Vanderbilt Minerals - Bidding Procedures / APA Summary

Bidding Procedures / Asset Purchase Agreement Summary

Parties Involved

• Seller: Vanderbilt Minerals, LLC, a Delaware limited liability company (the "Debtor")
• Purchaser: VM Buyer LLC, a Delaware limited liability company and an affiliate of Riverspan Partners Fund I LP ("Riverspan"), as the Successful Bidder
• Backup Bidder: Commodore Materials, LLC
• The APA was negotiated, proposed, and entered into by the Debtor and the Purchaser without collusion, in good faith and from arm's-length bargaining positions, with each party represented by separate and independent advisors. No common identity of directors or controlling stockholders exists between the Purchaser and the Debtor, and the Purchaser did not induce or cause the filing of the chapter 11 case.
• Concurrently with the execution of the APA, Purchaser and Riverspan Partners Fund I L.P. entered into an Equity Commitment Letter.

Assets Being Sold

• Substantially all of the Debtor's assets used in the business of mining minerals for natural rheology medication and other consumer and industry minerals used as additives and fillers in plastics, personal care and pharmaceuticals, ceramics, coatings, and agrochemical products (the "Business"). All references to Purchased Assets include both the Original Assets and the Settlement Assets.
• Purchased Assets generally include, among other items:
  • Owned Real Property and Leased Real Property (including Real Property Leases);
  • All inventory, supplies, materials, fixtures, furniture, equipment, machinery, motor vehicles, and other tangible personal property;
  • Purchased Contracts (including rights under non-disclosure, non-compete, and non-solicitation agreements relating to the Business);
  • Warranties, guarantees, and similar rights related to the Purchased Assets;
  • Purchased Intellectual Property;
  • Accounts receivable (including Assumed Intercompany Receivables, but excluding Excluded Receivables);
  • Goodwill, books and records, and Seller Permits (excluding Excluded Permits);
  • Cash Collateral, Seller Bonds, and other collateral or security posted in respect of Reclamation Performance Bonds and Lease Bonds;
  • Avoidance Actions between the Seller and any non-Affiliate third party that, as of the Petition Date, has a commercial relationship with the Business;
  • Current Assets included in the calculation of Working Capital, the Intercompany Settlement Assets, and the Seller Accounts (excluding Residual Cash).
• Excluded Assets include, among other items, all cash and cash equivalents (excluding Cash Collateral), refunds and credits of Taxes, Tax Returns of Seller (other than those relating solely to the Purchased Assets), claims and causes of action against Affiliates of the Seller, Excluded Permits, all insurance policies (or proceeds thereof) dated as of January 1, 2013 or earlier, and all Avoidance Actions not expressly included in the Purchased Assets.
• Assumed Liabilities include, among other items:
  • Liabilities arising from the post-Closing ownership or operation of the Purchased Assets or the Business;
  • Cure Costs;
  • Liabilities pursuant to the Purchased Contracts;
  • Current Liabilities included in the calculation of Working Capital (including Assumed Intercompany Payables);
  • Post-Closing Liabilities under the Seller Collective Bargaining Agreements;
  • Taxes associated with operations after the Closing Date and all Buyer Transfer Taxes;
  • The Assumed Known Environmental Liabilities expressly set forth on the Seller Disclosure Schedules;
  • Liabilities of the Assumed Benefit Plans; and
  • Liabilities under any Seller Permits or Laws relating to mineral rights maintenance and mining reclamation obligations.
• All liabilities not expressly assumed are Excluded Liabilities, for which the Purchaser bears no responsibility, including on the basis of any law imposing successor liability.

