Exhibit 99.6
ASSET PURCHASE AGREEMENT
AMONG
IBF FUND LIQUIDATING, LLC,
as the Buyer,
AND
IBF V- ALTERNATIVE INVESTMENT HOLDINGS, LLC,
as the Seller,
FEBRUARY 22, 2005
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is made as of February
22, 2005, by and among IBF Fund Liquidating, LLC, a Delaware limited liability
company (the "Buyer") and IBF V- Alternative Investment Holdings, LLC, a
Delaware limited liability company (the "Seller").
RECITALS:
WHEREAS, as of the date of this Agreement, the Seller owns 130 shares of
common stock (the "ABR Shares") in American Benefit Resources, Inc., a
Connecticut corporation (formerly known as Investment & Benefit Services, Inc.)
("ABR"), 271,085 shares of Common Stock (the "USM Common Stock") in U.S. ▇▇▇▇▇,
Inc., a Delaware corporation ("▇▇▇▇▇") and 207,792 shares of Series B Preferred
Stock in ▇▇▇▇▇ (the "USM Preferred Stock", and together with the USM Common
Stock and the ABS Shares, the "Shares"); and
WHEREAS, the Seller desires to sell, and the Buyer desires to purchase,
all of the Shares, plus any and all other equity interests of the Seller in ABR
and ▇▇▇▇▇ and all other assets of Seller (collectively, the "Assets"), for the
consideration and upon the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements herein set forth and for other good and valuable consideration,
the Buyer and the Seller hereby agree as follows:
1. THE ACQUISITION.
1.1 PURCHASE OF SHARES. Subject to and upon the terms and conditions set
forth in this Agreement, at the Closing (as defined below), the Seller will sell
and transfer to the Buyer, and the Buyer will purchase from the Seller, the
Assets for the Purchase Price (as defined below). The Seller will sell,
transfer, convey, assign, and deliver to the Buyer the Assets free and clear of
any liens, security interests, mortgages, escrows, rights of first refusal,
charges, adverse claims or restriction of any kind ("Encumbrances"), including,
but not limited to, any restriction on the use, voting, transfer, receipt or
income, or other exercise of any attributes of ownership or other encumbrances
or restrictions of any kind.
1.2 PURCHASE PRICE. The purchase price ("Purchase Price") for the Shares
will be $280,502.32 of cash plus the issuance to the Seller of uncertificated,
non-transferrable membership interests of the Buyer (the "New Shares") described
on Schedule 1 plus the contribution to Seller of the interests owned by Buyer in
Seller (the "AIH Interests").
1.3 PURCHASE PRICE ALLOCATION. The Buyer shall provide the Seller with its
proposed allocation of the Purchase Price within 120 days following the Closing
Date and the Seller shall respond within 45 days (the "Response Period") of
receipt, providing either (a) its acceptance of such allocation or (b) any
objections, in which case the Seller shall also provide its determination of the
allocation of the Purchase Price. If the Seller does not respond within the
Response Period, Seller shall be deemed to have accepted the allocations
proposed by Buyer. The Buyer and the Seller agree to act in good faith to
resolve any differences between them. In the event
that agreement cannot be reached, the parties will jointly choose an independent
certified public accounting firm, whose decision shall be final. The costs of
such firm shall be shared equally between the Seller and the Buyer. The
allocation of the Purchase Price shall be binding on all parties for all tax
purposes and the parties hereto agree to prepare and file all Tax Returns in a
manner consistent therewith.
2. THE CLOSING.
2.1 PLACE AND TIME. The closing of the sale of Assets pursuant to Section
1.1 ("Closing") shall take place at the offices of ▇▇▇▇ ▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as soon as reasonably practicable after the
conditions set forth in Section 3 hereof have been satisfied or waived.
2.2 DELIVERIES BY THE PARTIES.
(a) At the Closing the Seller shall deliver to the Buyer:
(i) stock certificates representing the Shares duly endorsed
for transfer to the Buyer, or accompanied by stock
powers duly endorsed in blank, with all requisite
documentary stamps affixed thereto and evidence of
payment of any applicable stock transfer taxes;
(ii) a copy of the validly executed and delivered and
enforceable release of the Seller, in the form annexed
hereto as Exhibit A , duly executed by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
("▇▇. ▇▇▇▇▇▇▇"), solely in his capacity as an
individual;
(iii) a release of the Buyer, in the form annexed hereto as
Exhibit B, duly executed by the Seller;
(iv) the documents contemplated by Section 3 of this
Agreement;
(v) a ▇▇▇▇ of Sale, in the form annexed hereto as Exhibit C;
and
(vi) A certificate in a form satisfactory to the Buyer from
the Seller in accordance with Treasury Regulation
1.1445-2(b)(2) that it is not a foreign person.
(b) At the Closing, the Buyer shall deliver to the Seller, or
cause to be delivered to the Seller:
(i) $280,502.32;
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(ii) evidence of issuance of the New Shares and the
contribution of the AIH Interests, in the form of a
written confirmation that the interests have been issued
and Interests contributed; and
(iii) the documents contemplated by Section 3 of this
Agreement.
