ACQUISITION AGREEMENT
AGREEMENT, dated this ___ day of August, 1999, by and between Ernst &
Company, a Delaware corporation ("Seller"), and ▇▇▇▇▇▇▇▇▇ & Co., a New York
limited partnership ("Purchaser").
WHEREAS, Purchaser has taken steps to complete an ownership restructuring
(the "Restructuring") involving the organization of ▇▇▇▇▇▇▇▇▇ & Co Inc., a
Delaware corporation which will hold 100% of the equity interest in Purchaser
("Newco"), and an initial public offering of the shares of stock of Newco (the
"IPO") to occur simultaneously with the Restructuring;
WHEREAS, Seller is a limited partner of Purchaser and owns an interest in
capital and a 5.3685% interest in the profits of Purchaser (the "LP Interest"),
but does not intend to participate in the IPO and become a stockholder of Newco;
WHEREAS, Seller has previously agreed to sell, and Purchaser has previously
agreed to acquire, the entire LP Interest (including the balance in Seller's
capital account with Purchaser); and
WHEREAS, Seller and Purchaser wish to formalize the terms and conditions of
their agreement by hereinafter setting forth such terms and conditions.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereto agree as follows (with all capitalized
terms used herein and not otherwise defined herein having the respective
meanings ascribed thereto in the Amended and Restated Articles of Partnership of
Purchaser, as amended to the date hereof (the "Partnership Agreement")):
1. PURCHASE AND SALE OF THE LP INTEREST. Subject to the terms and
conditions hereof, Seller shall sell, assign, transfer, convey and deliver to
Purchaser, and Purchaser will acquire from Seller, the LP Interest for a
purchase price of $28,176,000 (the "Purchase Price"), payable by wire transfer
of immediately available funds to the order of Seller immediately after the
closing of the IPO.
2. PRE-CLOSING CONDITIONS. Purchaser's and Seller's mutual obligations to
consummate the transactions contemplated hereby will be subject to the
conditions that (i) the IPO shall have been consummated on or before December
31, 1999, and (ii) no injunction or order shall be in effect prohibiting
consummation of the transactions contemplated hereby or which would make the
consummation of such transactions unlawful, and no action or proceeding shall
have been instituted and remain pending before a court, governmental body or
regulatory authority or shall be threatened to restrain or prohibit such
transactions.
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3. CAPITAL CONTRIBUTIONS. Notwithstanding the provisions of Section 4(b) of
the Partnership Agreement, Seller will not be required to make any additional
capital contributions to Purchaser pursuant to such provision prior to the
consummation of the IPO and the transactions contemplated hereby; PROVIDED,
HOWEVER, that if the IPO has not been consummated on or before December 31,
1999, unless otherwise agreed by the parties (i) Seller's obligation to make
such additional capital contributions to Purchaser shall be reinstated
immediately, retroactive to the date of this Agreement, and (ii) Purchaser shall
be entitled to retain that portion of Seller's share of the previously
undistributed profits of Purchaser for the fiscal year ended December 31, 1999
(as an additional capital contribution to Purchaser by Seller) which is equal to
the amounts which otherwise would have been retained by Purchaser pursuant to
Section 4(b) of the Partnership Agreement. Effective upon the consummation of
the transactions contemplated hereby, Seller shall have no further obligations
to ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ under the provisions of the Partnership Agreement.
4. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller hereby represents and
warrants to Purchaser as follows:
(a) upon the transfer of the LP Interest under this Agreement to
Purchaser, Purchaser will acquire good and marketable title to the LP Interest
free and clear of any pledge, security interest or other encumbrance, or any
restriction or claim;
(b) Seller has good and marketable title to the LP Interest, and there
are no options, warrants, calls, commitments or agreements of any type to which
Seller is a party or by which Seller may be bound under which any person or
entity has a right to purchase or acquire, own or maintain any rights in, of or
to any of the LP Interest;
(c) the execution, delivery and performance of this Agreement, the
consummation of the transactions contemplated hereby and the compliance with the
provisions hereof by Seller will not (i) conflict with, result in the breach of,
or constitute a default under the certificate of incorporation, bylaws or other
organizational documents of Seller or any agreement or other instrument to which
Seller is a party or by which the property of Seller is bound or affected, (ii)
result in the creation of any lien, security interest, charge or encumbrance
upon the LP Interest, (iii) require any authorization, consent, approval,
exemption or other action by, or notice to, any third party, court or other
governmental or administrative body, or (iv) violate any laws, statutes,
regulations, orders or judgments applicable to Seller or the LP Interest;
(d) Seller has full, absolute and entire power and legal right to
execute, deliver and perform this Agreement;
(e) the execution, delivery and performance by Seller of this
Agreement have been duly and validly authorized by all necessary corporate
action on behalf of Seller;
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(f) this Agreement has been duly executed and delivered by Seller and
constitutes the valid and binding agreement of Seller, enforceable in accordance
with its terms, except as its enforceability may be limited by bankruptcy,
insolvency, moratorium or other laws relating to or affecting creditors' rights
generally and the exercise of judicial discretion in accordance with general
equitable principles; and
(g) Seller has been afforded the opportunity to ask questions of, and
receive answers from, the management of Purchaser about the business and affairs
of Purchaser, LaB Investing Co. L.L.C., the general partner of Purchaser (the
"General Partner"), and Newco and the terms of the Restructuring and the IPO and
to obtain any additional information related thereto, to the extent available
and appropriate; Purchaser, the General Partner and Newco have furnished to
Seller all information which Seller considers necessary to form a decision
concerning the disposition of the LP Interest; and no valid request to
Purchaser, the General Partner or Newco by Seller for information of any kind
about Purchaser, the General Partner and Newco and the terms of the
Restructuring and the IPO has been refused or denied or remains unfulfilled as
of the date hereof.
