement of any Governmental Authority (including any Environmental Law)\napplicable to such Person or any of its Affiliates or Plan Affiliates or any of\ntheir respective properties, assets, officers, directors, employees,\nconsultants or agents (in connection with such officer's, director's,\nemployee's, consultant's or agent's activities on behalf of such Person or any\nof its Affiliates or Plan Affiliates).\n\n          \"ASRS Notes\" means those certain 9.80% Unsecured Senior Notes due\n2004, in the aggregate principal amount of $25,000,000, issued pursuant to that\ncertain Note Purchase Agreement by and among Seller and the note purchasers\nparty thereto dated December 8, 1989, as amended pursuant to that Amendment to\nNote Purchase Agreement dated as of December 12, 1989, those certain Amendments\nto Unsecured Notes dated December 12, 1989 and that certain Amended and\nRestated Note Purchase Agreement dated as of July 1, 1993, as amended by those\ncertain amendments dated January 24, 1995, October 27, 1995, and February 22,\n1996.\n\n          \"Benefit Arrangement\" means any material benefit arrangement that is\nnot an Employee Benefit Plan, including, without limitation, (i) each employ-\nment or consulting agreement, (ii) each arrangement providing for insurance\ncoverage or workers' compensation benefits, (iii) each incentive bonus or\ndeferred bonus arrangement, (iv) each arrangement providing termination\nallowance, severance or similar benefits, (v) each equity compensation plan,\n(vi) each deferred compensation plan and (vii) each compensation policy and\npractice maintained by Seller or any ERISA Affiliate of Seller covering the\nemployees, former employees, directors and former directors of Seller and the\nbeneficiaries of any\nof them.\n\n          \"Benefit Plan\" means an Employee Benefit Plan or Benefit Arrangement.\n\n          \"Business Day\" means a day other than a Saturday, Sunday or other day\non which commercial banks in New York, New York are authorized or required by\nlaw to close.\n\n          \"Code\" means the Internal Revenue Code of 1986, as amended.\n\n          \"CVC\" means Citicorp Venture Capital, Ltd.\n\n          \"Damages\" means all demands, claims, actions or causes of action,\nassessments, losses, damages, costs, expenses, liabilities, judgments, awards,\nfines, sanctions, penalties, charges and amounts paid in settlement, net of\ninsurance proceeds actually received, including without limitation (i) interest\non cash disbursements in respect of any of the foregoing at the Reference Rate\nin effect from time to time, compounded quarterly, from the date each such cash\ndisbursement is made until the Person incurring the same shall have been\nindemnified in respect thereof and (ii) reasonable costs, fees and expenses of\nattorneys, accountants and other agents of such Person.\n\n          \"Employee Benefit Plan\" means any employee benefit plan, as defined\nin Section 3(3) of ERISA, that is sponsored or contributed to by Seller or any\nERISA Affiliate thereof covering employees or former employees of Seller.\n\n          \"Employee Pension Benefit Plan\" means any employee pension benefit\nplan, as defined in Section 3(2) of ERISA, that is subject to Title IV of\nERISA, other than a Multiemployer Plan.\n\n          \"Environmental Laws\" means all Applicable Laws (including common law)\nrelating to Hazardous Substances, toxic torts, occupational health and safety,\npollution or the environment, including without limitation, the Resource\nConservation and Recovery Act (\"RCRA\"), the Comprehensive Environmental\nResponse Compensation and Liability Act (\"CERCLA\"), the Clean Air Act, the\nWater Pollution Control Act, the Safe Drinking Water Act, and the Toxic\nSubstances Control Act (\"TSCA\"), and any requirements promulgated pursuant\nto these Applicable Laws.\n\n          \"Environmental Liabilities\" means all Liabilities of a Person\n(whether such Liabilities are owed by such Person to Governmental Authorities\nor other Persons) whether currently in existence or arising hereafter which\narise under or relate to any Environmental Law, including, without limitation,\nany liability for personal injury, property damage, natural resource damage and\nany obligation for investigations, clean-up or corrective or remedial action.\n\n          \"ERISA Affiliate\" of any Person means any other Person that, together\nwith such Person as of the relevant measuring date under ERISA, was or is\nrequired to be treated as a single employer under Section 414 of the Code.\n\n          \"ERISA\" means the Employee Retirement Income Security Act of 1974, as\namended.\n\n          \"Funded Debt\" means any liabilities for borrowed money of Seller\n(including short-term commercial paper borrowings and long term debt),\nincluding all principal, interest, fees, expenses, overdrafts, penalties,\npremiums and indemnities due thereunder, or intercompany payables of Seller in\nany case of a nature that would be required to be reflected on a balance sheet\nunder GAAP.\n\n          \"GAAP\" means, with respect to any set of financial statements or\nschedules referred to herein, generally accepted accounting principles in the\nUnited States as in effect on the date of such financial statements or\nschedules and applied on a basis consistent with the prior financial statements\nof Seller.\n\n          \"Governmental Authority\" means any foreign, domestic, federal,\nterritorial, state or local governmental authority, quasi-governmental\nauthority, instrumentality, court, government or self-regulatory organization,\ncommission, tribunal or organization or any regulatory, administrative or other\nagency, or any political or other subdivision, department or branch of any of\nthe foregoing.\n\n          \"Group Health Plan\" means any group health plan, as defined in\nSection 5000(b)(1) of the Code.\n\n          \"Hazardous Substance\" means any substance or material:  (i) the\npresence or release of which requires investigation or remediation under any\nApplicable Law; or (ii) that is defined as a \"hazardous waste\" or \"hazardous\nsubstance\" under any Applicable Law; or (iii) that is toxic, explosive,\ncorrosive, flammable, infectious, radioactive, carcinogenic or mutagenic or\notherwise hazardous and is regulated by any Governmental Authority having or\nasserting jurisdiction over Seller; or (iv) the presence or release of which\ncauses a nuisance, trespass or other tortious condition; (v) the presence or\nrelease of which poses a hazard to the health or safety of Persons; or\n(vi) without limitation, that contains gasoline, diesel fuel or other petroleum\nhydrocarbons, polychlorinated biphenyls (PCBs) or asbestos.\n\n          \"HSR Act\" means the Hart-Scott-Rodino Antitrust Improvements Act of\n1976, as amended.\n\n          \"HSTC\" means the Hawaiian Sugar &amp; Transportation Cooperative.\n\n          \"HSTC Sugar Contract\" means the Delivery and Sale Agreement between\nHSTC and Seller dated as of June 4, 1993.\n\n          \"Indemnifying Party\" means:  (1) with respect to any Newco Indemnitee\nasserting a claim under Section 9.01, Seller, ABHI and McBryde; and (2) with\nrespect to any Seller Indemnitee asserting a claim under Section 9.02, Newco.\n\n          \"Indemnitee\" means:  (1) each of Newco and its respective Affiliates\nwith respect to any claim for which Seller, ABHI or McBryde is an Indemnifying\nParty under Section 9.01 and (2) each of Seller and its respective Affiliates\nwith respect to claims for which Newco is an Indemnifying Party under\nSection 9.02.\n\n          \"Intercompany Payables\" means any Liability of Seller to the\nShareholders or any of their respective Affiliates, other than any liability of\nSeller to HSTC pursuant to the HSTC Sugar Contract.\n\n          \"Intercompany Receivables\" means any amounts payable by any of the\nShareholders or their Affiliates to Seller other than any amount payable to\nSeller by HSTC pursuant to the HSTC Sugar Contract.\n\n          \"IRS\" means the Internal Revenue Service.\n\n          \"Liability\" means, with respect to any Person, any liability or\nobligation of such Person of any kind, character or description, whether known\nor unknown, absolute or contingent, accrued or unaccrued, liquidated or\nunliquidated, secured or unsecured, joint or several, due or to become due,\nvested or unvested or executory and whether or not the same is required to be\naccrued on the financial statements of such Person or is disclosed on any\nschedule to this Agreement.\n\n          \"Lien\" means, with respect to any asset, any mortgage, title defect\nor objection, lien, pledge, security interest, hypothecation, restriction,\nencumbrance or charge of any kind in respect of such asset.\n\n          \"Material Adverse Effect\" means a change or effect that (A) results\nin a material adverse effect on, or results in a material adverse change to,\nthe assets, operations, financial condition or results of operations of Seller\nor, after the Closing, the assets, operations, financial condition or results\nof operations of Newco (excluding (i) adverse changes of an industry-wide\nimpact or (ii) adverse changes attributable to the execution of this Agreement\nand the publicity attendant thereto) or (B) materially impairs or prohibits the\nability of Seller and Newco to consummate the transactions contemplated hereby.\n\n          \"Maui Warehouse\" means that certain steel building measuring 390 feet\nby 300 feet, located at Puunene, Maui, Hawaii at Tax Map Key No. 3-8-006-070.\n\n          \"Newco Charter\" shall mean the form of Amended and Restated\nCertificate of Incorporation of Newco attached hereto as Exhibit A, to be\n                                                         ---------\nadopted by the Board of Directors of Newco prior to the Closing Date.\n\n          \"Newco Class B Common Stock\" means Newco's Class B Common Stock, par\nvalue $0.01 per share, having the rights, preferences and privileges set forth\nin the Newco Charter attached hereto as Exhibit A.\n                                        ---------\n \n         \"Newco Common Stock\" means Newco's Class A Common Stock, par value\n$0.01 per share, having the rights, preferences and privileges set forth in the\nNewco Charter attached hereto as Exhibit A.\n                                 ---------\n \n         \"Newco Exchangeable Preferred Stock\" means Newco's 12.5% Senior\nCumulative Exchangeable Series A Preferred Stock, par value $.01 per share,\nhaving the rights, preferences and privileges set forth in the Newco Charter\nattached hereto as Exhibit A.\n                   ---------\n \n         \"Newco Junior Preferred Stock\" means Newco's Series C Preferred Stock,\npar value $.01 per share, having the rights, preferences and privileges as set\nforth in the Newco Charter attached hereto as Exhibit A.\n                                              ---------\n \n         \"Newco Note\" means that certain promissory note of Newco in form\nattached hereto as Exhibit D in the principal amount of $25 million to be\n                   ---------\nissued to Seller pursuant to Section 2.06(a) of this Agreement.\n\n          \"Newco Series B Preferred Stock\" means Newco's 12.5% Senior\nCumulative Series B Preferred Stock, par value $.01 per share, having the\nrights, preferences and privileges set forth in the Newco Charter attached\nhereto as Exhibit A.\n          ---------\n\n          \"Multiemployer Plan\" means a multiemployer plan, as defined in\nSection 3(37) and 4001(a)(3) of ERISA.\n\n          \"Permitted Liens\" means (i) Liens for Taxes or governmental\nassessments, charges or claims the payment of which is not yet delinquent\nbeyond any applicable grace period, or the validity of which is being contested\nin good faith by appropriate proceedings; (ii) statutory Liens of landlords and\nLiens of carriers, warehousemen, mechanics, materialmen and other similar\nPersons and other Liens imposed by Applicable Law incurred in the ordinary\ncourse of business for sums not yet delinquent beyond any applicable grace\nperiod and being contested in good faith; (iii) Liens relating to deposits made\nin the ordinary course of business in connection with workers' compensation,\nunemployment insurance and other types of social security or to secure the\nperformance of leases, trade contracts or other similar agreements; (iv) Liens\nand Encumbrances specifically identified as such in the Seller Balance Sheet;\n(v) Liens and Encumbrances that are a matter of public record and that do not\ndetract from the ability of Seller (or Newco as the case may be) to utilize the\nassets encumbered thereby in the operation of the Business; (vi) Liens securing\nexecutory obligations under any Lease that constitutes an \"operating lease\"\nunder GAAP; (vii) Liens and Encumbrances incurred in the ordinary course of\nbusiness that do not materially detract from the ability of Seller (or Newco as\nthe case may be) to utilize the assets encumbered thereby in the operation of\nthe Business and that do not materially affect the value of any asset; and\n(viii) other Liens and Encumbrances set forth on Schedule 1.01(a){xe\n\"Schedule 1.01(a)   Permitted Liens\"} hereto.\n\n          \"Person\" means an individual, corporation, partnership, limited\nliability company, association, trust, estate or other entity or organization,\nincluding a Governmental Authority.\n\n          \"Plan Affiliate\" means, with respect to any Person, any employee\nbenefit plan or arrangement sponsored by, maintained by or contributed to by\nsuch Person, and with respect to any employee benefit plan or arrangement, any\nPerson sponsoring, maintaining or contributing to such plan or arrangement.\n\n          \"Pollution Control Bonds\" means those certain 6.25% Bonds due 2002,\nin the aggregate principal amount of $5,400,000, issued by the California\nPollution Control Financing Authority and secured by a pledge of revenues\nunder a Pollution Control Facilities Lease, dated as of March 1, 1977, by and\nbetween the California Pollution Control Financing Authority and Seller.\n\n          \"Prepayment Penalties\" means the Make-Whole Amount paid to the\nholders of the ASRS Notes as a result of the prepayment by Seller, on December\n11, 1998, of the ASRS Notes, pursuant to Section 7 of that certain Amended and\nRestated Note Purchase Agreement dated as of July 1, 1993 among Seller and the\nnote purchasers party thereto.\n\n          \"Prohibited Transaction\" means a transaction that is prohibited under\nSection 4975 of the Code or Section 406 of ERISA and not exempt under\nSection 4975 of the Code or Section 408 of ERISA, respectively.\n\n          \"Reference Rate\" means LIBOR plus 2.75% per annum.\n\n          \"Related Agreements\" means the Stock Sale Agreement, the Registration\nRights Agreement to be entered into pursuant to Section 7.07 of this Agreement,\nthe Registration Rights Agreement to be entered into pursuant to Section 4.04\nof the Stock Sale Agreement, an Indenture for the Newco Exchange Debentures,\nthe Stockholders Agreement (as defined in the Stock Sale Agreement), the CMP\nLoan Agreement (as defined in the Stock Sale Agreement), the Transition\nServices Agreement and the other agreements to be entered into in connection\nwith, and as a condition to, the consummation of the transactions contemplated\nby this Agreement and the Stock Sale Agreement.\n\n          \"Seller Key Employees\" means David Koncelik, Jerry Dotson, Jon\nWolthuis, Nazeer Doomun, Jean Paul Merle, Richard Riffer, Eric Dorn, Ron\nHarris, Kerry Borges, Wayne Garrett, Gary Kemp, Steven Ball, John Basi, Vijay\nHemraj, Thomas Wilson, William Duff, John McManus, John Grazioli, Michael\nHaynes, Phil Gibbons, Teshager Essayas, Carolyn Braden, James Orear, Robert\nGuilbault and Michael Carnahan.\n\n          \"Shareholders\" means ABHI and McBryde.\n\n          \"Subsidiary\" means, with respect to any Person, (i) any corporation\nas to which more than 25% of the outstanding stock having ordinary voting\nrights or power (and excluding stock having voting rights only upon the\noccurrence of a contingency unless and until such contingency occurs and such\nrights may be exercised) is owned or controlled, directly or indirectly, by\nsuch Person and\/or by one or more of such Person's Subsidiaries, and (ii) any\npartnership, joint venture or other similar relationship between such Person\n(or any Subsidiary thereof) and any other Person (whether pursuant to a\nwritten agreement or otherwise), if such Person has a 10% or more equity\ninterest therein.\n\n          \"Tax Return\" means all returns, reports, forms or other information\n(including schedules and exhibits thereto) and any amendments thereof, filed or\nrequired to be filed with respect to any Tax.\n\n          \"Tax\" means all taxes imposed of any nature including federal, state,\nlocal or foreign net income tax, alternative or add-on minimum tax, profits or\nexcess profits tax, franchise tax, gross income, adjusted gross income or gross\nreceipts tax, employment related tax (including employee withholding or\nemployer payroll tax, FICA or FUTA), real or personal property tax or ad\nvalorem tax, sales or use tax, excise tax, stamp tax or duty, any withholding\nor back up withholding tax, value added tax, severance tax, prohibited\ntransaction tax, premiums tax, environmental tax, intangibles tax or occupation\ntax, together with any interest or any penalty, addition to tax or additional\namount imposed by any governmental authority (domestic or foreign) responsible\nfor the imposition of any such tax.\n\n          \"Warrants\" shall mean warrants to purchase shares of Newco Common\nStock having the terms set forth in Exhibit C and such other customary rights,\npreferences and privileges that are satisfactory to Seller and Newco in their\nreasonable discretion.\n\n          \"Working Capital\" means the excess of (i) the sum of the Company's\ncurrent assets which would be required to be reflected on a balance sheet of\nthe Company prepared as of the Closing Date in conformity with GAAP (including,\nwithout limitation, receivables, inventories (sugar, raw materials and\nsupplies) and prepaid expenses and other assets), over (ii) the sum of all\ncurrent liabilities which would be required to be reflected in or reserved on a\nbalance sheet of the Company prepared as of the Closing Date in conformity with\nGAAP (including, without limitation, accounts payable, payables to HSTC and\naccrued expenses and other current liabilities).  Notwithstanding any contrary\naccounting policies under GAAP, (A) Working Capital shall be calculated before\ngiving effect to the consummation of the transactions under this Agreement\nwhich are contemplated to take effect as of the Closing Date, (B) Working\nCapital shall not include any unpaid liabilities of the Company with respect to\nany fees, expenses or other costs owed by it or for which it is responsible\n(including, without limitation, all fees and expenses described in\nSection 11.03(a)), in connection with the negotiation, execution and delivery\nof this Agreement and the Related Agreements and the consummation of the\ntransactions contemplated hereby and thereby, (C) Working Capital shall not\ninclude, as current assets, any Excluded Assets and (D) Working Capital shall\nnot include, as current liabilities, any Excluded Liabilities.\n\n          1.02.  Index of Other Defined Terms.  In addition to those terms\n                 ----------------------------\ndefined above, the following terms shall have the respective meanings given\nthereto in the sections indicated below:\n\n        DEFINED TERM                                         SECTION\n        \"ABHI\"                                               Recitals\n        \"Allocation Statement\"                               2.08\n        \"Accounting Principles\"                              2.09(a)\n        \"Assumed Liabilities\"                                2.03\n        \"Business\"                                           Recitals\n        \"Cash Component\"                                     2.06(a)(i)\n        \"Closing Date\"                                       2.07(a)\n        \"Closing\"                                            2.07(a)\n        \"Contracts\"                                          2.01(c)\n        \"Crockett Order\"                                     2.04\n        \"Employment Agreements\"                              3.13(a)\n        \"Encumbrances\"                                       3.07(a)\n        \"Equipment\"                                          2.01(a)\n        \"Excluded Assets\"                                    2.02\n        \"Excluded Liabilities\"                               2.04\n        \"Expenses\"                                           11.03\n        \"Financial Statements\"                               3.05(a)\n        \"Insurance Policies\"                                 3.18\n        \"Intellectual Property Rights\"                       2.01(h)\n        \"Inventory\"                                          2.01(b)\n        \"Leases\"                                             3.07(c)\n        \"McBryde\"                                            Recitals\n        \"MLM\"                                                3.19(i)\n        \"Newco Exchange Debentures\"                          7.08\n        \"Newco Indemnitees\"                                  9.01(a)\n        \"Newco Senior Subordinated Notes\"                    7.05\n        \"Newco Securities\"                                   3.20(a)\n        \"Newco\"                                              Preamble\n        \"Outside Date\"                                       10.01(f)\n        \"Permits\"                                            3.11(a)\n        \"Preliminary Statement of Working Capital\"           2.06(b)\n        \"Preliminary Working Capital Adjustment\"             2.06(b)\n        \"Proceedings\"                                        3.09\n        \"Purchase Consideration\"                             2.06(a)\n        \"Required Consents\"                                  3.11(b)\n        \"Required Contractual Consent\"                       3.11(b)\n        \"Required Governmental Approval\"                     3.11(b)\n        \"Scheduled Contracts\"                                3.10(a)\n        \"Securities Act\"                                     3.20(a)\n        \"Seller Balance Sheet\"                               3.05(a)\n        \"Seller Indemnitees\"                                 9.01(b)\n        \"Seller Insurance Policies\"                          3.18\n        \"Statement of Working Capital\"                       2.09(a)\n        \"Stock Sale Agreement\"                               8.01(e)\n        \"Subsequent Material Contract\"                       5.01(b)(v)\n        \"Transferred Assets\"                                 2.01\n        \"Working Capital Facility\"                           7.05\n\n          1.03.  Rules of Interpretation.\n                 -----------------------\n\n                 (a)  The words \"include\", \"includes\" and \"including\" as used\nherein are not limiting.\n\n                 (b)  Any pronoun used herein shall be considered gender\nneutral.\n\n                                     ARTICLE II\n\n                                 TRANSFER OF ASSETS\n\n          2.01.  Transfer of Assets by Seller.  