Exhibit 10.59
FIRST AMENDMENT TO ACQUISITION
AGREEMENT
This First
Amendment to Acquisition Agreement (the “Amendment”) is executed as
of July 19, 2007, by Mac Farms of Hawaii, LLC, a Delaware limited
liability company ( “Mac
Farms”) and Kapua Orchard Estates, LLC, a Delaware
limited liability company ( “Kapua”), (both
collectively sometimes called “Seller”), and ML Macadamia
Orchards, L.P. ( “MLP” or “Buyer”), a Delaware
limited partnership, with reference to the following
facts:
A.
Effective as of May 24, 2007, Mac Farms, Kapua and Buyer executed
an Acquisition Agreement (the “Agreement”) providing for
the acquisition by Buyer of certain personal property assets and
the subleasing, leasing or otherwise acquiring rights of use from
Seller for those real property assets used by Seller in connection
with its macadamia nut operations, all as more particularly set
forth in the Agreement. Unless otherwise defined
herein, the capitalized terms
in this Amendment shall have the same meaning as set forth in
the Agreement.
B.
Section 5.9(a) of the Agreement required Buyer to seek SEC
Preliminary Approval to permit
the filing of certain abbreviated financial information in the
Proxy Statement, which
would be sent to Unitholders, and the Form 8-K, which would be
required to be filed
with the SEC by Buyer upon consummation of the acquisition under
the Agreement (the
“Form 8-K”).
Section 5.9(c) and Section 9.1(f) of the Agreement contained rights
to terminate the
Agreement in the event the SEC Preliminary Approval was not timely
obtained.
C.
Although Buyer timely sought the SEC Preliminary Approval, it
obtained relief from the
SEC only with respect to the financial information to be included
in the Proxy Statement,
but did not obtain any relief from the SEC with respect to the
financial information to be included in the Form 8-K. In light of
the failure to obtain the SEC Preliminary Approval, the
Parties have determined not to terminate the Agreement and to
attempt to provide audited financial statements in the Proxy
Statement and the Form 8-K.
D.
In order to prepare the necessary financial statements and to
obtain an audit thereon, the
Parties have agreed to extend the time for closing the transaction,
to take such other actions as set forth in this Amendment
and to amend the Agreement as set forth in this
Amendment.
NOW, THEREFORE, the
Parties have agreed as follows:
1.
Article 1 of the Agreement is amended to add the following new
definitions:
“Average
Closing Price” means the average closing price per unit of
the units of MLP on the New York Stock Exchange for the ten
(10) trading days immediately preceding the date upon which
approval of this transaction by a Majority Interest of the
Partnership is obtained.
“Buyer
Material Adverse Effect” means any condition, event, circumstance,
change, or effect, which, since March 31, 2007, individually
or in the aggregate, has had, or could reasonably be expected to have a material
adverse effect on the business, assets, properties, results
of operation or financial condition or prospects of Buyer. However,
neither (i) a decrease in the
market price of the units of MLP by itself, nor (ii) a decrease in
the Spot Price, as
defined herein, by itself, or the effects resulting from either of
these events shall be deemed a Buyer Material Adverse
Effect. Notwithstanding the foregoing, the cause of a decrease in
the market price of units of MLP
could be a Buyer Material Adverse Effect, if it otherwise meets the
definition thereof. For example, if a portion of Buyer’s nut
trees are destroyed and the market price of units of MLP dropped as a
result thereof, then the mere drop in the market price
would not be a Buyer Material
Adverse Effect, but the destruction of the trees (i.e., the
“cause” of the price reduction) could be a Buyer
Material Adverse Effect.
“ Floor
Price” means U.S. $4.72 per unit of MLP.
“Spot
Price” shall mean the average of the spot price
per pound for bulk premium (Hawaiian and Australian) Style II Raw
Macadamia Nuts (FOB West Coast) for a container load and the
spot price per pound for bulk premium (Hawaiian and Australian)
Style II Raw Macadamia Nuts (FOB West Coast) for a pallet load.
“ Spot Price
Adjustment” shall be the difference between the $3.25 and
the Spot Price on the
Closing Date times the number of pounds of marketable bulk premium
(Hawaiian and Australian) Style II Raw or Roasted Macadamia Nuts in
Seller’s inventory on the Closing Date.
“ Unit Price Adjustment”
shall mean the difference
between the Floor Price and the Average Closing Price times
650,000.
2.
Section 2.6 of the Agreement is amended to read as follows:
“ 2.6 Closing.
The closing of the
transactions contemplated by this Agreement (the “
Closing”)
will take place at the offices of Carlsmith Ball,
ASB Tower, Suite 2200, 1001 Bishop Street, Honolulu, Hawaii, 96813, ten (10) Business
Days, after Buyer receives the approval of a Majority
Interest of the Partnership to close this transaction or at such
other date or place as Buyer
and Seller may mutually determine (the “ Closing
Date”). The
Closing Date may be postponed by either Party provided that the
Closing Date shall not be later than December 31, 2007,
without the approval, in writing, of both Parties.”
3.
Section 2.8(d) of the Agreement is amended to change the date
“September 30, 2007” to the Closing Date and to change
the date “October 31, 2007” to December 31,
2007.
4.
Section 2.9 of the Agreement is added and shall read as
follows:
“
2.9 Unit Price
Adjustment
In the event
that the Average Closing Price is less than the Floor Price, Seller
shall also have a right to
terminate this Agreement by complying with the provisions of this
Section, subject,
however, to Buyer’s further rights as set forth in this
Section. In the event Seller wishes to terminate this
Agreement under this Section, then Seller must give written notice
to Buyer of its election to
terminate the Agreement on or before 3:00 p.m. Honolulu time on
the second Business Day after Seller’s receipt of
written notice from Buyer of the approval of a Majority Interest of the Partnership having
been obtained at a Unitholders’ meeting. In the event
Seller elects to terminate this Agreement, then the Buyer shall
have a right to elect to avoid
termination by agreeing to pay to Seller the Unit Price Adjustment,
which will be payable in cash in addition to but as a part
of the Cash Payment on the Closing Date. Buyer must give
written notice of its election
to avoid Seller’s termination under this Section on, or
before, three (3) Business Days after receipt by Buyer of
Seller’s written notice of termination. If Buyer
provides such notification,
then Buyer shall be obligated to pay the Unit Price Adjustment.
For example, if the Average Closing Price is $4.75 and the
Floor Price is $4.80 then Buyer would pay an additional $32,500 in cash as the
Unit Price Adjustment ($.05 times 650,000) on the Closing
Date.”
5.
Section 2.10 of the Agreement is added and shall read as
follows:
“2.10
Spot Price
Adjustment
If on the day
immediately preceding the day which Buyer obtains approval of this
transaction by a Majority Interest of the Partnership at a
Unitholders meeting, the Spot Price shall be less than U.S. $3.25
per pound, then Seller shall also have a right to terminate this
Agreement by complying with the provisions of this Section,
subject, however, to the Buyer’s further rights as set forth
in this Section. In the event Seller wishes to terminate this
Agreement under this Section,
Seller must provide written notice to Buyer of its election to
terminate this Agreement
on or before 3:00 p.m. Honolulu-time on the second Business Day,
after Seller’s receipt of written notification from Buyer
of the approval of a Majority Interest of the Partnership
having been obtained at a Unitholders’ meeting. Such notice
shall also contain backup
information justifying the claimed
