SIDE AGREEMENT
THIS SIDE AGREEMENT is entered into effective as of the 22nd day of
November, 1999 by and between REDBALL, LLC ("Redball"), AG-CHEM EQUIPMENT CO,
INC. ("Ag-Chem") and C.A.P., INC. ("C.A.P.").
WITNESSETH:
WHEREAS, Ag-Chem and C.A.P. are the sole members of Redball and are
entering into that certain Member Control Agreement dated as of the date hereof
("Member Control Agreement") and various other documents related thereto; and
WHEREAS, in connection with the execution of the Member Control
Agreement, Ag-Chem has agreed to contribute to Redball One Million Dollars
($1,000,000) in cash; and
WHEREAS, in connection with the execution of the Member Control
Agreement, C.A.P. has agreed to contribute certain of its assets, and Redball
has agreed to assume certain liabilities of C.A.P. so that the net book value of
the assets (net of liabilities) contributed by C.A.P. shall equal One Million
Dollars ($1,000,000);
WHEREAS, as of the date of this Agreement, the parties hereto have not
been able to confirm the net book value of the assets (net of liabilities)
contributed by C.A.P. or the amount of the liabilities assumed by Redball; and
WHEREAS, Ag-Chem and C.A.P. have decided to execute the Member Control
Agreement and, within sixty (60) days hereafter, Ag-Chem shall determine whether
the net book value of the assets contributed by C.A.P. (net of liabilities)
equals One Million Dollars ($1,000,000).
NOW, THEREFORE, in consideration of the mutual promises of the parties
hereto and the mutual benefits to be gained by the performance hereof, the
parties hereto agree as follows:
1.) Review of Contribution. Notwithstanding Section 3.1 of the Member
Control Agreement, within sixty (60) days after the date hereof, Ag-Chem and
C.A.P. agree that C.A.P. and Ag-Chem shall determine the net book value of the
assets contributed by C.A.P. and the amount of liabilities assumed by Redball so
as to confirm that the net book value of the assets contributed by C.A.P. (net
of liabilities) is equal to or greater than One Million Dollars ($1,000,000).
2.) Valuation of Capital Contributions. If upon such review, Ag-Chem
determines that the net book value of the assets contributed by C.A.P. (net of
liabilities) is less than One Million Dollars ($1,000,000), C.A.P. agrees that
it shall contribute to Redball cash or other assets (or assume certain
liabilities of Redball as determined by Ag-Chem) so as to make such contribution
equal One Million Dollars ($1,000,000). If upon such review, Ag-Chem determines
that the net book value of the assets contributed by C.A.P. (net of liabilities)
is greater than One Million Dollars ($1,000,000), Redball agrees that it shall
distribute to C.A.P. cash or other assets, as determined by Ag-Chem, so as to
make such contribution equal One Million Dollars ($1,000,000).
3.) Termination of Redball. Notwithstanding the provisions of Section
11.2 of the Member Control Agreement, Ag-Chem and C.A.P. further agree that
Ag-Chem shall not be obligated to continue as a member of Redball, and shall
have the sole and absolute right to terminate Redball, if C.A.P. does not make
the contribution provided above. Furthermore, if Ag-Chem terminates Redball
pursuant to this Section 3, Redball agrees to (and C.A.P. agrees to cause
Redball to) return Ag-Chem's contribution and repay any and all loans
outstanding from Ag-Chem.
4.) Miscellaneous. This Agreement is entered into in the State of
Minnesota, and shall be governed by the laws of the State of Minnesota,
notwithstanding the fact that one or more of the parties now is or may hereafter
become a resident of a different state. In the event any portion of this
Agreement is held to be invalid, the
same will not affect in any respect the validity of the remainder of this
Agreement. This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day and year first above written.
AG-CHEM EQUIPMENT CO., INC. C.A.P., INC.
By: /s/ Xxxx X. Retherfor By: /s/ Xxxxxx Xxxxxxxx
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Xxxx X. Xxxxxxxxxx Its:
Senior Vice President
Chief Financial Officer
REDBALL, LLC
By: /s/ Xxxxxx Xxxxxxxx
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Its: President
Xxxxxx Xxxxxxxx and Xxxxxx Xxxxxxxx, jointly and severally, guarantee the timely
performance of the obligations of C.A.P. hereunder.
/s/ Xxxxxx Xxxxxxxx /s/ Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx Xxxxxx Xxxxxxxx
2.