Upon the terms and subject to\n                 ----------------------------\nthe conditions of this Agreement and in reliance upon the representations,\nwarranties and agreements herein set forth, Newco agrees to purchase from\nSeller and Seller agrees to sell or cause to be sold to Newco at the Closing,\nfree and clear of all Liens, other than Permitted Liens, all the assets,\nproperties, leases, rights, licenses, permits, contracts, causes of action,\nclaims, operations and businesses of Seller of every kind and description as\nthe same shall exist on the Closing Date (other than the Excluded Assets (as\ndefined in Section 2.02) or any of the foregoing that relate solely to the\nExcluded Assets), wherever located, whether tangible or intangible, real,\npersonal or mixed, that are owned by, leased by or in the possession of Seller,\nwhether or not reflected on the books and records of Seller (the collective\nassets, properties, rights, licenses, permits, contracts, causes of action,\nclaims, operations and businesses to be transferred to Newco by Seller\npursuant hereto are referred to collectively herein as the \"Transferred\nAssets\") and including without limitation all right, title and interest of\nSeller in, to and under:\n\n                 (a)  all machinery, equipment, furniture, office equipment,\ncomputer equipment (including all hardware and software), communications\nequipment, vehicles, storage tanks, spare and replacement parts, fuel and other\ntangible property (and interests in any of the foregoing) (collectively, the\n\"Equipment\");\n\n                 (b)  all items of inventory notwithstanding how classified in\nthe financial records of Seller, including all raw materials, work-in-process,\nfinished goods, supplies, spare parts and samples (collectively, the\n\"Inventory\");\n  \n                 (c)  all contracts, agreements, options, leases, licenses,\nsales and purchase orders, commitments and other instruments of any kind,\nwhether written or oral, to which Seller is a party on the Closing Date,\nincluding the Scheduled Contracts and the Subsequent Material Contracts, but\nexcluding any documents, instruments or agreements governing Funded Debt of\nSeller other than the Pollution Control Bonds (collectively, the \"Contracts\");\n\n                 (d)  all accounts, accounts receivable and notes receivable,\ntogether with any unpaid interest or fees accrued thereon or other amounts due\nwith respect thereto, of Seller, and any security or collateral therefor,\nincluding recoverable advances and deposits;\n\n                 (e)  all prepaid charges and expenses of Seller, including any\nsuch charges and expenses with respect to ad valorem taxes, leases and rentals\nand utilities;\n\n                 (f)  subject to Section 5.04(b), the Seller Insurance Policies\nand all rights of Seller to insurance proceeds with respect to claims for\nDamages to the Transferred Assets occurring prior to the Closing Date, unless\nsuch proceeds reimburse Seller for the repair or restoration of such\nTransferred Assets and such amounts are so used;\n\n                 (g)  all of Seller's rights, claims, credits, causes of action\nor rights of set-off against third parties relating to the Business or the\nTransferred Assets, whether liquidated or unliquidated, fixed or contingent,\nincluding claims pursuant to all warranties, representations and guarantees\nmade by suppliers, manufacturers, contractors and other third parties in\nconnection with products or services purchased by or furnished to Seller for\nuse in the Business or affecting any of the Transferred Assets;\n\n                 (h)  all of Seller's patents, patent applications, copyrights,\ntrademarks, trade names, brand names, slogans, logos, service marks, service\nnames, designs, and any registrations or applications for registration of any\nof the foregoing, know-how, chip designs, mask works, processes, trade secrets,\ninventions, confidential information, formulae and other proprietary data and\ninformation, together with the right to sue for past infringements or\nmisappropriations thereof, and any and all corresponding rights that now or\nhereafter may be secured throughout the world and all copies and tangible\nembodiments thereof (together, the \"Intellectual Property Rights\");\n\n                 (i)  all transferable franchises, licenses, permits or other\nauthorizations issued or granted by any Governmental Authority that are owned\nby, granted to or held or used by Seller whether or not utilized in the\nBusiness;\n\n                 (j)  to the extent available, all books, records, files and\npapers of Seller, whether in hard copy or computer format, including bank\naccount records, books of account, invoices, engineering information, sales and\npromotional literature, manuals and data, sales and purchase correspondence,\nlists of present suppliers, personnel and employment records of present and, to\nthe extent lawful, former employees, and documentation developed or used for\naccounting, marketing, engineering, manufacturing or any other purpose related\nto the conduct of the Business at any time prior to the Closing except to the\nextent any such materials constitute Excluded Assets (as defined below);\n\n                 (k)  to the extent available, all lists of present customers\nand lists of former customers;\n\n                 (l)  all goodwill associated with the Business or the\nTransferred Assets of Seller and all rights in and to the Business as a going\nconcern; and\n            \n                 (m)  except as specifically provided in Section 2.02, all\nother assets and properties of Seller which exist on the Closing Date, whether\ntangible or intangible, real or personal.\n\n          2.02.  Excluded Assets.  Newco expressly understands and agrees that\n                 ---------------\nthe following assets shall be excluded from the Transferred Assets: (i) any\ncash or cash equivalents of Seller, (ii) deferred income tax assets and claims\nfor refund of income taxes of Seller, (iii) Intercompany Receivables and (iv)\nthe Maui Warehouse (collectively, the \"Excluded Assets\").\n\n          2.03.  Assumption of Liabilities.  Upon the terms and subject to the\n                 -------------------------\nconditions of this Agreement and in reliance upon the representations,\nwarranties and agreements herein set forth, Newco agrees, effective at the time\nof Closing, to assume, perform and timely pay and discharge all Liabilities of\nSeller other than the Excluded Liabilities (as defined in Section 2.04) (the\n\"Assumed Liabilities\").\n\n          2.04.  Excluded Liabilities.  Newco does not hereby assume, and shall\n                 --------------------\nnot at any time hereafter (including on or after the Closing Date) become\nliable for: (A) any Funded Debt of Seller (other than the obligations of Seller\nto pay (i) the principal amount of, and all accrued and unpaid interest on, the\nPollution Control Bonds, (ii) any interest accruing on the Pollution Control\nBonds from and after the Closing Date and (iii) Prepayment Penalties that have\nbeen paid with respect to the ASRS Notes prior to the date hereof, as is more\nspecifically addressed in Section 6.07); (B) any Liability (including without\nlimitation any Environmental Liabilities) relating to or arising from the\nownership or operation of the Maui Warehouse or any Excluded Asset; (C) any\nEnvironmental Liability relating to or arising from real property owned,\noperated, leased or used by Seller prior to the Closing Date that is no longer\nowned, operated, leased or used by Seller as of the Closing Date (provided,\nthat any Liability or obligation of Seller pursuant to that certain order of\nthe California Regional Water Quality Control Board -- San Francisco Bay Region\n(Order No. 95-191) dated September 13, 1995 (the \"Crockett Order\") shall not be\nexcluded but shall be assumed by Newco); (D) any Intercompany Payables; (E) any\nLiability of Seller in respect of income Taxes; or (F) any Liability relating\nto any current or former employee of Seller under any Employee Benefit Plan or\nBenefit Arrangement other than a Liability specifically assumed by Newco in\nArticle VII (collectively, the \"Excluded Liabilities\").\n\n          2.05.  Assignment of Contracts and Rights.\n                 ----------------------------------\n\n                 (a)  With respect to any Scheduled Contract (as defined in\nSection 3.10(a)) and any other Contract for which consent is required and any\nclaim, right or benefit arising thereunder or resulting therefrom, promptly\nafter the date hereof, Seller will use its commercially reasonable efforts to\nobtain prior to Closing each Required Contractual Consent (as defined in\nSection 3.11(b)) to any such Scheduled Contract and any other Contract for\nwhich consent is required for the assignment thereof to Newco in form and\nsubstance reasonably satisfactory to Newco.\n\n                 (b)  If (i) any such Required Contractual Consent is not\nobtained with respect to any such Scheduled Contract and (ii) notwithstanding\nthe provisions of Section 8.01(b), Newco shall elect to consummate the Closing,\nSeller and Newco shall cooperate in an arrangement reasonably satisfactory to\nNewco and Seller under which Newco would obtain, to the extent practicable, the\nclaims, rights and benefits arising under such Scheduled Contract and assume\nthe corresponding obligations thereunder in accordance with this Agreement,\nincluding subcontracting, sub-licensing or sub-leasing to Newco, or under which\nSeller would enforce for the benefit of Newco, with Newco assuming Seller's\nobligations, any and all claims, rights and benefits of Seller against a third\nparty thereto.  Seller will promptly pay to Newco when received all moneys\nreceived by Seller under any Transferred Asset or any claim, right or benefit\narising thereunder not transferred to Newco pursuant to this Section 2.05.\n\n          2.06.  Purchase Consideration.\n                 ----------------------\n\n                 (a)  In addition to the assumption by Newco of the Assumed\nLiabilities, the consideration for the Transferred Assets shall consist of the\nfollowing:\n\n                      (i)    an amount in cash (hereinafter referred to as the\n     \"Cash Component\") equal to (A) $68,000,000, as adjusted in accordance with\n     Section 2.06(b) by the Preliminary Working Capital Adjustment (as defined\n     in Section 2.06(b) below), minus (B) the principal amount of, and interest\n     accrued through the Closing Date on, the Pollution Control Bonds, which\n     principal amount and accrued interest shall be set forth on a statement to\n     be delivered to Newco by Seller not less than three (3) Business Days\n     prior to the Closing Date;\n\n                      (ii)   25,000 shares of Newco Exchangeable Preferred\n     Stock;\n     \n                      (iii)  the Newco Note in the principal amount of $25\n     million;\n\n                      (iv)   24,000 shares of Newco Junior Preferred Stock; and\n\n                      (iv)   810,000 shares Newco Common Stock and 90,000\n     shares of Newco Class B Common Stock.\n\n                 The consideration described in clauses (i) (as finally\nadjusted pursuant to Section 2.10), (ii), (iii) and (iv) is referred to herein\ncollectively as the \"Purchase Consideration\".\n\n                 (b)  Not later than three (3) Business Days prior to the\nClosing Date, Seller will prepare and deliver to Newco a statement of projected\nWorking Capital (the \"Preliminary Statement of Working Capital\") of Seller as\nof the Closing Date (which shall be prepared no more than five (5) days prior\nto the Closing Date).  The Preliminary Statement of Working Capital shall be\nbased upon the balance sheet of Seller as of the last day of the calendar month\npreceding the Closing Date and the books and records of Seller and (except as\notherwise provided in the definition of \"Working Capital\") shall be prepared in\naccordance with GAAP in a manner consistent with the accounting principles used\nin preparing the Seller Balance Sheet (as defined below), with such reasonable\nassumptions and estimates regarding changes in Working Capital between the\nmonth preceding the Closing Date and the Closing Date as are agreed upon by\nSeller and Newco.  Theount by which the Working Capital of Seller as set forth\nin the Preliminary Statement of Working Capital exceeds or is less than\n$64,263,000 (subject to adjustment pursuant to Section 2.09(a), the \"Estimated\nWorking Capital Amount\") (such excess or deficiency, as applicable, being\nreferred to as the \"Preliminary Working Capital Adjustment\"), shall be an\naddition (in the case of an excess), or a deduction (in the case of a\ndeficiency), in the formula for determining the Cash Component pursuant to\nSection 2.06(a)(i). \n\n          2.07.  Closing.\n                 -------\n\n                 (a)  The closing (the \"Closing\") of the transactions\ncontemplated by this Agreement shall take place at the offices of Gibson, Dunn\n&amp; Crutcher LLP, 333 South Grand Avenue, Los Angeles, California 90071 on the\nthird (3rd) Business Day following the date on which the last of the conditions\nto Closing set forth in Sections 8.01, 8.02 and 8.03 have been satisfied or\nwaived by the party or parties entitled to waive the same or such other date as\nto which Newco and Seller may agree (the \"Closing Date\").\n\n                 (b)  At the Closing, Newco shall deliver to Seller such\ncustomary instruments of assumption as may be reasonably requested by Seller to\nevidence such assumption of the Assumed Liabilities.\n\n                 (c)  At the Closing, Seller shall deliver to Newco such bills\nof sale, certificates of title, endorsements, consents, assignments and other\ngood and sufficient instruments of conveyance and assignment (which in the case\nof Intellectual Property Rights, shall be documents recordable in their\ndelivered form in the respective countries of origin) necessary or appropriate\nto vest in Newco all of Seller's right, title and interest in, to and under the\nTransferred Assets.\n\n                 (d)  At the Closing, Newco shall deliver to Seller, at\nSeller's election, by wire transfer (to a bank account designated by Seller in\nwriting at least three (3) Business Days prior to the Closing Date), in imme-\ndiately available funds, an amount in U.S. Dollars equal to the Cash Component.\n\n                 (e)  At the Closing, Seller shall receive (i) one or more\ncertificates representing in the aggregate 25,000 shares of Newco Exchangeable\nPreferred Stock; (ii) the Newco Note; (iii) one or more certificates\nrepresenting in the aggregate 24,000 shares of Newco Junior Preferred Stock;\n(iv) one or more certificates representing in the aggregate 810,000 shares of\nNewco Common Stock; and (v) one or more certificates representing in the\naggregate 90,000 shares of Newco Class B Common Stock as applicable.\n\n          2.08.  Purchase Consideration Allocation.  Schedule 2.08 sets forth\n                 ---------------------------------   -------------\nthe mechanism by which the parties will allocate the Purchase Consideration and\nAssumed Liabilities (to the extent taken into account for federal income tax\npurposes) among the Transferred Assets for purposes of complying with Section\n1060 of the Code and making any required filings under state or local law\n(the \"Allocation Statement\").  Newco and Seller shall report the tax\nconsequences of the transactions contemplated by this Agreement in a manner\nconsistent with the Allocation Statement, as it may be revised from time to\ntime, and shall not take any position inconsistent therewith.  The parties\nagree that the transactions contemplated hereby constitute a taxable sale of\nassets for income tax purposes and not as a transaction described in Part III,\nSubchapter C, Chapter 1, Subtitle A of the Code.\n\n          2.09.  Preparation of Final Statement of Working Capital.\n                 -------------------------------------------------\n\n                 (a)  Within 90 days after the Closing Date, Seller will\nprepare and deliver to Newco a statement of Working Capital (the \"Statement\nof Working Capital\") of Seller as of the Closing Date (immediately prior to,\nand without giving effect to, the Closing), which shall be audited by Deloitte\n&amp; Touche LLP, the independent public accountants of Seller.  In connection with\nthe preparation of the Statement of Working Capital, Seller shall give to the\nrepresentatives of Newco reasonable opportunity to participate in the physical\ninventory count and other examinations relating to the preparation of such\nStatement of Working Capital. The Statement of Working Capital shall be based\nupon the books and records of Seller and (except as otherwise provided in this\nSection 2.09 or the definition of \"Working Capital\") shall be prepared in\naccordance with GAAP in a manner consistent with the Accounting Principles\n(as defined below).  \"Accounting Principles\" means that each accounting term\nused herein (including in the definition of Working Capital) shall have the\nmeaning that is applied thereto in accordance with GAAP and each account\nincluded in the Statement of Working Capital of the Seller prepared as of the\nClosing Date shall be calculated in accordance with GAAP, in each case,\nconsistent with the Financial Statements and books and records of, and the past\npractice of, the Seller and in a manner consistent with the method of\ncalculation used in determining the Estimated Working Capital Amount as set\nforth on Schedule 2.09(a); provided, that all known errors shall be taken into\naccount in the calculation of each account set forth in the Statement of\nWorking Capital, regardless of their materiality, and a corresponding adjust-\nment shall be made to the Estimated Working Capital Amount to the extent such\nknown errors would have an impact upon the calculation of any account included\nin the determination of the Estimated Working Capital Amount.  With respect to\nthe calculation of the levels of the accounts set forth above, no change in\nAccounting Principles shall be made from those utilized in preparing the\nFinancial Statements (with regard to materiality) including, without\nlimitation, with respect to the nature or classification of accounts,\nclosing proceedings, levels of reserves, levels of accruals or reserve policies\nother than as a result of objective changes in the underlying business.  For\npurposes of the preceding sentence, \"changes in accounting principles\" includes\nall changes in accounting principles, policies, practices, procedures or\nmethodologies with respect to financial statements, their classification or\ntheir display, as well as all changes in practices, methods, conventions or\nassumptions utilized in making accounting estimates.\n\n                 (b)  If Newco has no objections to the Statement of Working\nCapital prepared and delivered by Seller pursuant to subsection (a), it shall\nso notify Seller, and the Statement of Working Capital shall become final on\nthe date Newco provides such notice.  If Newco has any objections to the\nStatement of Working Capital delivered by Seller, it will deliver a statement\ndescribing its objections to the calculation of any item on the Statement of\nWorking Capital to Seller within 30 days after receiving such Statement of\nWorking Capital.  Newco's failure to deliver a written statement of objections\nwithin 30 days after its receipt of the Statement of Working Capital shall\nconstitute Newco's acceptance of the Statement of Working Capital, in which\nevent, the Statement of Working Capital shall become final on such 30th day\nafter Newco's receipt of the Statement of Working Capital.  Newco, and its\nindependent certified public accountants, Ernst &amp; Young LLP shall, during the\nperiod between the delivery by Seller of the Statement of Working Capital and\nthe final resolution of any dispute relating thereto, be permitted to have\naccess to, examine and make copies of all books and records (including but not\nlimited to correspondence, memoranda, books of account and the like) in the\npossession of Seller relating to the sale of assets and, upon execution of the\nstandard form indemnity letter of Deloitte &amp; Touche LLP, be permitted to review\nthe working papers of Deloitte &amp; Touche LLP relating to such Statement of\nWorking Capital and shall have such access to Seller and its personnel as may\nbe reasonably necessary to permit Ernst &amp; Young LLP to review in detail the\nmanner in which such Statement of Working Capital was prepared.  Seller and\nDeloitte &amp; Touche LLP shall cooperate with Newco and Ernst &amp; Young LLP in\nfacilitating such review.  If any matter cannot be resolved by the parties\nwithin 15 days following delivery of Newco's notice of objection, the San\nFrancisco office of KPMG Peat Marwick LLP (or if such office of KPMG Peat\nMarwick LLP is unavailable for any reason, the San Francisco office of Price\nWaterhouse Coopers LLP) (in each case, the \"Independent Auditors\") will be\nretained to resolve all remaining objections.  Any determination shall be made\nby the Independent Auditors on the basis of such procedures as it, in its sole\njudgment, deems appropriate and expeditious, taking into account the nature of\nthe issues, the amount in dispute and the positions asserted by the parties.\nThe Independent Auditors shall not be required to follow any particular rules\nor procedures (except as provided in this Agreement and except that the\nIndependent Auditors shall be bound by the provisions of this Section 2.09 and\nthe defined accounting terms and other terms set forth in this Agreement),\nit being the intention of the parties to create a flexible, practical and\nexpeditious method for resolving any disagreement hereunder.  The parties may\nsubmit to such firm any facts or materials which they deem relevant to the\ndetermination.  The determination of the Independent Auditors will be set forth\nin writing and will be conclusive, nonappealable and binding upon the parties\nhereto for all purposes (if prepared in accordance with this Section 2.09).\n\n                 (c)  The parties shall pay the fees and expenses of their\nrespective internal and independent accountants and personnel incurred pursuant\nto this Section 2.09.  In the event the parties submit any unresolved\nobjections to the Independent Auditors for resolution as provided in Section\n2.09(b) above, Newco, on the one hand, and Seller, on the other hand, shall\neach bear equal responsibility for the fees and expenses of the Independent\nAuditors.\n\n          2.10.  Adjustments Resulting From The Statement of Working Capital.\n                 -----------------------------------------------------------\nThe Cash Component described in Section 2.06 will be adjusted as follows:\n\n                 (a)  If the Working Capital of Seller measured as of the\nClosing Date, as finally determined pursuant to Section 2.09, exceeds the\nWorking Capital as set forth in the Preliminary Statement of Working Capital,\nNewco will pay to Seller an amount equal to such excess, together with interest\non the amount of such payment from the Closing Date until the date of such\npayment at a floating rate of interest equal to the Reference Rate, by wire\ntransfer or delivery of other immediately available funds within five business\ndays after the date on which the Working Capital of Seller as reflected on the\nStatement of Working Capital is finally determined pursuant to Section 2.09\nabove; and\n\n                 (b)  If the Working Capital of Seller measured as of the\nClosing Date, as finally determined pursuant to Section 2.09, is less than the\nWorking Capital as set forth in the Preliminary Statement of Working Capital,\nSeller will pay to Newco an amount equal to such deficiency, together with\ninterest on the amount of such payment from the Closing Date until the date of\nsuch payment at a floating rate of interest equal to the Reference Rate, by\nwire transfer or delivery of other immediately available funds within five\nbusiness days after the date on which the Working Capital of Seller as\nreflected on the Statement of Working Capital finally is determined pursuant to\nSection 2.09 above.\n\n                                  ARTICLE III\n\n                    REPRESENTATIONS AND WARRANTIES OF SELLER\n\n          Seller represents and warrants to Newco, and with respect to\nSections 3.01 through 3.04 only, the Shareholders represent and warrant to\nNewco as follows:\n\n          3.01.  Corporate Existence and Power.\n                 -----------------------------\n\n                 (a)  Seller is a corporation duly organized, validly existing\nand in good standing under the laws of the state of its incorporation, and has\nall requisite power and all governmental licenses, authorizations, consents and\napprovals required to carry on the Business of Seller as now conducted and to\nown and operate the Transferred Assets as now owned and operated.  Seller is\nduly qualified to do business as a foreign corporation in each jurisdiction\nwhere the character of the property owned or leased by it or the nature of its\nactivities makes such qualification necessary to carry on the Business as now\nconducted, except for those jurisdictions where the failure to be so qualified\nhas not had, and would not reasonably be expected to have, a Material Adverse\nEffect.\n\n                 (b)  The Company does not, directly or indirectly, (a) have\nany Subsidiaries or (b) own or hold beneficially or of record any shares of\ncapital stock, equity interests or any other securities of any other entity.\n\n          3.02.  Authorization.  The execution, delivery and performance by\n                 -------------\nSeller of this Agreement and the consummation by Seller of the transactions\ncontemplated hereby are within Seller's corporate powers and have been duly\nauthorized by all necessary action on the part of Seller.  This Agreement has\nbeen duly and validly executed by Seller and constitutes the legal, valid and\nbinding agreement of Seller, enforceable against it in accordance with its\nterms, except as may be limited by applicable bankruptcy, insolvency,\nreorganization, moratorium or similar laws affecting creditors' rights\ngenerally and subject to general principles of equity.\n\n          3.03.  Governmental Authorization.  