ASSET PURCHASE AGREEMENT

Exhibit 2.1 ^*

E XECUTION V ERSION

 

A SSET P URCHASE A GREEMENT

DATED AS OF A PRIL  23, 2009

BY AND AMONG

W EST LB AG, N EW Y ORK B RANCH ,

IN ITS CAPACITY AS A DMINISTRATIVE A GENT AND S UB -C OLLATERAL A GENT ,

AS B UYER ’ S R EPRESENTATIVE ,

ASA B LOOMINGBURG , LLC,

ASA L INDEN , LLC,

ASA O P C O H OLDINGS , LLC

AND

V ERA S UN E NERGY C ORPORATION ,

AS S ELLERS

 

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In accordance with Item 601(b)(2) of Regulation S-K, the schedules and similar attachments to the asset purchase agreement in this exhibit, which schedules and similar attachments are listed in the table of contents of the asset purchase agreement, have not been filed. The registrant agrees to furnish a copy of any omitted schedule or similar attachment to the SEC upon request.

T ABLE OF C ONTENTS

 

 

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Asset Purchase Agreement

T HIS A SSET P URCHASE A GREEMENT (this “ Agreement ”) is made as of April 23, 2009 (the “ Effective Date ”), by and among WESTLB AG, NEW YORK BRANCH, in its capacity as administrative agent and sub-collateral agent under the First Lien Credit Agreement, as buyer’s representative (in such capacity, “ Buyer’s Representative ” together with all Purchasing Designees “ Buyer ”) , ASA Linden, LLC, a Delaware limited liability company (“ Linden ”), ASA Bloomingburg, LLC, a Delaware limited liability company (“ Bloomingburg ”), ASA OpCo Holdings, LLC, a Delaware limited liability company (“ ASA Holdings ”) and VeraSun Energy Corporation, a South Dakota corporation (“ Parent ” and, together with ASA Holdings, Bloomingburg and Linden, the “ Sellers ”). Capitalized terms used herein and not otherwise defined herein have the meanings set forth in Article 1 .

Recitals

W HEREAS , each Seller (other than ASA Holdings and Parent) is and was, prior to its reduction of operations following the Filings, engaged in the business of producing ethanol and its co-products, including distillers grains, at the Facility that bears its name (such business, the “ Business ”);

W HEREAS , ASA Holdings is the owner of 100% of the equity interests in Bloomingburg and Linden;

W HEREAS , Parent is party to certain Contracts related to Bloomingburg which are or may become Assigned Contracts;

W HEREAS , on October 31, 2008 (the “ Petition Date ”), Sellers filed a voluntary petition for relief (each a “ Filing ” and, together, the “ Filings ”) commencing cases under chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the “ Bankruptcy Court ”);

W HEREAS , Sellers desire to sell to Buyer all of the Acquired Assets, and Buyer desires to purchase from Sellers all of the Acquired Assets and assume all of the Assumed Liabilities, upon the terms and conditions hereinafter set forth;

W HEREAS , the Parties intend to effectuate the transactions contemplated by this Agreement through a sale of the Acquired Assets pursuant to Sections 363 and 365 of the Bankruptcy Code; and

W HEREAS , the execution and delivery of this Agreement and Sellers’ ability to consummate the transactions set forth in this Agreement are subject to, among other things, the entry of an Order of the Bankruptcy Court under, inter alia , Sections 363 and 365 of the Bankruptcy Code.

N OW , T HEREFORE , in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties and covenants herein contained, the Parties agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Definitions .

For purposes of this Agreement, the following terms have the meanings specified or referenced below.

“ Accounts Receivable ” means, with respect to each Seller, all accounts receivable and other rights to payment from customers of such Seller and the full benefit of all security for such accounts receivable or rights to payment, including those consisting of all accounts receivable in respect of goods shipped or products sold or services rendered to customers by such Seller, any other miscellaneous accounts receivable of such Seller, and any claim, remedy or other right of such Seller related to any of the foregoing.

“ Acquired Assets ” has the meaning set forth in Section 2.1 .

“ Action ” means any legal action, suit or arbitration, or any inquiry, proceeding or investigation, by or before any Governmental Authority.

“ Affiliate ” has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Securities Exchange Act of 1934, as amended.

“ Agreement ” has the meaning set forth in the introductory paragraph.

“ Albion ” means ASA Albion, LLC, a Delaware limited liability company.

“ Albion Sale Order ” means the Order of the Bankruptcy Court styled “Order (A) Approving the Sale of ASA Albion, LLC Assets Free and Clear of All Liens, Claims, Encumbrances and Interests; (B) Authorizing the Assumption and Assignment of Certain Executory Contracts and Unexpired Leases; and (C) Granting Certain Related Relief”.

“ Allocation Arbiter ” has the meaning set forth in Section 3.4 .

“ Allocation Schedule(s) ” has the meaning set forth in Section 3.4 .

“ ASA Holdings ” has the meaning provided in the introductory paragraph.

“ ASA Sellers ” means Linden, Bloomingburg and ASA Holdings, collectively.