(c) At any time and from time to time after the date hereof, each
party hereto, upon the request and with the assistance of the other, and without
further consideration, will execute and deliver such other instruments of sale,
transfer, conveyance, assignment and confirmation and take such action as the
requesting party reasonably deems necessary or desirable in order to carry out
the intent of this Agreement and the transactions contemplated hereby (the
"Contemplated Transactions").
3. CONDITIONS TO CLOSING.
3.1 CONDITIONS TO OBLIGATIONS OF THE BUYER AND THE SELLER. The respective
obligations of the Buyer and the Seller to consummate and effect this Agreement
and the transactions contemplated hereby shall be subject to the satisfaction at
or prior to the day of Closing of each of the following conditions, any of
which, with the exception of (a), below, may be waived, in writing by agreement
of all the parties hereto:
(a) MEMBER APPROVAL. This Agreement and the sale of Assets shall
have been approved by the requisite vote of the Seller's members (the
"Members");
(b) NO INJUNCTION. There shall not be in effect any injunction,
order or decree of a court of competent jurisdiction that prohibits or delays
the Contemplated Transactions, or that will require any material divestiture by
the Buyer as a result of Buyer's acquisition of the Shares;
(c) LITIGATION. No action or proceeding shall have been instituted
by any governmental body and, at what would otherwise have been the day of
Closing, remain pending to delay, restrain or prohibit any material part of the
Contemplated Transactions; nor shall any governmental body have notified any
party to this Agreement or any of their respective affiliates that consummation
of the Contemplated Transactions would constitute a violation of the laws of any
jurisdiction or that it intends to commence an action or proceeding to restrain
or prohibit any material part of the Contemplated Transactions; unless, in
either such case, such governmental body shall have withdrawn such notice and
abandoned such action or proceeding; and
(d) APPROVALS. All consents necessary for the consummation of the
Contemplated Transactions shall have been obtained or made and shall be in full
force and effect.
3.2 ADDITIONAL CONDITIONS TO OBLIGATIONS OF THE BUYER. The obligations of
the Buyer to consummate and effect this Agreement and the Contemplated
Transactions shall be
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subject to the satisfaction at or prior to the day of Closing of each of the
following conditions, any of which may be waived, in writing, by the Buyer:
(a) REPRESENTATIONS, WARRANTIES AND AGREEMENTS. (i) The
representations and warranties of the Seller set forth in this Agreement shall
be true and correct in all material respects as of the date of this Agreement,
and as of the day of Closing with the same effect as though made on the day of
Closing, (ii) the Seller shall have performed and complied in all material
respects with the agreements contained in this Agreement required to be
performed and complied with by them prior to or at the Closing and (iii) the
Buyer shall have received a certificate to the foregoing effect signed by the
Seller;
(b) PROCEEDINGS SATISFACTORY. All certificates and other documents
to be delivered by the Seller and all other matters to be accomplished by the
Seller and ▇▇. ▇▇▇▇▇▇▇ prior to or at the Closing pursuant to this Agreement
shall be satisfactory in the reasonable judgment of the Buyer and its counsel;
(c) RELEASE. The Seller shall have executed and delivered a
release of the Buyer, substantially in the form of Exhibit B attached hereto;
(d) RELEASE. ▇▇. ▇▇▇▇▇▇▇, solely in his capacity as an individual,
shall have executed and delivered a release of the Seller, substantially in the
form of Exhibit A attached hereto.
3.3 ADDITIONAL CONDITIONS TO OBLIGATIONS OF THE SELLER. The obligations of
the Seller to consummate and effect this Agreement and the Contemplated
Transactions shall be subject to the satisfaction at or prior to the day of
Closing of the following condition, which may be waived, in writing, by the
Seller:
(a) REPRESENTATIONS, WARRANTIES AND AGREEMENTS. (i) The
representations and warranties of the Buyer set forth in this Agreement shall be
true and correct in all material respects as of the date of this Agreement and
as of the day of Closing with the same effect as though made as of the day of
Closing, (ii) the Buyer shall have performed and complied in all material
respects with the agreements contained in this Agreement required to be
performed and complied with by it prior to or at the Closing and (iii) the
Seller shall have received a certificate to the foregoing effect signed by an
authorized officer of the Buyer; and
4. REPRESENTATIONS AND WARRANTIES OF SELLER.
The Seller hereby represents, warrants and acknowledges that:
4.1 AUTHORIZATION OF THE SELLER. The Seller has all necessary rights,
powers, authority and capacity to execute and deliver this Agreement and,
subject to the approval of this Agreement by the requisite vote of the Members,
to sell and transfer the Shares and otherwise perform Seller's obligations
hereunder. All action necessary to execute and deliver this Agreement and all
documents related thereto or under the Contemplated Transactions necessary
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to consummate the Contemplated Transactions by the Seller has been taken by the
Manager (as defined in Section 4.7 below) and subject to the approval of this
Agreement by the requisite vote of the Members, the Members. The Seller has
complied with all provisions of its operating agreement applicable to the
Contemplated Transactions or necessary for the consummation thereof, other than
the approval of the requisite vote of its members. This Agreement has been duly
executed and delivered by the Seller and constitutes the legal, valid and
binding obligation of the Seller enforceable against the Seller in accordance
with its terms.