The execution, delivery and\n                 --------------------------\nperformance by Seller of this Agreement require no action by, consent or\napproval of, or filing with, any Governmental Authority other than\n(a) compliance with any applicable requirements of the HSR Act and Federal and\nstate securities laws or (b) any actions, consents, approvals or filings\notherwise expressly referred to in this Agreement.  To the knowledge of Seller,\nthere are no facts relating to the identity or circumstances of Seller that\nwould prevent or materially delay obtaining any of the Required Consents.\n\n          3.04. Non-Contravention.  The execution, delivery and performance by\n                -----------------\nSeller of this Agreement do not and will not (a) contravene or conflict with\nthe certificate of incorporation or bylaws of Seller, a true and correct copy\nof which has been delivered to Newco by Seller; (b) assuming receipt of the\nRequired Consents, contravene or conflict with or constitute a violation of any\nprovision of any Applicable Law binding upon or applicable to Seller, the\nBusiness or any of the Transferred Assets; (c) except as set forth on Schedule\n                                                                      --------\n3.04(c), constitute a default under or give rise to any right of\n-------\ntermination, cancellation or acceleration of, or to a loss of any benefit to\nwhich Seller is entitled under, any Scheduled Contract, any  Subsequent\nMaterial Contract or any Permit or similar authorization relating to the\nBusiness or included in any of the Transferred Assets or by which the Business\nor any of the Transferred Assets may be bound; or (d) result in the creation or\nimposition of any Lien on any Transferred Assets, other than Permitted Liens;\nexcept, with respect to clauses (b) and (d), where the violation or Lien would\nnot have a Material Adverse Effect.\n\n          3.05.  Financial Statements; Undisclosed Liabilities.\n                 ---------------------------------------------\n\n                 (a)  Seller has heretofore delivered to Newco or its\nAffiliates true and complete copies of the consolidated balance sheet and\nrelated statement of operations and retained earnings and of cash flows for\nSeller as of and for the years ended December 31, 1995, 1996 and 1997, in each\ncase audited by Deloitte &amp; Touche LLP (the \"Financial Statements\").  The\nDecember 31, 1997 balance sheet is referred to herein as the \"Seller Balance\nSheet\".\n\n                 (b)  Each of the Financial Statements (i) has been prepared\nbased on the books and records of Seller in accordance with GAAP and Seller's\nnormal accounting practices, consistent with past practice, and present fairly\nin all material respects the consolidated financial condition, results of\noperations and statements of cash flow of Seller as of the dates indicated or\nfor the periods indicated; and (ii) contains and reflects all necessary adjust-\nments, accruals, provisions and allowances for a fair presentation in all\nmaterial respects of the combined financial condition and the combined results\nof operations of Seller for the periods covered by such financial statement;\nprovided, however, that Newco acknowledges that, prior to the filing or\ndistribution of any public or private equity or debt offering document which\nincludes historical financial statements of the Seller for any period ended or\nending at or prior to December 31, 1998 (\"Historical Financial Statements\"),\nthe Seller may, upon the advice of its independent accountants, Delloite &amp; Touche, revise and reissue, or cooperate in the revision and reissuance of,\nany such Historical Financial Statements to make appropriate revisions to\ncomply with Regulation S-X and to modify the footnote description of Other\nAssets, provided that such changes do not change the amounts recorded in the\nBalance Sheets, Statements of Operations, or Statements of Cash Flows and that\nsuch changes do not change the amortization lives assigned to assets.  The\nSeller further agrees to work with Deloitte &amp; Touche to obtain from that firm\nunqualified audit opinions on such revised and reissued Historical Financial\nStatements and to obtain the agreement of such firm to consent to the inclusion\nof their unqualified opinions on the revised and reissued Historical Financial\nStatements in any filings with the United States Securities and Exchange\nCommission or other body in connection with which such consents are required.\n\n                 (c)  Except as set forth on Schedule 3.05(c), there are no\n                                             ----------------\nmaterial Liabilities of Seller required by GAAP to be included on a balance\nsheet or the notes thereto other than:  (i) any Liability accrued as a\nLiability on Seller Balance Sheet; (ii) Liabilities specifically disclosed and\nidentified as such in the schedules to this Agreement; (iii) Liabilities\nincurred since the date of the Seller Balance Sheet in the ordinary course of\nbusiness and (iv) Liabilities that do not, and will not, individually or in the\naggregate, have a Material Adverse Effect.\n\n          3.06.  Absence of Certain Changes.  Except as set forth on\n                 --------------------------\nSchedule 3.06, between the date of the Seller Balance Sheet and the date of\n-------------\nexecution of this Agreement, (a) the Business has been conducted\nin the ordinary course consistent with past custom and practice, (b) there has\nnot been any event, occurrence, development or state of circumstances or facts\nor change in the Transferred Assets or the Business (including any damage,\ndestruction or other casualty loss, but excluding any event, occurrence,\ndevelopment or state of circumstances or facts or change resulting from changes\nin general economic conditions) affecting the Business or any Transferred\nAssets that has had or that may be reasonably expected to have, either alone or\ntogether with all such events, occurrences, developments, states of\ncircumstances or facts or changes, a Material Adverse Effect, (c) there has not\nbeen any material change by Seller in its accounting principles, methods or\npractices or in the manner in which it keeps its books and records or any\nmaterial change by Seller of its current practices with regards to inventory,\nsales, receivables, payables or accrued expenses which would affect the timing\nof collection of receivables or the payment of payables (provided, however,\nthat Newco acknowledges that, prior to the filing or distribution of any public\nor private equity or debt offering document which includes Historical Financial\nStatements, the Seller may, upon the advice of its independent accountants,\nDeloitte &amp; Touche, revise and reissue, or cooperate in the revision and\nreissuance of, any such Historical Financial Statements to make appropriate\nrevisions to comply with Regulation S-X and to modify the footnote description\nof Other Assets, provided that such changes do not change the amounts recorded\nin the Balance Sheets, Statements of Operations, or Statements of Cash Flows\nand that such changes do not change the amortization lives assigned to assets)\nand (d) Seller has not taken any of the actions set forth in or required to be\ndisclosed pursuant to Section 5.01(b).\n\n          3.07.  Properties; Leases; Tangible Assets.\n                 -----------------------------------\n\n                 (a)  Seller has a good, valid title to or, in the case of the\nLeased Real Properties (as defined below) or properties held under license, a\ngood and valid leasehold or license interest in, all of its properties,\nincluding all such properties (real, personal or mixed, tangible or intangible\n(including the Intellectual Property Rights)) reflected in the Seller Balance\nSheet, except those properties disposed of in the ordinary course of business\nafter the date thereof.  Disclosed on Schedule 3.07(a) is the address and legal\n                                      ----------------\ndescription of each parcel of real property (other than real property that is\nan Excluded Asset) owned by Seller.  Except as disclosed in Schedule 3.07(a),\n                                                            ----------------\nSeller holds title to each such property and asset free and clear of all Liens,\nadverse claims, easements, rights of way, servitudes, or any other rights of\nothers or other adverse interests of any kind, including leases, chattel\nmortgages, conditional sales contracts, collateral security arrangements and\nother title or interest retention arrangements (collectively, \"Encumbrances\"),\nexcept Permitted Liens.\n\n                 (b)  Except as set forth on Schedule 3.07(b), all tangible\n                                             ----------------\nproperties and assets (other than inventory) included in the Transferred Assets\nare in all material respects structurally sound and are in good operating\ncondition and repair (other than normal wear and tear) and are adequate for the\nuses to which they are put.\n\n                 (c)  Schedule 3.07(c) sets forth all personal property leases\n                      ----------------\nto which Seller is a party or by which either Seller is bound involving annual\nlease payments of in excess of $1,600,000 and all real property leases (such\nSchedule 3.07(c) describing separately those leases relating to real property\n----------------\n(the \"Leased Real Property\") and indicating where appropriate those leases that\nhave been recorded for tax, protection of title or interest, or other purposes)\nentered into by Seller (collectively, the \"Leases\").  With respect to the\nLeases, except as disclosed in Schedule 3.07(c), there exists no default by\n                               ----------------\nSeller or, to the knowledge of Seller, any default beyond any applicable grace,\ncure or notice periods by any third party thereunder, except for defaults which\ncould not, individually or in the aggregate, have a Material Adverse Effect.\nExcept as disclosed in Schedule 3.07(c), each Lease is a legal, valid\n                       ----------------\nand binding obligation of Seller, and, to the best knowledge of Seller, each\nother party thereto, enforceable against each such party thereto in accordance\nwith its terms, except as may be limited by applicable bankruptcy, insolvency,\nreorganization, moratorium or similar laws affecting creditors' rights\ngenerally and subject to general principles of equity.  Assuming that the\nnecessary Required Contractual Consents (as defined in Section 3.11(b)) are\nobtained, the transfer of the Transferred Assets contemplated by this Agreement\nwill not result in any default, penalty or modification to any Lease, except\nfor defaults, penalties or modifications that would not, individually or in the\naggregate, have a Material Adverse Effect.\n\n          3.08.  Sufficiency of and Title to the Transferred Assets.  Upon\n                 --------------------------------------------------\nconsummation of the transactions contemplated by this Agreement, Seller will\nhave sold, assigned, transferred and conveyed to Newco all of the Transferred\nAssets, free and clear of all Liens (other than Permitted Liens securing\nAssumed Liabilities).  The Transferred Assets include all of the assets and\nproperties of Seller (other than the Excluded Assets) used or employed by\nSeller in the ordinary course of operating the Business consistent with past\npractice as of the date of and as reflected on the Seller Balance Sheet and\nwill include all of the assets and properties of Seller (other than the\nExcluded Assets) used or employed by Seller in the ordinary course of operating\nthe Business consistent with past practice as of the Closing Date.  Except as\ndisclosed on Schedule 3.08, there are no facilities, assets or properties\n             -------------\nincluded within the Transferred Assets that are used by any Person for purposes\nother than the operation of the Business.\n\n          3.09.  Litigation.  Except as disclosed in Schedule 3.09, (i) there\n                 ----------                          -------------\nare no actions, suits, hearings, arbitrations, proceedings (public or private)\nor, to the knowledge of Seller, governmental investigations, that have been\nbrought by or against any Governmental Authority or any other Person\n(collectively, \"Proceedings\") pending or, to the knowledge of Seller,\nthreatened, against Seller, the Business or any of the Transferred\nAssets, which, if adversely determined, could have a Material Adverse Effect or\nwhich seek to enjoin or rescind the transactions contemplated by this Agreement\nor otherwise seek to prevent Seller from complying with the terms and\nprovisions of this Agreement; and (ii) to the knowledge of Seller, there are no\nexisting orders, judgments or decrees of any Governmental Authority directly\naffecting any of the Transferred Assets or the Business.\n\n          3.10.  Contracts.\n                 ---------\n\n                 (a)  Schedule 3.10(a) sets forth a complete list of all\n                      ----------------\nexisting Contracts of Seller that are material to Seller, including without\nlimitation the following (collectively with the Leases and the Employment\nAgreements, the \"Scheduled Contracts\"):\n\n                      (i)    each Contract between Seller and (A) each present\n     or former director, officer or other member of management or other\n     personnel of Seller, the dollar volume of which exceeds $50,000 on an\n     annual basis, (B) any supplier of services or products to the Business\n     whose dollar volume of sales to Seller exceeded in 1997, and (C) any\n     Person in which the aggregate payments made to Seller under such Contract\n     exceeded in 1997 $50,000 (excluding for the purposes of clauses (B) and\n     (C) purchase orders or sales orders entered into in the ordinary course of\n     business);\n\n                      (ii)   each other agreement or arrangement of Seller that\n     requires the payment or incurrence of Liabilities, or the rendering of\n     services, by Seller, subsequent to the date of this Agreement, of more\n     than $100,000;\n\n                      (iii)  all Contracts relating to, and evidences of or\n     guarantees of, or providing security for, the deferred purchase price of\n     property (whether incurred, assumed, guaranteed or secured by any asset)\n     the purchase price of which exceeds $100,000;\n\n                      (iv)   all material partnership, joint venture or other\n     similar Contracts, arrangements or agreements;\n\n                      (v)    all material license, sale, distribution,\n     commission, marketing, agent, franchise, technical assistance or similar\n     agreements relating to or providing for the marketing and\/or sale of the\n     products or services to which Seller is a party or by which Seller is\n     otherwise bound;\n\n                      (vi)   each Contract and other agreement with any labor\n     union or association representing any employee;\n\n                      (vii)  each Contract and other agreement for the sale of\n     any of its assets or properties or for the grant to any Person of any\n     preferential rights to purchase any of its assets or properties, in each\n     case in an amount exceeding $100,000;\n\n                      (viii) all take or pay or requirements Contracts or\n     agreements or any other Contracts or agreements requiring the Seller to\n     pay regardless of whether products or services are received;\n\n                      (ix)   each Contract and other agreement containing\n     covenants pertaining to the right to compete or not compete in any line of\n     business or similarly restricting the ability to conduct business with any\n     Person or in any geographical area;\n\n                      (x)    each Contract and other agreement relating to the\n     acquisition by the Seller of any operating business or the capital stock\n     of any other Person; and\n\n                      (xi)   all mortgages, indentures, notes, bonds, letters\n     of credit and other agreements relating to the borrowing of money,\n     creation of Liens, any indemnity, or the guarantee of the payment of\n     liabilities or performance of obligations to or by the Seller, to or by\n     any other Person;\n\nprovided, however, that the following Contracts shall not be required to be\ndisclosed on Schedule 3.10(a):  (A) Contracts with third parties providing\n             ----------------\ngoods or services to Seller which (1) are by their terms terminable by Seller\nwithout penalties upon ninety (90) days' notice or less or (2) have remaining\nannual payments thereunder of less than $50,000, (B) Contracts with customers\nwhich provide for (1) monthly payments of less than $10,000 and (2) annual\nprice adjustments of not more than the amount of the annual adjustment of the\nConsumer Price Index and (3) a remaining term of not more than twenty-four (24)\nmonths or (C) purchase orders or sales orders entered into in the ordinary\ncourse of business.\n\n                 (b)  Seller has made true and correct copies of all such\nScheduled Contracts available to Newco.  With respect to the Scheduled\nContracts, there exists no material default by Seller or, to the knowledge of\nSeller, any material default or threatened material default by any third party\nthereunder, that has affected or could reasonably be expected to affect\nmaterially and adversely the rights and privileges thereunder of Seller that is\na party to the Scheduled Contract or result in any material Liability of\nSeller.  Except as disclosed in Schedule 3.10(b), each Scheduled Contract is a\n                                ----------------\nlegal, valid and binding obligation of Seller, and to the knowledge of Seller,\neach other party thereto, and is enforceable against each such party thereto in\naccordance with its terms, except as may be limited by applicable bankruptcy,\ninsolvency, reorganization, moratorium or similar laws affecting creditors'\nrights generally and subject to general principles of equity.  Except as\nprovided in Schedule 3.10(b), assuming that the necessary Required Contractual\n            ----------------\nConsents are obtained, the transfer of the Transferred Assets contemplated by\nthis Agreement will not result in any default, penalty or modification to any\nScheduled Contract, except for defaults, penalties or modifications that would\nnot, individually or in the aggregate, have a Material Adverse Effect.\n\n          3.11.  Permits; Required Consents.\n                 --------------------------\n\n                 (a)  Schedule 3.11(a) sets forth all approvals,\n                      ----------------\nauthorizations, certificates, consents, licenses, orders and permits or other\nsimilar authorizations of all Governmental Authorities (and all other Persons),\nother than those relating to Environmental Laws (which are the subject of\nSection 3.17), necessary under Applicable Law for the ownership or\noperation of the Transferred Assets or the Business in substantially the same\nmanner as operated on the date of the Seller Balance Sheet and the date hereof\nand as of the Closing Date (the \"Permits\") except for those the absence of\nwhich would not individually or in the aggregate have a Material Adverse\nEffect.\n\n                 (b)  Schedule 3.11(b) lists (i) each governmental or other\n                      ----------------\nregistration, filing, application, notice, transfer, consent, approval, order,\nqualification and waiver (each, a \"Required Governmental Approval\"), other than\nthose relating to Environmental Laws (which are the subject of Section 3.17),\nrequired under Applicable Law to be obtained by Seller by virtue of the\nexecution and delivery of this Agreement or the consummation of the trans-\nactions contemplated hereby to avoid the loss of any material Permit, and\n(ii) each Scheduled Contract with respect to which the consent of the other\nparty or parties thereto must be obtained by Seller by virtue of the execution\nand delivery of this Agreement or the consummation of the transactions\ncontemplated hereby to avoid the invalidity of the transfer of such Scheduled\nContract, the termination thereof or a material breach or default or\nacceleration thereunder (each, a \"Required Contractual Consent\" and\ncollectively with the Required Governmental Approvals, the \"Required\nConsents\").  Except as set forth in Schedule 3.11(b), to the knowledge of\n                                    ----------------\nSeller, each Permit is valid and in full force and effect in all material\nrespects and, assuming the related Required Consents have been obtained prior\nto the Closing Date, are or will be transferable by Seller, and assuming the\nrelated Required Consents have been obtained prior to the Closing Date, none of\nthe Permits will be terminated or become terminable or impaired in any material\nrespect as a result of the transactions contemplated hereby.\n\n          3.12.  Compliance with Applicable Laws.  Except as set forth in\n                 -------------------------------\nSchedule 3.12, and except for violations or infringements of Applicable Law\n-------------\nthat do not individually or in the aggregate have a Material Adverse Effect,\nSeller is currently in compliance with, and the operation of the Business and\ncondition of the Transferred Assets during the past two (2) years have not\nviolated or infringed, any Applicable Law; provided, however, that this\nSection 3.12 shall not be deemed to address compliance with Environmental Laws,\nwhich are the subject of Section 3.17.\n\n          3.13.  Employment Agreements; Change in Control; and Employee\n                 ------------------------------------------------------\nBenefits.\n--------\n\n                 (a)  Except as set forth on Schedule 3.13(a), there are no\n                                             ----------------\nemployment, consulting, severance pay, continuation pay, termination pay or\nindemnification agreements or other similar agreements (collectively,\n\"Employment Agreements\") between Seller, on the one hand, and any current or\nformer stockholder, officer, director, employee or Affiliate of Seller or any\nof its respective Affiliates or any consultant or agent of Seller, on the other\nhand, that are currently in effect.  Except as set forth on Schedule 3.13(a),\n                                                            ----------------\nthere are no Employment Agreements or any other similar agreements to which\nSeller is a party under which the transactions contemplated by this Agreement\n(i) will require any payment by Seller, or any consent or waiver from any\nstockholder, officer, director, employee or Affiliate of Seller or any of their\nrespective Affiliates or any consultant or agent of Seller or (ii) will result\nin any material adverse change in the nature of any rights of any stockholder,\nofficer, director, employee or Affiliate of Seller or any of their respective\nAffiliates or any consultant or agent of Seller under any such Employment\nAgreement or other similar agreement.\n\n                 (b)  Schedule 3.13(b) sets forth all Benefit Plans of Seller.\nSeller has made true and correct copies of all governing instruments and\nrelated agreements pertaining to such Benefit Plans available to Newco.\n\n                 (c)  With respect to any Employee Pension Benefit Plan\nmaintained by Seller or any of its ERISA Affiliates, there have within the last\ntwo years been no reportable events under ERISA Section 4043 with respect to\nwhich the 30 day reporting requirement has not been waived and no such plan has\nbeen terminated or is reasonably expected to be terminated under ERISA Section\n4041(c) or 4042 and, with respect to any Employee Pension Benefit Plan assumed\nby Newco in accordance with Section 7.04(a), there is no liability under\nTitle IV of ERISA other than for premiums due in the future to the PBGC.\n\n                 (d)  Neither Seller nor any of its ERISA Affiliates has within\nthe last two years incurred or reasonably expects to incur any withdrawal\nliability to any Multiemployer Plan which is a pension plan within the meaning\nof ERISA Section 3(2).\n\n                 (e)  Except pursuant to the Benefit Plans listed in\nSchedule 3.13(e), no individual shall accrue or receive additional benefits,\n----------------\nservice or accelerated rights to payments of benefits under any Benefit Plan,\nincluding the right to receive any parachute payment, as defined in Section\n280G of the Code, or become entitled to severance, termination allowance or\nsimilar payments as a direct result of the transactions contemplated by this\nAgreement.