“ Assigned Contracts ” means the Contracts listed or described in Part A of Schedule 1.1(a) , together with any of the Contracts listed on Part B of Schedule 1.1(a) that are identified as

 

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Assigned Contracts after the date hereof and on or prior to the Designation Deadline pursuant to the penultimate paragraph of Section 2.1 .

“ Assignment Election ” has the meaning set forth in Section 2.1 .

“ Assumed Liabilities ” has the meaning set forth in Section 2.3 .

“ Assumption Agreement ” means the assumption agreement in the form attached hereto as Exhibit A .

“ Avoidance Actions ” means any and all claims for relief of any Seller under chapter 5 of the Bankruptcy Code, with the exception of any claims of any Seller under section 549 of the Bankruptcy Code.

“ Bankruptcy Case ” means the cases commenced by Sellers and certain of their Affiliates under chapter 11 of the Bankruptcy Code in the Bankruptcy Court, styled In re VeraSun Energy Corporation, et al. , jointly administered under Case No. 08-12606 (BLS), and pending before the Bankruptcy Court.

“ Bankruptcy Court ” has the meaning set forth in the recitals.

“ Bankruptcy Code ” means Title 11 of the United States Code, Sections 101 et seq .

“ Benefit Plan ” has the meaning set forth in Section 5.12 .

“ Bill of Sale ” means the bill of sale substantially in the form attached hereto as Exhibit B .

“ Bloomingburg ” has the meaning provided in the recitals.

“ Business ” has the meaning set forth in the recitals and, in the case of ASA Holdings and Parent, means collectively the Business of Bloomingburg and Linden.

“ Business Day ” means any day of the year on which national banking institutions in New York are open to the public for conducting business and are not required or authorized to close.

“ Buyer ” has the meaning set forth in the introductory paragraph.

“ Buyer Equity Consideration ” means the equity of the Purchasing Designee acquiring Acquired Assets from ASA Holdings (which Purchasing Designee will in turn own the equity interests in each other Purchasing Designee), which securities the First Lien Agent shall distribute ratably to the current First Lien Lenders (or to a separate special purpose company owned ratably by the First Lien Lenders) on or as soon as reasonably practicable after the Closing Date, and which securities shall be subject to documentation that shall be reasonably acceptable to the First Lien Agent.

“ Buyer Termination Notice ” has the meaning set forth in Section 11.1(b)(i) .

“ Buyer’s Representative ” has the meaning provided in the introductory paragraph.

 

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“ Cargill Entities ” means any of Cargill, Incorporated, Cargill Commodity Services Inc., Cargill Direct, Cargill Energy Services, AgHorizons U.S. Business Unit, Cargill Biofuels Investments, LLC, and any Affiliate or Subsidiary of any of them.

“ Closing ” has the meaning set forth in Section 4.1 .

“ Closing Date ” means the date and time as of which the Closing occurs as set forth in Section 4.1 .

“ COBRA ” means Section 4980B of the Code and Sections 601 through 609 of ERISA (together with the regulations promulgated thereunder.

“ Code ” means the Internal Revenue Code of 1986, as amended.

“ Commitment Letter ” has the meaning set forth in Section 8.8(a) .

“ Contract ” means any agreement, contract, obligation, promise, or undertaking (whether written or oral), other than a Lease, that is legally binding.

“ Copyrights ” means all United States and foreign copyright rights in any original works of authorship, whether registered or unregistered, including all copyright registrations and applications.

“ Credit Bid ” means the credit bid provided for in the First Lien Direction.

“ Cure Costs ” means amounts that must be paid and obligations that otherwise must be satisfied, including pursuant to Sections 365(b)(1)(A) and (B) of the Bankruptcy Code, in connection with the assumption and/or assignment of the Assigned Contracts.

“ Deeds ” means the deeds transferring title to the Owned Real Property to be delivered pursuant to Section 4.3(a) , in substantially the form of Exhibit E-1 or E-2 (as applicable).

“ Designation Deadline ” has the meaning set forth in Section 2.1 .

“ DIP Credit Agreement ” means the Priming Superpriority Debtor-In-Possession Credit Agreement, dated as of February 10, 2009 (as amended, restated, supplemented or otherwise modified from time to time, the “DIP Credit Agreement”) among ASA Holdings, Albion, Bloomingburg, and Linden, jointly and severally as Borrowers, ASA Holdings as Borrowers’ Agent, each of the Lenders from time to time party thereto, VeraSun Energy Corporation, WestLB AG, New York Branch, as Administrative Agent for the Lenders, First National Bank of Omaha, as Collateral Agent for the Secured Parties, WestLB AG, New York Branch, as Issuing Bank with respect to the Letters of Credit, and WestLB AG, New York Branch, as Lead Arranger and Sole Lead Bookrunner.

“ Documents ” means all books, records, files, invoices, Inventory records, product specifications, advertising materials, customer lists, cost and pricing information, supplier lists, business plans, catalogs, customer literature, quality control records and manuals, research and development files, owner or operator manuals, records and laboratory books and credit records

 

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of customers (including all data and other information stored on discs, tapes or other media) to the extent used exclusively in or to the extent relating exclusively to the assets, properties, business or operations of the Business.