4.2 NON-CONTRAVENTION. The execution and delivery of this Agreement and
the Contemplated Transactions by the Seller do not require the Seller to file
any notice, report or other filing with, or to obtain any consent, registration,
approval, permit or authorization of or from, any governmental or regulatory
authority of the United States, any State thereof or any foreign jurisdiction,
and do not constitute a material breach or violation of, or a material default
under, any provision of any mortgage, lien, lease, agreement, license,
instrument, law, regulation, order, arbitration, award, judgment or decree to
which the Seller is a party or by which its property is bound, in any such case
which could prevent, materially delay or materially burden the transactions
contemplated by this Agreement.
4.3 CERTAIN MATTERS RELATING TO THE SHARES. The Seller is the lawful
record and beneficial owner of the Shares. The Shares represent all of the
interests held by the Seller in ABS and ▇▇▇▇▇. The Seller owns the Shares free
and clear of all Encumbrances. Upon delivery of the Assets, the Buyer will
acquire the record, beneficial and legal title to such Assets, free and clear of
all Encumbrances. No legend or other preference to any purported Encumbrance
appears on any certificate representing the Shares.
4.4 NO CONFLICT; CONSENTS. To the best knowledge of the Seller, neither
the execution and delivery of this Agreement nor the consummation of the
Contemplated Transactions will (i) violate any material statute, ordinance,
rule, regulation, order or decree of any governmental body applicable to the
Seller; or (ii) other than the consent of the members of the Buyer, require any
filing with, or permission, consent or approval of, or the giving of any notice
to, any person by the Seller other than that certain Pledge Agreement and
related agreements for the benefit of Boston Private Bank and the other lenders
described therein relating to loans made to ▇▇▇▇▇ (the "▇▇▇▇▇ Agreements")
4.5 LITIGATION. There are no actions, suits, or proceedings pending or, to
Seller's knowledge, threatened against the Seller at law or in equity or before
any governmental body, which if adversely determined would preclude the
Contemplated Transactions or have a material adverse effect on the ability of
the Buyer to obtain the benefits of the Contemplated Transactions or would have
a material adverse effect on the validity or enforceability of this Agreement in
accordance with its terms or would adversely affect the ability of the Buyer to
consummate the Contemplated Transactions. The Seller is not in default with
respect to any order or decree of any court or of any such governmental body
which default would have a material adverse effect on the validity or
enforceability of this Agreement.
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4.6 CERTAIN MATTERS RELATING TO THE NEW SHARES.
(a) The Seller is acquiring the New Shares for investment purposes
only and not with a view to, or for, distribution, resale or fractionalization
thereof, in whole or in part, in each case under circumstances which would
require registration thereof under the Securities Act of 1933, as amended (the
"Securities Act"), or any state securities laws.
(b) The Seller acknowledges that no person has been authorized to
give any information or to make any representation relating to the New Shares or
the Buyer, other than as contained in this Agreement, and, if given or made,
information received from any person and any representation, other than as
aforesaid, must not be relied upon as having been authorized by the Buyer or any
person acting on its behalf.
(c) The Seller understands that an investment in the New Shares is
a speculative investment which involves a high degree of risk of loss of
Seller's investment therein. The Seller is able to bear the economic risk of
such investment for an indefinite period of time, including the risk of a
complete loss of Seller's investment in such securities. The Seller acknowledges
that the New Shares have not been registered under the Securities Act or any
applicable state securities laws and, therefore, cannot be sold unless
subsequently registered under the Securities Act or any applicable state
securities laws or an exemption from such registration is available and that
there are substantial restrictions on the transferability of such securities
under the Buyer's operating agreement.
(d) The Seller acknowledges that it has had a full opportunity to
ask questions and receive answers concerning the terms and conditions of the
issuance of the New Shares and has had full access to such other information
concerning the Buyer as it has requested.
(e) The Seller has been afforded the opportunity to examine all
documents related to and, if applicable, executed in connection with, the
transactions contemplated hereby, which the Seller or purchaser representatives
or advisors, if any, have requested to examine.
4.7 ACTION OF MANAGER. Seller's manager, IBF Management, Corp., a Delaware
corporation (the "Manager") has executed this Agreement. Pursuant to the
Seller's operating agreement, as in effect, the concurrence of the Manager is
not expressly required to consummate the Contemplated Transactions, but only the
concurrence and approval of Members holding a majority of the Membership
Interests in the Seller. The Manager, based on factors and analysis that will be
described in a statement to be sent to the Members, has executed this Agreement
subject to the approval of the requisite vote of the Members in order to permit
the Members to make their own decision as to whether to consummate the
Contemplated Transactions and shall request that the Members vote whether to
approve this Agreement and the sale of the Assets.