\n\n                 (f)  No Employee Benefit Plan has participated in, engaged in\nor been a party to any non-exempt Prohibited Transaction, and Seller nor any of\nSeller's Affiliates or ERISA Affiliates has had asserted against it any claim\nfor taxes under Chapter 43 of Subtitle A of the Code and Section 5000 of the\nCode, or for penalties under ERISA Section 502(c), (i) or (l), with respect to\nany Employee Benefit Plan nor, to the knowledge of Seller, is there a material\nbasis for any such claim.  No officer, director or employee of Seller has\ncommitted a material breach of any responsibility or obligation imposed upon\nfiduciaries by Title I of ERISA with respect to any Employee Benefit Plan.\n\n                 (g)  Except as set forth in Schedule 3.13(g), other than\n                                             ----------------\nroutine claims for benefits, there is no claim pending, or to the knowledge of\nSeller, threatened, involving any Benefit Plan by any Person against such\nBenefit Plan, Seller or its Affiliates and ERISA Affiliates.  There is no\npending, or to the knowledge of Seller, threatened, proceeding involving any\nEmployee Benefit Plan before the IRS, the United States Department of Labor or\nany other Governmental Authority.\n\n                 (h)  There is no material violation of any reporting or\ndisclosure requirement imposed by ERISA or the Code with respect to any Benefit\nPlan.\n\n                 (i)  Each Benefit Plan has at all times prior hereto been\nmaintained in all material respects, by its terms and in operation, in\naccordance with ERISA, the Code, and any other applicable law.  Each Employee\nBenefit Plan which is intended to be a \"qualified plan\" under Code\nSection 401(a) has received a favorable determination letter from the Internal\nRevenue Service that it is qualified and Seller is not aware of any facts or\ncircumstances which could result in any Employee Benefit Plan losing its\nqualified status.  Seller, its Affiliates and ERISA Affiliates have made full\nand timely payment of all amounts required to be contributed under the terms of\neach Benefit Plan and Applicable Law or required to be paid as expenses under\nsuch Benefit Plan, and Seller and its Affiliates and ERISA Affiliates shall\ncontinue to do so through the Closing.\n\n                 (j)  With respect to any Group Health Plans maintained by\nSeller or Seller's Affiliates or ERISA Affiliates, whether or not for the\nbenefit of the employees of Seller, its Affiliates or its ERISA Affiliates,\nSeller and, to its knowledge its Affiliates and ERISA Affiliates, have\ncomplied in all material respects with the provisions of Part 6 of Title I of\nERISA and 4980B of the Code and with the provisions of the Health Insurance\nPortability and Accountability Act of 1996 (\"HIPAA\").  Except as set forth in\nSchedule 3.13(j), neither Seller nor any of Seller's Affiliates or ERISA\n         -------\nAffiliates is obligated to provide health care benefits of any kind to its\nretired employees pursuant to any Employee Benefit Plan, including without\nlimitation any Group Health Plan, or pursuant to any agreement\nor understanding, other than as required by applicable law.  The Accumulated\nPostretirement Benefit Obligation, within the meaning of FAS 106, for the\npostretirement benefits set forth on Schedule 3.13(j) does not exceed\n$28 million as reported in the Valuation of Postretirement Benefits Other Than\nPensions as of January 1, 1998, and based on the assumptions included therein.\n\n                 (k)  Seller has made available to Newco a copy of (i) the most\nrecently filed Federal Form 5500 series and accountant's opinion, if\napplicable, for each Employee Benefit Plan, (ii) the most recent IRS\ndetermination letter obtained with respect to each Benefit Plan intended to be\nqualified under Section 401(a) of the Code or exempt under Section 501(a) of\nthe Code, and (iii) the most recently prepared financial statements of each\nBenefit Plan.\n\n                 (l)  The actual cost of all liabilities known by Seller as of\nthe date hereof with respect to workers compensation claims of employees\nincurred prior to the Closing Date will not exceed the amounts reserved\ntherefor on the Seller Balance Sheet.\n\n          3.14.  Labor and Employment Matters.\n                 ----------------------------\n\n                 (a)  Except as set forth on Schedule 3.14(a), as of the date\n                                             ----------------\nof this Agreement, no collective bargaining agreement exists that is binding\non Seller and, except as described on Schedule 3.14(a), no petition has been\n                                      ----------------\nfiled or proceedings instituted by an employee or group of employees of Seller\nwith any labor relations board seeking recognition of a bargaining\nrepresentative at any time subsequent to January 1, 1997.  Schedule 3.14(a)\n                                                           ----------------\ndescribes each organizational effort currently being made or threatened by or\non behalf of any labor union to organize any employees of Seller.\n\n                 (b)  Except as set forth on Schedule 3.14(b), as of the date\n                                             ----------------\nof this Agreement, (i) there is no labor strike, slow down or stoppage pending\nor, to the knowledge of Seller, threatened, against or directly affecting\nSeller; (ii) no grievance or arbitration proceeding arising out of or under any\ncollective bargaining agreement of Seller is pending and (iii) neither Seller\nnor any Affiliate of Seller has received any notice or has any knowledge of any\nthreatened labor or employment dispute, controversy or grievance or any other\nunfair labor practice proceeding or breach of contract claim or action with\nrespect to claims of, or obligations to, any employee or group of employees of\nSeller.  During the two years preceding the date of this Agreement, all notices\nto employees required under any law or collective bargaining agreement have\nbeen given, and all bargaining obligations with any employee representative\nhave been satisfied in all material respects.  During the two years preceding\nthe date of this Agreement, Seller has not implemented any plant closing or\nmass layoff of employees as those terms are defined in the Worker Adjustment\nRetraining and Notification (\"WARN\") Act, as amended, or any similar state or\nlocal law or regulation, and no layoffs that could implicate such laws or\nregulations will be implemented prior to the Closing without advance\nnotification to Newco.\n\n          3.15.  Intellectual Property.\n                 ---------------------\n\n                 (a)  Schedule 3.15(a) sets forth a complete and correct list\n                      ----------------\nof each patent, patent application and docketed invention, chip design, mask\nwork, registration, application for registration and material unregistered,\ntrademark, trade name, copyright, servicemark, brand mark or brand name\nincluded among the Intellectual Property Rights and each material license or\nlicensing agreement for any of the Intellectual Property Rights held by Seller.\n\n                 (b)  Except as disclosed in Schedule 3.15(b), Seller is not\n                                            ----------------\nand has not, during the three years preceding the date of this Agreement, been\na party to any Proceeding, nor to the knowledge of Seller is any Proceeding\nthreatened, as to which there is a reasonable likelihood of a determination\nmaterially adverse to Seller that involved or may involve a claim of mis-\nappropriation or infringement made by any Person (including any Governmental\nAuthority) against Seller or any claim contesting the validity, enforceability,\nuse or ownership of any of the Intellectual Property Rights.  Except as\ndisclosed in Schedule 3.15(b), no Intellectual Property Right is subject to\n             ----------------\nany outstanding order, judgment, decree, stipulation or agreement restricting\nthe use thereof by Seller, or restricting the licensing thereof by Seller to\nany Person.  To the knowledge of Seller, the use of such Intellectual Property\nRights and the operation of the Business as currently operated does not\nconflict with, infringe upon or violate any patent, patent application,\ndocketed invention, trademark, trade name, trademark or trade name registration\nor application, copyright, copyright registration or application for copyright\nregistration, service mark, brand or brand name or any pending application\nrelating thereto, or any trade secret, know-how, programs or processes, license\nor licensing arrangement for any of the foregoing or any similar rights, of any\nPerson except where such infringement or violation would not have a Material\nAdverse Effect.\n\n                 (c)  Except as set forth in Schedule 3.15(c), Seller either\n                                             ----------------\nowns the entire right, title and interest in, to and under, free and clear of\nany Liens (other than Permitted Liens), or has a lawful right to use the\nIntellectual Property Rights, and the Intellectual Property Rights comprise all\nthe inventions, processes, computer programs, know-how, formulae, trade\nsecrets, patents, chip designs, mask works, trademarks, service marks, trade\nnames, brand names, copyrights and other intellectual property rights which are\nnecessary for the conduct of the Business by Seller in the manner that such\nBusiness has heretofore been conducted except where the absence of rights would\nnot have a Material Adverse Effect.\n\n                 (d)  Except as set forth in Schedule 3.15(d), the Seller has\n                                             ----------------\nno knowledge that, during the past two years, any Person has infringed or\nmisappropriated any of the Intellectual Property Rights.\n\n                 (e)  Seller is not aware of any facts which would lead it to\nbelieve that it will incur costs or expenses relating to or arising from the\ninability of Seller's computer systems or software to appropriately interpret\ndates in the twenty first century, except for any of the foregoing which would\nnot, individually or in the aggregate, have a Material Adverse Effect.\n\n          3.16.  Advisory Fees.  Except for Goldman, Sachs &amp; Co., PaineWebber\n                 -------------\nIncorporated and Cybus Capital Markets, there is no investment banker, broker,\nfinder or other intermediary orfinancial advisor that has been retained by or\nis authorized to act on behalf of Seller who might be entitled to any fee,\ncommission or reimbursement of expenses from Newco or any of its Affiliates\nupon consummation of the transactions contemplated by this Agreement.\n\n          3.17.  Environmental Compliance.\n                 ------------------------\n\n                 (a)  Except as disclosed in Schedule 3.17(a) and except where\n                                             ----------------\nthe failure to obtain approvals would not have a Material Adverse Effect,\nSeller has obtained all approvals, authorizations, certificates, consents,\nlicenses, orders and permits or other similar authorizations of all\nGovernmental Authorities, or from any other Person, that are required under any\nEnvironmental Law for the ownership or operation of the Transferred Assets or\nthe Business.\n\n                 (b)  Except as disclosed in Schedule 3.17(b) and except where\n                                             ----------------\nnon-compliance would not have a Material Adverse Effect, for periods following\nthe acquisition of all of the outstanding capital stock of Seller by the\nShareholders, Seller has complied with and is in compliance with all\nEnvironmental Laws and all terms and conditions of all approvals,\nauthorizations, certificates, consents, licenses, orders and permits or other\nsimilar authorizations of all Governmental Authorities (and all other Persons)\nrequired under all Environmental Laws for the ownership and operation of the\nBusiness or that relate to the Transferred Assets, and is also in compliance\nwith all other limitations, restrictions, conditions, standards, requirements,\nschedules and timetables required or imposed under all Environmental Laws.\n\n                 (c)  Except as described in Schedule 3.17(c), except for\n                                             ----------------\nmatters that have been fully settled and resolved and except for notices the\nsubject of which would not have a Material Adverse Effect, Seller has received\nno notice of violation of or liability (contingent or otherwise) under any\nEnvironmental Law arising out of past facts, events, conditions, circumstances,\nactivities, practices, incidents, actions, omissions or plans relating to or in\nany way affecting Seller, the Business or the Transferred Assets.\n\n                 (d)  Except as disclosed in Schedule 3.17(d), except for\n                                             ----------------\nmatters that have been fully settled and resolved and except for matters that\nwould not have a Material Adverse Effect, to Seller's knowledge, there are no\npast or present facts, events, conditions, circumstances, activities,\npractices, incidents, actions, omissions or plans relating to or in any way\naffecting Seller, any of its predecessors or Affiliates, the Business or the\nTransferred Assets that would interfere with or prevent continued compliance\nwith any Environmental Law by Newco after the Closing, or that would give rise\nto any Environmental Liability, or otherwise form the basis of any claim,\naction, demand, suit, Proceeding (as defined below), hearing, study or\ninvestigation (i) under any Environmental Law, (ii) based on or related to the\nmanufacture, processing, distribution, use, treatment, storage (including\nwithout limitation underground storage tanks), on-site or off-site disposal,\ntransport or handling, r the emission, discharge, release or threatened release\nof any Hazardous ubstance, or (iii) resulting from exposure to workplace\nhazards.\n\n          3.18.  Insurance.  Schedule 3.18 sets forth a complete and correct\n                 ---------   -------------\nlist of all known insurance policies currently in force with respect to the\nBusiness or relating to the Transferred Assets or Assumed Liabilities (the\n\"Insurance Policies\"), including all known \"occurrence based\" liability\npolicies regardless of the periods to which they relate.  Each\nInsurance Policy issued in the name of Seller and which covers only liabilities\narising with respect to the business of Seller is denoted by an asterisk (*) on\nSchedule 3.18 (the \"Seller Insurance Policies\").  The Seller Insurance Policies\nare valid and enforceable in accordance with their terms in all material\nrespects and are in full force and effect.  All of such Seller Insurance\nPolicies have been issued by insurance companies actively engaged in the\ninsurance business.  The Seller is not in material default with respect to any\nprovision contained in any such Seller Insurance Policy and has not failed to\ngive any notice or present any claim under any such Seller Insurance Policy in\ndue and timely fashion.  Except for claims disclosed on Schedule 3.18, there\n                                                        -------------\nare no outstanding unpaid claims under any Insurance Policy which have gone\nunpaid for more than forty-five (45) days or as to which the carrier has\ndisclaimed liability.  All known claims or circumstances likely to give rise to\nany claims, if any, against the Seller have been disclosed and tendered to the\nappropriate insurance companies and are being defended by such appropriate\ninsurance companies in accordance with the policy terms and limits.\n\n          3.19.  Tax Matters.\n                 -----------\n\n          Except as set forth on Schedule 3.19:\n                                 -------------\n\n                 (a)  Seller has no material liability for unpaid Taxes other\nthan Taxes that are not yet due and payable.  Seller has filed all material Tax\nReturns that it was required to file on or prior to the date hereof, and all\nsuch Tax Returns were correct and complete in all material respects when filed.\n\n                 (b)  There are no Liens for Taxes other than Liens for current\nTaxes not yet due and payable on the Transferred Assets or which are being\ncontested in good faith or any Liens for Taxes owed with respect to the\nExcluded Assets.\n\n                 (c)  All Taxes and other amounts that are required to be\ncollected or withheld by Seller prior to the date hereof have been duly\ncollected or withheld and all such amounts that are required to be remitted to\nany taxing authority have been duly remitted.\n\n                 (d)  None of the Transferred Assets is property that is\nrequired to be treated as owned by any other Person pursuant to the \"safe\nharbor lease\" provisions of former Section 168(f)(8) of the Internal Revenue\nCode of 1954 as amended and in effect immediately prior to the enactment of the\nTax Reform Act of 1986 and none of the Transferred Assets is \"tax exempt use\nproperty\" within the meaning of Section 168(h) of the Code.\n\n                 (e)  Seller currently is not the beneficiary of any extension\nof time within which to file any Tax Return, other than any combined,\nconsolidated, unitary or similar Tax Return in which Seller is includible.\nSeller has not waived any statute of limitations in respect of Taxes or agreed\nto any extension of time with respect to a Tax assessment or deficiency, other\nthan with respect to any Tax imposed in connection with a combined,\nconsolidated, unitary or similar Tax Return.\n\n                 (f)  There is no dispute or claim concerning any Tax liability\nof Seller, other than with respect to any Tax imposed in connection with a\ncombined, consolidated, unitary or similar Tax Return, either (i) claimed or\nraised by any authority in writing or (ii) as to which any of Seller's\ndirectors, officers or other employees responsible for Tax matters has\nknowledge.\n\n                 (g)  Seller has not filed a consent under Code S341(f)\nconcerning collapsible corporations.\n\n                 (h)  Seller is not a party to any Tax allocation or sharing\nagreement.\n\n                 (i)  MLM Corporation, a California corporation (\"MLM\"), prior\nto its merger with and into Seller, was not a member of an affiliated group\nfiling a consolidated federal income Tax Return (other than a group which\nincluded Seller) and had no liability for any Taxes of any Person (other than\nSeller) as a transferee or successor.\n\n                 (j)  All Taxes (other than income Taxes) incurred by Seller or\nMLM on or prior to December 31, 1997 that are required by GAAP to be included\non a balance sheet as of December 31, 1997 are reflected on the Seller Balance\nSheet; and all Taxes (other than income Taxes) incurred by Seller or MLM after\nDecember 31, 1997 and prior to the Closing Date that are required by GAAP to be\nincluded on a balance sheet as of the Closing Date will be reflected on the\nStatement of Working Capital.\n\n          3.20.  Investment Representations.\n                 --------------------------\n\n                 (a)  The Newco Exchangeable Preferred Stock, the Newco Junior\nPreferred Stock, the Newco Common Stock, the Newco Class B Common Stock and the\nNewco Note (collectively the \"Newco Securities\") will be acquired by Seller for\nits own account, not as a nominee or agent, and not with a view to or in\nconnection with the sale or distribution of any part thereof, other than as\ncontemplated by the Stock Sale Agreement or pursuant to a valid exemption from\nthe registration requirements of the Securities Act of 1933 (the \"Securities\nAct\").\n\n                 (b)  Seller understands that the Newco Securities will not be\nregistered under the Securities Act on the ground that the issuance of the\nNewco Securities provided for in this Agreement is exempt from registration\nunder of the Securities Act, and that the reliance of Newco on such exemption\nis predicated in part on Seller's representations set forth in this Agreement.\n\n                 (c)  Seller acknowledges that it is able to fend for itself in\nthe transactions contemplated by this Agreement and has the ability to bear the\neconomic risks of its investment pursuant to this Agreement.\n\n                 (d)  Seller understands that the Newco Securities being\npurchased hereunder are restricted securities within the meaning of Rule 144\nunder the Securities Act and that the Newco Securities are not registered and\nmust be held indefinitely unless they are subsequently registered or an\nexemption from such registration is available.\n\n                 (e)  It is understood that each certificate representing\n(a) the Newco Securities and (b) any other securities issued in respect of the\nNewco Securities upon any stock split, stock dividend, recapitalization, merger\nor similar event (unless no longer required in the opinion of counsel for\nNewco) shall be stamped or otherwise imprinted with a legend substantially in\nthe following form (in addition to any legend that may now or hereafter be\nrequired by applicable state law):\n\n     THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE\n     SECURITIES ACT OF 1933, AS AMENDED (THE \"ACT\"), OR UNDER THE\n     SECURITIES LAWS OF CERTAIN STATES.  THESE SECURITIES ARE SUBJECT TO\n     RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED\n     OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE\n     SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.\n     INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE\n     FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.\n     THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN\n     FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE ISSUER TO THE EFFECT\n     THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND\n     ANY APPLICABLE STATE SECURITIES LAWS.\n\n          The legend set forth above shall be removed by Newco from any\ncertificate evidencing the Newco Securities upon delivery to Newco of an\nopinion of counsel, reasonably satisfactory to Newco, that a registration\nstatement under the Securities Act is at that time in effect with respect to\nthe legended security or that such security can be freely transferred in a\npublic sale without such a registration statement being in effect and that such\ntransfer will not jeopardize the exemption or exemptions from registration\npursuant to which Newco issued the Newco Securities.\n\n          3.21.  Transactions with Affiliates.  Other than the HSTC Sugar\n                 ----------------------------\nContract and Intercompany Liabilities, except as set forth on Schedule 3.21,\n                                                              -------------\nno director, officer, Shareholder or Affiliate of the Seller or of such\ndirector, officer or Shareholder has, since the date of the Seller Balance\nSheet:  (a) borrowed money from or loaned money to the Seller which remains\noutstanding; (b) had any contractual or other claim, express or implied, of any\nkind whatsoever against the Seller; (c) owned any interest in any property or\nassets (tangible or intangible) used or useful by the Seller in the Business;\n(d) engaged in any other transaction with the Seller or (e) owned, directly or\nindirectly, any interest in (except not more than two percent (2%) stock-\nholdings for investment purposes in securities of publicly held and traded\ncompanies), or served as an officer, director, employee or consultant of or\notherwise receives remuneration from, any Person which is, or\nhas engaged in business as, a competitor, lessor, lessee, licensor, licensee,\ncustomer or supplier of the Seller.  Each contract set forth on Schedule 3.21\n                                                                -------------\nis on terms no less favorable to the Seller party thereto than would otherwise\nbe available in an arm's length transaction with an unaffiliated third party.\n\n          3.22.  Accounts Receivable and Inventory.  All accounts receivable\n                 ---------------------------------\nreflected on the Seller Balance Sheet, and all accounts receivable arising\nsubsequent to the date of the Seller Balance Sheet, have arisen from bona fide\nsales transactions in the ordinary course of business of the Seller, and to the\nknowledge of Seller, there exist no valid, material set-offs or counterclaims\nwith respect thereto except for those created in the ordinary course of\nbusiness.  All items included in the inventory of Seller are the property of\nthe Seller, free and clear of any Lien (other than Permitted Liens), and are\nnot held by the Seller on consignment from others.\n\n          3.23.  Substantial Customers and Suppliers.  Schedule 3.23 lists the\n                 -----------------------------------   -------------\nten (10) largest customers of the Seller, on the basis of revenues for goods\nsold or services provided for the most recently-completed fiscal year.