Purchase Price

• The aggregate consideration for the Purchased Assets consists of:
  • The assumption of the Assumed Liabilities, including payment of the Cure Costs; and
  • Cash in an amount equal to $64 million (the "Cash Amount"), as adjusted pursuant to Sections 3.3 and 3.4 of the APA.
• At Closing, the Purchaser will pay the Closing Cash Payment, calculated as the Cash Amount, less (a) the Environmental Assumed Liabilities Amount, (b) the Adjustment Escrow Amount, (c) the Estimated Capital Lease Amount, (d) the Substitute Bond Amount, (e) the Estimated Working Capital Deficit (if any), plus the Estimated Working Capital Excess (if any), and less the Purchaser Financing Amount.
• The pay-off of the Purchaser Financing Amount will be satisfied at Closing by discharging the Seller's DIP Obligations owed to the Purchaser or its Affiliates.
• Target Working Capital is set at $22,559,000.
• The consideration provided by the Purchaser pursuant to the APA and DIP Credit Agreement constitutes substantial, reasonably equivalent value and fair consideration, and the Transactions shall not constitute a fraudulent transfer or fraudulent conveyance under the Bankruptcy Code or applicable state or federal law.

Good Faith Deposit

• Pursuant to Section 3.6 of the APA, the Purchaser has deposited $6,400,000 (the "Deposit Amount") with the Escrow Agent, to be held in escrow and distributed as follows:
  • If the Closing occurs, the Deposit Amount will be applied towards the Cash Amount payable by the Purchaser;
  • If the APA is terminated pursuant to Section 4.4(d) of the APA, the Deposit Amount will be released to the Debtor; and
  • If the APA is terminated for any other reason, the Deposit Amount will be promptly returned to the Purchaser.
• At Closing, the Purchaser will deliver to the Escrow Agent an Adjustment Escrow Amount of $3,383,850, to be held in the Adjustment Escrow Account pursuant to the terms of the Escrow Agreement.

Credit Bid

• The Purchaser may terminate the APA if it is unable to offset the Purchaser Financing Amount as provided in Section 3.1, pursuant to section 363(k) of the Bankruptcy Code or otherwise, to pay-off the Purchaser Financing Amount in full.

DIP Financing

• The Purchaser, who is the same entity as the DIP Lender, has committed to provide the Seller a senior secured superpriority debtor-in-possession term loan facility (the "Replacement DIP Commitment") in an aggregate principal amount of up to $20 million for the period from the Effective Date to the Closing.
• The existing DIP Facility consists of a senior secured superpriority debtor-in-possession term loan credit facility in an aggregate principal amount of up to $15 million, as approved by the Existing DIP Order.
• Nothing in the APA or the Sale Order amends, modifies, or limits the rights of the DIP Lender (including liens, security interests, or superpriority claims) until the Closing Date, at which point, upon receipt of cash sufficient to pay the DIP Obligations in full, such liens, security interests, and superpriority claims shall be deemed satisfied in full and/or released.

Auction Details

• The Debtor's prepetition and postpetition marketing process was conducted by Greenhill & Co., LLC, including outreach to approximately 150 potential bidders.
• The Debtor received three Qualified Bids by the April 24, 2026 Bid Deadline.
• The Auction was conducted on May 4, 2026, at the New York offices of Latham & Watkins LLP in accordance with the Bidding Procedures.
• In consultation with the Consultation Parties, the Debtor selected the bid submitted by VM Buyer LLC as the Successful Bid and designated Commodore Materials as the Backup Bidder, with Commodore's bid to remain irrevocable in accordance with the Bidding Procedures and Sale Order.
• All prospective purchasers and parties in interest were afforded a reasonable and fair opportunity to bid for the Purchased Assets.

Highest and Best Offer

• The consideration provided by the Purchaser under the APA constitutes the highest or otherwise best offer obtained for the Purchased Assets and will provide a greater recovery for the Debtor's estate than any alternative.
• The Debtor's view, supported by the Vomero Sale Declaration, is that a near-term sale to the Successful Bidder represents the best available path to maximize value for the estate and all stakeholders, particularly given the Debtor's acute liquidity constraints and the consequences to stakeholders, employees, customers, and vendors if the Sale does not close.
• The consideration is for fair, adequate, and sufficient consideration that constitutes reasonably equivalent value under the Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act, and section 548 of the Bankruptcy Code.
• No other person, entity, or group has offered to purchase the Purchased Assets for greater value to the Debtor's estate than the Purchaser.