5. REPRESENTATIONS AND WARRANTIES OF BUYER.
The Buyer hereby represents and warrants to the Seller that:
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5.1 AUTHORITY OF THE BUYER. The Buyer has all necessary rights, powers,
authority and capacity to execute and deliver this Agreement and to purchase the
Assets and otherwise perform Buyer's obligations hereunder. All action necessary
to execute and deliver this Agreement and all documents related thereto or under
the Contemplated Transactions necessary to consummate the Contemplated
Transactions by the Buyer has been taken by the manager and members, if
necessary, of the Buyer. This Agreement has been duly executed and delivered by
the Buyer and constitutes the legal, valid and binding obligation of the Buyer
enforceable against the Buyer in accordance with its terms.
5.2 NO CONFLICT; CONSENTS. To the best knowledge of the Buyer, neither the
execution and delivery of this Agreement nor the consummation of the
Contemplated Transactions will (i) violate any material statute, ordinance,
rule, regulation, order or decree of any governmental body applicable to the
Buyer or (ii) other than the consent of the manager of the Buyer, require any
filing with, or permission, consent or approval of, or the giving of any notice
to, any person, by the Buyer, except no representation or warranty is made as to
any requirements under any guaranties by the Buyer of indebtedness.
5.3 LITIGATION. There are no actions, suits, or proceedings pending or, to
Buyer's knowledge, threatened against the Buyer at law or in equity or before
any governmental body, which if adversely determined would preclude the
Contemplated Transactions or have a material adverse effect on the ability of
the Buyer to obtain the benefits of the Contemplated Transactions or would have
a material adverse effect on the validity or enforceability of this Agreement in
accordance with its terms or would adversely affect the ability of the Buyer to
consummate the Contemplated Transactions. The Buyer is not in default with
respect to any order or decree of any court or of any such governmental body
which default would have a material adverse effect on the validity or
enforceability of this Agreement.
5.4 DISCLOSURES. The Buyer has disclosed to the Seller all information and
materials requested to be disclosed by the Seller within the Buyer's knowledge
concerning the value of the assets of the Seller. To the Buyer's knowledge, the
draft consent solicitation materials, dated February 15, 2005, sets forth what
the Seller believes is all material information regarding the value of the
shares within the Buyer's knowledge other than information delivered to counsel
for the Seller prior to the date thereof, provided there can be no assurance
that the Buyer's information is complete and the Buyer undertakes no obligation
to update the Seller with any information it receives or discovers subsequent to
the date hereof.
6. FURTHER AGREEMENTS OF THE PARTIES.
6.1 INFORMATION STATEMENT. As promptly as practical following the date
hereof, the Seller shall prepare, with the cooperation of the Buyer and with the
special assistance of Buyer's counsel, an information statement (the
"Information Statement") and upon approval of such Information Statement by the
Buyer, in the Buyer's sole and absolute discretion, shall mail the Information
Statement to all of the Members entitled to vote on the Contemplated
Transactions under the Seller's Operating Agreement (as defined below) and under
Delaware Law. The
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Information Statement shall constitute an information statement for solicitation
of approval of this Agreement by the Members. Whenever there is brought to the
attention of the Seller the occurrence of any event that is required to be set
forth in an amendment or supplement to the Information Statement, the Seller
shall promptly inform the Buyer of such occurrence and cooperate in mailing,
with the special assistance of Buyer's counsel, to the Members, such amendment
or supplement which amendment or supplement shall be satisfactory to the Buyer
in its sole and absolute discretion. Anything to the contrary contained herein
notwithstanding, the Seller shall not include in the Information Statement any
information with respect to the Buyer or its affiliates or associates, the form
and content of which information shall not have been approved by the Buyer prior
to such inclusion.
6.2 MEETING OF THE MEMBERS OF THE SELLER. As promptly as practicable
following the date hereof, the Seller shall have taken, with the cooperation of
the Buyer and with the special assistance of Buyer's counsel, all action
necessary in accordance with Delaware Law and Seller's operating agreement,
dated as of October 1, 2001 (the "Operating Agreement"), by and among the
Manager, certain individuals and entities listed as the Members attached thereto
and all other persons admitted as Members pursuant to Articles VII and XIV
therein, to convene a meeting of the Members or to secure the written consent of
the Members. The Seller shall cooperate with the Buyer in order to request that
the Members of the Seller execute proxies or written consents in favor of this
Agreement. The Seller shall consult with the Buyer regarding the date of the
meeting of the Members and shall not postpone or adjourn (other than for the
absence of quorum) the meeting of the Members without the consent of the Buyer.