\nSchedule 3.23 lists the five (5) largest suppliers of the Seller, on the basis\n-------------\nof cost of goods or services purchased for the most recently-completed fiscal\nyear.  Except as disclosed in Schedule 3.23, no such customer or supplier\n                              -------------\n(i) has ceased or materially reduced its purchases from, use of the services\nof, sales to or provision of services to the Seller since the Seller Balance\nSheet date, or (ii) to the knowledge of the Seller or any Shareholder,\nnotified the Seller in writing of its intent to cease or materially reduce such\npurchases, use, sales or provision of services after the date hereof.\n\n          3.24.  Disclosure.  Neither this Agreement, nor any Schedule or\n                 ----------\nExhibit to this Agreement, contains an untrue statement of material fact or\nomits to state a material fact necessary to make the statements contained\nherein or therein not misleading.  All information provided to Newco and its\nagents by the Seller and its Affiliates or agents is true and correct in all\nmaterial respects.\n\n                                   ARTICLE IV\n\n                    REPRESENTATIONS AND WARRANTIES OF NEWCO\n\n          Newco hereby represents and warrants to Seller and the Shareholders\nthat:\n\n          4.01.  Corporate Existence and Power.\n                 -----------------------------\n\n                 (a)  Newco is a corporation duly incorporated, validly\nexisting and in good standing under the laws of the State of Delaware, and has\nall corporate power to carry out its business as now conducted.  Newco is duly\nqualified to do business as a foreign corporation in each jurisdiction where\nthe character of the property owned or leased by it or the nature of its\nactivities makes such qualification necessary to carry on its business as now\nconducted, except for those jurisdictions where the failure to be so qualified\nhas not been, and may not reasonably be expected to be, material.\n\n                 (b)  Newco does not, directly or indirectly, (a) have any\nSubsidiariesor (b) own or hold beneficially or of record any shares of capital\nstock, equity interests or any other securities of any other entity.\n\n          4.02.  Corporate Authorization.  The execution, delivery and\n                 -----------------------\nperformance by Newco of this Agreement and the Related Agreements and the\nconsummation by Newco of the transactions contemplated hereby are within the\ncorporate powers of Newco and have been duly authorized by all necessary\ncorporate action on the part of Newco.  This Agreement has been, and the\nRelated Agreements as of the Closing Date will be, duly and validly executed\nby Newco and constitutes, or will constitute, as applicable, legal, valid and\nbinding agreements of Newco, enforceable in accordance with their terms, except\nas may be limited by applicable bankruptcy, insolvency, reorganization,\nmoratorium or similar laws affecting creditors' rights generally and subject to\ngeneral principles of equity.\n\n          4.03.  Capital Stock.\n                 -------------\n\n                 (a)  As of the date of this Agreement, the authorized capital\nstock of Newco consists of 1000 shares of Newco Common Stock.  As of the date\nof this Agreement, no shares of capital stock or other voting securities of\nNewco are issued or outstanding.  Except as set forth above or as otherwise\nrequired by this Agreement, as of the date of this Agreement, there are no\noutstanding securities, options, warrants, calls, stock appreciation rights,\nprofit sharing plans, phantom stock awards, rights, commitments, agreements,\narrangements or undertakings of any kind, to which Newco is a party or by which\nit is bound, obligating Newco to issue, deliver or sell, or cause to be issued,\ndelivered or sold, additional shares of capital stock or other voting\nsecurities of Newco, or obligating Newco to issue, grant, extend or enter into\nany such security, option, warrant, call, right, commitment, agreement,\narrangement or undertaking.\n\n                 (b)  The Newco Securities that are being issued by Newco\npursuant to this Agreement have been duly authorized for issuance to Seller\nand, when issued and delivered by Newco pursuant to this Agreement, will be\nvalidly issued, fully paid and nonassessable.  The issuance of Newco Securities\npursuant to the terms of this Agreement will not require registration and\/or\nqualification under the Securities Act or any state securities laws.  The Newco\nCommon Stock, Newco Class B Common Stock, Newco Exchangeable Preferred Stock\nand Newco Junior Preferred Stock to be issued to Seller hereunder, when issued,\nwill have the rights, preferences and privileges set forth in Exhibit A hereto,\n                                                              ---------\nand the Warrants to be issued to persons that purchase shares of Newco\nExchangeable Preferred Stock from Seller pursuant to Section 6.09, when issued,\nwill have the rights, preferences and privileges set forth in Exhibit C hereto.\n                                                              ---------\n\n          4.04.  Governmental Authorization.  The execution, delivery and\n                 --------------------------\nperformance by Newco of this Agreement and the Related Agreements require no\naction by, consent or approval of, or filing with, any Governmental Authority\nor any other Person other than (i) compliance with any applicable requirements\nof the HSR Act and Federal and state securities laws or (ii) any actions,\nconsents, approvals or filings otherwise expressly referred to in this\nAgreement.\n\n          4.05.  Non-Contravention.  The execution, delivery and performance by\n                 -----------------\nNewco of this Agreement and the Related Agreements do not and will not\n(a) contravene or conflict with the Certificate of Incorporation or Bylaws of\nNewco, (b) assuming compliance with the matters referred to in Section 4.03,\ncontravene or conflict with or constitute a violation of any provision of any\nApplicable Law binding upon or applicable to Newco or (c) constitute a default\nunder or give rise to any right of termination, cancellation or acceleration\nof, or to a loss of any benefit to which Newco is entitled under, any contract,\ncommitment, agreement or obligation to which Newco is a party or by which Newco\nor any of its assets may be bound.\n\n          4.06.  Advisory Fees.  Prior to the Closing Date, except for Goldman,\n                 -------------\nSachs &amp; Co., PaineWebber Incorporated and Cybus Capital Markets, there is no\ninvestment banker, broker, finder or other intermediary or financial advisor\nthat has been retained by or is authorized to act on behalf of Newco who might\nbe entitled to any fee, commission or reimbursement of expenses from Seller or\nany of its Affiliates or any of their respective Affiliates upon consummation\nof the transactions contemplated by this Agreement.\n\n          4.07.  Litigation.  There is no Proceeding pending against, or to the\n                 ----------\nknowledge of Newco, threatened against or affecting, Newco before any court or\narbitrators or any governmental body, agency or official.\n\n          4.08.  Conduct of Newco.  Newco (i) was formed solely to acquire and\n                 ----------------\ncarry on the Business as contemplated in this Agreement, (ii) is not a party to\nany contract or agreement, whether written or oral, of any nature and does not\nown any assets, tangible or otherwise, (iii) has no employees and has not\nconducted any business activities or incurred any obligations prior to the date\nof this Agreement, and (iv) on the date of this Agreement does not currently\nconduct any business activities or have any liabilities other than under this\nAgreement and any other documents contemplated by or entered into in connection\nwith this Agreement.\n\n                                   ARTICLE V\n\n                              COVENANTS OF SELLER\n\n          Seller hereby agrees that:\n\n          5.01.  Conduct of the Business; Distributions.  From the date hereof\n                 --------------------------------------\nuntil the Closing Date, Seller shall conduct the Business in the ordinary\ncourse consistent with past practice and procedure and shall use its best\nefforts to preserve intact the business organizations and relationships and\ngoodwill of Seller with third parties and shall use its best efforts to keep\navailable the services of the present officers, employees, agents and other\npersonnel of the Business.  Without limiting the generality of this Section\n5.01, from the date hereof until the Closing Date:\n\n                 (a)  Seller will:\n\n                      (i)    (A) use its commercially reasonable efforts to\n     maintain the Transferred Assets in the ordinary course of business\n     consistent with past practice in good operating order and condition,\n     reasonable wear and tear, damage by fire and other casualty excepted and\n     (B) promptly repair, restore or replace any Transferred Assets in the\n     ordinary course of business consistent with past practice;\n\n                      (ii)   use its commercially reasonable efforts to comply\n     with all material Applicable Laws;\n\n                      (iii)  use its commercially reasonable efforts to obtain,\n     prior to the Closing Date, all Required Consents set forth on\n     Schedule 3.11(b);\n\n                      (iv)   use its commercially reasonable efforts to be in\n     compliance with, and to maintain the effectiveness of, all Permits; and\n\n                      (v)    promptly notify Newco in writing of the occurrence\n     of any material breach by such Seller of any representation or warranty,\n     or any covenant or agreement, contained in this Agreement.\n\n                 (b)  except as contemplated by this Agreement, without Newco's\nprior consent (which consent shall not be unreasonably withheld), Seller will\nnot agree to:\n\n                      (i)    purchase or otherwise acquire all or any substan-\n     tial part of the assets of, or capital stock of, any other Person;\n\n                      (ii)   except in the ordinary course of business, amend,\n     in any material respect, terminate or renew any Lease of real property\n     other than a renewal pursuant to a renewal option contained in a Lease\n     listed on Schedule 3.07(c);\n\n                      (iii)  except in the ordinary course of business, subject\n     to clause (ii) above, sell, assign, lease, license, transfer, abandon, let\n     lapse or otherwise dispose of, or mortgage, pledge or encumber (other than\n     with Permitted Liens), any of its assets (other than Excluded Assets)\n     except pursuant to existing obligations of Seller as set forth in\n     Schedule 3.07(a);\n\n                      (iv)   amend or modify in any material respect or\n     terminate any Scheduled Contract other than in the ordinary course of\n     business;\n\n                      (v)    other than the execution of (or amendment of)\n     purchase orders or sales orders or raw sugar supply contracts entered into\n     or amended in the ordinary course of business, enter into or commit to\n     enter into any Contract which, if in existence on the date hereof, would\n     be required to be set forth in the Schedule 3.10(a)\" as a Scheduled\n                                        ----------------\n     Contract (each, a \"Subsequent Material Contract\") or, if any\n     Subsequent Material Contract shall have been entered into or committed to,\n     amend or modify in any material respect or terminate any such Subsequent\n     Material Contract;\n\n                      (vi)   except as contemplated by Section 3.05, make any\n     change in its accounting methods or in the manner of keeping its books and\n     records or any change in its current practices with respect to inventory,\n     sales, receivables, payables or accrued expenses, except as required by\n     changes in GAAP or Applicable Law.\n\n                      (vii)  enter into, amend or terminate (a) any employment\n     agreement except in the ordinary course of business or (b) any collective\n     bargaining agreement or adopt, enter into or amend any arrangement which\n     is, or would be, a Benefit Plan or make any change in any actuarial\n     methods or assumptions used in funding any Benefit Plan or in the\n     assumptions or factors used in determining benefit equivalents thereunder;\n\n                      (viii) declare, set aside or pay any distributions of any\n     kind to the Shareholders or holders of its equity interests, or make any\n     direct or indirect redemption, retirement, purchase or other acquisition\n     of any shares of its capital stock or other equity interests other than\n     cash distributions to the Shareholders;\n\n                      (ix)   make any wage or salary increase or increase any\n     other compensation or bonus payable or to become payable for or to any of\n     its officers, directors, employees, consultants, agents or other\n     representatives, or make any accrual for or commitment or agreement to\n     make or pay the same, other than increases made in the ordinary course of\n     business consistent with past practice;\n\n                      (x)    make any payment or commitment to pay any\n     severance or termination pay to any Person or any of its officers,\n     directors, employees, consultants, agents or other representatives, other\n     than payments or commitments to pay such Persons or its officers,\n     directors, employees in the ordinary course of business consistent with\n     past practice;\n\n                      (xi)   pay, directly or indirectly, any of its\n     liabilities before the same become due in accordance with its terms\n     otherwise than in the ordinary course of business, except to obtain the\n     benefit of discounts available for early payment; or\n\n                      (xii)  make any capital expenditure or commitments for\n     capital expenditures other than in the ordinary course of business\n     consistent with past practice.\n\n          5.02.  Access to Information.  Subject to compliance with Applicable\n                 ---------------------\nLaws, from the date hereof until the Closing Date, Seller will promptly:\n(a) give Newco and its counsel, financial advisors, auditors and other\nauthorized representatives reasonable access during normal business hours to\nthe offices, properties, books and records relating to the Business and the\nTransferred Assets upon reasonable prior notice, (b) furnish to Newco its\ncounsel, financial advisors, auditors and other authorized representatives such\ninformation relating to the Business or the Transferred Assets as Newco may\nreasonably request and (c) instruct the directors, officers, employees,\ncounsel, auditors and financial advisors of Seller to cooperate with Newco and\nits counsel, financial advisors, auditors and other authorized representatives\nin their investigation of the Business and the Transferred Assets.  During such\nperiod, subject to prior notice to and approval of Seller (which approval will\nnot be unreasonably withheld), Newco's representatives shall be permitted to\nmake copies of such books and records and other data at Newco's expense.\nNewco and its representatives will conduct all inspections pursuant to this\nSection 5.02 in a manner which will seek to minimize any disruptions of the\nbusiness and operations of Seller.\n\n          5.03.  Compliance with Terms of Required Governmental Approvals and\n                 ------------------------------------------------------------\nRequired Contractual Consents.  On and after the Closing Date, Seller shall\n-----------------------------\ncomply at its own expense with all conditions and requirements set forth in\n(i) all Required Governmental Approvals as necessary to keep the same in full\nforce and effect assuming continued compliance with the terms thereof by Newco\nand (ii) all Required Contractual Consents as necessary to keep the same\neffective and enforceable against the Persons giving such Required Contractual\nConsents assuming continued compliance with the terms thereof by Newco.\n\n          5.04.  Maintenance of Insurance Policies.\n                 ---------------------------------\n\n                 (a)  On and after the date hereof (including after the Closing\nDate), Seller shall not unreasonably take or fail to take any action if such\naction or inaction, as the case may be, would adversely affect the applica-\nbility of any insurance in effect on the date hereof that covers all or any\npart of the Transferred Assets or the Business.  Notwithstanding the foregoing,\nSeller shall not have any obligation to make any monetary payment to maintain\nthe effectiveness of any such Insurance Policy after the Closing Date.\n\n                 (b)  Seller shall take or cause to be taken all reasonable\nactions within its power to cause Newco to be the direct or indirect bene-\nficiary of, or otherwise gain the benefit of, any occurrence-based Insurance\nPolicies known to such Seller, including, but not limited to, the following:\n(i) Seller shall, to the extent permissible by Applicable Law and the terms of\nthe Insurance Policies, take all reasonable actions (but without any additional\ncosts and expenses) necessary to assign the occurrence-based Seller Insurance\nPolicies to Newco on or before the Closing Date, subject to the provisions of\nthis Section 5.04; and (ii) with respect to any occurrence-based Insurance\nPolicy issued in the name of any entity other than Seller or insuring any\nentity other than Seller and any occurrence-based Seller Insurance Policy that\nis not assignable to Newco as provided herein, Seller shall take reasonable\nefforts (but without any additional costs and expenses) to (A) retain and\nmaintain, including after the Closing Date, such occurrence-based Insurance\nPolicy as it applies to occurrences prior to the Closing Date, (B) from time to\ntime and at Newco's request and Newco's expense, Seller shall submit claims and\naggressively pursue the benefits under such occurrence-based Insurance Policy\nwith respect to occurrences arising prior to the Closing Date and (C) promptly\napply any amounts recovered from any such Insurance Policy to pay such claims\nand any costs incurred in defending the same, and, to the extent such claim has\nbeen asserted against Newco, to indemnify Newco in connection with any and all\nDamages actually incurred by Newco in connection with such claim, to the extent\nof the proceeds of the Insurance Policy remaining after payment of such claims\nand costs.\n\n                 (c)  With respect to any Damages incurred by Newco or the\nBusiness as a result of an action, suit, hearing, arbitration, proceeding\n(public or private) or governmental investigation arising from or connected to\nthe operation of the Business, Seller or the Transferred Assets prior to the\nClosing, such Damages shall be deemed reduced for purposes of Article IX hereof\nto the extent that amounts are paid to Newco in connection therewith from any\nInsurance Policy.\n\n                 (d)  With respect to any Damages incurred by Seller as a\nresult of an action, suit, hearing, arbitration, proceeding (public or private)\nor governmental investigation arising from or connected to the operation of the\nBusiness or the Transferred Assets prior to the Closing, Seller shall be\nconsidered to be a joint beneficiary of any Seller Insurance Policy that has\nbeen assigned to Newco covering such Damages to the extent any such Seller\nInsurance Policy entitles Seller to be a direct or an indirect beneficiary\nthereof.\n\n          5.05.  Change of Name.  Seller will amend its Articles of\n                 --------------\nIncorporation within ten (10) Business Days after the Closing Date so as to\nchange its corporate name to a name dissimilar to the name by which the\nBusiness of Seller is known, including, \"C&amp;H,\" \"C&amp;H Sugar Company\" or\n\"California and Hawaiian Sugar Company,\" and will file as promptly as\npracticable, but in any event within sixty (60) days after the\nClosing, in all jurisdictions in which it is qualified to do business, any\ndocuments necessary to reflect such change in its corporate name or to\nterminate its qualification therein.\n\n          5.06.  Administration of Accounts.  All payments and reimbursements\n                 --------------------------\nmade in the ordinary course by any third party in the name of or to any Seller\nor Affiliate thereof in connection with or arising out of the Transferred\nAssets, the Business or the Assumed Liabilities after the Closing Date shall be\nheld by Seller or such Affiliate in trust for the benefit of Newco and,\nimmediately upon receipt by Seller or any such Affiliate of any such payment or\nreimbursement, Seller shall pay, or cause to be paid, over to Newco as soon as\npracticable the amount of such payment or reimbursement without right of set\noff.\n\n          5.07.  Notice of Events.  The Seller and each Shareholder with\n                 ----------------\nknowledge thereof shall promptly notify Newco of (a) any event, condition or\ncircumstance occurring from the date hereof through the Closing Date that would\nconstitute a violation or breach of this Agreement, (b) any event, occurrence,\ntransaction or other item which would have been required to have been disclosed\non any Schedule or statement delivered hereunder had such event, occurrence,\ntransaction or item existed on the date hereof, other than items arising in the\nordinary course of business which would not render any representation or\nwarranty of the Seller or the Shareholders materially misleading.\n\n          5.08.  Bulk Sale Filings.  The Seller shall timely make all required\n                 -----------------\nfilings under all applicable state bulk sales notification statutes and\nregulations in connection with the sale of the Transferred Assets to Newco.\n\n          5.09.  Exclusivity.  Until the earlier occurs of the Closing or the\n                 -----------\ntermination of this Agreement, none of the Seller, the Shareholders nor any of\ntheir respective directors, officers, employees, agents, representatives,\nmembers or Affiliates shall initiate, solicit, entertain, negotiate, accept\nor discuss, directly or indirectly, or encourage inquiries or proposals\n(each, an \"Acquisition Proposal\") with respect to, or furnish any\ninformation relating to or participate in any negotiations or discussions\nconcerning, or enter into any agreement with respect to, any acquisition or\npurchase of all or a substantial portion of the assets of, or of a substantial\nequity interest in, the Business or any business combination with the Seller or\nany reorganizations, dissolution, recapitalization, merger or consolidation of\nthe Seller other than as contemplated by this Agreement (a \"Third Party\n                                                            -----------\nAcquisition\").  The Seller shall, and shall cause each of their respective\n-----------\nAffiliates to, immediately cease and cause to be terminated any existing\nactivities, including discussions or negotiations with any parties, conducted\nprior to the date hereof with respect to any Acquisition Proposal.  Each of\nthe Seller and Shareholders represent that it is not a party to or bound by any\nagreement with respect to an Acquisition Proposal other than under this\nAgreement.  Each of the Seller and the Shareholders shall cause its\nofficers, directors, agents and advisors to comply with the provisions of this\nSection 5.09.\n\n          5.10.  Confidentiality.\n                 ---------------\n\n                 (a)  For a period of two (2) years following the Closing,\nSeller will, and will cause its Affiliates and representatives to, treat any\ndata and information obtained with respect to CVC or any of its Affiliates\nfrom any representative, officer, director or employee of CVC, or from any\nbooks or records of CVC in connection with this Agreement, confidentially and\nwith commercially reasonable care and discretion, and will not disclose any\nsuch information to third parties; provided, however, that the foregoing shall\nnot apply to (i) information in the public domain or that becomes public\nthrough disclosure by any party other than Seller, or its Affiliates or\nrepresentatives, so long as such other party is not in breach of a\nconfidentiality obligation, (ii) information regarding CVC required to be\ndisclosed by Applicable Law, (iii) with CVC's consent (which shall not be\nunreasonably withheld), information required to be disclosed, on a confidential\nbasis, whenever possible, to obtain any Required Consents; or (iv) with CVC's\nconsent (which shall not be unreasonably withheld), any information regarding\nCVC that is disclosed, on a confidential basis, whenever possible, by Seller or\nits Affiliates to any of their actual or prospective lenders or investors in\nconnection with financing the transactions contemplated by this Agreement or in\nconnection with future financings.