“ Effective Date ” has the meaning set forth in the introductory paragraph.

“ Encumbrance ” means any charge, lien, claim, mortgage, lease, sublease, hypothecation, deed of trust, pledge, security interest, option, right of use or possession, right of first offer or first refusal, easement, servitude, restrictive covenant, encroachment, encumbrance, or other similar restriction of any kind.

“ Environmental, Health and Safety Laws ” has the meaning set forth in Section 5.6(a) .

“ Equipment ” means, with respect to any Seller, all furniture, trade fixtures, equipment, computers, machinery, apparatus, appliances, implements, signage, supplies and all other tangible personal property of every kind and description owned by such Seller and used or held for use exclusively in the Business of such Seller, other than spare parts.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

“ ERISA Affiliate ” has the meaning set forth in Section 5.12 .

“ Excluded Accounts Receivable ” has the meaning set forth in Section 2.2(l) .

“ Excluded Assets ” has the meaning set forth in Section 2.2 .

“ Excluded Cash ” has the meaning set forth in Section 2.2(b) .

“ Excluded Liabilities ” has the meaning set forth in Section 2.4 .

“ Existing LCs ” has the meaning set forth in Section 7.10 .

“ Facilities ” means the production facilities listed on Exhibit C .

“ Facility Employees ” means employees who are employed by or on behalf of any Seller or any of its Affiliates exclusively at one or both Facilities.

“ Filing ” and “ Filings ” have the respective meanings set forth in the recitals.

“ Final Order ” means an action taken or order issued by the applicable Governmental Authority as to which no stay of the action or order is in effect.

“ Financing ” means financing facilities available to the Purchasing Designees as of the Closing Date in an amount adequate to cover the Assumed Liabilities and other reasonably anticipated costs of operating the Business and the Facilities.

“ First Lien Agent ” means WestLB AG, New York Branch, as Administrative Agent and as sub-Collateral Agent under the First Lien Credit Agreement.

 

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“ First Lien Credit Agreement ” means the Credit Agreement, dated as of February 6, 2006 (as amended, restated, supplemented or otherwise modified from time to time), among ASA Holdings, Albion, Bloomingburg and Linden (collectively, ASA Holdings, Albion and Bloomingburg and Linden, the “ Borrowers ”), ASA Holdings, as Borrowers’ Agent, the lenders party thereto, WestLB AG, New York Branch, as administrative agent, First National Bank of Omaha as collateral agent and as the accounts bank, WestLB AG, New York Branch, as co-syndication agent, lead arranger, and sole lead bookrunner, First National Bank of Omaha and Standard Chartered Bank, as co-syndication agents and lead arrangers and CIT Capital USA INC. and ING Capital LLC, as co-documentation agents and lead arrangers.

“ First Lien Credit Facility ” means the credit facility provided under the First Lien Credit Agreement.

“ First Lien Direction ” means a written direction by the Required Lenders (as that term is defined in the First Lien Credit Agreement) to the First Lien Agent to credit bid in the amount of $49,500,000 of the First Lien Indebtedness per Facility for each of the Bloomingburg and Linden Facilities (for a total of $99,000,000 of the First Lien Indebtedness) toward the purchase of the Acquired Assets on the terms and conditions contained herein.

“ First Lien Indebtedness ” means all of the obligations outstanding under the First Lien Credit Agreement, including all pre- and post-petition interest due and owing thereunder (at the contractual default rate) and all unpaid fees and expenses related thereto, in each case at the time of Closing.

“ First Lien Lenders ” means the financial institutions party to the First Lien Credit Agreement on the date hereof, together with their successors and assigns permitted by the First Lien Credit Agreement.

“ Finished Ethanol ” means 190 proof ethanol, 200 proof ethanol and denatured ethanol.

“ Governmental Authority ” means any United States federal, state or local or any foreign government, governmental authority or regulatory or administrative authority or any court, tribunal or judicial body having jurisdiction.

“ Governmental Authorization ” means any approval, consent, license, permit, waiver or other authorization issued, granted or otherwise made available by or under the authority of any Governmental Authority.

“ Hazardous Substance ” means any “pollutant,” “contaminant,” “hazardous waste,” “hazardous material” or “hazardous substance” under any Environmental, Health and Safety Laws.

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the relevant rules and regulations thereunder.

“ Intellectual Property ” means, with respect to any Seller, all intellectual property, including all Copyrights, Patents, Trademarks and Trade Secrets, owned, used or licensed by such Seller and used or held for use exclusively in such Seller’s Business.

 

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“ Inventory ” means (i) all Finished Ethanol stored at the Facilities; (ii) all Work in Progress; (iii) all Finished Ethanol produced at the Facilities and in transit via truck or railcar; (iv) all corn stored at the Facilities or stored at third-party facilities, but only to the extent such corn is exclusively for use at any of the Facilities; (v) all dry distillers grain and wet distillers grain located at the Facilities; (vi) all spare parts located at the Facilities; and (vii) all yeast, enzymes, chemicals and denaturant located at the Facilities.