6.3 CONDUCT OF SELLER'S BUSINESS. The Seller agrees to carry on its
business prior to and until the day of Closing in the usual, regular, and
ordinary course in substantially the same manner as heretofore conducted. The
Seller further agrees to pay debts and taxes when due subject (i) to good faith
disputes over such debts or taxes and (ii) the Buyer's consent to the filing of
material tax returns (which consent shall not be unreasonably withheld or
delayed), to pay or perform other obligations when due, and to use all
reasonable efforts consistent with past practice and policies to preserve intact
its present business organizations, keep available the services of its present
officers and key employees and preserve its relationships with customers,
suppliers, distributors, licensors, licensees and others having business
dealings with it to the end that its goodwill and ongoing businesses shall be
unimpaired at or until Closing. The Seller agrees to promptly notify the Buyer
of any event or occurrence not in the ordinary course of its business, and of
any event which could have a material adverse effect on the Seller.
6.4 RESTRICTION ON CONDUCT OF SELLER'S BUSINESS. Prior to the Closing, the
Seller shall not do, cause or permit any of the following, without the prior
written consent of the Buyer:
(a) Charter Documents. Cause or permit any amendments to Seller's
Operating Agreement;
(b) Dividends; Change in Capital Stock. Declare or pay any
dividends on or make any other distributions (whether in cash, stock or
property) in respect of any of its
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membership interests, or split, combine or reclassify any of its membership
interests or issue or authorize the issuance of any other securities in respect
of, in lieu of or in substitution for its membership interests, or repurchase or
otherwise acquire, directly or indirectly, any of its membership interests;
(c) Stock Option Plans, Etc. Accelerate, amend or change the
period of exercisability or vesting of options or other rights granted under its
stock plans or authorize cash payments in exchange for any options or other
rights granted under any of such plans;
(d) Material Contracts. Enter into any material contract or
commitment, or violate, amend or otherwise modify or waive any of the terms of
any of its material contracts;
(e) Issuance of Securities. Issue, deliver or sell or authorize or
propose the issuance, delivery of sale of, or purchase or propose the purchase
of, any membership interests or certificates convertible into, or subscriptions,
rights, warrants or other agreements or commitments of any character obligating
it to issue any such shares or other convertible securities;
(f) Dispositions. Sell, lease, license or otherwise dispose of or
encumber any of its properties or assets;
(g) Indebtedness. Incur any additional indebtedness for borrowed
money or guarantee any such indebtedness or issue or sell any debt securities or
guarantee any debt securities of others;
(h) Leases. Enter into any operating lease;
(i) Payment of Obligations. Pay, discharge or satisfy any claim,
liability or obligation (absolute, accrued, asserted or unasserted, contingent
or otherwise) arising other than in the ordinary course of business other than
the payment, discharge or satisfaction of liabilities reflected or reserved
against in Seller's financial statements;
(j) Capital Expenditures. Make any capital expenditures, capital
additions or capital improvements;
(k) Insurance. Materially reduce the amount of any insurance
coverage provided by existing insurance policies;
(l) Termination or Waiver. Terminate or waive any right of
substantial value;
(m) Employee Benefit Plans; New Hires; Pay Increases. Adopt or
amend any employee benefit or stock purchase or option plan, except as required
under ERISA or except as necessary to maintain the qualified status of such plan
under the Internal Revenue Code of 1986, as amended (the "Code"), or hire any
new employee, pay any special bonus or special remuneration to any employee or
director to increase the salaries or wage rates of its employees;
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(n) Severance Arrangements. Grant any severance or termination pay
to any employee;
(o) Lawsuits. Commence a lawsuit other than for a breach of this
Agreement;
(p) Acquisitions. Acquire or agree to acquire by merging or
consolidating with, or by purchasing a substantial portion of the assets of, or
by any other manner, any business or any corporation, partnership, association
or other business organization or division thereof, or otherwise acquire or
agree to acquire any assets which are material, individually or in the
aggregate, to its business, taken as a whole;
(q) Taxes. Make or change any material election in respect of
taxes, adopt or change any accounting method in respect of taxes, file any
material tax return or any amendment to a material tax return, enter into any
closing agreement, settle any claim or assessment in respect to taxes, or
consent to any extension or waiver of the limitation period applicable to any
claim or assessment in respect of taxes; or
(r) Other. Take or agree in writing or otherwise to take, any of
the actions described in 6.4(a) through (q) above, or any action which would
make any of its representations or warranties contained in this Agreement untrue
or incorrect or prevent it from performing or cause it not to perform its
covenants hereunder.
6.5 EXPENSES. All parties to this Agreement shall bear their own
respective expenses (including, without limitation, reasonable fees and
disbursements of their respective accountants and counsel) incurred in
connection with all obligations to be performed by each of them under this
Agreement.
6.6 FURTHER ACTIONS. All parties to this Agreement agree to use all
reasonable good faith efforts to take all actions and to do all things
necessary, proper or advisable to consummate this Agreement and the Contemplated
Transactions, including, but not limited to, executing any documents in order to
comply with or accommodate, the ▇▇▇▇▇ Agreements.