5. PURCHASER'S REPRESENTATIONS AND WARRANTIES. Purchaser hereby represents
and warrants to Seller as follows:
(a) Purchaser has full, absolute and entire power and legal right to
execute, deliver and perform this Agreement;
(b) the execution, delivery and performance by Purchaser of this
Agreement have been duly and validly authorized by all necessary action on
behalf of Purchaser;
(c) this Agreement has been duly executed and delivered by Purchaser
and constitutes the valid and binding agreement of Purchaser, enforceable in
accordance with its terms, except as its enforceability may be limited by
bankruptcy, insolvency, moratorium or other laws relating to our affecting
creditors' rights generally and the exercise of judicial discretion in
accordance with general equitable principles; and
(d) the execution, delivery and performance of this Agreement, the
consummation of the transactions contemplated hereby and the compliance with the
provisions hereof by Purchaser will not (i) conflict with, result in the breach
of, or constitute a default under the certificate of incorporation, bylaws or
other organizational documents of Purchaser or any agreement or other instrument
to which Purchaser is a party or by which the property of Purchaser is bound or
affected, (ii) require any authorization, consent, approval, exemption or other
action by, or notice to, any third party, court or other governmental or
administrative body, or (iii) violate any laws, statutes, regulations, orders or
judgments applicable to Purchaser.
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6. CONSENT OF GENERAL PARTNER. By signing below on behalf of Purchaser, the
General Partner consents to the sale of the LP Interest by Seller to Purchaser
pursuant to, and on the terms and conditions set forth in, this Agreement.
7. TERMINATION OF LIMITED PARTNER STATUS. Effective upon the consummation
of the transactions contemplated hereby, Seller shall cease to be a Limited
Partner of Purchaser.
8. RELEASES. Effective upon the consummation of the transactions
contemplated hereby, (i) Seller hereby releases Purchaser, Newco and the General
Partner, and any of their respective affiliates, partners, predecessors,
administrators, successors and assigns from any and all causes of action, suits,
debts, demands, covenants, contracts, agreements, damages, liabilities and
claims of any nature whatsoever (collectively, "Claims") that could ever be
asserted by Seller, whether presently known or unknown, accrued or unaccrued,
which pertain to Purchaser or Seller's acquisition, ownership and disposition of
the LP Interest, and (ii) Purchaser hereby releases Seller and any of its
affiliates, predecessors, administrators, successors and assigns from any and
all Claims that could ever be asserted by Purchaser, whether presently known or
unknown, accrued or unaccrued, which pertain to Purchaser or Seller's
acquisition ownership and disposition of the LP Interest. The foregoing releases
are not intended to affect the obligations of the parties under this Agreement.
9. ENTIRE AGREEMENT. This Agreement and that certain waiver letter, dated
June 11, 1999, from Purchaser to Seller state the entire agreement between the
parties with respect to the subject matter hereof (other than the Partnership
Agreement), and the provisions hereof may only be modified, waived or terminated
by a writing signed by the party or parties to be bound thereby.
10. GOVERNING LAW. This Agreement shall be governed by the laws of the
State of New York, without regard to the principles of conflicts of laws
thereof.
11. BINDING EFFECT. This Agreement and all the terms and conditions hereof
shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns.
12. FURTHER ASSURANCES. The parties hereto will execute, acknowledge and
deliver such further instruments and do such further acts and things as may be
required to carry out the intent and purpose of this Agreement.
13. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, all of which taken together shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
ERNST & COMPANY
By:
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Name:
Title:
▇▇▇▇▇▇▇▇▇ & CO.
By: LaB Investing Co. L.L.C.,
As General Partner
By:
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▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇▇, ▇▇, Member
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