“ Inventory Disposition Agreement ” has the meaning set forth in Section 2.1(a)(v) .

“ Knowledge ” means, with respect to any matter in question, in the case of ASA Sellers or Parent, the actual knowledge of any of James Bonsall, Donald Endres, Mark Dickey, Bryan Meier and Joel West with respect to such matter.

“ Leases ” has the meaning set forth in Section 5.5(a) .

“ Legal Requirement ” means any federal, state, provincial, local, municipal, foreign, international, multinational, or other administrative Order, constitution, law, ordinance, principle of common law, regulation, statute or treaty.

“ Liability ” means any debt, losses, claim, damage, demand, fine, judgment, penalty, liability or obligation (whether known or unknown, asserted or unasserted, absolute or contingent, accrued or unaccrued, liquidated or unliquidated, or due or to become due).

“ Linden ” has the meaning provided in the introductory paragraph.

“ Material Adverse Effect ” means a material adverse change in or material adverse effect on the Acquired Assets or the Business (excluding the Excluded Assets and the Excluded Liabilities), in each case taken as a whole, but excluding (a) any change or effect to the extent that it results from or arises out of (i) the Filings; (ii) the execution and delivery of this Agreement or the announcement thereof or the pendency or consummation of the transactions contemplated hereby; (iii) geopolitical conditions or any outbreak or escalation of hostilities or acts of terrorism or war; (iv) any hurricane, tornado, flood, earthquake or other natural disaster; (v) changes in (or proposals to change) Legal Requirements or accounting regulations or principles; (vi) any action contemplated by this Agreement or taken at the request of Buyer; (vii) changes in prices or costs of commodities or supplies; (viii) failure of Sellers to meet any internal or published projections, forecasts, estimates or predictions in respect of financial or operating metrics; or (ix) any motion, application, pleading or Order filed under or in connection with the Bankruptcy Case; and (b) any change or effect generally applicable to (I) the industries and markets in which Sellers operate or (II) economic or political conditions or the securities or financial markets in any country or region.

“ Order ” means any award, writ, injunction, judgment, order or decree entered, issued, made, or rendered by any Governmental Authority.

“ Owned Real Property ” has the meaning set forth in Section 5.5(a) .

“ Part B Contracts ” means the Contracts listed on Part B of Schedule 1.1(a) .

 

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“ Party ” or “ Parties ” means, individually or collectively, Buyer and Sellers.

“ Parent ” has the meaning set forth in the introductory paragraph.

“ Patents ” means United States and foreign patents and patent applications, as well as any continuations, continuations-in-part, divisions, extensions, reexaminations, reissues, renewals and patent disclosures related thereto.

“ Periodic Taxes ” has the meaning set forth in Section 8.1(b) .

“ Permits ” means all franchises, grants, authorizations, licenses, permits, easements, variances, exceptions, consents, certificates, approvals, clearances and Orders that are necessary for Sellers to own, lease and operate their properties and assets or to carry on the Business as it is now being conducted.

“ Permitted Encumbrances ” means (a) liens for Taxes and assessments that are not yet due and payable or that are being contested in good faith, (b) easements, covenants, rights-of-way, conditions, restrictions, encroachments, overlaps, boundary line disputes and other similar matters of record on real property, leasehold estates or personality, and any other matters which would be disclosed by an accurate survey and inspection of any real property, that do not interfere in any material respect with Sellers’ ordinary conduct of the Business, (c) Encumbrances that constitute Assumed Liabilities (including Encumbrances arising under the Assigned Contracts), (d) Encumbrances, title exceptions or other imperfections of title caused by or resulting from the acts of Buyer or any of their respective Affiliates, employees, officers, directors, agents, contractors, invitees or licensees, (e) statutory liens and rights of set-off of landlords, banks, carriers, warehousemen, mechanics, repairmen, workmen, suppliers and materialmen, and other Encumbrances imposed by law, in each case, incurred in the ordinary course of business (i) for amounts not yet overdue or (ii) for amounts that are overdue and that (in the case of any such amounts overdue for a period in excess of thirty (30 days)) are being contested in good faith, (f) deposits and pledges securing (i) the performance of bids, tenders, leases, Contracts (other than for payment of money), statutory obligations and licenses or (ii) obligations on performance, surety or appeal bonds, (g) rights of setoff or banker’s liens or other similar Encumbrances upon deposits of cash in favor of banks or other depositary institutions, (h) local, county, state and federal laws, ordinances or governmental regulations now or hereafter in effect relating to real property, which do not, individually or in the aggregate, have a material adverse effect on the present use of the property subject thereto, (i) Encumbrances on subject goods arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into in the ordinary course of business, (j) security given to a public or private utility or other natural gas suppliers as required in the ordinary course of business, (k) Encumbrances arising by operation of law under Article 2 of any state’s Uniform Commercial Code (or successor statute) in favor of a seller of goods or buyer of goods and (l) all matters set forth on Schedule 1.1(b) .