6.7 FURTHER ASSURANCES. Following the Closing, each party to this
Agreement shall, and shall cause each of their affiliates and associates to,
from time to time, execute and deliver such additional instruments, documents,
conveyances or assurances and take such other actions as shall be necessary, or
otherwise reasonably requested by the other party, to confirm and assure the
rights and obligations provided for in this Agreement and render effective the
consummation of this Agreement and the Contemplated Transactions.
6.8 SELLER EXISTENCE, ETC. (a) Following the Closing, without the express
written consent of the Buyer, which consent the Buyer may withhold in its sole
and absolute discretion (i) the Seller shall remain in existence, in good
standing and in compliance with applicable law and the requirements of the
Operating Agreement, until the date of the dissolution of the Buyer, and shall
not commence any liquidation or dissolution, or engage in any merger,
recapitalization
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or reorganization or similar transaction; and (ii) the Seller shall not change
the identity of the Manager.
(b) Following the Closing, the Seller shall not, directly or
indirectly, distribute to its members, or otherwise sell, transfer or
hypothecate the New Shares, or take any other action with respect to the New
Shares that has the effect of transferring legal or beneficial ownership of the
new Shares or any portion thereof or interest therein. Promptly upon receipt of
any distributions made with respect to the New Shares, the Seller shall
distribute such amounts received, less any accrued expenses (within the expense
limitations permitted by Section 6.8(c), below) of the Seller, to its Members.
(c) Following the Closing, without the express written consent of
the Buyer, which consent the Buyer may withhold in its sole and absolute
discretion, the Seller shall not incur any operating or other expenses or
liabilities relating to the operation of the Seller following the Closing in
excess of $5,000 per calendar year. Following the Closing, without charge to the
Seller, the Buyer shall provide, or arrange for the provision at no cost to the
Seller, the following services: (i) preparation of tax related forms, returns
and documentation (tax returns, K-1's, etc.) reasonably requested by the Seller
relating to tax years 2003 and 2004 (but not any services or documentation
relating to any audit or tax assessment); (ii) until the dissolution of the
Buyer, transfers of distributions to the Members, check signing and other
administrative tasks reasonably required for the Seller to function and comply
with law, including preparing tax returns, K-1's and similar matters; and (iii)
the winding up of the Seller's business and preparation for its dissolution
substantially simultaneously with the dissolution of the Buyer.
6.9 NO ASSUMED LIABILITIES. Seller hereby acknowledges that Buyer is not
acquiring any liabilities of Seller.
7. TERMINATION.
7.1 TERMINATION PROCEDURES. This Agreement may be terminated before the
Closing occurs only as follows:
(a) by written agreement of the Seller and the Buyer at any time;
(b) by the Buyer, by notice to the Seller at any time, if
satisfaction of any of the conditions specified in Section 3 becomes impossible
and such condition has not been waived by the Buyer;
(c) by the Seller, by notice to the Buyer at any time, if
satisfaction of any of the conditions specified in Section 3 becomes impossible
and such condition has not been waived by the Seller; or
(d) by either party, by notice to the other, if the Closing has
not occurred on or before March 31, 2005.
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7.2 EFFECT OF TERMINATION. In the event that this Agreement is terminated
pursuant to Section 7.1, this Agreement shall terminate without any liability or
further obligation of any party to another, except for the liability for breach
of this Agreement.
8. MISCELLANEOUS.
8.1 ENTIRE AGREEMENT. This Agreement, together with the releases
contemplated to be delivered hereunder, contains, and is intended as, a complete
statement of all of the terms and the arrangements between the parties with
respect to the matters provided for, supersedes any previous agreements and
understandings between the parties with respect to those matters.
8.2 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the law of the State of New York without regard to the conflicts
of law principle thereof.
8.3 HEADINGS. The section headings contained in this Agreement are solely
for the purpose of reference, are not part of the agreement of the parties and
shall not in any way affect the meaning or interpretation of this Agreement. All
references in this Agreement to Sections, Schedules, Annexes and Exhibits are to
sections, schedules, annexes and exhibits to this Agreement, unless otherwise
indicated.
8.4 NOTICES. All notices and other communications under this Agreement
shall be in writing and shall be deemed given when (a) delivered by hand, (b)
transmitted by telecopier (and confirmed by return facsimile), or (c) delivered,
if sent by Express Mail, Federal Express or other express delivery service, or
registered or certified mail, return receipt requested, to the addressee at the
following addresses or telecopier numbers (or to such other addresses, telex
number or telecopier number as a party may specify by notice given to the other
party pursuant to this provision):
If to the Seller:
IBF V- Alternative Investment Holdings, LLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
12
If to the Buyer:
IBF Fund Liquidating, LLC
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, not personally but
solely in his capacity as Manager
▇▇▇▇ ▇▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇ ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
8.5 BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns. Nothing in this Agreement shall create or be deemed to create
any third party beneficiary rights in any person or entity not party to this
Agreement. No assignment of this Agreement or of any rights or obligations
hereunder may be made by either party (by operation of law or otherwise) without
the prior written consent of the other and any attempted assignment without the
required consent shall be void.