\n\n                 (b)  In the event that the Closing fails to take place and\nthis Agreement is terminated, Seller, upon the written request of CVC and at\nCVC's request, will, and will cause its Affiliates and representatives to,\npromptly deliver to CVC any and all documents or other materials furnished by\nCVC to Seller in connection with this Agreement without retaining any copy\nthereof and without using any confidential information of CVC to solicit any\ncustomers of CVC.  In the event of such request, all other documents, whether\nanalyses, compilations or studies, that contain or otherwise reflect the\ninformation furnished by CVC to Seller shall be destroyed by Seller or shall\nbe returned to CVC, and Seller shall confirm to CVC in writing that all such\nmaterials have been returned or destroyed.  No failure or delay by CVC in\nexercising any right, power or privilege hereunder shall operate as a waiver\nthereof, nor shall any single or partial exercise thereof preclude any other\nor further exercise thereof or the exercise of any right, power or privilege\nhereunder.\n\n          5.11.  Non-Competition.\n                 ---------------\n\n                 (a)  For a period of three years following the Closing Date,\nneither Seller, the Shareholders nor their respective Affiliates shall solicit\nNewco employees for employment in the business of sugar refining or marketing.\nIn addition, for a period of three years following the Closing Date, neither\nSeller, the Shareholders nor their respective Affiliates shall hire or employ\nany of the Seller Key Employees for positions in the business of sugar refining\nor marketing.\n\n                 (b)  For the period from the Closing Date through June 4, 2003\n(the \"Non-Compete Period\"), neither Seller, the Shareholders nor their\nrespective Affiliates shall (i) build any new sugar refinery or add refining\ncapacity to its existing sugar factory (which shall not prohibit ABHI from\nperforming improvements and upgrades at its existing sugar factory so long as\nneither Seller, the Shareholders nor their respective Affiliates produce sugar\nat the factory during such Non-Compete Period having whole color less than 1150\nICUMSA or having polarity greater than 99.5 percent); (ii) sell or license, for\nuse other than in connection with the sale of ABHI raw sugar, any existing\nbrand names or trademarks relating to the ABHI raw sugar business, or (iii)\nsell in the aggregate more than 10,000 tons of raw or refined sugar per annum\nto any Person other than HSTC or Newco.  As remedy for breach of clause (iii)\nof this subsection (b), Seller or the Shareholders shall pay liquidated damages\nequal to the number of tons of raw or refined sugar exceeding 10,000 sold by\nSeller or the Shareholders to persons other than HSTC or Newco in any twelve\nmonth period multiplied by $25 per ton.\n\n          5.12.  Specific Performance.  The parties hereto recognize and agree\n                 --------------------\nthat in the event of a breach by Seller of Sections 5.10 and 5.11, money\ndamages would not be an adequate remedy to CVC for such breach and, even if\nmoney damages were adequate, it would be impossible to ascertain or measure\nwith any degree of accuracy the damages sustained by CVC therefrom.\nAccordingly, if there should be a breach or threatened breach by Seller of\nprovisions of Sections 5.10 or 5.11, CVC shall be entitled to an injunction\nrestraining Seller from any breach without showing or proving actual damage\nsustained by CVC.  Nothing in the preceding sentence shall limit or otherwise\naffect any remedies that CVC may otherwise have under Applicable Law.\n\n          5.13.  Termination of Intercompany Arrangements.  Seller shall cause\n                 ----------------------------------------\nall contracts, agreements and arrangements between Seller, on the one hand, and\nA&amp;B, the Shareholders or any Affiliate of A&amp;B, on the other hand, to be\nterminated effective as of the Closing Date; provided, however, that this\nSection 5.13 shall not apply to any agreement or covenant contained in this\nAgreement or any contract or agreement entered into between Newco, on the one\nhand, and A&amp;B, the Shareholders or any Affiliate of A&amp;B, on the other hand, in\nconnection with the consummation of the transactions contemplated hereby; and\nprovided, further, however, that this Section 5.13 shall not require the\ntermination of, or amendment of, (i) any contract or agreement in effect\nbetween Seller and HSTC or (ii) that certain Transfer Pricing Agreement dated\nas of December 21, 1998 between ABHI. and Seller, which is being assigned by\nSeller to Newco pursuant to this Agreement.\n\n                                   ARTICLE VI\n\n                               COVENANTS OF NEWCO\n\n          6.01.  Access to Information.  Subject to compliance with Applicable\n                 ---------------------\nLaws, after the Closing Date, Newco will promptly:  (a) give Seller and its\ncounsel, financial advisors, auditors and other authorized representatives\nreasonable access during normal business hours to the offices, properties,\nbooks and records relating to the Business and the Transferred Assets (in each\ncase for any periods prior to the Closing Date) upon reasonable prior notice,\n(b) furnish to Seller, its counsel, financial advisors, auditors and other\nauthorized representatives such information relating to the Business or the\nTransferred Assets (in each case for any periods prior to the Closing Date)\nas Seller may reasonably request and (c) instruct the directors, officers,\nemployees, counsel, auditors and financial advisors of Newco to cooperate with\nSeller and its counsel, financial advisors, auditors and other authorized\nrepresentatives in their preparation of all necessary certificates or similar\ndocuments required to be prepared and delivered by Seller to Newco by this\nAgreement.\n\n          6.02.  Compliance with Terms of Required Governmental Approvals and\n                 ------------------------------------------------------------\nRequired Contractual Consents.  On and after the Closing Date, Newco shall\n-----------------------------\ncomply at its own expense with all conditions and requirements set forth in\n(i) all Required Governmental Approvals as necessary to keep the same in full\nforce and effect assuming continued compliance with the terms thereof by Seller\nand (ii) all Required Contractual Consents as necessary to keep the same\neffective and enforceable against the Persons giving such Required Contractual\nConsents assuming continued compliance with the terms thereof by Seller.\n\n          6.03.  Confidentiality.\n                 ---------------\n\n                 (a)  For a period of two (2) years following the Closing,\nNewco will, and will cause its Affiliates and representatives to, treat any\ndata and information obtained with respect to Seller or any of its Affiliates\nfrom any representative, officer, director or employee of Seller, or from any\nbooks or records of Seller in connection with this Agreement, confidentially\nand with commercially reasonable care and discretion, and will not disclose any\nsuch information to third parties; provided, however, that the foregoing shall\nnot apply to (i) information in the public domain or that becomes public\nthrough disclosure by any party other than Newco, or its Affiliates or\nrepresentatives, so long as such other party is not in breach of a\nconfidentiality obligation, (ii) information regarding Seller required to be\ndisclosed by Applicable Law, (iii) information required to be disclosed, on a\nconfidential basis, whenever possible, to obtain any Required Consents; or\n(iv) any information regarding Seller that is disclosed, on a confidential\nbasis, whenever possible, by Newco or its Affiliates to any of their actual or\nprospective lenders or investors in connection with financing the transactions\ncontemplated by this Agreement or in connection with future financings.\n\n                 (b)  In the event that the Closing fails to take place and\nthis Agreement is terminated, Newco, upon the written request of Seller and at\nSeller's request, will, and will cause its Affiliates and representatives to,\npromptly deliver to Seller any and all documents or other materials furnished\nby Seller to Newco in connection with this Agreement without retaining any copy\nthereof and without using any confidential information of Seller to solicit any\ncustomers of Seller.  In the event of such request, all other documents,\nwhether analyses, compilations or studies, that contain or otherwise reflect\nthe information furnished by Seller to Newco shall be destroyed by Newco or\nshall be returned to Seller, and Newco shall confirm to Seller in writing that\nall such materials have been returned or destroyed.  No failure or delay by\nSeller in exercising any right, power or privilege hereunder shall operate as a\nwaiver thereof, nor shall any single or partial exercise thereof preclude any\nother or further exercise thereof or the exercise of any right, power or\nprivilege hereunder.\n\n          6.04.  Specific Performance.  The parties hereto recognize and agree\n                 --------------------\nthat in the event of a breach by Newco of Section 6.03, money damages would not\nbe an adequate remedy to Seller for such breach and, even if money damages were\nadequate, it would be impossible to ascertain or measure with any degree of\naccuracy the damages sustained by Seller therefrom.  Accordingly, if there\nshould be a breach or threatened breach by Newco of provisions of Section 6.03,\nSeller shall be entitled to an injunction restraining Newco from any breach\nwithout showing or proving actual damage sustained by Seller.  Nothing in the\npreceding sentence shall limit or otherwise affect any remedies that Seller may\notherwise have under Applicable Law.\n\n          6.05.  Amendment of Certificate of Incorporation.  Newco will, prior\n                 -----------------------------------------\nto the Closing, amend and restate its Certificate of Incorporation in order to\nauthorize the issuance of 25,000 shares of Newco Exchangeable Preferred Stock,\n25,000 shares of Newco Series B Preferred Stock, 24,000 shares of Newco Junior\nPreferred Stock, 1,200,000 shares of Newco Common Stock, and 237,929 shares of\nNewco Class B Common Stock.\n\n          6.06.  Company Employees.  Effective as of the Closing Date, Newco\n                 -----------------\nshall offer at will employment to all active employees of Seller not otherwise\ncovered by a collective bargaining agreement, including any Person on\nshort-term or (to the extent required by law or any applicable contract)\nlong-term disability, workers' compensation or personal leave, and, for a\nperiod of one year after the Closing Date, shall compensate such employees\nat current pay rates and shall provide such employees with benefits\nsubstantially similar in the aggregate to those benefits provided to the\nemployees by Seller immediately prior to the Closing.\n\n          6.07.  Payment of ASRS Note and Pollution Control Bond Interest.\n                 --------------------------------------------------------\nNewco agrees (i) to pay all interest accruing on the Pollution\nControl Bonds from and after the Closing Date and (ii) to reimburse Seller for\nPrepayment Penalties, which have been paid on the ASRS Notes as a result of the\nrepayment of the ASRS Notes on December 11, 1998.\n\n          6.08   Performance of Certain Obligations by Newco.\n                 -------------------------------------------\n\n                 (a)  On and after the Closing Date, Newco shall, or shall\ncause its designated subsidiaries to, duly, promptly and faithfully pay,\nperform and discharge when due, all Assumed Liabilities.  Without limiting the\nforegoing, Newco shall, or shall cause its designated subsidiaries to, duly,\npromptly and faithfully pay, perform and discharge when due, any liability or\nobligation under any guarantee or obligation to assure performance given or\nmade by the Seller, the Shareholders, A&amp;B or its Affiliates with respect to any\nAssumed Liability.  On or prior to the Closing Date, Newco shall either\n(i) assume existing letters of credit and\/or surety bonds tendered to third\nparties by Seller, the Shareholders, A&amp;B or its Affiliates with respect to any\nAssumed Liability, (ii) tender substitute letters of credit and\/or surety bonds\nto such third parties or (iii) issue to ABHI and Seller one or more standby\nletters of credit (in form and substance acceptable to ABHI and Seller) in an\naggregate amount equal to the aggregate contingent liability of ABHI and Seller\nunder such existing letters of credit and surety bonds, pursuant to which ABHI\nor Seller, as applicable, will be entitled to draw payment in the event of,\nand in the amount of, any payment made by ABHI as Seller after the Closing Date\nin respect of any existing letter of credit or surety bond.  To the extent that\nany such letters of credit and\/or surety bonds of the Seller, the Shareholders,\nA&amp;B or its Affiliates with respect to any Assumed Liability are not assumed by\nNewco, Newco shall take all actions that are necessary in order to obtain the\nrelease of any such existing letters of credit and\/or surety bonds on or prior\nto the Closing Date.  If Seller permits the Closing to occur prior to the\nrelease of any such existing letters of credit and\/or surety bonds of Seller,\nNewco agrees (i) to maintain in effect the standby letter or letters of credit\nreferred to in clause (iii) of Section 6.08(a) in an aggregate amount equal to\nthe aggregate contingent liabilities of ABHI and Seller under such letters of\ncredit and surety bonds for as long as any such existing letters of credit\nand\/or surety bonds remain in effect and (ii) to take any and all actions that\nare necessary (including by the payment of money, as necessary) to obtain the\nrelease of any such existing letter of credit and\/or surety bond having a term\nof six (6) months or greater and representing an aggregate contingent liability\nof ABHI or Seller of in excess of $200,000 as soon as practicable following the\nClosing Date, and in any event by no later than thirty (30) days following the\nClosing Date.\n\n                 (b)  Notwithstanding any provision to the contrary contained\nin this Section 6.08, Newco shall not be required to assume or obtain the\nrelease of that certain letter of credit issued on behalf of Seller by First\nHawaiian Bank in the amount not to exceed $10,432,131 in favor of the State of\nCalifornia for workers compensation self insurance or any successor letter of\ncredit issued by any banking institution on behalf of Seller with respect to\nworkers compensation claims arising prior to the Closing Date (the \"Workers\nCompensation LC\") until the earlier of (i) the fifth (5th) anniversary of the\nClosing Date and (ii) the first date upon which Newco or any successor entity\n(a) consummates an offering of equity securities registered under the\nSecurities Act of 1933, as amended, (b) consummates a sale, in a single\ntransaction or series of related transactions, of all or a substantial portion\nof its assets or (c) consummates a merger with or into another entity or any\nother reorganization or recapitalization transaction as a result of which the\nowners of the outstanding voting capital stock of Newco or such successor\nreceive capital stock of the surviving entity in the merger, reorganization or\nrecapitalization representing less than 50% of the voting power of all\noutstanding capital stock of the surviving entity.  Newco agrees that the\nWorkers Compensation LC has been issued to the State of California to cover\nonly workers compensation liabilities of Newco arising prior to the Closing\nDate that, together with all other such workers compensation liabilities of\nNewco arising prior to the Closing Date, exceed, in the aggregate, the sum of\n(i) self insurance reserves established on the balance sheet of Seller as of\nthe Closing Date for workers compensation charges and expenses (the \"Closing\nWorkers Compensation Reserve\") and (ii) Newco's workers compensation insurance\ncoverage, if any; and Newco agrees not to allow any draw to be made on the\nWorkers Compensation LC prior to such time, if ever, that the workers\ncompensation liabilities of Newco arising prior to the Closing Date exceed, in\nthe aggregate, the sum of (i) the Closing Workers Compensation Reserve and\n(ii) Newco's workers compensation insurance coverage, if any.  The provisions\nof this Section 6.08(b) shall not, in any event, alter Newco's agreement to\nduly, promptly and faithfully pay, perform and discharge, when due, all\nAssumed Liabilities, including any workers compensation liabilities included\nwithin the Assumed Liabilities.\n\n          6.09.  Re-marketing of Preferred Stock.  Upon Seller's request, Newco\n                 -------------------------------\nwill cooperate in all reasonable respects in connection with Seller's resale of\nthe Newco Exchangeable Preferred Stock received under the terms of this\nAgreement (including preparing a customary prospectus or offering memorandum\nfor such resale), and Newco shall reimburse and indemnify Seller for all costs,\nexpenses, liabilities, Taxes (including but not limited to sales and other\ntransfer Taxes) and other charges incurred in connection with such resale,\nincluding, but not limited to, the costs and expenses associated with entering\ninto any purchase greement, placement agent agreement or underwriting agreement\nand the ransactions contemplated thereby; provided, however, that Newco shall\nnot be equired to reimburse Seller for underwriting discounts or commissions in\nexcess f 4% of the aggregate proceeds received by Seller in connection with its\nremarketing of the Newco Exchangeable Preferred Stock.  In connection with any\nsale by Seller of its Newco Exchangeable Preferred Stock covered by this\nSection 6.09, Newco agrees, in addition to the reimbursement and indemnifica-\nion provided for in the preceding sentence, (i) to issue Warrants to the\npurchasers of such Exchangeable Preferred Stock at the direction of Seller in\nthe amount and having the terms set forth in Exhibit C and to enter into a\nWarrant Agreement (covering the Warrants) and Registration Rights Agreement\n(covering the registration rights set forth on Exhibit C) with such purchasers\ncontaining terms and provisions, including representations, warranties and\ncovenants of Newco, and indemnities by Newco, as are customary for a\ntransaction of this nature and (ii) to enter into a purchase agreement,\nplacement agent agreement or underwriting agreement with the initial purchaser,\nplacement agent or underwriter, as applicable, and Seller, containing\nreasonable and customary representations, warranties and covenants of Newco,\nand indemnities by Newco of the Seller and the initial purchaser, placement\nagent or underwriter, as applicable, as are customary for a transaction of\nthis nature.  Newco agrees, for as long as shares of Newco Exchangeable\nPreferred Stock are outstanding, to make available to any purchaser or\nsubsequent purchaser the information described in Rule 144A(d) in order to\nenable resales of the Newco Exchangeable Preferred Stock to occur pursuant to\nRule 144A under the Securities Act.\n\n                                  ARTICLE VII\n\n                            COVENANTS OF ALL PARTIES\n\n          7.01.  Further Assurances.  Subject to the terms and conditions of\n                 ------------------\nthis Agreement, each party will use all commercially reasonable efforts\n(whether before or after the Closing Date) to take, or cause to be taken, all\nactions and to do, or cause to be done, all things necessary or reasonably\ndesirable under Applicable Law to consummate the transactions contemplated by\nthis Agreement.  Newco and Seller agree to execute and deliver such other\ndocuments, certificates, agreements and other writings and to take such other\nactions as may be reasonably necessary or desirable in order to consummate or\nimplement expeditiously the transactions contemplated by this Agreement;\nprovided, however, that nothing contained in any such documents, certificates,\nagreements or other writings shall be deemed to supersede, amend or modify any\nof the terms, conditions or any of the rights or obligations of the parties\nhereunder and, to the extent of any conflict between any such documents,\ncertificates, agreements or other writings, on the one hand, and this\nAgreement, on the other hand, the terms and provisions of this Agreement shall\nprevail.\n\n          7.02.  Certain Filings.  The parties hereto shall cooperate with one\n                 ---------------\nanother in determining whether any action by or in respect of, or filing with,\nany Governmental Authority is required or reasonably appropriate, or any\naction, consent, approval or waiver from any party to any Contract is required\nor reasonably appropriate, in connection with the consummation of the\ntransactions contemplated by this Agreement.  Subject to the terms and\nconditions of this Agreement, in taking such actions or making any such\nfilings, the parties hereto shall furnish information required in connection\ntherewith and seek timely to obtain any such actions, consents, approvals or\nwaivers.  Without limiting the foregoing, the parties hereto shall each\npromptly complete and file all reports and forms, and respond to all requests\nor further requests for additional information, if any, as may be required or\nauthorized under the HSR Act.\n\n         7.03.  Public Announcements.  Up to (and including) the Closing Date,\n                --------------------\neach party agrees that, without the consent of the other party, it will not,\nexcept as may be required by Applicable Law, issue any press release or make\nany public statement with respect to this Agreement or the transactions\ncontemplated hereby.  For a period of ninety (90) days after the Closing Date,\nthe parties agree to consult with each other before issuing any press release\nor making any public statement with respect to this Agreement or the\ntransactions contemplated hereby, and, except as may be required by Applicable\nLaw, will not issue any such press release or public statement prior to such\nconsultation.  Notwithstanding the foregoing, the parties may, on a\nconfidential basis, advise and release information regarding the existence and\ncontent of this Agreement or the transactions contemplated hereby to their\nrespective Affiliates or any of their agents, accountants,\nattorneys and prospective lenders or investors in connection with or related to\nthe transactions contemplated by this Agreement, including without limitation\nthe financing of such transactions.\n\n          7.04.  Disposition of Benefit Plans.  The following provisions shall\n                 ----------------------------\ngovern the disposition of Benefit Plans in which employees of Seller\nparticipate.\n\n                 (a)  Effective as of the Closing Date, Newco shall assume the\nsponsorship of and responsibility for the maintenance, funding and\nadministration of each Benefit Plan in which employees and former employees of\nSeller are the sole participants and which are listed on Schedule 7.04(a).\nAppropriate arrangements shall be made to transfer any assets of such plans held\nin an A&amp;B sponsored master trust to a funding arrangement to be established as\nof the Closing Date by Newco.  In the case of the A&amp;B Retirement Plan for\nSalaried Employees of C&amp;H, C&amp;H shall on or before the Closing Date cause such\nplan to be amended to strike Article XII thereof effective as of the Closing\nDate and contingent on the consummation of the transactions contemplated by\nthis Agreement to occur on the Closing Date.\n\n                 (b)  In connection with any Benefit Plan sponsored and main-\ntained by A&amp;B and in which employees and former employees of Seller partici-\npate, but are not the sole participants, the following shall apply:\n\n                      (i)    In the case of any Employee Pension Benefit Plan,\n     employees of Seller shall cease active participation in such plan as of\n     the Closing Date and shall thereafter participate in a substantially\n     similar plan to be established by Newco effective as of the Closing Date.\n     Contributions to the Newco tax sheltered investment plan shall be funded\n     through a date that is three months after the Closing Date through the\n     Alexander &amp; Baldwin Deferred Compensation Trust.  