“ Person ” means any individual, corporation (including any non-profit corporation), partnership, limited liability company, joint venture, estate, trust, association, organization or other entity or Governmental Authority.

 

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“ Petition Date ” has the meaning set forth in the recitals.

“ Pre-Closing Designated Contract ” means (i) each Contract listed or described on Part A of Schedule 1.1(a) and (ii) each of the Part B Contracts for which Buyer has delivered an Assignment Election to Sellers prior to the Closing Date.

“ Pre-Paid Expenses ” means, with respect to any Seller, all deposits and prepaid charges and expenses of such Seller as of the Closing Date to the extent related exclusively to such Seller’s Business.

“ Proceeding ” means any action, arbitration, audit, hearing, investigation, litigation, or suit (whether civil, criminal, administrative or investigative) commenced, brought, conducted, or heard by or before, or otherwise involving, any Governmental Authority.

“ Purchase Price ” has the meaning set forth in Section 3.1 .

“ Purchasing Designee ” has the meaning provided in Section 10.7 .

“ Release ” means any past or present spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping or disposing of a Hazardous Substance into the environment.

“ Representative ” means, with respect to a particular Person, any director, officer, employee, agent, consultant, advisor or other representative of such Person, including legal counsel, accountants and financial advisors.

“ Sale Motion ” means the motion styled “Motion Pursuant to 11 U.S.C. §§ 105(a), 363, 365 and Fed. R. Bankr. P. 2002, 6004, 6006 for (I) Entry of an Order (A) Establishing Bidding and Auction Procedures Related to the Sale of Some or All of the Debtors’ Assets; (B) Approving Bid Protections for Sale of VSE Assets; (C) Establishing Procedures for the Debtors to Enter into Additional Stalking Horse Agreements with Bid Protections in Connection with Sale of Assets; (D) Scheduling an Auction and Sale Hearing for the Sale of the Debtors’ Assets; (E) Permitting Credit Bidding Pursuant to Bankruptcy Code Section 363(K); (F) Establishing Certain Notice Procedures for Determining Cure Amounts; (G) Approving Form and Manner of Notice of All Procedures, Protections, Schedules and Agreements; and (H) Granting Certain Related Relief; and (II) Entry of an Order (A) Approving the Sale of Debtors’ Assets Free and Clear of All Liens, Claims, Encumbrances and Interests; (B) Authorizing the Assumption and Assignment of Certain Executory Contracts and Unexpired Leases; and (C) Granting Certain Related Relief” and filed with the Bankruptcy Court on February 6, 2009 (Docket No. 622 in the Bankruptcy Case).

“ Sale Order ” means an Order of the Bankruptcy Court approving this Agreement and the transactions contemplated hereby.

“ Seller Termination Notice ” has the meaning set forth in Section 11.1(c) .

“ Sellers ” has the meaning set forth in the introductory paragraph.

 

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“ Subsidiary ” means any entity with respect to which a specified Person (or a Subsidiary thereof) has the power, through the ownership of securities or otherwise, to elect a majority of the directors or similar managing body.

“ Tax ” or “ Taxes ” (and with correlative meaning, “ Taxable ” and “ Taxing ”) means (i) any federal, state, provincial, local, foreign or other income, alternative, minimum, add-on minimum, accumulated earnings, personal holding company, franchise, capital stock, net worth, capital, profits, intangibles, windfall profits, gross receipts, value added, sales, use, goods and services, excise, customs duties, transfer, conveyance, mortgage, registration, stamp, documentary, recording, premium, severance, environmental (including taxes under Section 59A of the Code), natural resources, real property, personal property, ad valorem, intangibles, rent, occupancy, license, occupational, employment, unemployment insurance, social security, disability, workers’ compensation, payroll, health care, withholding, estimated or other similar tax, duty, levy or other governmental charge or assessment or deficiency thereof (including all interest and penalties thereon and additions thereto whether disputed or not) and (ii) any transferee liability in respect of any items described in clause (i) above.

“ Tax Return ” means any return, declaration, report, claim for refund, information return, form or other document (including any related or supporting estimates, elections, schedules, statements, or information) filed or required to be filed in connection with the determination, assessment or collection of any Tax or the administration of any laws, regulations or administrative requirements relating to any Tax.

“ Trademarks ” means United States, state and foreign trademarks, service marks, logos, slogans, trade dress and trade names and any other similar designations of source of goods or services, whether registered or unregistered, and registrations and pending applications to register the foregoing, and all goodwill related to or symbolized by the foregoing.

“ Trade Secrets ” means trade secrets and other confidential and proprietary information and know-how and, for avoidance of doubt, does not include any of the Assigned Contracts.

“ Transaction Documents ” means this Agreement and any other agreements, instruments or documents entered into pursuant to this Agreement.

“ Transfer Taxes ” has the meaning set forth in Section 8.1(a) .

“ Transferred Employee ” has the meaning set forth in Section 2.3(e) .

“ Treasury Regulations ” means the regulations promulgated by the U.S. Treasury Department pursuant to the Code.