8.6 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
13
IN WITNESS WHEREOF, the parties hereto have executed this instrument as of
the date and year first above written.
IBF FUND LIQUIDATING, LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ICA Trustee
Title: Liquidating Agent and Manager
IBF V- ALTERNATIVE INVESTMENT
HOLDINGS, LLC
by IBF MANAGEMENT CORP, as sole Manager
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
14
SCHEDULE 1
Membership Interests equal to 1.9339% of the Membership Interests in
the Buyer on the date hereof.
EXHIBIT A
FORM OF RELEASE OF SELLER (BY ▇▇. ▇▇▇▇▇▇▇)
This Release (this "Release") is being executed and delivered in
accordance with Sections 2.1(a)(ii) and 3.1(e) of the Asset Purchase Agreement
dated February __, 2005 (the "Agreement"), by and among IBF Fund Liquidating,
LLC, a Delaware limited liability company, as Buyer, and IBF V-Alternative
Investment Holdings, LLC, a Delaware limited liability company, as Seller (the
"Releasee") and is executed by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, solely in his capacity as an
individual (the "Releasor"). Capitalized terms used in this Release without
definition have the respective meanings given to them in the Agreement.
The Releasor acknowledges that execution and delivery of this
Release is a condition to the Buyer's obligation to purchase, and to the
Seller's obligation to sell, the Assets pursuant to the Agreement, and that the
Buyer and the Seller are relying on this Release in consummating such purchase
and sale.
The Releasor, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged and intending to be legally bound,
in order to induce the Buyer to purchase, and to induce the Releasee to sell,
the Assets pursuant to the Agreement and the documents related thereto, hereby
agrees as follows:
The Releasor hereby releases and forever discharges the Releasee and
each of the Releasee's respective individual, joint or mutual, past, present and
future affiliates, representatives, successors and assigns from any and all
claims, demands, proceedings, causes of action, orders, obligations, contracts,
agreements, debts and liabilities whatsoever, whether known or unknown,
suspected or unsuspected, both at law and in equity, which the Releasor now has,
has ever had or may hereafter have against the Releasee arising
contemporaneously with or prior to the Closing or on account of or arising out
of any matter, cause or event occurring contemporaneously with or prior to the
Closing, provided, however, this Release shall not be effective to bar or in any
way limit any defenses or set-offs that Releasor may bring against the Releasee,
up to, but not exceeding, the amount or amounts claimed by the Releasee, if the
Releasee shall make any claims against the Releasor in any legal action.
Except as expressly set forth in the preceding paragraph, the
Releasor hereby irrevocably covenants to refrain from, directly or indirectly,
asserting any claim or demand, or commencing, instituting or causing to be
commenced, any proceeding of any kind against the Releasee, based upon any
matter purported to be released hereby.
Without in any way limiting any of the rights and remedies otherwise
available to the Releasee, the Releasor shall indemnify and hold harmless the
Releasee from and against all loss, liability, claim, damage (including
incidental and consequential damages) or expense (including costs of
investigation and defense and reasonable attorney's fees) whether or not
involving third party claims, arising directly or indirectly from or in
connection with (i) the assertion by or on behalf of the Releasor or any of its
affiliates (including any person serving as
A-1
an executor, trustee or similar capacity on behalf of the Releasor), of any
claim or other matter purported to be released pursuant to this Release and (ii)
the assertion by any third party of any claim or demand against the Releasee
which claim or demand arises directly or indirectly from, or in connection with,
any assertion by or on behalf of the Releasor or any of its affiliates
(including any person serving as an executor, trustee or similar capacity on
behalf of the Releasor), against such third party of any claims or other matters
purported to be released pursuant to this Release.
If any provision of this Release is held invalid or unenforceable by
any court of competent jurisdiction, the other provisions of this Release will
remain in full force and effect. Any provision of this Release held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.
This Release may not be changed except in a writing signed by the
party against whose interest such change shall operate. This Release shall be
governed by and construed under the laws of the State of New York without regard
to principles or conflicts of law.
All words used in this Release will be construed to be of such
gender or number as the circumstances require.
(Remainder of Page Intentionally Left Blank)
A-2
IN WITNESS WHEREOF, each of the undersigned have executed and
delivered this Release as of this ___ day of _______, 2005.
RELEASOR
______________________________
Name:
Title:
RELEASEE
______________________________
Name:
Title:
(Remainder of Page Intentionally Left Blank)
A-3
EXHIBIT B
FORM OF RELEASE OF BUYER (BY SELLER)
This Release (this "Release") is being executed and delivered in
accordance with Sections 2.2(a)(iii) and 3.2(c) of the Asset Purchase Agreement
dated February __, 2005 (the "Agreement"), by and among IBF Fund Liquidating,
LLC, a Delaware limited liability company, as Buyer (the "Releasee") and IBF
V-Alternative Investment Holdings, LLC, a Delaware limited liability company, as
Seller (the "Releasor"). Capitalized terms used in this Release without
definition have the respective meanings given to them in the Agreement.
