AGREEMENT RE CLOSING OF "SUN WORLD-BONDHOLDER-CADIZ TERM
SHEET AND AGREEMENT IN PRINCIPLE"
THIS AGREEMENT (the "Closing Agreement") is
entered into as of November 24, 2003, by and between
Black Diamond Capital Management, L.L.C., on behalf of
its affiliates, and CFSC Wayland Advisers, Inc. and their
respective affiliates (collectively, the "Majority
Bondholders"), and Cadiz Inc. ("Cadiz"), with reference
to the following facts and recitations:
A. On October 13, 2003, Sun World
International, Inc. ("SWI") and its debtor affiliates
(collectively, "Sun World"), Cadiz, and the Majority
Bondholders entered into the "Sun World-Bondholder-Cadiz
Term Sheet and Agreement in Principle" (the "Settlement
Agreement").
B. On November 7, 2003, the United Sates
Bankruptcy Court for the Central District of California,
Riverside Division (the "Bankruptcy Court") entered its
order (the "Approval Order") approving the Initial
Settlement (as defined in the Settlement Agreement).
C. On November 14, 2003, an unsecured
creditor of Sun World filed a notice of appeal from the
Approval Order (the "Pending Appeal")
D. No stay of the Approval Order has been
requested or issued.
E. Section 2.A of the Settlement Agreement
provides that the Closing (as defined in the Settlement
Agreement) shall occur on or before the fifth business
day after the Court's order approving the Initial
Settlement becomes final and non-appealable, or prior
thereto if so agreed by Cadiz and the Majority
Bondholders in their discretion.
F. After discussions, Cadiz and the Majority
Bondholders have agreed that, notwithstanding the Pending
Appeal, the Closing shall occur on the terms and
conditions set forth in this Closing Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED, by and
between the parties hereto, as follows:
1. Notwithstanding the Pending Appeal, the
Closing of the Settlement Agreement shall take place on
December __, 2003, at 1:00 PM Pacific Standard Time (the
"Scheduled Closing Time").
2. In the event that the Closing shall not
have occurred, then any party hereto may, at any time
thereafter but before the Closing has occurred, elect to
terminate this Closing Agreement by providing written
notice of termination to each other party hereto. If
this Closing Agreement is so terminated, it shall be of
no force or effect.
3. Notwithstanding the Closing or this
Closing Agreement, the parties' respective rights and
obligations under the Settlement Agreement, the Approval
Order, and each of the documents executed by the parties
to implement the Settlement Agreement and the Approval
Order shall remain in full force and effect, and nothing
contained herein shall constitute or be construed as a
waiver thereof by any party.
4. In the event that the Approval Order shall
be reversed, modified, or set aside or shall otherwise
not be in full force and effect for any reason, then
Cadiz and the Majority Bondholders shall each use their
respective reasonable efforts in good faith to preserve
the benefits of the Settlement Agreement for the parties
hereto. Without limitation of the foregoing: (a) the
assignment, pursuant to Section 2.A of the Settlement
Agreement, of the Allowed Cadiz Claim (as defined in the
Settlement Agreement) and the pledge of Cadiz's equity
interest in SWI to the Bondholder Trust (as defined in
the Settlement Agreement) shall remain fully effective;
(b) Cadiz's agreement, pursuant to Section 1.B of the
Settlement Agreement, that it will affirmatively support
a plan of reorganization for Sun World that provides no
recovery on account of Cadiz's equity interest in SWI and
that is otherwise consistent with the Settlement
Agreement shall remain fully effective; (c) the
Bondholder Trust, the Opt-In Forms (as defined in the
Settlement Agreement), the Majority Bondholders'
irrevocable instructions to the Indenture Trustee (as
defined in the Settlement Agreement) to take no action
against Cadiz on behalf of Bondholders (as defined in the
Settlement Agreement) or on account of the Guaranty (as
defined in the Settlement Agreement), and the Majority
Bondholders' irrevocable consent to the amendment of the
indenture deleting substantially all covenants and other
provisions relating to the Guaranty or remedies against
Cadiz as guarantor, each as executed pursuant to Sections
2.B. and 2.C. of the Settlement Agreement, shall remain
fully effective; (d) the Majority Bondholders' agreement,
pursuant to Section 3 of the Settlement Agreement, that
any plan of reorganization filed or supported by Sun
World and /or the Majority Bondholders shall provide (i)
that the consideration to Bondholders contemplated under
such plan is in full satisfaction and settlement of all
claims of Bondholders under the indenture, including the
Guaranty, (ii) that the indenture for the bonds
(including the Guaranty thereunder) shall be deemed
cancelled and extinguished as of the effective date of
the plan, and (iii) for all Bondholders to be deemed to
release their Guaranty claims against Cadiz in exchange
for the consideration to be distributed to the Bondholder
Trust, and the obligations of Sun World and the Majority
Bondholders to each use their respective reasonable
efforts in good faith to have these provisions approved
by the Court as part of any plan shall each remain fully
effective; and (e) Cadiz and the Majority Bondholders
shall each use their respective reasonable efforts in
good faith to defend against and defeat any objections to
claims and/or avoidance actions which might be brought
seeking to disallow or reduce the Cadiz Claim assigned to
the Bondholder Trust or seeking any recovery from Cadiz
and, if there is any such recovery from Cadiz, to turn
over to Cadiz any net cash proceeds of any avoidance
actions against Cadiz actually distributed to the
Majority Bondholders.
5. The parties agree to execute such other
documents as may be reasonably necessary or appropriate
to effectuate the purposes of the Settlement Agreement,
including without limitation additional directions to the
Indenture Trustee and consents to additional amendments
to the indenture consistent with the Settlement
Agreement.
6. This Closing Agreement is intended, and
shall be construed, to preserve for each party the
benefits of the Settlement Agreement to the maximum
feasible extent.
Accepted and Agreed:
Black Diamond Capital
Management, L.L.C. Cadiz Inc.
By: Xxxxx X. Xxxxx Xx. By: /s/ Xxxxxxxx Xxxxxx Painter
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Its: President & Managing Partner Its: VP, General Counsel
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CFSC Wayland Advisors, Inc.
By: /s/ Xxxxx X. Xxxxxxx
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Its: Authorized Signatory
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