“ Work in Progress ” means all unfinished ethanol (or ethanol components) still involved in the production process (i.e., not Finished Ethanol) and located in fermentation devices, distillation devices, piping or elsewhere within the Facilities, as well as all grains and grain products still involved in the production process (i.e., not yet ready to be marketed as dry, modified or wet distillers grains) and located anywhere within the Facilities.

 

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“ WARN Act ” means the Worker Adjustment and Retraining Notification Act of 1988, as amended, any similar Legal Requirement, and the rules and regulations thereunder.

“ WARN List ” has the meaning set forth in Section 5.11(c) .

1.2 Other Definitions and Interpretive Matters .

(a) Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation shall apply:

Calculation of Time Period. When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded. If the last day of such period is a day other than a Business Day, the period in question shall end on the next succeeding Business Day.

Dollars. Any reference in this Agreement to $ means U.S. dollars.

Exhibits/Schedules. All Exhibits and Schedules attached or annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in any Schedule or Exhibit but not otherwise defined therein shall be defined as set forth in this Agreement.

Gender and Number. Any reference in this Agreement to gender includes all genders, and words imparting the singular number only include the plural and vice versa.

Headings. The provision of a table of contents, the division of this Agreement into Articles, Sections and other subdivisions and the insertion of headings are for convenience of reference only and shall not affect or be utilized in the construction or interpretation of this Agreement. All references in this Agreement to any “ Section ” or “ Article ” are to the corresponding Section or Article of this Agreement unless otherwise specified.

Herein. Words such as “ herein ,” “ hereof ” and “ hereunder ” refer to this Agreement as a whole and not merely to a subdivision in which such words appear, unless the context otherwise requires.

Including. The word “ including ” or any variation thereof means “ including, without limitation, ” and shall not be construed to limit any general statement that it follows to the specific or similar items or matters immediately following it.

(b) No Strict Construction. Buyer, on the one hand, and Sellers, on the other hand, participated jointly in the negotiation and drafting of this Agreement, and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by Buyer, on the one hand, and Sellers, on the other hand, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement. Without limitation as to the foregoing, no rule of strict construction construing ambiguities against the draftsperson shall be applied against any Person with respect to this Agreement.

 

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ARTICLE 2

PURCHASE AND SALE

2.1 Purchase and Sale .

Upon the terms and subject to the conditions of this Agreement, on the Closing Date, each Seller shall sell, transfer, assign, convey and deliver, or cause to be sold, transferred, assigned, conveyed and delivered, to the applicable Purchasing Designee, and the applicable Purchasing Designee shall purchase, free and clear of all Encumbrances (other than Permitted Encumbrances), all right, title and interest of the respective Seller in, to or under the following (collectively, the “ Acquired Assets ”):

(a) all of the properties and assets of such Seller (other than the Excluded Assets) of every kind and description, wherever located, real, personal or mixed, tangible or intangible, to the extent owned, leased, licensed, used or held for use exclusively in or relating exclusively to the Business of such Seller, as the same shall exist on the Closing Date, including all right, title and interest of such Seller in, to or under:

(i) all cash and cash equivalents, including checks, commercial paper, treasury bills, certificates of deposit and other bank deposits (other than the Excluded Cash);

(ii) Inventory;

(iii) Equipment;

(iv) Assigned Contracts;

(v) all Accounts Receivable, other than Accounts Receivable in respect of any Finished Ethanol or dry distillers grain sold by the Sellers on or after March 1, 2009 under the inventory disposition agreement confirmed by the Sellers pursuant to that certain email dated February 27, 2009 at 9:54 Central Standard Time from John K. Lyons to Robert G. Parish (the “ Inventory Disposition Agreement ”);

(vi) Owned Real Property listed or described on Schedule 2.1(a)(vi) ;

(vii) all Permits and pending applications therefor, in each case to the extent assignable;

(viii) Intellectual Property other than Intellectual Property included in the Excluded Assets;

(ix) the Pre-Paid Expenses, other than Pre-Paid Expenses paid to Haas TCM Processing, LLC attributable to periods occurring prior to the Petition Date;

 

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(x) all telephone, telex and telephone facsimile numbers and other directory listings, to the extent assignable;

(xi) all insurance policies and rights to proceeds thereof relating to its Business, to the extent assignable;

(xii) all goodwill associated with its Business;

(xiii) all causes of action of such Seller against third parties (including any Cargill Entities) arising out of events occurring prior to the Closing Date, including and, for the avoidance of doubt, arising out of events occurring prior to the Petition Date, and including any rights under or pursuant to any and all warranties, representations and guarantees made by suppliers, manufacturers and contractors relating to products sold, or services provided, to Sellers, excluding only the rights, claims and causes of action that are identified as Excluded Assets in Section 2.2 ;

(xiv) any rights it has or retains in any security given by it to a public or private utility or other natural gas suppliers; and

(xv) all other or additional privileges, rights and interests associated with the Acquired Assets described in this Section 2.1(a) of every kind and description and wherever located to the extent that they are or have been used or intended for use exclusively in connection with its Business;

(b) the assets of such Seller listed on Schedule 2.1(b) ; and

(c) to the extent available and permitted by applicable Legal Requirements, all Documents that relate exclusively to any of the Acquired Assets specified in Section 2.1(a) or Section 2.1(b) , provided that such Seller may retain copies of such Documents.