Such assets along with\n     other assets and liabilities attributable to current employees of Seller\n     who will be transferred to Newco's payroll as of the Closing Date shall be\n     transferred to the Newco Plan as soon as practicable after the later to\n     occur of the date that is three months after the Closing Date or the date\n     upon which Newco confirms to Seller that Newco's plan and trust qualify\n     under Code Sections 401 and 501, respectively.\n \n                      (ii)   In the case of the A&amp;B Flexible Benefit Program\n     and the A&amp;B Retiree Health and Welfare Benefit Plan, Newco shall,\n     effective as of the Closing Date, establish substantially similar plans in\n     the aggregate and cause such plans to be adequately insured either through\n     commercially underwritten insurance or a self insurance arrangement.\n     Accounts maintained as of the Closing under the Flexible Benefit Program\n     pertaining to the medical reimbursement and dependent care reimbursement\n     plans in respect of employees of Seller for 1998 shall be transferred to\n     and assumed by Newco and Newco shall therefore be responsible for claims\n     (expenses)incurred during 1998 prior to the Closing Date and shall be\n     responsible for any claims incurred thereafter.  Individuals who are\n     participants in the A&amp;B Retiree Health and Welfare Benefit Plan as of the\n     Closing Date shall cease participation in such plan as of the Closing Date\n     and be covered thereafter under Newco's plan.  Except as provided above,\n     Seller shall retain all liability for benefits accrued and claims whether\n     or not reported incurred prior to the Closing Date under any Benefit Plan\n     which is an Employee Welfare Benefit Plan (as described in 3(1) of ERISA).\n     A&amp;B shall extend coverage under the medical, vision, dental, life\n     insurance and disability programs to current or former employees of Seller\n     (including those employed by Newco on and after the Closing Date) through\n     a date that is three (3) months after the Closing Date, and Newco shall\n     reimburse A&amp;B for the cost of providing such benefits.\n\n                      (iii)  Notwithstanding the foregoing, effective as of the\n     Closing Date, Newco shall establish a plan substantially similar to A&amp;B's\n     Excess Benefit Plan and the one year Performance Improvement Incentive\n     Plan in respect of employees or former employees of Seller and all liabi-\n     lities attributable to them, to the extent accrued, shall be assumed by\n     Newco.  In the case of both the Excess Benefit Plan and the one year\n     Performance Improvement Incentive Plan, Newco may not diminish benefits\n     accrued through the Closing and must allow benefits to accrue through the\n     end of 1998 on terms at least as favorable as those presently in effect.\n\n          7.05.  Working Capital Facility.  The parties shall cooperate with\n                 ------------------------\none another and each party shall use its commercially reasonable efforts to\narrange for a term loan and a revolving working capital credit facility for\nNewco on terms satisfactory to Newco (the \"Working Capital Facility\") pursuant\nto which Newco will have not less than $75,500,000 of borrowing capacity as of\nthe Closing Date immediately prior to the consummation of the transactions\ncontemplated hereby.\n\n          7.06.  Cooperation in Tax Matters.  Newco and Seller shall\n                 --------------------------\n(i) provide each other with such assistance as may reasonably be requested in\nconnection with the preparation of any Tax Return and the conduct of any audit\nor other examination by any taxing authority or in connection with judicial or\nadministrative proceedings relating to any liability for Taxes and (ii) retain\nand provide each other with all records or other information that may be\nrelevant to the preparation of any Tax Returns, or the conduct of any audit or\nexamination, or other Tax Proceeding.  Seller shall retain all relevant\ndocuments, including prior year's Tax Returns, supporting work schedules and\nother records or information that may be relevant to such returns and shall not\ndestroy or otherwise dispose of any such records without the prior written\nconsent of the other party.  All tax sharing or similar agreements with respect\nto or involving MLM shall be terminated as of the Closing Date and, after the\nClosing Date, MLM shall not be bound thereby or have any Liability thereunder.\n\n          7.07.  Registration Rights Agreement.  Newco and Seller shall enter\n                 -----------------------------\ninto aRegistration Rights Agreement relating to the Newco Exchangeable\nPreferred Stock, on commercially reasonable terms and conditions satisfactory\nto Newco and Seller in their reasonable discretion, concurrently with the\nClosing.\n\n          7.08.  Indenture.  The parties shall cooperate with one another and\n                 ---------\nshall use their commercially reasonable efforts to arrange for Newco to enter\ninto an Indenture, relating to Newco's 12.5% Subordinated Exchange Debentures\nissuable in exchange for shares of Newco Exchangeable Preferred Stock (\"Newco\nExchange Debentures\"), concurrently with the Closing, containing the terms set\nforth in Exhibit E.\n\n          7.09.  Disposition of Certain Properties.  Seller and Newco\n                 ---------------------------------\nacknowledge thatcertain parcels of real property referred to in that certain\nAmendment to Settlement Agreement dated August 9, 1996 between Seller and the\nCrockett Power Plant Committee, which amends that certain Settlement Agreement\ndated July 21, 1993 among the Crockett Power Plant Committee, the Glenn Cove\nHomeowners Association, Ruth Blakeny, Douglas Tubb, Energy National, Inc. and\nSeller (collectively, the \"Settlement Agreement\"), are owned by A&amp;B and\/or its\nAffiliates and not by Seller.  Seller and Newco acknowledge that A&amp;B and its\nAffiliates, either before or after the Closing Date, may elect to transfer some\nor all of such parcels in fee title (i) to Seller (for inclusion in the\nTransferred Assets), (ii) to Newco, (iii) to a governmental agency or body or\n(iv) to the Crockett Community Foundation (or any successor organization); and,\nin the event that some or all of such parcels are transferred to Seller (for\ninclusion in the Transferred Assets) prior to the Closing Date or to Newco\nwithin six (6) months after the Closing Date, Newco agrees to accept conveyance\nof title to such parcels.\n\n                                  ARTICLE VIII\n\n                             CONDITIONS TO CLOSING\n\n          8.01.  Conditions of All Parties.\n                 -------------------------\n\n                 (a)  All Required Governmental Approvals for the transactions\ncontemplated by this Agreement indicated with an asterisk (*) on\nSchedule 3.11(b) and all Permits indicated with an asterisk (*) on\n----------------\nSchedule 3.11(a) shall have been obtained without the imposition of any\n----------------\nmaterial conditions.  All such Required Governmental Approvals and such Permits\nshall be in effect, and no Proceedings shall have been instituted or threatened\nby any Governmental Authority against Seller or Newco (or any of their\nAffiliates) with respect thereto as to which there is a material risk of a\ndetermination that would terminate the effectiveness of, or otherwise\nmaterially and adversely modify the terms of, any such Required Governmental\nApproval or such Permit; all applicable waiting periods with respect to such\nRequired Governmental Approvals and such Permits shall have expired; and all\nconditions and requirements prescribed by Applicable Law or by such Required\nGovernmental Approvals and such Permits to be satisfied on or prior to the \nClosing Date shall have been satisfied allowing all such Required Governmental\nApprovals and such Permits to be and to remain in full force and effect\nassuming continued compliance with the terms thereof after the Closing.\n\n                 (b)  The Required Contractual Consents indicated with an\nasterisk (*) on Schedule 3.11(b) shall have been obtained without the \n                ----------------\nimposition of any material conditions.  All such Required Contractual Consents\n(and with respect to the Subsequent Material Contracts, such other consents as\nmay be required) shall be in full force and effect and no Proceeding shall have\nbeen instituted or threatened with respect thereto that would have a Material\nAdverse Effect.  All conditions and requirements prescribed by any required\nContractual Consent (or any such other consent) to be satisfied on or prior to\nthe Closing Date shall have been satisfied in all material respects.\n \n                 c)  The transactions contemplated by this Agreement and the\nconsummation of the Closing shall not violate any Applicable Law.  No temporary\nrestraining order, preliminary or permanent injunction, cease and desist order\nor other order issued by any court of competent jurisdiction or any competent\nGovernmental Authority or any other legal restraint or prohibition preventing\nthe consummation of the transactions contemplated hereby shall be in effect,\nand there shall be no pending or threatened actions or proceedings by any\nGovernmental Authority (or determinations by any Governmental Authority) or by\nany other Person challenging or in any manner seeking to restrict or prohibit\nthe consummation of the transactions contemplated hereby.\n\n                 (d)  Newco shall have amended its certificate of incorporation\nand restated its certificate of incorporation in substantially the form of the\nNewco Charter attached hereto as Exhibit A.\n\n                 (e)  Seller and CVC (the \"Purchaser\") shall have entered into\nan Amended and Restated Stock Sale Agreement, substantially in the form\nattached hereto as Exhibit B (the \"Stock Sale Agreement\"), relating to the\n                   ---------\npurchase by Purchaser from Seller of, in the aggregate, 450,000 shares of Newco\nCommon Stock, 90,000 shares of Newco Class B Common Stock and 14,400 shares of\nNewco Junior Preferred Stock immediately following the Closing.  The Stock Sale\nAgreement shall remain in full force and effect and all conditions to closing\ncontained in the Stock Sale Agreement shall have been satisfied (other than the\nconsummation of the transactions contemplated hereby); and Seller shall have\nreceived a certificate signed by Purchaser and Citicorp Mezzanine Partners,\nL.P. (\"CMP\") to the foregoing effect and to the effect that (i) Purchaser has\nirrevocably and unconditionally committed to consummate the transactions\ncontemplated by the Stock Sale Agreement and to pay the purchase price for the\nNewco Common Stock, Newco Class B Common Stock, and Newco Junior Preferred\nStock to be sold thereunder following consummation of the transactions\ncontemplated hereby, (ii) CMP has irrevoacably and unconditionally committed\nto consummate the CMP Loan (as defined in the Stock Sale Agreement).\n\n                 (f)  Concurrently with the Closing, Newco shall be satisfied\nwith all of its working capital financing, including the terms of the Working\nCapital Facility, which, among other things, will provide Newco with not less\nthan $75,500,000 of borrowing capacity on the Closing Date prior to the\nconsummation of the transactions contemplated hereby; and Newco shall have\nreceived cash funds under its working capital facilities sufficient, when taken\ntogether with all other funds available to Newco on the Closing Date, to pay\nthe Cash Component to Seller.  The parties hereto agree and acknowledge that\nNewco's financing arrangements with HSTC are satisfactory to Newco.\n\n                 (g)  Concurrently with the Closing, Newco and Seller shall\nhave entered into the Registration Rights Agreement relating to the Newco\nExchangeable Preferred Stock, Newco Common Stock and Newco Class B Common Stock\non commercially reasonable terms and conditions satisfactory to Newco and\nSeller in their reasonable discretion, and each party shall have delivered to\nthe other party a certificate to the effect that the provisions contained in\nsuch agreement are satisfactory.\n\n                 (h)  Concurrently with the Closing, Newco shall have entered\ninto an Indenture relating to the Newco Exchange Debentures, and each party\nshall have delivered to the other party a certificate to the effect that the\nprovisions contained in the Indenture are satisfactory.\n\n                 (i)  Concurrently with or prior to the Closing Date, except as\notherwise provided in Section 6.08, all letters of credit tendered on behalf of\nthe Seller to third parties and all guarantees by Seller, the Shareholders or\nA&amp;B of any Assumed Liabilities shall have been released, extinguished or\nassumed by Newco or arrangements satisfactory to Seller shall have been made\nfor their release, extinguishment or assumption promptly after the Closing.\n \n                 (j)  Seller shall have obtained fee title to that certain\nparcel of real property located in Crockett, California commonly referred to\nas 15 and 9 Crolona Heights Drive (the \"Company Guest House and Cottage\" listed\nas item 3 on Schedule 3.07(a)), and such parcel shall be included in the\nTransferred Assets.\n\n                 (k)  Newco, ABHI and the lender under the Working Capital\nFacility shall have entered into the Standby Financing Agreement in the form\nattached hereto as Exhibit F.\n\n          8.02.  Conditions to Obligation of Newco.  The obligations of Newco\n                 ---------------------------------\nto consummate the Closing are subject to the satisfaction on or prior to the\nClosing Date of each of the following conditions:\n\n                 (a)  (i) Seller shall have performed and satisfied, in all\nmaterial respects, each of its obligations hereunder required to be performed\nand satisfied by it on or prior to the Closing Date, (ii) each of the\nrepresentations and warranties of Seller contained in this Agreement shall be\ntrue and correct, at and as of the Closing Date with the same force and effect\nas if made as of the Closing Date (except (x) for any breach of any such\nrepresentations or warranties which, when combined with all other breaches of\nsuch representations and warranties, would not result in a Material Adverse\nEffect, (y) representations and warranties made as of a specific date (other\nthan the date of execution of this Agreement) shall continue to be true and\ncorrect in all material respects as of such specific date, and (z) any event,\noccurrence, development or state of circumstances or facts or change in the\nTransferred Assets or Business occurring or arising after the date of execution\nof this Agreement shall not be deemed to constitute a breach of the\nrepresentations and warranties contained in clause (b) of Section 3.06) and\n(iii) Newco shall have received certificates signed by a duly authorized\nexecutive officer of Seller on behalf of Seller to the foregoing effect and to\nthe effect that, to the knowledge of such executive officer, the conditions\nspecified within this Section 8.02 have been satisfied.\n\n                 (b)  Since the date hereof, there shall not have been any\nevent, occurrence, development or change of circumstances, in any case,\nresulting directly from the resolution of any collective bargaining issues of\nSeller or the Business that has had or that may be reasonably expected to have\na Material Adverse Effect.\n\n                 (c)  The Required Contractual Consents indicated with a\nplus (+) sign on Schedule 3.11(b) shall have been obtained without the\n                 ----------------\nimposition of any material conditions.  All such Required Contractual Consents\n(and with respect to the Subsequent Material Contracts, such other consents as\nmay be required) shall be in full force and effect and no Proceeding shall have\nbeen instituted or threatened with respect thereto that, would have a Material\nAdverse Effect.  All conditions and requirements prescribed by any required\nContractual Consent (or any such other consent) to be satisfied on or prior to\nthe Closing Date shall have been satisfied in all material respects.\n\n                 (d)  A&amp;B shall have delivered to Newco a letter, signed by an\nauthorized officer of A&amp;B, certifying that:  \"For a period of five (5) years\nafter the Closing Date, A&amp;B shall cause ABHI to comply with the covenant\ncontained in Section 9.06 of this Agreement.\"\n\n          8.03.   Conditions to Obligation of Seller.  The obligations of\n                  ----------------------------------\nSeller to consummate the Closing is subject to the satisfaction on or prior to\nthe Closing Date of each of the following conditions:  (i) Newco shall have\nperformed and satisfied in all material respects its obligations hereunder\nrequired to be performed and satisfied by it on or prior to the Closing Date;\n(ii) the representations and warranties of Newco contained in this Agreement\nshall be true, complete and accurate in all material respects at and as of the\nClosing Date, as if made at and as of the Closing Date (except (y) for any\nbreach of any such representations and warranties which, when combined with all\nother breaches of such representations and warranties, would not be materially\nadverse to seller, and (z) representations and warranties made as of a specific\ndate (other than the date of this Agreement) shall continue to be true and\ncorrect in all material respects as of such specific date), (iii) Seller shall\nhave received a \"resale certificate\" in form and substance satisfactory to\nSeller pertaining to that portion of the Transferred Assets being acquired by\nNewco for resale, and (iv) Seller shall have received a certificate signed by a\nduly authorized executive officer of Newco to the foregoing effect and to the\neffect that, to such executive officer's knowledge, the conditions specified\nwithin this Section 8.03 have been satisfied.\n\n                                ARTICLE IX\n  \n                              INDEMNIFICATION\n\n          9.01.  Agreement to Indemnify.\n                 ----------------------\n\n                 (a)  Newco and its Affiliates, and each officer, director,\nshareholder, employer, representative and agent of the foregoing (collectively,\nthe \"Newco Indemnitees\"{xe \"\\\"Newco Indemnitees\\\" 9.01(a)\"}) shall each be\nindemnified and held harmless to the extent set forth in this Article IX,\njointly and severally, by Seller and each of the Shareholders jointly and\nseverally in respect of any and all Damages reasonably and proximately incurred\nby any Newco Indemnitee as a result of:\n\n                      (i)    any inaccuracy or misrepresentation in or breach\n     of any representation or warranty made by Seller in this Agreement or any\n     certificate delivered by Seller pursuant hereto and any covenant of Seller\n     or the Shareholders contained in Section 5.01(a) to be performed prior to\n     or as of the Closing (other than those representations and warranties of\n     Seller contained in Sections 3.01, 3.02, 3.16, or 3.19 of this Agreement);\n     provided, however, that Seller shall have no obligation under clause (i)\n     of this Section 9.01(a) unless and until the aggregate amount of Damages\n     so incurred exceeds One Million Four Hundred Thirty Thousand Dollars\n     ($1,430,000), whereupon Seller shall be liable to indemnify all amounts\n     over One Million Four Hundred Thirty Thousand Dollars  ($1,430,000);\n     provided, further, that Seller shall have no obligation under clause (i)\n     of this Section 9.01(a) with respect to any individual item where the\n     Damages relating to such item are less than Ten Thousand Dollars ($10,000)\n     (and such items shall not be aggregated for purposes of the first proviso\n     in clause (i) of this Section 9.01(a)); provided, further, that Seller \n     shall have no obligation under clause (i) of this Section 9.01(a) to the\n     extent that the aggregate amount of Damages so incurred exceeds Fourteen\n     Million Three Hundred Thousand Dollars ($14,300,000), after which point\n     Seller will have no obligation hereunder to indemnify Newco Indemnitees\n     from and against further such Damages pursuant to this Section 9.01(a)(i);\n\n                      (ii)   any inaccuracy or misrepresentation in or breach\n     of any representation or warranty made by Seller in Sections 3.01, 3.02,\n     3.16 or 3.19 of this Agreement or with respect to such Sections in any\n     certificate delivered by Seller pursuant hereto;\n\n                      (iii)  any breach of any covenant or agreement of Seller\n     (other than the covenants contained in Section 5.01(a) of this Agreement);\n\n                      (iv)   any Excluded Liabilities; and\n\n                      (v)    any loss, claim, or expense arising from the\n     amendment of the A&amp;B Retirement Plan for Salaried Employees of C&amp;H\n     referenced in Section 7.04(a), above, to strike Article XII thereof.\n\n                 (b)  Seller and its Affiliates, and each officer, director,\nshareholder, employer, representative and agent of the foregoing (collectively,\nthe \"Seller Indemnitees\") shall each be indemnified and held harmless to the\nextent set forth in this Article IX by Newco in respect of any and all Damages\nreasonably and proximately incurred by any Seller Indemnitee as a result of:\n\n                      (i)    any inaccuracy or misrepresentation in or breach\n     of any representation, warranty, covenant or agreement made by Newco in\n     this Agreement;\n                      (ii)   any Assumed Liabilities;\n\n                      (iii)  any liability or obligation arising pursuant to\n     the Crockett Order; and\n\n                      (iv)   any liabilities of Newco or the Business incurred\n     or arising after the Closing Date other than Excluded Liabilities.\n\n                 (c)  Nothing set forth in this Article IX shall be deemed to\nprohibit or limit any Newco Indemnitee's or Seller Indemnitee's right at any\ntime before, on or after the Closing Date, to seek injunctive or other\nequitable relief for the failure of any Indemnifying Party to perform any\ncovenant or agreement contained herein.\n\n                 (d)  For purposes of the indemnification obligations hereunder\nand the calculation of Damages, any inaccuracy in or breach of a representation\nor warranty shall be deemed to constitute a breach of such representation or\nwarranty, notwithstanding any limitation or qualification as to materiality set\nforth in such representation or warranty as to the scope, accuracy or\ncompleteness thereof or any such limitation or qualification with respect to\nany such matter resulting in a Material Adverse Effect, it being the intention\nof the parties that, subject to the provisos set forth in clause (i) of\nSection 9.01(a), the Newco Indemnitees shall be indemnified and held harmless\nfrom and against any and all Damages arising out of or based upon or with\nrespect to the failure of any such representation or warranty to be true,\ncorrect and complete in any respect.\n\n          9.02.  Survival of Representation, Warranties and Covenants.  Except\n                 ----------------------------------------------------\nas hereinafter provided in this Section 9.02, all representations, warranties,\ncovenants, agreements and obligations of each Indemnifying Party contained\nherein (including the indemnification obligations contained in this Article IX)\nand all claims of any Newco Indemnitee or Seller Indemnitee in respect of any\nbreach of any representation, warranty, covenant, agreement or obligation of\nany Indemnifying Party contained in this Agreement, shall survive the Closing\nand shall expire on the second anniversary of the Closing Date; provided,\nhowever, that the representations and warranties contained in Sections\n3.01-3.04 and 3.16 of this Agreement shall survive the Closing indefinitely;\nprovided, further, that the representations and warranties contained in Section\n3.19 of this Agreement shall survive the Closing through the applicable statute\nof limitations; and provided, further, that the representations and warranties\ncontained in Section 3.17 of this Agreement shall survive the Closing and shall\nexpire on the fifth anniversary of the Closing Date.\n\n          9.03.  Claims for Indemnification.  If any Indemnitee shall believe\n                 --------------------------\nthat such Indemnitee is entitled to indemnification pursuant to this Article IX\nin respect of any Damages, such Indemnitee shall give the appropriate\nIndemnifying Parties prompt written notice thereof.  Any such notice shall set\nforth in reasonable detail and to the extent then known the basis for such\nclaim for indemnification.  