The Releasor acknowledges that execution and delivery of this
Release is a condition to the Releasee's obligation to purchase the Assets
pursuant to the Agreement and that the Releasee is relying on this Release in
consummating such purchase.
The Releasor, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged and intending to be legally bound,
in order to induce the Releasee to purchase the Assets pursuant to the Agreement
and the documents related thereto, hereby agrees as follows:
The Releasor, on behalf of itself and its affiliates (including any
person serving as an executor, trustee or similar capacity on behalf of the
Releasor), hereby releases and forever discharges the Releasee and each of its
respective individual, joint or mutual, past, present and future affiliates,
representatives, successors and assigns from any and all claims, demands,
proceedings, causes of action, orders, obligations, contracts, agreements, debts
and liabilities whatsoever, whether known or unknown, suspected or unsuspected,
both at law and in equity, which the Releasor or any of its affiliates
(including any person serving as an executor, trustee or similar capacity on
behalf of the Releasor) now has, has ever had or may hereafter have against the
Releasee arising contemporaneously with or prior to the Closing or on account of
or arising out of any matter, cause or event occurring contemporaneously with or
prior to the Closing, including, but not limited to, any rights to
indemnification or reimbursement from the Releasee, whether pursuant to its
operating agreement and whether or not relating to claims pending on, or
asserted after, the Closing; provided, however, that nothing contained herein
shall operate to release (i) any obligations of the Releasee arising under the
Agreement or (ii) any rights to indemnification from the Releasee pursuant to
Releasee's operating agreement and to the extent permitted by applicable law,
whether or not relating to claims arising contemporaneously with or prior to the
Closing or on account of or arising out of any matter, cause or event occurring
contemporaneously with or prior to the Closing.
The Releasor hereby irrevocably covenants to refrain from, directly
or indirectly, asserting any claim or demand, or commencing, instituting or
causing to be commenced, any proceeding of any kind against the Releasee, based
upon any matter purported to be released hereby.
B-1
Without in any way limiting any of the rights and remedies otherwise
available to the Releasee, the Releasor shall indemnify and hold harmless the
Releasee from and against all loss, liability, claim, damage (including
incidental and consequential damages) or expense (including costs of
investigation and defense and reasonable attorney's fees) whether or not
involving third party claims, arising directly or indirectly from or in
connection with (i) the assertion by or on behalf of the Releasor or any of its
affiliates (including any person serving as an executor, trustee or similar
capacity on behalf of the Releasor), of any claim or other matter purported to
be released pursuant to this Release and (ii) the assertion by any third party
of any claim or demand against the Releasee which claim or demand arises
directly or indirectly from, or in connection with, any assertion by or on
behalf of the Releasor or any of its affiliates (including any person serving as
an executor, trustee or similar capacity on behalf of the Releasor), against
such third party of any claims or other matters purported to be released
pursuant to this Release.
If any provision of this Release is held invalid or unenforceable by
any court of competent jurisdiction, the other provisions of this Release will
remain in full force and effect. Any provision of this Release held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.
This Release may not be changed except in a writing signed by the
party against whose interest such change shall operate. This Release shall be
governed by and construed under the laws of the State of New York without regard
to principles or conflicts of law.
All words used in this Release will be construed to be of such
gender or number as the circumstances require.
(Remainder of Page Intentionally Left Blank)
B-2
IN WITNESS WHEREOF, each of the undersigned have executed and
delivered this Release as of this ___ day of ________, 2005.
RELEASOR
______________________________
Name:
Title:
RELEASEE
______________________________
Name:
Title:
B-3
EXHIBIT C
▇▇▇▇ OF SALE AND ASSIGNMENT
KNOW ALL MEN BY THESE PRESENT:
Reference is made to that certain Asset Purchase Agreement, dated as
of February __, 2005, by and among IBF Fund Liquidating, LLC, a Delaware limited
liability company (the "Buyer") and IBF V Alternative Investment Holdings, LLC,
a Delaware limited liability company (the "Seller"). All capitalized terms used
and not defined herein shall have the same meaning as set forth in the
Agreement.
Seller hereby grants, bargains, sells, transfers, assigns and
conveys to Buyer, its successors and assigns, all of Seller's right, title and
interest in and to the Assets.
TO HAVE AND TO HOLD the transferred Assets forever, together with
all of the Seller's right, title and interest in such Assets. This ▇▇▇▇ of Sale
and Assignment is governed by the laws of New York, without regard to the
conflicts of law provisions thereof.
IN WITNESS WHEREOF, the undersigned have duly executed this ▇▇▇▇ of
Sale and Assignment on behalf of Seller as of the ___ day of ___, 2005.
IBF V ALTERNATIVE INVESTMENT
HOLDINGS, LLC
By: IBF Management Corp., as
Sole Manager
By:______________________________
Name:
Title:
C-1