At any time up to 5:00 p.m., Central Time, on the day that is thirty (30) days following the Closing Date (the “ Designation Deadline ”), Buyer, in its discretion by written notice to Sellers (such notice to be signed and dated by Buyer), may include as Assigned Contracts any Part B Contracts, and, in such circumstances, such Contracts shall constitute Assigned Contracts and shall not form part of Excluded Assets, and Buyer shall acquire all rights and assume all Liabilities with respect thereto in accordance with this Article 2 effective as of the Designation Deadline or effective as of the Closing Date to the extent such Part B Contracts are Pre-Closing Designated Contracts (each such notice, an “ Assignment Election ”). Buyer and Sellers shall cause each of the Part B Contracts for which Buyer delivers an Assignment Election prior to the Designation Deadline to be assumed by and assigned to the applicable Purchasing Designee set forth in the Assignment Election pursuant to one or more contract assignment and assumption agreements, in the form attached hereto as Exhibit D, duly executed by each applicable Seller and Purchasing Designee. Upon Buyer’s reasonable request, Sellers shall provide additional information as to the rights and Liabilities under the Part B Contracts sufficient for Buyer to make an informed assessment whether to make an Assignment Election with respect to such Part B Contracts hereunder, including, without limitation, providing Buyer with Cure Costs information in connection with such Part B Contracts.

 

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At any time prior to five (5) Business Days prior to the Closing Date, Buyer may, in its discretion by written notice to Sellers, designate any of the Acquired Assets as additional Excluded Assets, which notice shall set forth in reasonable detail the Acquired Assets so designated. Buyer acknowledges and agrees that there shall be no reduction in the Purchase Price if it elects to designate any Acquired Assets as Excluded Assets. Notwithstanding any other provision hereof, the Liabilities of Sellers under or related to any Acquired Asset excluded under this paragraph will constitute Excluded Liabilities.

2.2 Excluded Assets .

The Acquired Assets shall not include any of the following (collectively, the “ Excluded Assets ”):

(a) the Purchase Price delivered to Sellers pursuant to this Agreement;

(b) (i) cash and cash equivalents, including checks, commercial paper, treasury bills, certificates of deposit and other bank deposits in respect of any dry distillers grain sold by the Sellers on or after March 1, 2009 under the Inventory Disposition Agreement and (ii) any other cash and cash equivalents, including checks, commercial paper, treasury bills, certificates of deposit and other bank deposits (exclusive of the cash and cash equivalents described in the immediately foregoing clause (i)) in an aggregate amount up to, and not in excess of, $2,792,000 (which amount includes, for the avoidance of doubt, proceeds from the drawing in full of the loans under the DIP Credit Agreement, proceeds from the sale of Finished Ethanol pursuant to the Inventory Disposition Agreement and other cash on hand) (collectively, the “ Excluded Cash ”);

(c) all Owned Real Property not listed or described on Schedule 2.1(a)(vi) ;

(d) all Trade Secrets;

(e) the intellectual property listed or described on Schedule 2.2(e) ;

(f) all capitalized leases other than pursuant to any Assigned Contract;

(g) any shares of capital stock or other equity interest of Sellers or any securities convertible into, exchangeable or exercisable for shares of capital stock or other equity interest of Sellers;

(h) all minute books, stock ledgers, corporate seals and stock certificates of Sellers;

(i) any Contract that is not an Assigned Contract;

(j) any Lease;

(k) any Tax refunds or credits to the extent associated with any period prior to the Closing Date;

 

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(l) all Accounts Receivable in respect of any Finished Ethanol or dry distillers grain sold by the Sellers on or after March 1, 2009 under the Inventory Disposition Agreement (the “ Excluded Accounts Receivable ”);

(m) all telephone, telex and telephone facsimile numbers and other directory listings not used exclusively in connection with the Business;

(n) all Permits and pending applications therefor other than those specified in Section 2.1(a)(vii) ;

(o) except for any properties or assets of Sellers listed on Schedule 2.1(b) or specified in Section 2.1(c) , any properties and assets of Sellers not related exclusively to, used exclusively in or held for use exclusively in the Business;

(p) the Avoidance Actions;

(q) Pre-Paid Expenses paid to Haas TCM Processing, LLC attributable to periods occurring prior to the Petition Date;

(r) any rights, claims or causes of action of such Seller under this Agreement or any other Transaction Document; and

(s) all properties and assets of Parent other than all right, title and interest of Parent in, to or under any Assigned Contract.

2.3 Assumed Liabilities .

Upon the terms and subject to the conditions of this Agreement, on the Closing Date, each respective Purchasing Designee shall assume and agree to discharge, when due (in accordance with their respective terms and subject to the respective conditions thereof), only the following Liabilities (collectively, the “ Assumed Liabilities ”) and no others:

(a) Acquired Assets . All Liabilities of each respective Seller arising after the Closing Date with respect to the Acquired Assets or, in the case of each of Bloomingburg and Linden, the operation of its Business following the Closing.