The failure of such Indemnitee to give notice of\nany claim for indemnification promptly, but within the periods specified by\nSection 9.02, as the case may be, shall not adversely affect such Indemnitee's\nright to indemnity hereunder except to the extent that such failure adversely\naffects the right of the Indemnifying Parties to assert any reasonable defense\nto such claim.  Each such claim for indemnity shall expressly state that the\nIndemnifying Parties shall have only the thirty (30) Business Day period\nreferred to in the next sentence to dispute or deny such claim.  The\nIndemnifying Parties shall have thirty (30) Business Days following its receipt\nof such notice either (y) to acquiesce in such claim by giving such Indemnitee\nwritten notice of such acquiescence or (z) to object to the claim by giving\nsuch Indemnitee written notice of the objection.\n\n          9.04.  Defense of Claims.  In connection with any claim which may\n                 -----------------\ngive rise to indemnity under this Article IX resulting from or arising out of\nany claim or Proceeding against an Indemnitee by a Person that is not a party\nhereto, the Indemnifying Parties may (unless such Indemnitee elects not to\nseek indemnity hereunder for such claim), upon written notice sent at any time\nto the relevant Indemnitee, assume the defense of any such claim or Proceeding\nif all Indemnifying Parties with respect to such claim or Proceeding jointly\nacknowledge to the Indemnitee the Indemnitee's right to indemnity pursuant\nhereto in respect of the entirety of such claim (as such claim may have been\nmodified through written agreement of the parties or arbitration hereunder)\nand provide assurances, reasonably satisfactory to such Indemnitee, that the\nIndemnifying Parties will be financially able to satisfy such claim in full\nif such claim or Proceeding is decided adversely.  If the Indemnifying Parties\nassume the defense of any such claim or Proceeding, the Indemnifying Parties\nshall select counsel reasonably acceptable to such Indemnitee (the parties\nagree that any Indemnitee shall be precluded from asserting that the firms of\nKirkland &amp; Ellis or Gibson, Dunn &amp; Crutcher LLP are not reasonably acceptable)\nto conduct the defense of such claim or Proceeding, shall take all steps\nreasonably necessary in the defense or settlement thereof and shall at all\ntimes diligently and promptly pursue theresolution thereof.  If the\nIndemnifying Parties shall have assumed the defense of any claim or Proceeding\nin accordance with this Section 9.04, the Indemnifying Parties shall be\nauthorized to consent to a settlement of, or the entry of any judgment arising\nfrom, any such claim or Proceeding, without the prior written consent of such\nIndemnitee; provided, however, that the Indemnifying Parties shall pay or cause\nto be paid all amounts arising out of such settlement or judgment either\nconcurrently with the effectiveness thereof or shall obtain and deliver to such\nIndemnitees prior to the execution of such settlement a general release\nexecuted by the Person not a party hereto, which general release shall release\nsuch Indemnitee from any liability in such matter; provided, further, that the\nIndemnifying Parties shall not be authorized to encumber any of the assets of\nany Indemnitee or to agree to any restriction that would apply to any\nIndemnitee or to its conduct of business; and provided, further, that a\ncondition to any such settlement shall be a complete release of such Indemnitee\nand its Affiliates, officers, employees, consultants and agents with respect to\nsuch claim.  Such Indemnitee shall be entitled to participate in (but not\ncontrol) the defense of any such action, with its own counsel and at its own\nexpense.  Each Indemnitee shall, and shall cause each of its Affiliates,\nofficers, employees, consultants and agents to, cooperate fully with the\nIndemnifying Parties in the defense of any claim or Proceeding being defended\nby the Indemnifying Parties pursuant to this Section 9.04.  If the Indemnifying\nParties do not assume the defense of any claim or Proceeding resulting\ntherefrom in accordance with the terms of this Section 9.04, such Indemnitee\nmay defend against such claim or Proceeding in such manner as it may deem\nappropriate, including settling such claim or Proceeding after giving notice of\nthe same to the Indemnifying Parties, on such terms as such Indemnitee may deem\nappropriate.  If the Indemnifying Parties seek to question the manner in which\nsuch Indemnitee defended such claim or Proceeding or the amount of or nature of\nany such settlement, the Indemnifying Parties shall have the burden to prove\nby a preponderance of the evidence that such Indemnitee did not defend such\nclaim or Proceeding in a reasonably prudent manner.\n\n          9.05.  Nature of Payments.  Any payment under this Article IX shall\n                 ------------------\nbe treated for tax purposes as an adjustment of the Purchase Consideration to\nthe extent such characterization is proper and permissible under relevant Tax\nauthorities, including court decisions, statutes, regulations and\nadministrative promulgations.\n\n          9.06.  ABHI's Financial Condition.  ABHI agrees that, for a period of\n                 --------------------------\nfive (5) years after the Closing Date, it will maintain shareholder's equity,\ndetermined in accordance with GAAP, of not less than $25 million.\n\n                                   ARTICLE X\n\n                                  TERMINATION\n\n          10.01.  Grounds for Termination.  This Agreement may be terminated at\n                  -----------------------\nany time prior to the Closing:\n\n                  (a)  by mutual written agreement of all of the parties\nhereto.\n\n                  (b)  by Newco after written notice to Seller of any one or\nmore misrepresentations in or breaches of the representations or warranties\nmade by Seller contained herein that, if not cured on or prior to the Closing\nDate, could be reasonably expected to give Newco grounds not to close under\nArticle VIII when taken into account with all other uncured misrepresentations\nin or breaches of such representations or warranties as to which Newco shall\nhave given notice to Seller as provided in this clause (b).  A termination\npursuant to this paragraph (b) shall become effective (i) fifteen (15) days\nafter such notice with respect to such a misrepresentation or breach that is\nnot capable of being cured on or prior to the Closing Date, or (ii) immediately\nprior to the Closing with respect to such a misrepresentation or breach that is\ncapable of being cured, but is not cured, on or prior to the Closing Date;\n\n                  (c)  by Newco after written notice to Seller of the failure\nby Seller to perform and satisfy any of its obligations under this Agreement\nrequired to be performed and satisfied by Seller on or prior to the Closing\nDate, if the aggregate of all such failures shall be material.  A termination\npursuant to this paragraph (c) shall become effective (i) fifteen (15) days\nafter such notice with respect to such a failure that is not capable of being\ncured on or prior to the Closing Date, or (ii) immediately prior to the Closing\nwith respect to such a failure that is capable of being cured, but is not\ncured, on or prior to the Closing Date;\n\n                  (d)  by Seller after written notice to Newco of any one or\nmore misrepresentations in or breaches of the representations or warranties\nmade by Newco herein which, if not cured on or prior to the Closing Date,\ncould be reasonably expected to give Seller grounds not to close under Article\nVIII when taken into account with all other uncured misrepresentations in or\nbreaches of such representations or warranties as to which Seller shall have\ngiven notice to Newco as provided in this clause (d). A termination pursuant to\nthis paragraph (d) shall become effective (i) fifteen (15) days after such\nnotice with respect to such a misrepresentation or breach that is not capable\nof being cured on or prior to the Closing Date, or (ii) immediately prior to\nthe Closing with respect to such a misrepresentation or breach that is capable\nof being cured, but is not cured, on or prior to the Closing Date;\n\n                  (e)  by Seller after written notice to Newco of Newco's\nfailure to perform and satisfy any of its obligations under this Agreement\nrequired to be performed and satisfied by Newco on or prior to the Closing\nDate, if the aggregate of all such failures shall be material.  A termination\npursuant to this paragraph (e) shall become effective (i) fifteen (15) days\nafter such notice with respect to such a failure that is not capable of being\ncured on or prior to the Closing Date, or (ii) immediately prior to the Closing\nwith respect to such a failure that is capable of being cured, but is not\ncured, on or prior to the Closing Date;\n\n                  (f)  by Newco or by Seller, if the Closing shall not have\nbeen consummated by March 31, 1999 (the \"Outside Date\"); provided, however,\nthat neither Newco nor Seller may terminate this Agreement pursuant to this\nclause (f) if the Closing shall not have been consummated within such time\nperiod by reason of the failure of such party or any of its Affiliates to\nperform in all material respects any of its or their respective covenants or\nagreements contained in this Agreement; and\n\n                  (g)  by any party hereto if any Federal, state or foreign\nlaw or regulation thereunder shall hereafter be enacted or become applicable\nthat makes the transactions contemplated hereby or the consummation of the\nClosing illegal or otherwise prohibited, or if any judgment, injunction, order\nor decree enjoining either party hereto from consummating the transactions\ncontemplated hereby is entered, and such judgment, injunction, order or decree\nshall become final and nonappealable.\n\n                  The party desiring to terminate this Agreement pursuant to\nclauses (b) through (g) shall give written notice of such termination to the\nother party as soon as is practicable.\n\n          10.02.  Effect of Termination.  If this Agreement is terminated as\n                  ---------------------\npermitted by Section 10.01, such termination shall be without liability of any\nparty to any other party to this Agreement except as hereinafter expressly\nprovided in this Section 10.02.  If such termination shall result from the\nbreach by any party of itsrepresentations, warranties or covenants contained\nin this Agreement, such party shall be fully liable for any and all Damages\nincurred or suffered by the other parties as a result of such failure or\nbreach.  The provisions of Sections 5.10, 5.11, 6.03, 6.04, 11.03 and 11.05\nshall survive any termination of this Agreement pursuant to Article X, and each\nparty hereto shall be fully responsible for any breach of any such provision,\nwhether or not such breach occurs prior to the termination of this Agreement.\n\n                                   ARTICLE XI\n\n                                 MISCELLANEOUS\n\n          11.01.  Notices.  All notices, requests, demands, claims and other\n                  -------\ncommunications hereunder shall be in writing.  Any notice, request, demand,\nclaim, or other communication hereunder shall be deemed duly given (i) if\npersonally delivered, when so delivered, (ii) if mailed, five Business Days\nafter having been sent by registered or certified mail, return receipt\nrequested, postage prepaid and addressed to the intended recipient as set forth\nbelow, (iii) if given by telex or telecopier, once such notice or other\ncommunication is transmitted to the telex or telecopier number specified below\nand the appropriate answer back or telephonic confirmation is received,\nprovided that such notice or other communication is promptly thereafter mailed\nin accordance with the provisions of clause (ii) above or (iv) if sent through\nan overnight delivery service in circumstances to which such service guarantees\nnext day delivery, the day following being so sent:\n\n\n          If to Seller:\n          ------------\n\n               Glenn R. Rogers\n               Alexander &amp; Baldwin, Inc.\n               333 Market Street\n               P.O. Box 7452\n               San Francisco, CA  94120\n               Telecopier:  (415) 546-9630\n\n          with copies to:\n          --------------\n\n               Michael J. Marks, Esq.\n               Alexander &amp; Baldwin, Inc.\n               Post Office Box 3440\n               Honolulu, HI  96801\n               Telecopier:  (808) 525-6678\n\n               Bradford P. Weirick, Esq.\n               Gibson, Dunn &amp; Crutcher LLP\n               333 S. Grand Avenue\n               Los Angeles, CA  90071\n               Telecopier:  (213) 229-7520\n\n          If to Newco:\n          -----------\n\n               David Howe\n               Citicorp Venture Capital, Ltd.\n               399 Park Avenue\n               New York, NY  10043\n               Telecopier:  (212) 888-2940\n\n          with a copy to:\n          --------------\n\n               Kirk Radke, Esq.\n               Kirkland &amp; Ellis\n               Citicorp Center\n               153 East 53rd Street\n               New York, NY  10022\n               Telecopier:  (212) 446-4900\n\n          Any party may give any notice, request, demand, claim or other\ncommunication hereunder using any other means (including ordinary mail or\nelectronic mail), but no such notice, request, demand, claim or other\ncommunication shall be deemed to have been duly given unless and until it\nactually is received by the individual for whom it is intended.  Any party may\nchange the address to which notices, requests, demands, claims and other\ncommunications hereunder are to be delivered by giving the other parties\nnotice in the manner herein set forth.\n\n          11.02.  Amendments; No Waivers.\n                  ----------------------\n\n                  (a)  Any provision of this Agreement may be amended or\nwaived if, and only if, such amendment or waiver is in writing and signed, in\nthe case of an amendment, by all parties hereto, or in the case of a waiver, by\nthe party against whom the waiver is to be effective.\n\n                  (b)  No waiver by a party of any default, misrepresentation\nor breach of warranty or covenant hereunder, whether intentional or not, shall\nbe deemed to extend to any prior or subsequent default, misrepresentation or\nbreach of warranty or covenant hereunder or affect in any way any rights\narising by virtue of any prior or subsequent occurrence.  No failure or delay\nby a party in exercising any right, power or privilege hereunder shall operate\nas a waiver thereof nor shall any single or partial exercise thereof preclude\nany other or further exercise thereof or the exercise of any other right, power\nor privilege.  The rights and remedies herein provided shall be cumulative and\nnot exclusive of any rights or remedies provided by law.\n\n          11.03.  Expenses.\n                  --------\n\n                  (a)  Except as otherwise provided herein, all costs,\nexpenses, liabilities, Taxes (excluding sales and transfer Taxes) and other\ncharges incurred in connection with this Agreement and the transactions\ncontemplated hereby shall be paid by Newco, including the reasonable fees and\nexpenses of investment banks, attorneys and other advisors.  Newco and Seller\nshall each pay 50% of all sales and transfer Taxes arising as a result of the\nsale of the Transferred Assets pursuant to this Agreement.\n\n                  (b)  In the event that this Agreement is terminated and\/or\nthe transactions contemplated hereby are not consummated, Seller shall be\nresponsible for all of its expenses (including any fees and expenses of\ninvestment banks, attorneys and other advisors engaged by Seller) and CVC shall\nbe responsible for its expenses (including any fees and expenses of investment\nbanks, attorneys and other advisors engaged by CVC).\n\n          11.04.  Successors and Assigns.  This Agreement shall be binding upon\n                  ----------------------\nand inure to the benefit of the parties hereto and their respective successors\nand permitted assigns.  No party hereto may assign either this Agreement or any\nof its rights, interests or obligations hereunder without the prior written\napproval of each other party, which approval shall not be unreasonably\nwithheld; provided, however, that Newco may assign either this Agreement or any\nof its rights, interests or obligations hereunder without the prior written\napproval of each other party if such assignment is expressly requested in\nwriting by any party providing funds or other financings in connection with\nthis Agreement.\n\n          11.05.  Governing Law.  This Agreement shall be construed in\n                  -------------\naccordance with and governed by the internal laws (without reference to choice\nor conflict of laws) of the State of California.\n\n          11.06.  Counterparts; Effectiveness.  This Agreement may be signed in\n                  ---------------------------\nany number of counterparts, each of which shall be an original, with the same\neffect as if the signatures thereto and hereto were upon the same instrument.\nThis Agreement shall become effective when each party hereto shall have\nreceived a counterpart hereof signed by the other parties hereto.\n\n          11.07.  Entire Agreement.  This Agreement (including the Schedules\n                  ----------------\nand Exhibits referred to herein which are hereby incorporated by reference)\nconstitutes the entire agreement between the parties with respect to the\nsubject matter hereof and supersedes all prior agreements (including the Letter\nof Intent, dated May 5, 1998 and that certain Confidentiality Agreement, dated\nas of August 8, 1997, between Cybus Capital Markets and Citicorp Venture\nCapital, Ltd., which terminates at Closing), understandings and negotiations,\nboth written and oral, between the parties with respect to the subject matter\nof this Agreement.  Neither this Agreement nor any provision hereof is intended\nto confer upon any Person other than the parties hereto any rights or remedies\nhereunder.\n\n          11.08.  Captions.  The captions herein are included for convenience\n                  --------\nof reference only and shall be ignored in the construction or interpretation\nhereof.  All references to an Article or Section include all subparts thereof.\n\n          11.09.  Severability.  If any provision of this Agreement, or the\n                  ------------\napplication thereof to any Person, place or circumstance, shall be held by a\ncourt of competent jurisdiction to be invalid, unenforceable or void, the\nremainder of this Agreement and such provisions as applied to other Persons,\nplaces and circumstances shall remain in full force and effect only if, after\nexcluding the portion deemed to be unenforceable, the remaining terms shall\nprovide for the consummation of the transactions contemplated hereby in\nsubstantially the same manner as originally set forth at the later of the\ndate this Agreement was executed or last amended. \n\n          11.10.  Construction.\n                  ------------\n\n                  (a)  The language used in this Agreement will be deemed to be\nthe language chosen by the parties hereto to express their mutual intent, and\nno rule of strict construction shall be applied against either party.  Any\nreference to any Applicable Law shall be deemed also to refer to all rules and\nregulations promulgated thereunder, unless the context requires otherwise.\nWhenever required by the context, any gender shall include any other gender,\nthe singular shall include the plural and the plural shall include the\nsingular.  The words \"herein,\" \"hereof,\" \"hereunder,\" and words of similar\nimport refer to the Agreement as a whole and not to a particular section.\nWhenever the word \"including\" is used in this Agreement, it shall be deemed to\nmean \"including, without limitation,\" \"including, but not limited to\" or other\nwords of similar import such that the items following the word \"including\"\nshall be deemed to be a list by way of illustration only and shall not be\ndeemed to be an exhaustive list of applicable items in the context thereof.\n\n                  (b)  The parties hereto intend that each representation,\nwarranty, and covenant contained herein shall have independent significance.\nIf any party has breached any representation, warranty or covenant contained\nherein in any respect, the fact that there exists another representation,\nwarranty or covenant relating to the same subject matter (regardless of the\nrelative levels of specificity) that the party has not breached shall not\ndetract from or mitigate the fact that the party is in breach of the first\nrepresentation, warranty or covenant.\n\n          11.11.  Cumulative Remedies.  The rights, remedies, powers and\n                  -------------------\nprivileges herein provided are cumulative and not exclusive of any rights,\nremedies, powers and privileges provided by law.  The parties hereto agree that\nany party may seek specific performance by the other party of its obligations\nhereunder without the requirement of posting a bond.\n\n          11.12.  Third Party Beneficiaries.  Except for any rights provided\n                  -------------------------\nunder the Stock Sale Agreement, no provision of this Agreement shall create any\nthird party beneficiary rights in any Person, including any employee of Newco\nor employee or former employee of Seller or any Affiliate thereof (including\nany beneficiary or dependent thereof).\n\n          11.13.  Knowledge.  Whenever \"knowledge,\" \"to the knowledge of\" \"has\n                  ---------\nreceived no notice\" or \"is not aware\" (and all variants and derivatives\nthereof) with respect to any Person, means the current actual knowledge of\nsuch Person, after reasonable inquiry.  Notwithstanding the foregoing, the\nforegoing terms, when applied to Seller, shall mean the actual knowledge, after\nreasonable inquiry, of any and all persons listed on Schedule 11.13.\n                                                     --------------\n\n\n\n          IN WITNESS WHEREOF, the parties hereto have caused this Amended and\nRestated Asset Purchase Agreement to be duly executed by their respective\nauthorized officers as of the day and year first above written.\n\n                               SELLER:\n                               CALIFORNIA AND HAWAIIAN SUGAR COMPANY, INC.,\n                               A HAWAII CORPORATION\n                               By:  \/s\/ Robert J. Guilbault\n                                    ----------------------------\n                               Name:  Robert J. Guilbault\n                               Title:  Vice President\n\n                               NEWCO:\n                               SUGAR ACQUISITION CORPORATION, A DELAWARE\n                               CORPORATION\n                               By:  \/s\/ David G. Koncelik\n                                    ----------------------------\n                               Name:  David G. Koncelik\n                               Title:  President and Chief Executive Officer\n\n                               SHAREHOLDERS:\n                               A &amp; B - HAWAII, INC., A HAWAII CORPORATION\n                               By:  \/s\/ Glenn R. Rogers\n                                    ----------------------------\n                               Name:  Glenn R. Rogers\n                               Title:  Senior Vice President, Chief\n                                    Financial Officer and Treasurer\n\n                               MCBRYDE SUGAR COMPANY, LIMITED, A HAWAII\n                               CORPORATION\n                               By:  \/s\/ Glenn R. Rogers\n                                    ----------------------------\n                               Name:  Glenn R. Rogers\n                               Title:  Vice President\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6618],"corporate_contracts_industries":[9526],"corporate_contracts_types":[9623,9622],"class_list":["post-43286","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-alexander---baldwin-inc","corporate_contracts_industries-transportation__shipping","corporate_contracts_types-planning__asset","corporate_contracts_types-planning"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43286","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43286"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43286"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43286"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43286"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}