Backup Bidder

• Commodore Materials submitted the next highest or otherwise best Qualified Bid and was designated as the Backup Bidder, with the Backup Bid to remain irrevocable in accordance with the Bidding Procedures.
• Commodore Materials is a good-faith purchaser within the meaning of section 363(m) of the Bankruptcy Code and complied in all respects with the Bidding Procedures Order and the Bidding Procedures.
• If the Purchaser fails to close the Transactions and the APA is terminated as a result of the Purchaser's breach (the "Backup Bidder Date"), Commodore Materials shall be deemed to have the new prevailing bid, and the Debtor is authorized, without further order of the Court, to consummate the Transactions with Commodore Materials on the terms of the Backup Bid pursuant to a Backup Bidder APA negotiated in good faith.
• Within one business day of the Backup Bidder Date, the Debtor shall file a notice with the Court advising that the APA has not been consummated and that Commodore Materials has the new prevailing bid.
• If the Transactions are consummated with Commodore Materials, all references to "Purchaser" and "APA" in the Sale Order will refer to Commodore Materials and the Backup Bidder APA, with all protections, authorizations, and provisions applying with the same force and effect.
• Commodore Materials did not reach an agreement with the United States Department of Justice on the language set forth in paragraph 50 of the Sale Order. If Commodore Materials' Backup Bid becomes the Successful Bid, the Debtor will schedule an emergency hearing to address such language, and the United States' arguments raised in its objection [Docket No. 524] are preserved.

Sale Free and Clear & Successor Liability

• The Purchased Assets will be transferred to the Purchaser free and clear of all liens, claims, interests, and encumbrances (including Talc Liabilities, fraudulent transfer claims, environmental rights and claims, labor and employment claims, pension rights, tax claims, and successor liability claims), other than the Assumed Liabilities, Permitted Exceptions, and Transferred Exceptions (collectively, the "Exceptions"), pursuant to section 363(f) of the Bankruptcy Code.
• By consummating the Transactions, the Purchaser is not a continuation or successor of the Debtor, its Affiliates, or the Debtor's estate by any theory of law or equity. The Transactions do not amount to a consolidation, merger, or de facto merger.
• The Purchaser Related Parties shall have no successor or vicarious liabilities of any kind, including under any labor law or theory of antitrust, environmental, successor or transferee liability, de facto merger, mere continuation, substantial continuity, or fraudulent transfer.
• The Purchaser shall have no liability for any claims against the Debtor, its Affiliates, or the Debtor's estate, including any claims arising from or related to the Intercompany Settlement.

Assumption and Assignment of Contracts

• The Purchaser shall pay all Cure Costs with respect to the Purchased Contracts and satisfy and perform all Liabilities related to each Purchased Contract when due.
• The Purchaser has provided sufficient evidence of adequate assurance of future performance within the meaning of section 365 of the Bankruptcy Code.
• Each counterparty to a Purchased Contract had a reasonable opportunity to object to Cure Costs and to the assumption and assignment of the applicable contracts. Counterparties failing to timely object are deemed to have consented.
• Any anti-assignment, "change of control," or similar provisions in the Purchased Contracts are deemed unenforceable and void with respect to the Transactions.
• For Additional Contracts identified by the Purchaser through the Closing Date, the Debtor shall serve a supplemental Assumption and Assignment Notice, with counterparties having 14 days from service to file objections to the assumption, assignment, or proposed Cure Cost.
• From the date of the Bidding Procedures Order through the Designation Deadline, the Purchaser may, in its sole discretion, designate any contract of the Debtor as an assumed and assigned contract or a rejected contract by providing a Designation Notice to the Debtor. The Debtor shall, within five business days, deliver an Assignment/Rejection Notice to the applicable counterparties. Any Cure Costs due following a post-Closing Designation Notice shall be paid within five business days of delivery of the Assignment/Rejection Notice.
• After the Closing, the Debtor and its estate shall have no further liabilities or obligations with respect to any Purchased Contracts or Assumed Liabilities.