(b) Assigned Contracts . All Liabilities of each respective Seller under the Assigned Contracts in, to or under which such respective Seller has any right, title or interest.

(c) Taxes . Each respective Seller’s Liability for Taxes, to the extent provided in Section 8.1 .

(d) WARN Act Liabilities . All Liabilities that may arise under the WARN Act as a result of the WARN Act being triggered at either Facility on or after the Closing Date, including all such Liabilities to (i) any Facility Employees terminated by any Seller or any of its Affiliates within the ninety (90) day period ending on the Closing Date who are listed on the WARN List and (ii) any Facility Employees employed immediately prior to Closing who are listed on Schedule 5.11(a) (as may be updated pursuant to Section 7.9(a) ) and who are not

 

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offered employment by Buyer, effective as of the Closing Date, at the same location and annual rate of pay and otherwise on substantially similar terms, in the aggregate, as those under which the Facility Employee was employed immediately prior to Closing.

(e) Transferred Employees . All Liabilities with respect to claims arising out of the employment by Buyer of any Facility Employee who, in the sole discretion of Buyer, is offered employment by Buyer and who becomes employed by Buyer on or after the Closing Date (each such employee, a “ Transferred Employee ”).

(f) Cure Costs . All Cure Costs which are to be satisfied by Buyer as contemplated by Section 2.5 .

2.4 Excluded Liabilities .

Notwithstanding any provision in this Agreement to the contrary, Buyer shall not assume and shall not be obligated to assume or be obliged to pay, perform or otherwise discharge any Liability of Sellers, and Sellers shall be solely and exclusively liable with respect to all Liabilities of Sellers, other than the Assumed Liabilities (such Liabilities other than Assumed Liabilities, collectively, the “ Excluded Liabilities ”). Excluded Liabilities shall include any and all Liabilities with respect to Taxes arising out of an audit, examination or other administrative or judicial proceeding or adjustment by any taxing authority relating to or arising out of a period prior to the Closing Date, as described in Section 8.1 .

2.5 Assignments; Cure Costs .

(a) Each Seller shall transfer and assign all of its respective Assigned Contracts to the respective Purchasing Designee, and each such Purchasing Designee shall assume all Assigned Contracts from the respective Seller pursuant to Section 365 of the Bankruptcy Code and the Sale Order either (i) as of the Closing Date with respect to the Pre-Closing Designated Contracts or (ii) as of the Designation Deadline with respect to the Part B Contracts for which Buyer delivers an Assignment Election on or after the Closing Date, but prior to the Designation Deadline. Buyer agrees to promptly satisfy all Cure Costs, as and when such Cure Costs become due, in respect of any Assigned Contracts that are Part B Contracts for which Buyer delivers an Assignment Election on or after the Effective Date and prior to the Designation Deadline. Seller agrees to promptly satisfy all Cure Costs, as and when such Cure Costs become due, in respect of any Assigned Contracts listed on Part A of Schedule 1.1(a) on the Effective Date.

(b) With respect to any Part B Contract for which Buyer has not delivered an Assignment Election prior to the Closing Date, Buyer shall pay to the counterparty under such Part B Contract (or reimburse Sellers for any such payment made by Sellers) any amounts due and payable for services rendered, goods provided or benefits obtained by Buyer thereunder on or after the Closing Date and prior to the Designation Deadline. After the Designation Deadline, Sellers may in their sole and absolute discretion, subject to applicable Legal Requirements, assume, assign or reject any Contract other than an Assigned Contract.

 

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(c) From the Effective Date through and including the Designation Deadline, Sellers shall not reject any Assigned Contract or any Part B Contract unless otherwise agreed to in writing by Buyer.

(d) To the maximum extent permitted by the Bankruptcy Code, the Acquired Assets shall be transferred to the respective Purchasing Designee pursuant to Section 365 of the Bankruptcy Code as of the Closing Date or such other date as specified in an Order or this Agreement, as applicable. Notwithstanding any other provision of this Agreement to the contrary, this Agreement shall not constitute an agreement to transfer any asset or assign any right thereunder if an attempted transfer or assignment without the consent of a third party, which consent has not been obtained prior to the Closing (after giving effect to the Sale Order and the Bankruptcy Code), would constitute a breach or in any way adversely affect the rights of Buyer or Sellers thereunder. If with respect to any Acquired Asset such consent is not obtained or such assignment or transfer is not attainable pursuant to Sections 105, 363 or 365 of the Bankruptcy Code other than as a result of the failure to pay Cure Costs (other than Cure Costs to be paid by Buyer pursuant to this Section 2.5 ), then such Acquired Asset shall not be transferred hereunder and the Closing shall proceed with respect to the remaining Acquired Assets without any reduction in the Purchase Price. In the case of licenses, certificates, approvals, authorizations, leases, Contracts and other commitments included