Intercompany Settlement

• The Debtor and the Purchaser would not have entered into the APA or consummated the Transactions absent approval and consummation of the Intercompany Settlement.
• The Intercompany Settlement, by and among the Seller and the Intercompany Settlement Counterparties, provides for the contribution to the Seller of all related assets necessary for the Seller to continue the Business as a going concern, including (i) the inventory, intellectual property, land, building, machinery, and equipment of the VEEGUM processing plant in Murray, Kentucky (the "Murray Assets"), (ii) the mining rights and other assets of Vanderbilt Western Resources Lyles Mine, and (iii) the assets of Advanced Milling.
• Upon the Closing, the Purchaser has the right, automatically and without further action, to enforce the Intercompany Settlement and all rights and remedies of the Debtor thereunder.

Talc Removal

• Following the Closing, the Purchaser shall provide the Debtor, its Affiliates, and their respective Representatives with reasonable access to the Gouverneur Premises for a period of six months, solely for the purposes of, at the Debtor's cost and expense:
  • Removing all talc from the premises;
  • Cleaning the talc silos and any other storage areas containing talc, including areas used for storage of core samples; and
  • Removing all related materials and debris other than the silos themselves (collectively, the "Remediation Activities").
• Such access will be provided in accordance with the terms of the Reciprocal TSA, under which the Seller shall indemnify the Purchaser and its Affiliates for all physical damages caused by the Remediation Activities.
• During the Remediation Activities, the Purchaser shall not take any action to alter, demolish, or otherwise interfere with the talc silos or storage areas in a manner that would materially impair the Remediation Activities, and shall cooperate in good faith, including by facilitating reasonable physical access and coordinating scheduling.

Licenses and Permits

• Except as set forth in paragraph 50 of the Sale Order with respect to Federal Interests, the Purchaser shall be authorized, as of the Closing Date, to operate under any license, permit, registration, and governmental authorization or approval of the Debtor with respect to the Purchased Assets.
• To the extent the Purchaser cannot operate under any such authorization, such licenses, permits, and approvals shall remain in effect while the Purchaser, with the Debtor's assistance, works to apply for and secure new issuances.
• To the extent provided by section 525 of the Bankruptcy Code, no governmental unit may revoke or suspend any permit or license relating to the operation of the Purchased Assets on account of the chapter 11 case or consummation of the Transactions.

United States Provisions

• Notwithstanding any provision to the contrary, nothing in the Sale Order, the APA, or any other related document shall:
  • Release, nullify, preclude, or enjoin the enforcement of any police or regulatory power or any liability that any entity would be subject to as the owner, lessor, lessee, or operator of property after entry of the Sale Order;
  • Affect the setoff or recoupment rights of the United States of America against the Debtor;
  • Authorize the assumption, assignment, sale, or other transfer of any federal or state grants, grant funds, rights-of-way, agreements, awards, leases, registrations, billing numbers, national provider identifiers, provider transaction access numbers, licenses, or permits (collectively, "Federal Interests") without compliance with all terms of the Federal Interests and applicable non-bankruptcy law;
  • Be interpreted to set cure amounts or to require the United States to novate, approve, or otherwise consent to the sale, assumption, or transfer of any Federal Interests; or
  • Expand the scope of 11 U.S.C. § 525.
• In the event of inconsistency or conflict between the APA and the Sale Order as to the United States, the provisions of the Sale Order govern.

Labor and Pension Matters

• Nothing in the Sale Order shall discharge, release, limit, or relieve the Debtor, any of its affiliates or controlled group members, or any fiduciary, party-in-interest, or improper recipient of assets (collectively, the "Pension Plan Parties") from any liability with respect to (i) the R.T. Vanderbilt Holding Company Pension Plan and (ii) any other defined benefit pension plan sponsored by the Debtor or its affiliates (collectively, the "Pension Plans"), unless such obligations are otherwise assumed by the Purchaser or its Affiliates.
• The Purchaser or its Affiliates cannot assume such obligations without the written consent of the Pension Benefit Guaranty Corporation ("PBGC"). The Purchaser has not agreed to assume any Pension Plans.
• Cure Costs related to the assumption and assignment of the Debtor's collective bargaining agreements with the United Steelworkers (including obligations for paid time off, grievances, arbitration awards, and contributions for health care, retirement, or other benefits) shall be satisfied in the ordinary course. No proof of claim, request for administrative expense, or cure claim need be filed with respect to such cure amounts.
• Nothing in the Sale Order or the APA requires the Purchaser to continue or maintain any employee, pension, welfare, fringe benefit, or other benefit plan of the Debtor or its Affiliates.

Surety Bonds

• "Surety" refers to Fidelity and Deposit Company of Maryland and/or any of its affiliates or subsidiaries, including Zurich North America and Zurich American Insurance Company.
• Surety has executed certain Existing Surety Bonds on behalf of the Debtor and non-Debtor affiliates, and the Debtor and certain non-Debtor affiliates have entered into Existing Indemnity Agreements with the Surety.
• Nothing in any sale order, APA, or related document shall be construed to authorize the Debtor's assumption and/or assignment of any Existing Surety Bond or Existing Indemnity Agreement without Surety's written consent, or to obligate Surety to replace any Existing Surety Bond. No Purchaser shall be deemed a substitute principal under any Existing Surety Bond or indemnitor under any Existing Indemnity Agreement without Surety's written consent.

Injunctions and Releases

• On the Closing Date, all persons and entities are forever prohibited, estopped, and permanently enjoined from commencing or continuing any action against the Purchaser, its successors and assigns, or the Purchased Assets, based upon any Encumbrance from which the Transactions are free and clear.
• The injunction extends to Talc Liabilities, provided that the Sale Order shall not enjoin Talc Liability claims with respect solely to the Debtor and its Affiliates, or against the Debtor's directors and/or JAK officers in their capacity as such.
• Effective upon Closing, the Purchaser (on behalf of itself and its Affiliates) and the Seller (on behalf of itself and its Affiliates) provide mutual releases of claims relating to the Purchased Assets, the Business, the operations of the Business prior to Closing, the Excluded Assets, and the Excluded Liabilities, subject to customary carve-outs for Fraud, willful breach, knowing and intentional misrepresentation, criminal acts, and contractual obligations under the APA. The release does not apply to claims related to Tax liabilities constituting priority tax claims under Section 507(a)(8) of the Bankruptcy Code.
• The Purchaser and Seller expressly waive any and all rights, benefits, and protections of California Civil Code Section 1542 and any other state or federal statute or common law principle limiting the scope of a general release.

Notice of Sale

• Actual written notice of the Motion, the Notice of Sale, the Bidding Procedures, the Auction, the Sale Hearing, the Assumption and Assignment Notice, and related deadlines was provided to all required parties, including the U.S. Trustee, counsel to the DIP Lender, lien holders, parties asserting interests in the Purchased Assets, parties expressing interest in acquiring the Purchased Assets within the prior year, the Office of the United States Attorney for the Northern District of New York, the IRS and state and local taxing authorities, all counterparties to Purchased Contracts, all known creditors, and all parties to litigation with the Debtor.
• Publication notice was provided in USA Today, the Hartford Courant, the Gouverneur Tribune Press, and Pit & Quarry.
• The notices were proper, timely, adequate, and constitutionally sufficient, providing a fair and reasonable opportunity to object and be heard.

Key Dates

• Petition Date: Feb. 16, 2026
• Bidding Procedures Hearing: March 4 and March 18, 2026
• Bidding Procedures Order Entry: March 26, 2026
• Bid Deadline: April 24, 2026
• Auction: May 4, 2026, at the New York offices of Latham & Watkins LLP
• Sale Hearing: May 7, 2026
• Sale Order Deadline / Sale Order Entry: May 8, 2026
• Earliest Permitted Closing Date: June 1, 2026 (no Closing prior to this date without the prior written consent of the Purchaser)
• Termination Date: June 23, 2026, at 5:00 p.m. Eastern time, which date may be extended by the Seller for an additional 15 days (unless the failure of Closing is primarily caused by Seller's material breach) or by mutual consent